Legal Document Updates in English (02/2020)

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NUMBER

TITLE

 

In This Updates:

INVESTMENT

 

INVESTMENT

1

01/2020/ND-CP

 

 

Decree No. 01/2020/ND-CP dated January 01, 2020 on amending and supplementing a number of Articles of the Decree No. 84/2015/ND-CP on investment supervision and evaluation

 

Methods and indicators for evaluating the efficiency of public investment project

Page 2

FINANCE – BANKING

 

FINANCE – BANKING

2

37/2019/TT-NHNN

Circular No. 37/2019/TT-NHNN dated December 31, 2019 guiding credit institutions and foreign bank branches to act as insurance agents for insurance enterprises

 

Credit institutions must compare variation of insurance contract at least once a month

Page 2

3

34/2019/TT-NHNN

Circular No. 34/2019/TT-NHNN dated December 31, 2019 providing guidelines on the foreign exchange control with foreign currency capital of microfinance programs and projects of political organizations, socio-political organizations and non-governmental organizations

 

To guide the foreign exchange control of microfinance program and project

Page 2

4

33/2019/TT-NHNN

 

 

 

Circular No. 33/2019/TT-NHNN dated December 31, 2019 on amending and supplementing a number of Articles of the Circular No. 34/2013/TT-NHNN on issuance of exchange bill, treasury bills, deposit certificates and domestic bonds…

 

Convertible bonds privately issued are allowed to transferred at the issuing time

Page 3

5

32/2019/TT-NHNN

 

 

Circular No. 32/2019/TT-NHNN dated December 31, 2019 on amending and supplementing a number of Articles of the Circular No. 19/2013/TT-NHNN providing the purchase, sale and settlement of bad debts by Vietnam Asset Management Company

 

The maximum term of special bonds is 10 years

Page 3

6

30/2019/TT-NHNN

Circular No. 30/2019/TT-NHNN dated December 27, 2019 providing regulations on the fulfillment of compulsory reserves of the credit institutions, foreign bank branches

 

3 types of credit institution not subject to compulsory reserves

Page 3

7

26/2019/TT-NHNN

Circular No. 26/2019/TT-NHNN dated December 23, 2019 on amending and supplementing a number of Articles of the Regulation on the grant, use and management of bank card issuers code issued in conjunction with the Decision No. 38/2007/QD-NHNN

 

Card issuer shall be granted only 1 unique BIN

Page 3

BIDDING - COMPETITION

 

BIDDING - COMPETITION

8

11/2019/TT-BKHDT

Circular No. 11/2019/TT-BKHDT dated December 16, 2019 detailing the provision and publishing of bidding information, the roadmap for applying online contractor selection and the management and use of values of bid security and performance of non-refundable contract

 

Investors and contractors may cancel digital certificates them self

Page 4

 

 

SUMMARY:

 

Ü  INVESTMENT

METHODS AND INDICATORS FOR EVALUATING THE EFFICIENCY
OF PUBLIC INVESTMENT PROJECT

On January 01, 2020, the Government promulgates the Decree No. 01/2020/ND-CP on amending and supplementing a number of Articles of the Government’s Decree No. 84/2015/ND-CP dated September 30, 2015 on investment supervision and evaluation.

Accordingly, the Government supplements provisions on methods and indicators of evaluation of the efficiency of public investment project as follows:

The efficiency of public investment project shall be evaluated by comparative and collated methods between results/actual number collected at the time of evaluation and objectives; or between the parameters of the project at the time of

 
 

evaluation with the standard indicators; or a combination.  In addition, the efficiency of public investment project also is evaluated by benefit-cost analysis method.

Criteria for evaluating the efficiency of public investment project includes: The extent of achievement of investment project objectives under the approved investment decision; indicators of exploitation, operation in reality of project comparing to indicators of exploitation, operation of approved project; economic internal rate of return; socio-economic and environmental impacts and other specific development objectives; measures to minimize negative social and environmental impacts...

This Decree takes effect on January 01, 2020.

Ü  FINANCE – BANKING

CREDIT INSTITUTIONS MUST COMPARE VARIATION
OF INSURANCE CONTRACT AT LEAST ONCE A MONTH

This content is prescribed by the State Bank of Vietnam in the Circular No. 37/2019/TT-NHNN dated December 31, 2019 guiding credit institutions and foreign bank branches to act as insurance agents for insurance enterprises.

In accordance with this Circular, at least once a month as agreed upon in insurance agent contracts, credit institutions (except for policy banks), foreign bank branches (hereinafter collectively referred to as credit institutions) shall coordinate with insurance enterprises to collate  information about new insurance contracts, premium turnover, changes of valid insurance contracts, information related to insurance compensation and payment settlement carried out by credit institutions upon the occurrence of insurance events.

In addition, the provision of clients’ information shall comply with law on security.

 

This Circular also prescribes that such credit institutions have the obligations of insurance agents as prescribed in the law on insurance business as well as the following obligations:

First, to explain to customers about insurance products distributed by credit institutions other than the credit institutions' products.

Second, to remit the entire amount of collected insurance premiums to the insurance enterprises after deducting insurance agent commissions, insurance benefit payments and other payments as agreed upon in the insurance agent contracts...

This Circular takes effect on March 02, 2020.

TO GUIDE THE FOREIGN EXCHANGE CONTROL
OF MICROFINANCE PROGRAM AND PROJECT

The State Bank of Vietnam issues the Circular No. 34/2019/TT-NHNN providing guidelines on the foreign exchange control with foreign currency capital of microfinance programs and projects of political organizations, socio-political organizations and non-governmental organizations on December 31, 2019.

Accordingly, political organizations, socio-political organizations and non-governmental organizations may only mobilize capital in foreign currencies under the form of receiving non-refundable aid, sponsorship from individuals and organization being non-residents to perform microfinance programs and projects.

Concurrently, political organizations, socio-political organizations and non-governmental organizations shall take responsibility for the implementation of regulations of

 

specific law on receiving and using non-refundable aid, sponsorship from individuals and organization being non-residents and regulations on foreign exchange control with foreign currencies.

Noticeably, when receiving non-refundable aid, sponsorship in foreign currencies from individuals and organizations being non-residents, political organizations, socio-political organizations and non-governmental organizations shall present papers and documents prove that such money is non-refundable aid, sponsorship of individuals and organizations being non-residents according to permitted banks’ regulations and be responsible for the authenticity of such papers and documents.

This Circular takes effect on February 14, 2020.

CONVERTIBLE BONDS PRIVATELY ISSUED
ARE ALLOWED TO TRANSFERRED AT THE ISSUING TIME

This new provision is prescribed at the Circular No. 33/2019/TT-NHNN dated December 31, 2019 of the State Bank of Vietnam on amending and supplementing a number of Articles of the Circular No. 34/2013/TT-NHNN on issuance of exchange bill, treasury bills, deposit certificates and domestic bonds of credit institutions and foreign bank branches.

Accordingly, ownership to valuable papers may be transferred in the forms of buying, selling, offering, giving, exchanging and inheriting in accordance with provisions of relevant laws.

This Circular repeals provisions that: For convertible bonds that are issued in private placements, warrants issued in

 
 

conjunction with such bonds shall not be transferred within a minimum period of 01 year from the finishing date of issue, except for the case of transferring among professional securities investors. In concussion, convertible bonds that are issued in private placements, warrants issued in conjunction with such bonds shall be transferred right at the time of issuance.

This Circular also amends and supplements regulations on issuance of bonds. For Plan on bond issuance which is approved before the effective date of this Circular, credit institution shall continue implementing according to such Plan.

This Circular takes effect on February 19, 2020.

THE MAXIMUM TERM OF SPECIAL BONDS IS 10 YEARS

On December 31, 2019, the State Bank of Vietnam promulgates the Circular No. 32/2019/TT-NHNN on amending and supplementing a number of Articles of the Circular No. 19/2013/TT-NHNN dated September 6, 2013 of the State Bank of Vietnam’s Governor providing the purchase, sale and settlement of bad debts by Vietnam Asset Management Company.

In accordance with this Circular, the term of special bonds shall be determined according to the agreement between the Vietnam Asset Management Company and the credit institution selling debts and shall be at least 01 year. If the amount of debt recovery is not enough to pay the bonds when the bonds are due, the Vietnam Asset Management Company shall decide to extend the term of the bonds, not

 

exceeding 03 years. The extension of the bond term that exceeds 03 years must be approved by the bond owner. It’s not allowed to extend the term of bonds being used to participate in the open market operation.

The maximum term of special bonds is 05 years. In case of issuing special bonds to purchase bad debts of credit institutions that are implementing restructuring plans or facing financial difficulties, the term of special bonds shall not exceed 10 years.  Such bonds are exempt from the depositing charge at the State Bank and shall be used in the refinancing and open market operations in accordance with law.

This Circular takes effect on February 14, 2020.

3 TYPES OF CREDIT INSTITUTION NOT SUBJECT TO COMPULSORY RESERVES

On December 27, 2019, the Government of the State Bank of Vietnam promulgates the Circular No. 30/2019/TT-NHNN providing regulations on the fulfillment of compulsory reserves of the credit institutions, foreign bank branches.

Accordingly, there are 03 types of credit institutions that are not subject to compulsory reserves, include: The credit institutions under special supervision; The credit institutions which are about to open; The credit institutions which are approved to dissolve or receive decision to commence bankruptcy procedures or receive decisions of license revoking from competent authorities.

This Circular also prescribes that within 03 initial working of the month, credit institutions are responsible for reporting the

 

average balance of deposits subject to compulsory reserves in the period of determining compulsory reserves as per the Form DTBB001, as a basis for calculating compulsory reserves of period of remaining compulsory reserves, submitting the State Bank’s Transaction Office in writing, directly or by post, or electronically.

The credit institutions of the types applied with ratio of compulsory reserves 0% for all types of deposits subject to compulsory reserves calculation don’t have to submit report as prescribed above in the periods of maintaining compulsory reserves applied with ratio of compulsory reserves of 0%.

This Circular takes effect on March 01, 2020.

CARD ISSUER SHALL BE GRANTED ONLY 1 UNIQUE BIN

On December 23, 2019, the Governor of the State Bank of Vietnam promulgates the Circular No. 26/2019/TT-NHNN amending and supplementing a number of articles of the Regulation on the grant, use and management of bank card issuers code issued in conjunction with the Decision No. 38/2007/QD-NHNN dated October 30, 2007 of the Governor of the State Bank of Vietnam.

According to the new regulation, in case of having demand for grant of BIN, the card issuer has to send, directly or via postal service or via the Bank's Online Public Services Web Portal, to the State Bank of Vietnam an application for a BIN as the Form issued.  The before regulation requires that the application must enclosed with a copy of establishment and operation license of the card issuance.

 

Within 05 working days from the receiving day of the appropriate request of BIN issuance, the State Bank shall decide to grant the BIN in written. It is remarkable that, the State Bank of Vietnam shall issue 01 unique BIN to each card issuer who is allowed to be granted a BIN.

Within 180 days from the date of issuance of the BIN, card issuers shall be responsible for putting the BIN into use. In case a card issuer does not use the BIN within the prescribed time limit, it shall send a written request to the State Bank of Vietnam for extension of such time limit.  The maximum extended time limit is 90 days.

This Circular takes effect on March 01, 2020.

Ü  BIDDING - COMPETITION

INVESTORS AND CONTRACTORS MAY CANCEL DIGITAL CERTIFICATES THEM SELF

On December 16, 2019, the Minister of Planning and Investment promulgates the Circular No. 11/2019/TT-BKHDT detailing the provision and publishing of bidding information, the roadmap for applying online contractor selection and the management and use of values of bid security and performance of non-refundable contract.

Accordingly, digital certificates shall be granted to bid solicitors, contractors and investors after registering their participation in the National Bidding Network System. Bid solicitors, contractors, or investors may cancel their digital certificates according to the User's Guide or send a dispatch to the National Online Bidding Center to request the cancellation of such digital certificate. Both parties can duplicate digital certificates and store them on hard disks, USBs, smart cards or other information-bearing objects. In

 

addition, parties may also register additional digital certificate in accordance with law provisions.

A registration application to the National Bidding Network System of bid solicitor includes: Registration application and a copy of Establishment Decision or Certificate of Enterprise Registration or other equivalent documents.  A bid solicitor shall send application to the National Online Bidding Center or via the National Bidding Network System. Within 02 working days after receiving application, the National Online Bidding Center shall examine the application, and notify the bid solicitor on the result. When in need of amendment of registered information, a bid solicitor shall implement according to the User’s Guide or request the National Online Bidding Center to amend in case of unable to amend.

This Circular takes effect on February 01, 2020.

 

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