Bản dịch văn bản 10/2006/TT-NHNN
Circular 10/2006/TT-NHNN
Cơ quan ban hành: Ngân hàng Nhà nước Việt Nam
Ngày ban hành: 2006-12-21

CIRCULAR Guiding the provision of loans by credit institutions to their customers for offshore direct investment Pursuant to the Government's Decree No. 78/2006/ND-CP of August 9, 2006, providing for offshore direct investment (below referred to as Decree No. 78/2006/ND-CP for short), the State Bank of Vietnam guides the provision of loans by credit institutions to their customers for offshore direct investment as follows: 1. Subjects of application a/ Credit institutions that may provide loans to their customers for offshore direct investment are credit institutions licensed to conduct foreign exchange operations. b/ Borrowing customers are investors defined in Clauses 1, 2, 3, 4, 5 and 6, Article 2 of Decree No. 78/2006/ND-CP. 2. Responsibilities of credit institutions Credit institutions that provide loans to their customers for offshore direct investment have the responsibilities: a/ To properly implement the provisions of Decree No. 78/2006/ND-CP, this Circular and relevant provisions of law. b/ To balance capital and foreign currency sources by themselves so as to meet customers' borrowing demand. c/ To evaluate investment projects, capital borrowing conditions and loan repayment capability of customers so as to make lending decisions and take responsibility for their decisions. 3. Capital borrowing conditions Credit institutions shall consider and decide on the provision of loans to those customers that seek capital for offshore direct investment and fully meet the following conditions: a/ Having investment projects not on the list of domains in which offshore direct investment is banned or restricted, which is promulgated by the Prime Minister. b/ Satisfying all conditions for offshore direct investment and transfer of investment capital abroad according to the provisions of Article 4 and Clause 1 of Article 23 of Decree No. 78/2006/ND-CP. c/ Satisfying all capital borrowing conditions defined in Article 7 of the Regulation on the provision of loans by credit institutions to their customers, issued together with the State Bank Governor's Decision No. 1627/2001/QD-NHNN of December 31, 2001. d/ Having equity capital (including equity capital, funds and undistributed profits) in the total investment capital of offshore direct investment projects under regulations of credit institutions. 4. Demands for loan capital Credit institutions shall provide loans to those customers that have Vietnam dong or foreign-currency capital demands for offshore direct investment as follows: a/ For capital contributions in cash in order to execute offshore direct investment projects. b/ For making expenses on or buying assets in Vietnam or foreign countries for offshore direct investment projects, including machinery, equipment; supplies, raw materials, fuels, goods being finished or semi-finished products; value of industrial property rights, technical know-how, technological processes, technical services, intellectual property rights and other lawful assets. Credit institutions may not provide loans to those customers that need capital to make expenses or buy assets banned or restricted from transfer abroad under Vietnamese law or assets banned or restricted from trading under the laws of investment-receiving countries. 5. Loan security a/ Credit institutions shall consider and decide on the provision of loans with or without security to customers for offshore direct investment in accordance with law and take responsibility for their decisions. b/ When loans are secured by assets of borrowing customers or a foreign third party, or assets of legal entities created from their offshore direct investment projects, the concerned parties shall abide by the laws of investment-receiving countries if such compliance or results of such compliance do not contravene the basic principles of Vietnamese law; credits institutions accepting security assets located in a foreign country must be able to manage these assets throughout the lending process and handle them for debt recovery, if borrowing customers fail to pay their debts. 6. Dossiers for borrowing capital When wishing to borrow capital, customers shall send written requests for loans and documents proving their satisfaction of borrowing conditions specified in Clause 3 of this Circular. They shall take responsibility for the accuracy and legality of their documents sent to credit institutions. Credit institutions shall guide the submission of documents in a capital loan dossier in accordance with specific characteristics of each type of investment project and form of offshore direct investment, and the lending modes. 7. Implementation of regulations on foreign exchange Customers borrowing capital for offshore direct investment may transfer loan capital abroad for capital contribution to the execution of investment projects and may also transfer capital, profits and other incomes generated from their offshore direct investment projects back to Vietnam in order to pay loan debts. With regard to all transactions of money transfer from Vietnam to foreign countries and vice versa, in the process of lending, using loan capital and paying debts, credit institutions and borrowing customers shall abide by the provisions of the Ordinance on Foreign Exchange, the Government's Decree guiding the implementation of the Ordinance on Foreign Exchange and relevant legal documents on foreign exchange. 8. Examination and supervision of loan capital Credit institutions have the responsibility and the right to examine and supervise the process of borrowing, use of loan capital and payment of debts by customers on the basis of financial reports and relevant documents of borrowing customers and legal entities established from offshore direct investment projects; directly examine the operations of offshore direct investment projects and security assets (if any). Credit institutions and borrowing customers shall reach agreements in their credit contracts on the methods of examination and supervision in accordance with the practical conditions, characteristics and nature of loans so as to ensure the safety and efficiency of loan capital. 9. Classification of debts, setting up of provisions and handling of risks Credit institutions shall classify debts, set up and use provisions for handling credit risks of offshore direct investment loans in accordance with the State Bank Governor's Decision No. 493/2005/QD-NHNN of April 22, 2005, promulgating the Regulation on classification of debts, setting up and use of provisions for handling credit risks in banking activities of credit institutions, and relevant legal documents. 10. Application of regulations on lending Regarding issues related to the provision of loans to customers to offshore direct investment which have not yet been specified in this Circular, credit institutions and borrowing customers shall apply the provisions of the Government's Decree No. 78/2006/ND-CP of August 9, 2006, providing for offshore direct investment; the Government's Decree No. 138/2006/ND-CP of November 15, 2006, detailing the implementation of the Civil Code's provisions on civil relations involving foreign elements; the Regulation on the provision of loans by credit institutions to their customers, issued together with the State Bank Governor's Decision No. 1627/2001/QD-NHNN of December 31, 2001, the State Bank Governor's Decision No. 127/2005/QD-NHNN of February 3, 2005, amending and supplementing of a number of articles of the Regulation on the provision of loans by credit institutions to their customers, issued together with the State Bank Governor's Decision No. 1627/2001/QD-NHNN, the State Bank Governor's Decision No. 783/2005/QD-NHNN of May 31, 2005, amending and supplementing Clause 6, Article 1 of Decision No. 127/2005/QD-NHNN, the State Bank Governor's Decision No. 966/2003/QD-NHNN of August 22, 2003, on foreign currency loans provided by credit institutions to customers being residents, and relevant legal documents. 11. Organization of implementation a/ This Circular takes effect 15 days after its publication of "CONG BAO." b/ Based on the provisions of this Circular, credit institutions shall promulgate legal documents guiding the provision of loans to customers for offshore direct investment according to their conditions and operation characteristics, and shall send reports on loans provided for offshore direct investment according to the Vietnam State Bank's regulations on accounting and statistical reporting in the banking domain. c/ Heads of units attached to the State Bank of Vietnam, directors of the State Bank's branches in provinces and centrally run cities, chairmen of Managing Boards and general directors (directors) of credit institutions, and borrowing customers shall implement this Circular.