Where issued: | The bank of Viet Nam | Effective date: | 28/04/2014 |
Date issued: | 12/03/2014 | Status: | Still validated |
STATE BANK VIETNAM | SOCIAL REPUBLIC OF VIETNAM Independence - Freedom - Happiness |
No: 05/2014/TT-NHNN | Hanoi, date 12 month 3 year 2014 |
CIRCULARS
GUIDELINES FOR OPENING AND USING INVESTMENT CAPITAL ACCOUNTS FOR FOREIGN INVESTMENT ACTIVITIES IN VIETNAM
Pursuant to the Law on the State Bank of Vietnam No. 46/2010/QH12 dated June 16, 6;
Pursuant to the Law on Credit Institutions No. 47/2010/QH12 dated June 16, 6;
Pursuant to the Investment Law No. 59/2005/QH11 dated November 29, 11;
Pursuant to the Law on Securities No. 70/2006/QH11 dated June 29, 6;
Pursuant to the Law amending and supplementing a number of articles of the Law on Securities No. 62/2010/QH12 dated November 24, 11;
Pursuant to the Ordinance on Foreign Exchange No. 28/2005/PL-UBTVQH11 dated December 13, 12;
Pursuant to Ordinance No. 06/2013/PL-UBTVQH113 dated March 18, 3 amending and supplementing a number of articles of the Ordinance on Foreign Exchange;
Pursuant to Decree No. 156/2013/ND-CP dated November 11, 11 of the Government defining the functions, tasks, powers and organizational structure of the State Bank of Vietnam (hereinafter referred to as the State Bank of Vietnam). Government);
At the proposal of the Director of the Foreign Exchange Management Department,
The Governor of the State Bank promulgates a Circular guiding the opening and use of indirect investment capital accounts to conduct foreign portfolio investment activities in Vietnam.
Chapter I
GENERAL RULES
Article 1. Scope
This Circular regulates the opening and use of indirect investment capital accounts to perform transactions related to foreign indirect investment activities in Vietnam.
Article 2. Subject of application
1. This Circular applies to the following subjects:
a) Foreign investors are non-residents conducting indirect investment activities in Vietnam;
b) Organizations and individuals involved in foreign indirect investment activities in Vietnam.
2. This Circular does not apply to foreign investors being residents who are foreign organizations and individuals. These subjects carry out indirect investment activities in Vietnam in accordance with current regulations on securities law and other relevant legal documents.
Article 3. Explain words
In this Circular, the following terms are construed as follows:
1. “Foreign investor” includes non-residents who are foreign organizations and individuals conducting indirect investment activities in Vietnam.
2. “Authorized bank” includes commercial banks and branches of foreign banks that are permitted to do business and provide foreign exchange services in accordance with law.
3. “Authorized credit institution” includes credit institutions and foreign bank branches licensed to do business and provide foreign exchange services in accordance with law.
4. “Indirect investment capital account” means a payment account in Vietnam dong opened by a foreign investor at an authorized bank to conduct authorized revenue and expenditure transactions related to indirect investment activities. foreign exchange in Vietnam.
Article 4. General principles
1. All indirect investment activities of foreign investors in Vietnam must be done in Vietnam dong. Transactions related to foreign indirect investment activities in Vietnam of foreign investors must be done through 01 (one) indirect investment capital account opened at 01 (one) authorized bank. .
2. When carrying out foreign indirect investment activities in Vietnam in the forms specified in Article 5 of this Circular, foreign investors must comply with the provisions of this Circular and the provisions of the law on opening and using payment accounts, the provisions of the Securities Law, the guiding documents of the Securities Law, the current provisions of law related to the activities of capital contribution and share purchase of investors. Foreign investment in Vietnamese enterprises and activities of foreign investors on Vietnam's stock market and other relevant provisions of law.
3. The balance on the indirect investment capital account of foreign investors must not be converted to term deposits and savings deposits at credit institutions, foreign bank branches.
Article 5. Forms of foreign indirect investment in Vietnam
Foreign investors' indirect investment activities in Vietnam include the following forms:
1. Contribute capital, buy and sell shares and contributed capital in Vietnamese enterprises that have not been listed or registered for trading on the Vietnamese stock market and are not directly involved in the management and administration of the enterprise.
2. Contribute capital, buy and sell shares in Vietnamese enterprises on the market for trading registration (UPCOM) and the listed stock market and do not directly participate in the management and administration of the enterprise.
3. Buy and sell bonds and other securities on Vietnam's stock market.
4. Buying and selling other valuable papers in Vietnam dong issued by residents being organizations in the Vietnamese territory.
5. Investment entrustment in Vietnam dong through fund management companies, securities companies and organizations authorized to conduct investment entrustment operations in accordance with the provisions of the law on securities; investment trustees in Vietnam dong through credit institutions and foreign bank branches are allowed to perform investment entrustment operations in accordance with regulations of the State Bank.
6. Capital contribution, transfer of contributed capital by foreign investors (not directly involved in management) in securities investment funds and fund management companies in accordance with the law on securities.
7. Other forms of indirect investment as prescribed by law.
Chapter II
SPECIFIC PROVISIONS
Article 6. Opening an indirect investment capital account
1. When conducting indirect investment activities in Vietnam, foreign investors must open one (01) indirect investment capital account at one (01) authorized bank to conduct revenue and expenditure transactions. permitted under Article 7 of this Circular.
2. In case a foreign investor is opening and using an indirect investment capital account at an authorized bank but wishes to open an indirect investment capital account at another licensed bank, the investor Foreigners must close the indirect investment capital account opened and transfer the entire balance on this account to the new account. Procedures for opening and closing the indirect investment capital account shall comply with the regulations of the authorized bank.
Foreign investors are only allowed to conduct revenue and expenditure transactions on their newly opened indirect investment capital accounts in accordance with the above provisions after closing and finalizing the previously opened indirect investment capital accounts.
Article 7. Use of indirect investment capital account
The indirect investment capital account is used to conduct the following revenue and expenditure transactions related to foreign indirect investment activities in Vietnam:
1. Collection part:
a) Revenues from selling foreign currencies to authorized credit institutions;
b) Income from transfer of contributed capital, shares, sale of securities and other valuable papers, receipt of dividends and interest from bonds and valuable papers arising in Vietnam dong from foreign indirect investment activities; outside in Vietnam;
c) Collection of transfer from the payment account in Vietnam dong of foreign investors opened at an authorized bank;
d) Collection of transfers from the accounts of fund management companies, securities companies, credit institutions and foreign bank branches authorized to perform investment entrustment operations for foreign investors (applicable to foreign investors). in case foreign investors make indirect investments in Vietnam in the form of investment entrustment);
dd) Other lawful receipts in Vietnam dong by foreign investors related to foreign indirect investment activities in Vietnam.
2. Expenses:
a) Expenses for performing foreign indirect investment activities in Vietnam in the forms specified in Article 5 of this Circular;
b) Spending to buy foreign currency at authorized credit institutions to transfer capital, profits and lawful revenue sources abroad;
c) Payment of legal expenses incurred in Vietnam;
d) Expenses transferred to a foreign investor's current account in Vietnam dong opened at an authorized bank;
dd) Transfer money to the accounts of fund management companies, securities companies and organizations authorized to conduct investment entrustment operations for foreign investors (applicable in cases where the in addition to making indirect investments in Vietnam in the form of investment trusts);
e) Other lawful spending transactions related to foreign indirect investment activities in Vietnam.
Article 8. Transfer of investment capital abroad
In case there is a need to transfer capital, profits and other lawful sources of income from indirect investment activities abroad, foreign investors may use Vietnam dong on their indirect investment capital account to buy foreign currencies. currency at authorized credit institutions and transferred abroad.
Article 9. Conversion of investment forms by foreign investors
1. The conversion from the form of indirect investment to the form of direct investment or the transformation from the form of direct investment to the form of indirect investment by foreign investors must comply with current regulations. of the investment law and other relevant laws.
2. In case foreign investors are making indirect investments in Vietnam in the form of buying shares or contributing capital in Vietnamese enterprises, converting to direct investment (participating in management and administration). business), the account conversion is done as follows:
a) In case the foreign investor does not continue to carry out indirect investment activities in Vietnam, after completing the procedures for converting the investment form according to the current regulations of law, the foreign investor shall: In addition to opening a direct investment capital account in Vietnam dong at an authorized bank, then closing the previously opened indirect investment capital account and transferring the balance on this account to the investment capital account. directly in Vietnam dong mentioned above to carry out direct investment activities in Vietnam in accordance with current regulations on foreign exchange management and other relevant laws. Procedures for closing the indirect investment capital account and opening the direct investment capital account in Vietnam dong shall comply with the regulations of the authorized bank;
b) In case of continuing to conduct indirect investment activities in Vietnam, foreign investors may use the previously opened indirect investment capital account to conduct indirect investment activities in Vietnam on establishments comply with the provisions of this Circular and other relevant laws. At the same time, foreign investors shall open and use direct investment capital accounts to conduct foreign direct investment activities in Vietnam in accordance with current regulations on foreign exchange management for foreign direct investment activities. foreign direct investment in Vietnam and other relevant laws.
Chapter III
RIGHTS AND OBLIGATIONS OF LICENSE CREDIT INSTITUTIONS AND FOREIGN INVESTORS
Article 10. Rights and obligations of authorized credit institutions
1. When performing revenue and expenditure transactions on indirect investment capital accounts for foreign investors, authorized credit institutions have the right to request foreign investors to present relevant documents and vouchers. to foreign indirect investment activities in Vietnam.
2. When performing revenue and expenditure transactions on indirect investment capital accounts for foreign investors, authorized credit institutions are responsible for:
a) Guide foreign investors to carry out the procedures for opening and closing the indirect investment capital account and the provisions of this Circular;
b) Regulate, examine and keep documents and vouchers related to revenue and expenditure transactions made on the indirect investment capital account presented by foreign investors to ensure the supply of goods and services. foreign exchange services are performed for the right purposes and in accordance with the provisions of law;
c) Selling foreign currency to foreign investors on the basis of self-balancing foreign currency sources of credit institutions.
3. In addition to the rights and obligations specified in Clauses 1 and 2 of this Article, the licensed bank is responsible for guiding foreign investors to convert the indirect investment capital account as prescribed in Article 17. This circular.
Article 11. Rights and obligations of foreign investors
1. Foreign investors are allowed to conduct foreign indirect investment activities in Vietnam on the basis of compliance with the provisions of this Circular and other relevant provisions of Vietnamese law.
2. When performing revenue and expenditure transactions on the indirect investment capital account, foreign investors are responsible for:
a) Declare content of revenue and expenditure transactions related to foreign indirect investment activities in Vietnam at the request and instructions of the authorized bank;
b) Present and supplement dossiers, documents and vouchers at the request of the authorized bank.
Chapter IV
REPORT MODE
Article 12. Reporting regime for authorized credit institutions
Credit institutions are allowed to report to the State Bank according to the State Bank's current regulations on statistical reporting regime.
Article 13. Requests for ad hoc reports
In extraordinary cases or when necessary, foreign investors, authorized credit institutions and branches of the State Bank in provinces and centrally run cities shall report relevant contents at the request of the State Bank. State bank.
Chapter V
INSPECTION, INSPECTION, SUPERVISION AND HANDLING OF VIOLATIONS
Article 14. Inspection, inspection and supervision
1. The State Bank, State Bank branches in provinces and centrally run cities shall inspect, inspect and supervise the observance of regulations by authorized banks and related foreign investors. to the opening and use of indirect investment capital accounts of foreign investors to carry out foreign indirect investment activities in Vietnam.
2. The inspected organizations and individuals are responsible for providing all necessary documents as prescribed so that the examination, inspection and supervision is carried out in a timely and effective manner.
Article 15. Handling of violations
In case of violation of the provisions of this Circular, depending on the seriousness of the violation, foreign investors and permitted banks will be sanctioned according to the provisions of law.
Chapter VI
ORGANIZATION OF IMPLEMENTATION
Article 16. Enforcement
1. This Circular takes effect from April 28, 4.
2. This Circular replaces Circular No. 03/2004/TT-NHNN dated May 25, 5 of the State Bank guiding foreign exchange management for foreign investors' capital contribution to buy shares in Vietnamese enterprises.
Article 17. Transitional provisions
1. Within 90 days from the effective date of this Circular, the foreign investor is responsible for converting the indirect investment capital account to continue performing indirect investment activities in Vietnam. Vietnam according to the following regulations:
a) In case the foreign investor has opened an account for capital contribution or share purchase in Vietnam dong, the foreign investor shall convert the name of the account for capital contribution or share purchase in Vietnam dong as mentioned above. indirect investment capital;
b) In case the foreign investor has opened an account for capital contribution or share purchase in Vietnam dong, and at the same time has a balance of Vietnam dong on the specialized demand deposit account in Vietnam dong of the securities company; Securities opened at a licensed bank:
– The foreign investor converts the name of the account for capital contribution or share purchase in Vietnam dong mentioned above into an indirect investment capital account;
– Foreign investors transfer their Vietnam dong balance on a specialized demand deposit account in Vietnam dong of a securities company opened at an authorized bank to an indirect investment capital account opened. at an authorized bank;
c) In case the foreign investor has not opened an account for capital contribution or share purchase in Vietnam dong and has a balance of Vietnam dong deposited in a specialized demand deposit account in Vietnam dong of the securities company, Securities opened at a licensed bank:
– Foreign investors open an indirect investment capital account at an authorized bank;
– Foreign investors transfer their Vietnam dong balance on a specialized demand deposit account in Vietnam dong of a securities company opened at an authorized bank to an indirect investment capital account the above-mentioned opening to continue carrying out indirect investment activities in Vietnam;
d) In case the foreign investor has opened an account for capital contribution or share purchase in Vietnam dong, and at the same time has a foreign currency deposit balance on the specialized demand deposit account in foreign currency of the securities company; Securities opened at a licensed bank:
– Foreign investors change the name of the account for capital contribution or share purchase in Vietnam dong opened into an indirect investment capital account;
– Foreign investors transfer their foreign currency deposit balances on specialized demand deposit accounts in foreign currencies opened by securities companies at authorized banks into Vietnam Dong; then transfer this amount of Vietnam dong to the indirect investment capital account to continue performing indirect investment activities in Vietnam.
e) In case the foreign investor has not opened an account for capital contribution or share purchase in Vietnam dong, and at the same time has a foreign currency deposit balance on the specialized demand deposit account in foreign currency of the securities company; Securities opened at a licensed bank:
– Foreign investors open an indirect investment capital account at an authorized bank;
– Foreign investors transfer their foreign currency deposit balances on specialized demand deposit accounts in foreign currencies opened by securities companies at authorized banks into Vietnam Dong; then transfer this amount of Vietnam dong to the indirect investment capital account to continue performing indirect investment activities in Vietnam.
2. In case of not continuing to carry out indirect investment activities in Vietnam:
a) Foreign investors are allowed to transfer their Vietnamese dong deposit balance on a specialized demand deposit account in Vietnam dong opened by a securities company at an authorized bank and the balance of foreign deposits in Vietnam. their currency on a specialized demand deposit account in foreign currency opened by a securities company at an authorized bank to a Vietnamese dong account or foreign currency account of a foreign investor at an authorized bank. to serve lawful purposes in Vietnam according to regulations on foreign exchange management and other relevant laws, or to move abroad;
b) Foreign investors are allowed to use their Vietnamese dong balance on the specialized demand deposit in Vietnam dong opened by a securities company at an authorized bank to buy foreign currency and remit it abroad. on the basis of presenting valid documents and documents in accordance with current regulations on foreign exchange management.
3. If after 90 days from the effective date of this Circular, the foreign investor fails to convert the indirect investment capital account as prescribed in Clause 1 of this Article, the foreign investor shall Not allowed to conduct indirect investment activities in Vietnam through capital contribution accounts, share purchase, specialized demand deposit accounts in foreign currencies and in Vietnam Dong opened at banks by securities companies. licensed.
Article 18. Organization of implementation
Chief of Office, Director of Foreign Exchange Management Department, Heads of relevant units under the State Bank, Directors of State Bank branches in provinces and centrally run cities, Chairman of the Board of Directors, Chairman of the Members' Council, General Director (Director) of credit institutions, foreign bank branches are responsible for organizing the implementation of this Circular.
Recipients: | KT. GOVERNOR |