Foreign loans must be registered

| Updated: 06/02/2024
Circular 12/2022/TT-NHNN on foreign exchange management for foreign borrowing and debt repayment by enterprises sets out a number of important regulations, especially on the registration of foreign loans. Here are detailed instructions:
Foreign loans must be registered

Loans must be registered

Article 11 of Circular 12/2022/TT-NHNN stipulates that foreign loans that must be registered are the following loans:

Loans that must be registered with the State Bank include:

1. Medium and long-term foreign loans.

2. Short-term loans may have their principal repayment period extended for which the total term of the loan is over 01 year.

3. Short-term loans without an extension agreement but with outstanding principal balance (including principally entered interest) at the full date of 01 year from the date of first capital withdrawal, unless the borrower completes payment pay the above principal balance within 30 working days from the date of full 01 year from the date of first capital withdrawal.

Registration is not required for any loans

There are 4 loans that do not have to be registered with the State Bank:

1. Short-term loans (foreign loan contracts (Contract Appendix) with a loan term of less than 1 year).

2. Short-term foreign loans without extension agreements, outstanding principal (including principal interest) at the time of 1 year from the date of first capital withdrawal, and the borrower completes payment of outstanding debt above mentioned principal within 30 working days from the date of first capital withdrawal.

3. Borrowers are not required to carry out loan registration procedures when signing with non-residents agreements that do not have the effect of withdrawing capital such as a framework credit agreement, memorandum of understanding, or other similar agreements. .

4. Self-borrowed and self-paid loans in the form of imported goods with deferred payment are not subject to registration or registration for changes in foreign loans according to the provisions of Circular 12.

Subjects registering and registering loan changes at the State Bank of Vietnam

Borrowers make registration and registration for loan changes, including:

1. The borrower signs a foreign loan agreement with the lender who is a non-resident.

2. The organization is responsible for directly repaying the debt to the entrusting party in case the credit institution, foreign bank branch signs an entrustment contract for on-lending with the entrusting party being a non-resident.

3. The party obligated to repay the debt under the debt instrument issued outside the Vietnamese territory to the non-resident.

4. The lessee in the financial leasing contract with the lessor is a non-resident.

5. Organizations inheriting foreign loan repayment obligations subject to registration or registration for changes as prescribed in this Circular. In case the borrower is making foreign loans, it shall divide and separate , merge or merge.

How to calculate loan term to determine registration obligations

1. For the medium and long-term foreign loans, the loan term is determined from the expected date of first capital withdrawal to the expected date of final principal repayment on the basis of the provisions in the foreign loan agreement.

2. For the Short-term loans have the principal repayment period extended if the total loan term is over 01 year, the loan term is determined from the date of first capital withdrawal to the expected date of final principal repayment on the basis of the provisions in the foreign loan agreement and foreign loan extension agreement.

3. For loans specified in Clause 3, Article 11 of this Circular, the loan term is determined from the date of first capital withdrawal to the expected date of final repayment of the principal.

4. The capital withdrawal date specified in this Article is:

a) The date money is credited to the borrower's account for loans disbursed in cash;

b) The date the lender makes payment to the non-resident for the provision of goods or services under the goods and service purchase and sale contract with the resident being the borrower;

c) The date the borrower is recorded as fulfilling the payment obligation to the lender in case the parties choose to withdraw capital from the medium and long-term foreign loan in the form of clearing as prescribed in point d. Clause 1, Article 34 of this Circular.

d) The date the borrower receives the leased property for loans in the form of foreign financial lease in accordance with relevant laws;

dd) The date the borrower is granted the Certificate of Business Registration, the License for establishment and operation under specialized laws, the date of signing the public-private partnership (PPP) investment contract, the date of the party signing the foreign loan agreement to convert the investment preparation amount into loan capital (whichever is later), applicable to foreign loans arising from the transfer of the investment preparation amount of the parties. the project has been granted an investment registration certificate into foreign loan in accordance with the law on foreign exchange management for foreign direct investment activities in Vietnam.

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