Tiếng Việt

Legal update relating to Finance and Credit (Monthly Legal Update – 07/2023)

by | Jul 3, 2023 | Banking, EN, Legal Update | 0 comments

1. LEGAL DOCUMENTS ARE EFFECTIVE FROM 01/07/2023

1.1.  Decree No. 13/2023/ND-CP protection of personal data

  • Name of legal document: Decree 13/2023/ND-CP issued on 17/04/2023 by the Government protection of personal data (referred to as the “Decree No. 13/2023/ND-CP”).
  • Effective date: 01/07/2023.

The content should be noted: Duties for credit institutions.

Specifically, Article 3 of Decree No. 13/2023/ND-CP stipulates: “Article 3. Rules for protection of personal data

  1. The personal data shall be processed as prescribed by law.
  2. The data subject shall be entitled to receive information related to the processing of his/her personal data, unless otherwise provided for by law.
  3. The personal data shall be processed for the purposes that have been registered and declared by the Personal Data Controller, the Personal Data Processor, the Personal Data Controller-cum-Processor and the Third Party.
  4. The collected personal data shall be appropriate for the scope and purposes of processing. The purchase or sale of personal data shall be prohibited in any form, unless otherwise provided for by law.
  5. The personal data shall be updated and added for the processing purposes.
  6. The personal data shall be protected and secured throughout the processing. To be specific, the personal data shall be protected from violations against regulations on protection of personal data and prevention of loss, destruction or damage caused by incidents and use of technical measures.
  7. The personal data shall be stored within a period of time that is appropriate for the processing purposes, unless otherwise provided for by law.
  8. The Personal Data Controller and the Personal Data Controller-cum-Processor shall comply with the rules for data processing specified in Clauses 1 through 7 of this Article and prove their compliance.”

1.2.  Circular No. 06/2023/TT-NHNN amending and supplementing a number of articles of Circular No. 39/2016/TT-NHNN dated December 30, 2016 of the Governor of the State Bank of Vietnam prescribing lending transactions of credit institutions and/or foreign bank branches with customers

  • Name of legal document: Circular No. 06/2023/TT-NHNN issued on 28/06/2023 by the State Bank of Vietnam amending and supplementing a number of articles of Circular No. 39/2016/TT-NHNN dated December 30, 2016 of the Governor of the State Bank of Vietnam prescribing lending transactions of credit institutions and/or foreign bank branches with customers (referred to as the “Circular No. 06/2023/TT-NHNN”).
  • Effective date: 01/09/2023.

The content should be noted: Rejected loan demands.

Specifically, Article 6 of Circular No. 17/2022/TT-NHNN stipulates: ““Article 1. Amending and supplementing a number of articles of Circular No. 39/2016/TT-NHNN

…

  1. To amend and supplement Article 8 as follows:

“Article 8. Rejected loan demands

Credit institutions shall not be allowed to approve the following loan demands:

  1. To carry out business investment activities in bussiness lines banned from investment and business in accordance with the Law on Investment.
  2. To pay expenses and meet the financial needs of business investment activities in bussiness lines banned from investment and business in accordance with the Law on Investment and other transactions and acts prohibited by laws.
  3. To purchase and use goods and services in bussiness lines banned from investment and business in accordance with the Law on Investment.
  4. To buy gold bars.
  5. To repay the loan at the lending credit institution, except for the case of lending to pay the loan interest arising during the construction process, the interest expense is calculated in total construction investment approved by competent authorities in accordance with laws.
  6. To repay foreign loans (excluding foreign loans in the form of goods purchase and sale with deferred payment), credit extension at other credit institutions, except for loans to repay loans before maturity. The loan fully meets the following conditions:a) The loan term does not exceed the remaining loan term of the old loan;b) It is a loan that has not yet been restructured.
  7. To send money.
  8. To pay for capital contribution, purchase, receive and transfer capital contributions of limited liability companies or partnerships; contribute capital, purchase, receive and transfer shares of joint stock companies that have not been listed on the stock market or have not been registered for trading on the Upcom trading system.
  9. To pay the capital contribution under the capital contribution contract, investment cooperation contract or business cooperation contract for the implementation of an investment project that is not eligible to be put into business as prescribed by law at that time credit institutions decide to lend.
  10. For financial compensation, unless the loan fully meets the following conditions:a) The customer has advanced the customer’s own capital to pay and pay the cost of implementing the business project, which the costs of implementing this business project have been incurred less than 12 months up to the time credit institutions decide to lend;b) Expenses paid and paid with the customer’s own capital in order to carry out the business project are the expenses using the loan source of the credit institution according to the capital use plan sent to the credit institutions to be considered for medium and long-term loans to carry out that business project.””

2. LEGAL DOCUMENTS ARE ISSUED IN 06/2023

2.1. Decision No. 1123/QĐ-NHNN refinancing interest rate, re-discount interest rate, interest rate on overnight loans in interbank electronic payment and loans for making up fund deficits in clearing payment given by the State Bank of Vietnam to credit institutions and foreign bank branches

  • Name of legal document: Decision No. 1123/QĐ-NHNN issued on 16/06/2023 by the State Bank of Vietnam refinancing interest rate, re-discount interest rate, interest rate on overnight loans in interbank electronic payment and loans for making up fund deficits in clearing payment given by the State Bank of Vietnam to credit institutions and foreign bank branches (referred to as the “Decision No. 1123/QĐ-NHNN”).
  • Effective date: 19/06/2023.

The content should be noted: The interest rates are adopted by the State Bank of Vietnam.

Specifically, Article 1 of Decision No. 1123/QĐ-NHNN stipulates: “Article 1. The following interest rates are adopted by the State Bank of Vietnam, including:

  1. Refinancing interest rate: 4,5%/year.
  2. Re-discount interest rate: 3,0%/year.
  3. Interest rate on overnight loans in interbank electronic payment and loans for making up fund deficits in clearing payment given by the State Bank of Vietnam to credit Institutions and foreign bank branches: 5,0%/year.”

2.2. Decision No. 1124/QĐ-NHNN on maximum interest rates of deposits in Vietnam Dong of organizations and individuals at credit institutions and foreign bank branches according to Circular No. 07/2014/TT-NHNN dated March 17, 2014

  • Name of legal document: Decision No. 1124/QĐ-NHNN issued on 16/06/2023 by the State Bank of Vietnam on maximum interest rates of deposits in Vietnam Dong of organizations and individuals at credit institutions and foreign bank branches according to Circular No. 07/2014/TT-NHNNdated March 17, 2014 (referred to as the “Decision No. 1124/QĐ-NHNN”).
  • Effective date: 19/06/2023.

The content should be noted: Maximum interest rates of deposits in Vietnam Dong (VND) of organizations and individuals at credit institutions and foreign banks branches according to Circular No. 07/2014/TT-NHNN.

Specifically, Article 1 of Decision No. 1124/QĐ-NHNN stipulates: “Article 1. Maximum interest rates of deposits in Vietnam Dong (VND) of organizations (except credit institutions and foreign bank branches) and individuals at credit institutions and foreign banks branches according to Circular No. 07/2014/TT-NHNN dated March 17, 2014 are as follows:

  1. The maximum interest rate of demand deposits and deposits with a term less than 1 month is 0,5%/year.
  2. The maximum interest rate of deposits with a term from 1 month to less than 6 months is 4,75%/year. Particularly, people’s credit funds and microfinance institutions shall apply the maximum interest rate of 5,25%/year with respect to deposits with a term from 1 month to less than 6 months.”

2.3. Decision No. 1125/QĐ-NHNN prescribing maximum interest rates of short-term loans in Vietnamese Dong granted by credit institutions and foreign bank branches to meet borrowers’ funding demand in certain business sectors according to Circular No. 39/2016/TT-NHNN dated December 30, 2016

  • Name of legal document: Decision No. 1125/QĐ-NHNN issued on 16/06/2023 by the State Bank of Vietnam prescribing maximum interest rates of short-term loans in Vietnamese Dong granted by credit institutions and foreign bank branches to meet borrowers’ funding demand in certain business sectors according to Circular No. 39/2016/TT-NHNNdated December 30, 2016 (referred to as the “Decision No. 1125/QĐ-NHNN”).
  • Effective date: 19/06/2023.

The content should be noted: Maximum interest rates of short-term loans in Vietnamese Dong (VND) according to Clause 2 Article 13 of the Circular No. 39/2016/TT-NHNN.

Specifically, Article 1 of Decision No. 1125/QĐ-NHNN stipulates: “Article 1. Maximum interest rates of short-term loans in Vietnamese Dong (VND) according to Clause 2 Article 13 of the Circular No. 39/2016/TT-NHNN dated December 30, 2016 are as follows:

  1. Credit institutions and foreign bank branches (except for People’s Credit Funds and microfinance institutions) shall grant short-term loans in VND with the maximum interest rate of 4,0%/year.
  2. People’s Credit Funds and microfinance institutions shall grant short-term loans in VND with the maximum interest rate of 5,0%/year.”

2.4. Official Letter No. 2535/TCT-TTKT on strengthen coordination in tax administration

  • Name of document: Official Letter 2535/TCT-TTKT issued on 21/06/2023 by the General Department of Taxation on strengthen coordination in tax administration (referred to as the “Official Letter No. 2535/TCT-TTKT”).

The content should be noted: Providing information on transactions through accounts, account balances, transaction data.

Specifically, Section 1 of Official Letter No. 2535/TCT-TTKT stipulates: “1. About providing information on transactions through accounts, account balances, transaction data.

– Commercial banks and other credit institutions provide information on transactions through accounts, account balances and transaction data at the request of the Director of Taxation Department for purposes of inspection, examination, determine the tax payable and take measures to enforce the administrative decision on tax administration in accordance with the tax law, within 10 working days from the date of receipt of the written request of the tax authority. In case commercial banks and other credit institutions fail to provide data at the request of tax administration authorities, they will be administratively sanctioned as prescribed in Article 19 of Decree No. 125/2020/ND-CP dated October 19, 2020 of the Government on penalties for administrative violations on taxes and invoices.

– Tax Departments, upon request for information, shall send documents to the Head Office of commercial banks and other credit institutions for implementation. The requested content needs to be complete and detailed with identification information and content for commercial banks and other credit institutions to implement. For complicated and important matters, it is possible to organize a meeting between the Tax Department and commercial banks and other credit institutions; or coordinate and work with the Tax Department to directly manage such commercial banks and other credit institutions in accordance with law. Tax Departments that directly manage commercial banks and other credit institutions are responsible for coordinating with Tax Departments upon request.

– Tax Departments are responsible for keeping information confidential, using information for the right purposes and taking full responsibility for the safety of information in accordance with the Law on Tax Administration and relevant laws.”