Tiếng Việt| THE STATE BANK OF VIETNAM ------- | SOCIALIST REPUBLIC OF VIET NAM |
| No. 196/QD-NH14 | Hanoi, September 16, 1994 |
ON THE PROMULGATION OF REGULATION ON GUARANTY OPERATIONS OF BANKS.
THE GOVERNOR OF THE STATE BANK OF VIETNAM
Pursuant to the Ordinance on State Bank of Vietnam dated may 24, 1990;
Pursuant to the Decree No. 15/CP dated March 2nd, 1993 of the Government stipulating the task, power and responsibility for the State management of the Ministries and Ministerial-ranking offices;
On the proposal of the Director of the Credit Department of the State Bank of Vietnam.
DECIDES
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FOR THE STATE BANK OF VIETNAM
GOVERNOR
Cao Sy Kiem
ON GUARANTY OPERATIONS OF BANKS
(Promulgated in Connection with Decision No. 196/QD-NH14 dated September 16th, 1994 of the Governor of the State Bank of Vietnam)
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The guaranteed party is responsible for fulfilling its commitments to the guaranty - requesting party and to the guaranty bank.
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Many banks can at the same time offer guaranty for one guaranteed party (enterprise)
Guaranty banks have the right to decide whether or not to offer guaranty for a client on the basis of conditions set forth by the guaranty - requesting party.
Enterprises which want to be guaranteed have to obtain the following conditions :
- Having legal status and operating in accordance with the existing laws of Vietnam;
- Having a contract relating to the guaranty;
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- Having proved reliable credit and payment relations;
- Having licenses for import export businesses if these businesses relate to the guaranty.
- Having no overdue debts in neither Vietnamese dong nor foreign currencies.
- Having enough properties to be used as legal collateral's for guaranty.
Enterprises which request guaranty have to submit to the guaranty banks the following documents :
- Application for guaranty (attached form);
- Contract and documents relating to the guaranty;
- Licenses for exports and imports (in the cases that the guaranty relates to the businesses).
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- For the properties as real estates : It is compulsory to have the licenses of ownership (the original documents) which are ratified by state notary offices and easily transferable;
- For the bank bonds and credit cards ... They must be valid for transaction, issued by credible organizations, easily transferable and in the possession of the enterprise that requests the guaranty;
- For gold and gems : They must be appraised by the guaranty bank or a professional office designated by the guaranty bank : the guaranty - requesting enterprise has to wrap them up and put seals on them by itself at the witness of the guaranty bank before giving them to the bank.
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The amount of money for establishing guaranty fund shall be accounted for by a separate sub-account at the guaranty bank on each guaranty operation with a minimum ratio of 5 per cent of the total guaranty turnover and can be used to pay the guaranty requesting bank when the guaranteed enterprise does not fulfill its obligation.
The total amount of money for guaranty for one enterprise can not exceed 10 percent and for ten enterprises can not exceed 30 percent of the total amount of money for guaranty of a guaranty bank.
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In the case of the collateral property being a money bearing document which expires before the guaranty duration comes to an end, the enterprise has to replace it with another valid document of the same quality. In case of failure, the guaranteed enterprise has to pay a fine of 1% per month of the value of the expired document.
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In the case, the guaranty bank has to fulfill the obligation of a guarantor, the enterprise has to recognize in paper its debt to the guaranty bank which paid in its place before that and for which the enterprise has to pay an interest of 150% for the overdue debt owed by such an enterprise to guaranty bank. After that the guaranty bank shall hold auction for the collateral properties to get back the amount of money it has paid in the place of the enterprise in accordance with the laws.
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OF THE REGULATIONS ON GUARANTY OPERATIONS OF BANKS
1. Guaranty for contract bidding
- The guaranty bank commits itself to the contract issuing body on the participation of a contractor. In case the contractor has to pay a fine for violating the contract application, but it does not pay any or all of its to the contract issuing body, the guaranty bank shall pay instead of the contractor.
- Forms of guaranty for contract bidding.
+ Guaranty for bidding contracts of construction.
+ Guaranty for bidding contracts of supplying machinery and equipment (contracts of supply).
- The amount of money and duration of guaranty are those defined by the contract issuing body in accordance with the regulations on contract bidding.
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- Guaranty bank commits itself to the contract implementation by the contractor. In the case that the contractor does not implement the contract and nor pay any or all of the fine to the contract issuing body, the guaranty bank shall pay instead of the contractor.
- Forms of guaranty for the implementation of contract
+ Guaranty for implementation of construction contract
+ Guaranty for implementation of contract for machinery and equipment supply (contract of supply).
- The amount of money and duration of guaranty are those defined by the contract issuing body and contractor in the contracts.
3. Guaranty for the advances.
- Guaranty bank commits to the contract issuing body on the use of the advances received by the contractor. In case the contractor violates the contract by not repaying any or all the advances to the contract issuing body, the guaranty bank is responsible for payment on behalf of the contractor.
- Forms of guaranty for the advances :
+ Guaranty for the advances used for the execution of the project.
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- The amount of money and duration of the guaranty are those defined by the contract issuing body and the contractor in the contract.
4 - Guaranty for payment.
- Guaranty bank commits itself to the contract issuing body on the payment in accordance with the contract. In the case that the contractor does not pay any or all of the amount of money as defined in the contract, the guaranty bank is responsible for the payment of the contractor.
- Forms of guaranty :
+ Guaranty for the payment of construction costs.
+ Guaranty for the payment of machinery and equipment installation.
- The amount of money and duration of the guaranty are those defined by the contract issuing body and the contractor in the contract.
5. Guaranty for the product quality as defined in the contract.
Guaranty bank commits to the contract issuing body on the case that the contractor violates the contract in regard to product quality and therefore has to compensate for the issuing body of the contract, but the contractor does not compensate any or all, the guaranty bank is responsible for payment on behalf of the contractor.
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+ Guaranty for the project quality
+ Guaranty for the quality of machinery and equipment.
- The amount of money and duration of guaranty are those defined by the contract issuing body and the contractor in the contract.
6. Guaranty for the repayment of borrowed capital.
- Guaranty bank commits itself to the lender that in the case that the borrower does not pay all nor on time the debt (both principal and interest), the guaranty bank shall be responsible for the payment on behalf of the borrower.
The amount of money and duration of guaranty are those defined in the contract for borrowing capital.