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THE STATE BANK OF
VIETNAM
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SOCIALIST REPUBLIC
OF VIETNAM
Independence- Freedom – Happiness
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No. 03/2004/TT-NHNN
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Hanoi, May 25, 2004
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CIRCULAR
PROVIDING
GUIDANCE ON FOREIGN EXCHANGE CONTROL TO THE CAPITAL CONTRIBUTION, SHARE
PURCHASE BY FOREIGN INVESTORS IN VIETNAMESE ENTERPRISES
According to Article 2 of the Decision No.
36/2003/QD-TTg dated 11 March, 2003 of the Prime Minister on the issuance of
the Regulation on capital contribution, share purchase by foreign investors in
Vietnamese enterprises, the State Bank provides specific guidance on the
foreign exchange control over the capital contribution, share purchase by
foreign investors in Vietnamese enterprises as follows:
Chapter I
GENERAL
PROVISION
1. Governing scope:
1.1. This Circular shall govern foreign
exchange transactions relating to the activity of capital contribution, share
purchase in Vietnamese enterprises by foreign investors, including the capital
transfer into Vietnam for the capital contribution, share purchase, the opening
and use of account "VND" to make capital contribution, share
purchase, the conversion of VND into foreign currency and foreign currency
repatriation.
1.2. Foreign exchange transactions relating
to the activity of securities purchase, sale at Vietnam Securities Exchange
shall be performed in accordance with separate guidance by the State Bank.
1.3. Foreign exchange transactions of foreign
investors relating to the direct investment activity in Vietnam in accordance
with the Law on foreign investment shall not be governed by this Circular.
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Terms used in this Circular shall be
construed as follows:
2.1. Foreign investor includes:
- Nonresidents being foreign financial,
economic organizations, which are set up in accordance with applicable laws of
Vietnam
- Nonresidents being foreigners, who do not
permanently reside in Vietnam, or Vietnamese, who permanently reside in foreign
country.
- Residents being foreigners, who permanently
reside in Vietnam
2.2. Authorized banks shall be banks, which
are operating in Vietnam and authorized by the State Bank to engage in foreign
exchange activities.
2.3. Vietnamese enterprises, which accept
capital contribution, sell shares to foreign investors, shall include: the
state-owned enterprises which are equitized, joint stock companies (including
listed companies in securities market), limited liability companies,
partnership companies, co-operatives unions, co-operatives engaging in business
lines, which are decided upon by the Prime Minister or announced by the
Minister of Planning and Investment, from time to time, under the authorization
of the Prime Minister.
3. Currency used for
the capital contribution, share purchase in Vietnamese enterprises
The capital contribution, share purchase by
foreign investors in Vietnamese enterprises within the territory of Vietnam
shall be made in VND.
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Foreign investors shall be entitled to use
following sources of foreign currency and VND to make capital contribution and
share purchase:
4.1. Foreign currency which is transferred
into Vietnam in accordance with current provisions on foreign exchange control;
4.2. Foreign currency and VND in the
accounts, which are opened at commercial banks, of the foreign investors who
are subjects mentioned in Point 2.1, Chapter I of this Circular;
4.3. VND in the account "securities
transactions in VND" of those foreign investors in accordance with
provisions of applicable laws on foreign exchange control.
4.4. The distributed profit from the direct
investment activity in Vietnam of foreign investors.
4.5. Earnings of foreign investors from the
assignment, liquidation, dissolution of their direct investment activity in
Vietnam in accordance with provisions of applicable laws;
4.6. Salary, bonus and other legal incomes of
foreign individuals in Vietnam in accordance with provisions of applicable
laws;
4.7. Other sources provided that they are
approved by the State Bank
5. Transfer of funds
into, out of Vietnam:
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5.2. Foreign investors who possess foreign
currency must sell it to authorized banks for VND to make the capital
contribution, share purchase.
5.3. Foreign investors shall be entitled to,
after completion all their tax obligations in accordance with provisions of
Vietnam's laws, purchase foreign currency at authorized banks for repatriation
abroad.
Chapter II
MANAGEMENT
OF THE CAPITAL CONTRIBUTION, SHARE PURCHASE TRANSACTIONS OF FOREIGN INVESTOR IN
VIETNAMESE ENTERPRISES
Section I. OPENING
AND USE OF THE ACCOUNT "CAPITAL CONTRIBUTION, SHARE PURCHASE IN VIETNAMESE
ENTERPRISES"
6. Opening of the
account "capital contribution, share purchase in VND"
In order to make the capital contribution to,
the share purchase from Vietnamese enterprises, foreign investors must open an
account "capital contribution, share purchase in VND" (hereinafter
referred to as the account "capital contribution, share purchase") at
a commercial Bank that is operating in Vietnam. All money transfer to perform
the capital contribution, share purchase, the assignment of contributed
capital, the collection and use of distributed dividends and profits, foreign
currency purchase at authorized banks for repatriation abroad and other
transactions relating to the activity of the capital contribution, share purchase
in Vietnamese enterprises by foreign investors must be performed through this
account.
7. The use of the
account "capital contribution, share purchase"
- Foreign investors shall only be authorized
to use the account "capital contribution, share purchase" for the
capital contribution, share purchase in Vietnamese enterprises:
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a. Receipt from the sale of foreign currency
to authorized banks
b. Receipt from sources of VND as mentioned
in points 4.2, 4.3, 4.4, 4.5 and 4.6, Chapter I of this Circular;
c. Receipt from the transfer from the account
"securities transactions in VND" of those foreign investors to make
the capital contribution, share purchases;
d. Receipt from the assignment of contributed
capital and shares;
dd. Receipt from distributed dividends,
profits and other related receipts arising from the capital contribution, share
purchase.
Expenditure:
a. Expense for the capital contribution,
share purchase and payment of expenses relating to the capital contribution,
share purchase transaction;
b. Expense for transfer to the account
"securities transactions in VND" of those foreign investors to buy
securities at the Securities Exchange;
c. Expense for foreign currency purchase at
authorized bank for repatriation abroad.
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8. Registration of
the account "capital contribution, share purchase"
8.1. A Foreign investor must register his
account "capital contribution, share purchase", within 2 working days
from the opening of that account at a commercial bank, with the State Bank
(Department of Foreign Exchange Control). The file includes:
a. An application for the registration of the
account "capital contribution, share purchase" (Form No. 01)
b. Documents proving the legal status of the
foreign investor;
c. A confirmation of the commercial bank on
the opening of the account "capital contribution, share purchase" by
the foreign investor there. The confirmation shall include: name, address,
nationality of the account holder; account number, account balance.
8.2. The State Bank shall, within 5 working
days from the date of full receipt of valid file, be responsible for confirming
the registration of the account "capital contribution, share
purchase" (form No. 02), which is opened at the commercial bank and
through which the foreign investor can perform the transactions of capital
contribution, share purchase in Vietnamese enterprise. In case of
non-confirmation, the State Bank must respond in writing and clearly state the
reasons thereof.
8.3. Foreign investors shall be only
authorized to perform the receipt, expenditure transactions in the account
"capital contribution, share purchase" in accordance with the
provision in above-mentioned point 2, Section I, Chapter II after the availability
of the written confirmation of the account registration by the State Bank.
8.4. Foreign investors must make new
registration of the account "capital contribution, share purchase"
with the State Bank in following cases:
a. Change in name, contact address;
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c. Change of the commercial bank where they
open the account "capital contribution, share purchase".
The file, procedures for the new registration
shall be performed in accordance with provisions in points 8.1, 8.2 and 8.3,
Section II, Chapter II of this Circular.
8.5. Foreign investors being an organization
shall directly submit the application file for registration of the account
"capital contribution, share purchase" to the State Bank (Department
of Foreign Exchange Control). The State Bank shall directly send the written
confirmation of the account registration to the foreign investors.
8.6. For individual foreign investors, their
file shall be sent through the commercial bank where they open the account
"capital contribution, share purchase". The State Bank shall send the
written confirmation of the account registration to the foreign investors
through the commercial bank.
9. Closing of the
account "capital contribution, share purchase":
Foreign investors must, in following cases,
close the account "capital contribution, share purchase" they
maintain at the commercial banks and return the written confirmation of the
account registration (original copy) to the State Bank (Department of Foreign
Exchange Control):
9.1. Repatriation of the total account
balance abroad or to the account "Securities transaction";
9.2. Dissolution, bankruptcy and termination
of their legal entity (in respect of foreign investor being an organization).
9.3. Other cases under applicable provisions
of the State Bank.
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10. Verification of
the written confirmation of the account registration by the State Bank
The commercial bank shall, upon carrying out
receipt, expenditure transactions in the account "capital contribution,
share purchase" under the foreign investors' requirement, be responsible
for verifying the written confirmation by the State Bank of their registration
of the account "capital contribution, share purchase". The commercial
banks shall only be authorized to perform receipt, expenditure transactions in
the account of foreign investors upon receipt of the written confirmation by
the State Bank of the registration of the account "capital contribution,
share purchase" in accordance with provisions in Section II, Chapter II of
this Circular.
11. Verification of
transaction documents:
The commercial bank shall, upon carrying out
receipt, expenditure transactions in the account "capital contribution,
share purchase" for foreign investors, be responsible for the verification
of following documents:
11.1. In respect of receipt
For cash contributions in VND to the account
"capital contribution, share purchase": documents that prove the
receipts arising from activities in accordance with provisions in point 7,
Section I, Chapter II of this Circular.
11.2 For expenditures relating to the capital
contribution, share purchase in Vietnamese enterprises:
Depending on each case of capital
contribution, share purchase in different types of Vietnamese enterprises, the
commercial bank shall be responsible for the verification of following
documents:
a. For the State owned enterprises that are
carrying out the equitization:
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b. In respect of operating joint stock
companies, which are not yet listed in the stock market:
- The minutes of shareholders' Meeting or the
Board of Directors' Meeting (if any) on the sale of shares to foreign
investors.
- The contract or documents relating to the
assignment of shares.
c. For limited liability companies,
partnership companies, cooperative unions, cooperatives:
The minutes of the members' council,
partnership members (for partnership company), cooperative members' Meeting
(for cooperative union, cooperatives) that decides on the plan of mobilization
of contribution capital from foreign investors.
11.3. In respect of the transfer to the
account "Securities transactions":
Commercial banks shall be responsible for the
verification of whether the transferred amount is made to the account "Securities
transactions", which is opened at the authorized depository member by that
foreign investor in accordance with provisions of the State Bank on foreign
exchange control for the purchase, sale of securities of foreign investor at
the Securities Exchange.
11.4. In respect of VND expense to purchase
foreign currency for repatriation abroad
Written confirmation by the competent tax
authority of the completion of tax obligations to the State of Vietnam for
profits earned from the capital contribution to, share purchase in Vietnamese
enterprises.
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INFORMATION,
REPORTING AND DEALING WITH VIOLATION
12. Reports of
commercial banks:
The commercial banks must submit reports to
the State Bank (Foreign Exchange Control Department) on monthly (on the 5th of
following month at the latest), 6 month (on the 10th of July annually at the
latest) and annual (on the 10th of January of the following year at the latest)
basis.
a. Performance of the opening, closing of the
account "capital contribution, share purchase" of foreign investors
at the commercial banks (Form No. 03);
b. Performance of the operation of the
account "capital contribution, share purchase" of foreign investors
at the commercial banks (Form No. 04);
c Performance of the purchase, sale of
foreign currency for repatriation abroad by foreign investors at commercial
banks, which are authorized to engage in foreign exchange activity (Form No.
05);
d. In case of need, commercial banks shall be
responsible for provision of information, reports at the request of the State
Bank.
13. The reports of
foreign investors:
Foreign Investors must submit reports to the
State Bank (Department of Foreign Exchange Control) on their share purchase,
capital contribution in Vietnamese enterprises (Form No. 06) on the quarterly
(on the 5th of the first month of the following quarter) and annual (on the
10th of the first month of the following year) basis.
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Foreign investors, who commit one of
following violation acts, shall be subject to the revocation of the
confirmation of the registration of the account "capital contribution,
share purchase" by the State Bank:
- Opening more than one account "capital
contribution, share purchase in VND" to carry out the capital contribution,
share purchase in Vietnamese enterprises;
- Carrying out the receipt, expenditure in
the account "capital contribution, share purchase" in contrary to
provisions in point 7, section I, Chapter II of this Circular.
- Failing to submit timely and sufficiently
reports to the State Bank in accordance with provision in point 13, Section I,
Chapter IV of this Circular;
- Violating current provisions on foreign
exchange control.
Chapter IV
IMPLEMENTING
PROVISIONS
15. Implementing
provisions
15.1 This Circular shall be effective after
15 days from its publication in the Official Gazette.
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16. Organization of
the implementation
Director of the Foreign Exchange Control
Department, Heads of units of the State Bank, General Managers of the State
Bank branches in provinces, cities under the central Government's management,
Chairperson of the Board of Directors and General Managers (Managers) of
commercial banks, foreign investors who contribute capital to, purchase shares
from Vietnamese enterprises, shall be responsible for the implementation of
this Circular.
FOR THE GOVERNOR OF
THE STATE BANK
DEPUTY GOVERNOR
Phung Khac Ke
Form No. 01
SOCIALIST REPUBLIC OF
VIETNAM
Independence - Freedom - Happiness
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REQUEST
FOR THE CONFIRMATION OF THE REGISTRATION OF THE ACCOUNT "CAPITAL
CONTRIBUTION, SHARE PURCHASE IN VND", WHICH IS MAINTAINED AT A COMMERCIAL
BANK
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To:
THE STATE BANK OF VIETNAM
DEPARTMENT OF FOREIGN EXCHANGE CONTROL
Name of foreign investor:
Type: Organization
Individual
Address:
Nationality:
Tel No.:
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We would like to request the State Bank of
Vietnam to confirm my registration of the account "capital contribution,
share purchase in VND" to facilitate the activity of capital contribution,
share purchase in Vietnamese enterprises as follows:
Name of the commercial bank where my account
is maintained:
Address:
Tel No.
Fax No.:
Account No.:
Account balance:
We undertake to correctly comply with current
provisions on foreign exchange control of Vietnam and other provisions of
applicable laws relating to the purchase, sale of securities, capital
contribution, share purchase in Vietnamese enterprises.
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FOREIGN INVESTOR
Form No. 02
THE STATE BANK OF
VIETNAM
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SOCIALIST REPUBLIC
OF VIETNAM
Independence- Freedom – Happiness
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No.: …/CV-QLNH
(Re:
confirmation of the registration of the account "capital contribution,
share purchase in VND" which is opened at commercial bank)
Hanoi,
date...............
To:
Upon the request in the application enclosed
with the file for registration of the account "capital contribution, share
purchase in VND" to facilitate the activity of capital contribution, share
purchase in Vietnamese enterprises of the foreign investor.................,
the State Bank of Vietnam has following opinions:
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Name of the foreign investor
Type: Organization
Individual
Address:
Tel No.
Fax No.
Nationality:
Name of the authorized bank where his account
is maintained:
Address:
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Fax No.
Account No
Account balance
2. While performing the capital contribution,
share purchase in Vietnamese enterprises, foreign investor must correctly
comply with provisions in the Circular No. ......./TT-NHNN dated............ of
the State Bank providing guidance on the foreign exchange control to the
capital contribution, share purchase in Vietnamese enterprises and other
related provisions of applicable laws.
RECEIVER:
-
As above
- Commercial bank where the account is opened
- Keep as record
AUTHORIZED BY THE
GOVERNOR OF THE STATE BANK
DIRECTOR OF FOREIGN
EXCHANGE CONTROL DEPARTMENT
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Commercial bank:
Address:
Fax:
Tel:
REPORT
ON THE OPENING, CLOSING OF THE ACCOUNT "CAPITAL CONTRIBUTION, SHARE
PURCHASE IN VND" OF FOREIGN INVESTOR
(Report of the
month............./20............, from the date............... to the
date........)
(Consolidated 6 month
report of the year.............. and annual report of the year.......)
To:
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Name of account
holder
The account
"capital contribution, share purchase"
Account No.
Nationality
Account balance
Opening date
Closing date
I. Organization investor
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1.
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2.
3.
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Sum
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II. Individual investor
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1.
2.
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3.
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Sum
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III. Total
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DRAWER
CONTROLLER
MANAGER
Form No. 04
Commercial bank:
Address:
Fax:
Tel:
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(Report of the
month............./20............, from the date............... to the
date........)
(Consolidated 6 month
report of the year.............. and annual report of the year.......)
To:
THE STATE BANK OF VIETNAM
(DEPARTMENT OF FOREIGN EXCHANGE CONTROL)
(Unit: VND)
Norms
Organization
Individual
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I. Balance at the beginning of the
period
II. Arising in the period
1. Receipt
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a. From foreign country
b. From domestic transfer
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c. From the transaction of capital
contribution, share purchase
d. Other receipts
2. Expenditure
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a. For capital contribution in Vietnamese
enterprises
b. For transfer to the account
"securities transactions", which is opened at the authorized
depository member by that foreign investor
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c. For foreign currency purchase for
repatriation abroad
Sum
III. Balance at the end of period
(III = I+II)
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Note:
- II.1.d: Receipts from the transaction of
capital contribution, share purchase including distributed dividends, the sale,
assignment of contributed capital, shares in cash
- II.2.b: Expenses for capital contribution,
share purchase including the amount for capital contribution, share purchase
and payment of other related expenses in cash
.............,
Date.................
COMMERCIAL BANK
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CONTROLLER
MANAGER
Form No. 05
Commercial bank authorized to engage in
foreign exchange activity:
Address:
Fax:
Tel:
REPORT
ON THE PURCHASE, SALE OF FOREIGN CURRENCY BY FOREIGN INVESTOR AT THE AUTHORIZED
BANK
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(Consolidated 6 month
report of the year.............. and annual report of the year.......)
To:
THE STATE BANK OF VIETNAM
(DEPARTMENT OF FOREIGN EXCHANGE CONTROL)
Norms
Organization
Individual
Total
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1. From sources abroad
2. Other sources
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Sum
II. Foreign currency sale for
repatriation abroad
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.............,
Date.................
AUTHORIZED BANK
DRAWER
CONTROLLER
GENERAL MANAGER
Form No. 06
REPORT
ON THE CAPITAL CONTRIBUTION, SHARE PURCHASE IN VIETNAMESE ENTERPRISES BY THE
FOREIGN INVESTOR
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(Consolidated report
of the year 200...)
To:
THE STATE BANK OF VIETNAM
(DEPARTMENT OF FOREIGN EXCHANGE CONTROL)
Name of foreign investor:
Type: Organization
Individual
Address:
Tel:
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Nationality:
Name of the commercial bank where the account
"capital contribution, share purchase in VND" is opened:
Account No.:
The confirmation of the account registration
by the State Bank: the Official Dispatch No...............
1. The report of the performance of the
account "capital contribution, share purchase":
(Unit: VND)
Norms
Amount
I. Balance at the beginning of the
period
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II. Arising in the period
1. Receipt
a. From foreign country
b. From domestic transfer
c. From the transaction of capital
contribution, share purchase
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d. Other receipts
Sum
2. Expenditure
a. For capital contribution in Vietnamese
enterprises
b. For transfer to the account
"securities transactions", which is opened at the authorized
depository member by that foreign investor
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d. For foreign currency purchase for
repatriation abroad
Sum
III. Balance at the end of period
(III = I+II)
Note:
- II.1.c: Receipts from the transaction of
capital contribution, share purchase including distributed dividends, the sale,
assignment of contributed capital, shares in cash
- II.2.b: Expenses for capital contribution,
share purchase including the amount for capital contribution, share purchase
and payment of other related expenses in cash
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Norms
Value in VND
1. Shares
2. Contributed capital
3. Other interests
Sum
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Total (III=I+II)
Note:
- The value of shares, contributed capital
shall be equivalent to the number of shares, contributed capital, which is held
by the foreign investor, multiplied by the original buying price or market
price (if any)
FOREIGN INVESTOR