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THE
MINISTRY OF LABOR, WAR INVALIDS AND SOCIAL AFFAIRS
THE MINISTRY OF JUSTICE
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SOCIALIST
REPUBLIC OF VIET NAM
Independence - Freedom - Happiness
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No:
06/2006/TTLT-BLDTBXH-BTP
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Hanoi,
July 07, 2006
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JOINT CIRCULAR
PROVIDING
GUIDANCE ON GUARANTY FOR LABORERS GOING TO WORK ABROAD
Pursuant to the June 14, 2005 Civil Code;
Pursuant to the Government's Decree No. 141/2005/ND-CP of November 11, 2005, on
management of Vietnamese laborers working abroad;
Pursuant to the Government's Decree No. 29/2003/ND-CP of March 31, 2003,
defining the functions, tasks, powers and organizational structure of the
Ministry of Labor, War Invalids and Social Affairs;
Pursuant to the Government's Decree No. 62/2003/ND-CP of June 6, 2003, defining
the functions, tasks, powers and organizational structure of the Ministry of
Justice,
In order to ensure uniform guaranty for laborers going to work abroad, the
Ministry of Labor, War Invalids and Social Affairs and the Ministry of Justice
hereby jointly guide guaranty for laborers going to work abroad as follows:
I. GENERAL ISSUES
1. Guaranty for laborers going to work abroad
a/ Guaranty for laborers going to work abroad
means an act whereby a third person (hereinafter referred to as the guarantor)
gives an enterprise sending laborers to work abroad (hereinafter referred to as
the guarantee) an undertaking to perform obligations on behalf of laborers
going to work abroad (hereinafter referred to as the guaranteed) when the
guaranteed fails to perform or improperly or incompletely performs his/her
obligations falling due towards the guarantee. The parties may also agree that
the guarantor shall perform obligations only when the guaranteed is incapable
of performing his/her obligations.
b/ The guarantee may request the guaranteed to
recommend a guarantor who meets all the conditions specified in Clause 1,
Article 16 of the Government's Decree No. 141/2005/ND-CP of November 11, 2005,
on management of Vietnamese laborers working abroad, and is accepted by the
guarantee for signing a guaranty contract.
2. Scope of guaranty:
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a/ To pay service charges which the guaranteed
fails to pay, if any;
b/ To pay compensations for damage caused to
foreign partners and other damage caused by breach of contract on the part of
the guaranteed;
c/ To pay fines for breach of contract, if so
agreed upon in the overseas working contract;
d/ To pay interests on guaranteed amounts which
are paid lately. These interests shall be calculated at the basic interest rate
announced by the State Bank at the time of payment for the late payment
duration, unless otherwise agreed by the parties or provided for by law;
e/ Other obligations of the guaranteed as agreed
upon by the parties which are neither prohibited by law nor contrary to social
ethics.
The scope of guaranty shall cover all
obligations of the guaranteed, unless otherwise agreed upon by the parties or
provided for by law.
3. Time limit for performance of guaranty
obligations
The time limit for performance of guaranty
obligations shall be agreed upon by the guarantor and the guarantee; if the two
parties have no agreement thereon, the guarantor shall perform guaranty
obligations within a reasonable time limit set by the guarantee, counting from
the time the guarantor receives the guarantee's notice on the performance of
obligations on behalf of the guaranteed.
4. Form and contents of guaranty contracts
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b/ Guaranty contracts shall be made by involved
parties, covering the following principal contents: scope of guaranty; rights
and obligations of contractual parties; time limit for performance of guaranty
obligations; and settlement of guaranty.
5. Application of measures to secure the
performance of guaranty obligations
a/ The guarantee may agree with the guarantor on
the application of such measures as pledge of property, mortgage of property or
deposit so as to secure the performance of guaranty obligations.
b/ The pledge, mortgage and deposit shall be
made in writing, either in a separate document or incorporated in the guaranty
contract.
c/ The establishment and application of the
measure of pledge of property, mortgage of property or deposit to secure the
performance of guaranty obligations shall comply with the provisions of the
Civil Code and relevant legal documents.
II. RIGHTS AND OBLIGATIONS OF PARTIES TO
GUARANTY CONTRACTS
1. Rights of the guarantor
a/ To be fully informed by involved parties of
the rights and obligations of the guaranteed towards the guarantee.
b/ To agree to provide guaranty for part or the
whole of obligations to be performed by the guaranteed towards the guarantee
according to the provisions of Clause 2, Section I of this Circular.
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d/ To request the guarantee to apply necessary
measures and create favorable conditions for the guaranteed to properly perform
the contract signed with foreign partners.
e/ To receive back papers and documents proving
his/her financial capacity, capability and prestige which have been handed over
to the guarantee upon signing of the guaranty contract, unless otherwise agreed
by the parties on the time of returning the aforesaid papers and documents.
f/ After the guaranty contract terminates, the
guarantee prioritizes the recruitment of the guarantor and his/her family
members to work abroad.
g/ In case where the guarantee improperly or
incompletely performs obligations stated at Points a, b, c and d, Clause 4 of
this Section, thus causing damage to the guarantor, the guarantor shall have
the right to claim damages and offset such damages against his/her obligations
towards the guarantee.
h/ When the guarantor has fulfilled guaranty
obligations, he/she may request the guaranteed to perform the latter's
obligations towards the guarantor within the scope of guaranty, unless
otherwise agreed upon.
i/ Other rights, if so provided for by law or
agreed upon by the parties.
2. Obligations of the guarantor:
a/ To hand over papers and documents proving
his/her financial capacity, capability and prestige and other necessary documents
to the guarantee for verification and consideration before signing the guaranty
contract, if so agreed upon.
b/ To urge and educate the guaranteed and
his/her family to perform obligations under the contract signed with the
guarantee; and together with the guaranteed's family, to apply necessary
measures to mitigate damage caused by breach of contract on the part of the
guaranteed.
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d/ To transfer his/her property to the guarantee
or to a third person as agreed upon for disposal in case of failure to perform
or improper or incomplete performance of guaranty obligations.
e/ Other obligations, if so provided for by law
or agreed upon by the parties.
3. Rights of the guarantee
a/ To request the guarantor to prove his/her
financial capacity, capability and prestige and hand over relevant papers and
documents, if any, for verification and consideration.
b/ To request the guarantor to transfer his/her
property for disposal in case where upon the expiration of the time limit for
performance of guaranty obligations, the guarantor still fails to perform or
incompletely performs guaranty obligations. If the guarantor refuses to
transfer his/her property for disposal, the guarantee may initiate a lawsuit at
a competent court.
c/ Other rights, if so provided for by law or
agreed upon by the parties.
4. Obligations of the guarantee
a/ To fully inform the guarantor of the
guaranteed's rights and obligations toward the guarantee;
b/ To notify the guarantor of the guaranteed's
workplace, working situation, incomes, health, working and living conditions.
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d/ To preserve papers and documents proving the
guarantor's financial capacity, capability and prestige. If causing damage to
or loss of such papers and documents, to pay damages therefor.
e/ When the guaranteed breaches the overseas
working contract, the guarantee shall immediately notify in writing the
guarantor and the guaranteed's family thereof for the latter to urge and
educate the guaranteed to properly perform the contract and remedy damage
caused by the guaranteed.
f/ To notify the guarantor of the performance of
obligations on behalf of the guaranteed.
g/ To supply the guarantor with papers and
documents proving the damage caused by the guaranteed.
h/ To return to the guarantor papers and
documents proving the guarantor's financial capacity, capability and prestige,
if any, which were supplied upon signing of the guaranty contract, unless
otherwise agreed by the parties on the time of returning the aforesaid papers
and documents.
i/ To prioritize the recruitment of the
guarantor and his/her family members to work abroad after the guaranty contract
terminates.
j/ Other obligations, if so provided for by law
or agreed upon by the parties.
5. Rights and obligations of parties in case of
application of measures to secure the performance of guaranty obligations
In case where the parties to a guaranty contract
agree upon on the application of measures to secure the performance of guaranty
obligations as specified in Clause 5, Section I of this Circular, the guarantee
shall have the rights and obligations of the pledgee, mortgagee or depositary
and the guarantor shall have the rights and obligations of the pledgor,
mortgagor or depositor under the pledge, mortgage or deposit contract signed
between the parties serving as a security measure.
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1. To recommend a guarantor to the guarantee for
signing the guaranty contract.
2. To sign the guaranty contract, if so
requested by the guarantor and the guarantee.
3. To perform his/her obligations towards the
guarantor within the scope of guaranty when the guarantor has fulfilled
obligations for him/her, unless otherwise agreed upon.
4. Other obligations, if so provided for by law
or agreed upon by involved parties.
IV. TERMINATION AND LIQUIDATION OF GUARANTY
CONTRACTS
1. A guaranty contract shall terminate when:
a/ The guaranteed has fulfilled his/her
obligations towards the guarantee.
b/ The guarantor has fulfilled guaranty
obligations.
c/ The guaranty is cancelled or replaced by
other security measures.
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e/ Other cases provided for by law.
2. Liquidation of a guaranty contract
a/ The time limit for liquidation of a guaranty
contract shall be 30 days, counting from its termination, unless otherwise
agreed by the parties.
b/ The liquidation of a guaranty contract shall
be made in writing, clearly stating the degree of performance of the agreements
reached in the guaranty contract and the parties responsibilities, if any,
arising from the liquidation of the contract.
In case of termination of the guaranty under the
provisions of Points c and d, Clause 1 of this Decision, the liquidation of the
guaranty contract may be made in a separate document or incorporated in the
document on cancellation or replacement of the guaranty or in the written
agreement on guaranty termination.
V. SETTLEMENT OF GUARANTY
1. The guarantor shall perform guaranty
obligations if, upon the expiration of the time limit for performance of
guaranty obligations, the guaranteed fails to perform, improperly or
incompletely performs the obligations. The guarantor shall also perform
guaranty obligations if, upon the expiration of the time limit for performance
of guaranty obligations, the guaranteed is incapable of performing his/her
obligations towards the guarantee, if so agreed upon by the parties.
2. If upon the expiration of the time limit for
performance of obligations the guarantor still fails to perform, improperly or
incompletely performs guaranty obligations, and refuses to transfer his/her
property for disposal as agreed upon, the guarantee shall have the right to
initiate a lawsuit at the court or request another competent state agency to
dispose of the property of the guarantor.
If the performance of guaranty obligations is
secured by pledge, mortgage or deposit under the provisions of Clause 5,
Section I of this Circular, the guarantee may dispose of the security property
according to the pledge, mortgage or deposit contract already signed by the
parties.
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The guarantee shall return the amount left after
payment of guaranty obligations to the guarantor. In case where the proceeds
from the sale of property are not enough to make payment to the guarantee, the
guarantor shall add other property which shall be disposed for payment of the
deficient amount.
4. The parties shall have the right to request a
competent court to settle any arising disputes according to the provisions of
law.
VI. STATUTE OF LIMITATIONS FOR INITIATING
LAWSUITS OVER GUARANTY CONTRACTS
The statute of limitations for initiating a
lawsuit to request the court to settle disputes over a guaranty contract is two
years, counting from the date when legitimate rights and interests of
individuals, legal persons and other subjects are infringed upon.
VII. ORGANIZATION OF IMPLEMENTATION
1. This Circular takes effect 15 days after its
publication in "CONG BAO."
2. Individuals and organizations should report
any problems arising in the course of implementation to the Ministry of Labor,
War Invalids and Social Affairs and the Ministry of Justice for consideration
and settlement.