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CIRCULAR

Guidelines for implementing Decree No. 202/2004/NĐ-CP of the Government dated December 10, 2004 on penalties for administrative violations in the field of currency and banking activities

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 On the basis of the Administrative Offense Handling Ordinance, July 2, 2002. vi            On the basis of Decree No. 134/2003/NĐ-CP of the Government dated November 14, 2003 detailing certain provisions of the Administrative Offense Handling Ordinance 2002;
On the basis of Decree No. 202/2004/NĐ-CP of the Government dated December 10, 2004 on penalties for administrative violations in the field of currency and banking activities;

The State Bank of Vietnam guides the implementation of Decree No. 202/2004/NĐ-CP of the Government dated December 10, 2004 on penalties for administrative violations in the field of currency and banking activities (hereinafter referred to as Decree No. 202/2004/NĐ-CP) as follows:

I. GENERAL PROVISIONS; AUTHORITY TO IMPOSE PENALTIES FOR ADMINISTRATIVE VIOLATIONS; APPLICATION OF FORMS OF PENALTIES FOR ADMINISTRATIVE VIOLATIONS

1. Mitigating circumstances, aggravating circumstances

The mitigating circumstances and aggravating circumstances prescribed in Article 6 of Decree No. 202/2004/NĐ-CP shall be applied when imposing penalties for administrative violations in the field of currency and banking activities as follows:

1.1. The person authorized to impose penalties for administrative violations within their scope of authority decides on mitigating circumstances and aggravating circumstances.

1.2. Repeated violation in the same field or recidivism in the same field:

- Repeated violation in the same field means an act of administrative violation that has been committed before but not yet punished and the statute of limitations for punishment has not expired;

- Recidivism means an act of administrative violation that has been punished before but the one-year period from the date of completion of the penalty decision or from the expiration of the enforcement period of the penalty decision has not yet passed, and the administrative violation regarding that act occurs again.

2. Authority to impose penalties for administrative violations

Only those persons authorized to impose penalties for administrative violations as stipulated in Article 37 of Decree No. 202/2004/NĐ-CP have the authority to issue decisions on penalties for administrative violations in the field of currency and banking activities.

For inspection teams: during the inspection process, if administrative violations in the field of currency and banking activities are discovered, the person authorized to impose penalties for administrative violations in the inspection team must issue a penalty decision within the time limit specified in Clause 2, Article 41 of Decree No. 202/2004/NĐ-CP. If members of the team do not have the authority to impose penalties or exceed their authority to impose penalties, the Head of the Inspection Team must complete the administrative violation penalty file to send to the person authorized to impose penalties as stipulated in Point c, Clause 2, Article 41 of Decree No. 202/2004/NĐ-CP.

3. Application of forms of penalties for administrative violations

3.1. The person issuing the penalty decision for administrative violations must base on the aggravating circumstances and mitigating circumstances prescribed in Article 6, the provisions on acts of violation, forms of penalties, and fines set out in Chapter II of Decree No. 202/2004/NĐ-CP to decide on the application of the main form of penalty, supplementary form of penalty, or measures to remedy consequences in accordance with the nature and degree of the act of violation.

3.2. There are two main forms of penalty prescribed in Clause 1, Article 7 of Decree No. 202/2004/NĐ-CP, which are warning or fine. The person issuing the penalty decision for administrative violations may only apply one of these two main forms of penalty, not both main forms of penalty for one act of violation.

4. Acts of violation, forms of penalty, and fines

Decree No. 202/2004/NĐ-CP, from Article 8 to Article 36, stipulates nine groups of acts, each group having specific acts of violation. When imposing penalties for administrative violations in the field of currency and banking activities, the person authorized to impose penalties must base on current legal documents: Law on the State Bank of Vietnam, Law on Credit Organizations, Administrative Offense Handling Ordinance, Decrees of the Government guiding the implementation of the Law on the State Bank of Vietnam, Law on Credit Organizations, and other related legal documents to determine the signs constituting the act of administrative violation, its nature, and degree.

5. Administrative violations concerning accounting and statistics

The imposition of penalties for administrative violations concerning accounting and statistics in the field of currency and banking activities shall be carried out in accordance with the provisions of Government Decree No. 185/2004/NĐ-CP dated November 4, 2004 on penalties for administrative violations in the field of accounting; Government Decree No. 93/1999/NĐ-CP dated September 7, 1999 on penalties for administrative violations in the field of statistics, together with guiding documents on penalties for administrative violations in the fields of accounting and statistics.

During the inspection process, if any acts of administrative violations concerning accounting and statistics are discovered, the Head of the Inspection Team must report to the specialized Financial Inspection Department to impose penalties according to their authority.

6. Exceptions

The provisions in Article 23 of Decree No. 202/2004/NĐ-CP do not apply to the case of selling assets during the process of handling collateral to recover debts.

The provisions in Points a and c, Clause 2, Article 25 of Decree No. 202/2004/NĐ-CP do not apply to the General Directors and Deputy General Directors of branches of credit organizations.

II. PROCEDURES FOR IMPOSING PENALTIES FOR ADMINISTRATIVE VIOLATIONS:

When imposing penalties for administrative violations, the person authorized to impose penalties must strictly follow the procedures for imposing penalties for administrative violations prescribed in Chapter III of Decree No. 202/2004/NĐ-CP and Chapter IV of Government Decree No. 134/2003/NĐ-CP dated November 14, 2003 detailing certain provisions of the Administrative Offense Handling Ordinance 2002.

The State Bank of Vietnam provides additional guidance on the following matters:

1. Transfer of violation case files with criminal offense indications for criminal prosecution

When examining a violation case to decide on penalties, if it is found that the act of violation has indications of a criminal offense, then the person authorized as stipulated in Clauses 2, 3, and 4, Article 37 of Decree No. 202/2004/NĐ-CP must immediately transfer the file to the competent criminal prosecution agency as prescribed in Article 62 of the Administrative Offense Handling Ordinance.

2. Retrieving violation case files for administrative penalty imposition:

2. Retrieve the violation file for administrative offense penalty:

Acts of administrative violations in the monetary and banking sector that have been transferred to competent criminal proceedings agencies but subsequently have decisions to terminate investigation or close the case issued by such agencies shall be subject to an administrative penalty decision by the competent authority to impose administrative penalties within the following time limits:

2.1. If the authority responsible for imposing administrative penalties requests an extension of the deadline for issuing the administrative penalty decision before transferring the case to the criminal proceedings agency, the maximum period for issuing the administrative penalty decision shall be 10 days from the date of receipt of the decision returning the case file;

2.2. If the authority responsible for imposing administrative penalties does not request an extension of the deadline for issuing the administrative penalty decision before transferring the case to the criminal proceedings agency, the maximum period for issuing the administrative penalty decision shall be 15 days from the date of receipt of the decision returning the case file;

In cases where additional time is required for verification and collection of evidence, the authority handling the violation may request an extension of the deadline for issuing the administrative penalty decision, which shall not exceed 30 days;

2.3. After imposing administrative penalties in accordance with Decree No. 202/2004/NĐ-CP, the authority specified in Clause 4, Article 37 of Decree No. 202/2004/NĐ-CP must notify the State Bank of Vietnam thereof;

3. Handling of administrative violations transferred by state management agencies and law enforcement agencies

3.1. In cases where administrative violations in the monetary and banking sector on provincial or centrally-administered city territory are transferred by state management agencies and law enforcement agencies, the State Bank branch in the province or centrally-administered city shall be responsible for:

a. Receiving the case file and materials related to the administrative violation;

b. Reviewing and issuing an administrative penalty decision, applying supplementary sanctions and measures to remedy consequences according to the authority prescribed in Decree No. 202/2004/NĐ-CP and this Circular;

c. Within five working days from the date of receiving the case file on the administrative violation, upon review, if it finds that the materials and evidence in the file are insufficient grounds for imposing an administrative penalty, the State Bank branch in the province or centrally-administered city shall issue a document stating the reasons and requesting the violator's record keeper to provide additional evidence to prove the violation; if necessary, directly verify and investigate. If the record keeper fails to provide sufficient materials and evidence or, upon verification and investigation, finds insufficient grounds to prove the administrative violation, no administrative penalty decision shall be issued and the case file and materials shall be returned to the violator's record keeper;

In cases where the administrative penalty exceeds the authority, the Director of the Inspectorate of the State Bank branch in the province or centrally-administered city shall be responsible for implementing the provisions set out in items a, b, and c of point 3.1, Clause 3, Section of this document, then submit a written proposal for handling the administrative violation specifying the act, proposed penalty level, basis for application, and the entire administrative violation file, original violation record to the State Bank of Vietnam (Inspectorate of the State Bank) for handling in accordance with the law;

3.2. Handling cases where the administrative violation record is established in violation of the law

In cases where the administrative violation file transferred by another agency does not comply with the procedures stipulated in Decree No. 202/2004/NĐ-CP; the content of the record does not comply with the provisions of Article 55 of the Administrative Violation Handling Ordinance, the Director of the Inspectorate of the State Bank and the Director of the Inspectorate of the State Bank branch in the province or centrally-administered city shall not issue an administrative penalty decision, but return the file to the violator's record keeper to request supplementation in full and in compliance with regulations;

3.3. The Inspectorate of the State Bank shall be responsible for reviewing and imposing administrative penalties within its authority for administrative violations transferred by central state management agencies and law enforcement agencies; administrative violations transferred by the State Bank branch in the province or centrally-administered city;

4. Temporary detention of objects and means involved in administrative violations

The temporary detention of objects and means involved in administrative violations shall be carried out in accordance with the provisions of Article 46 of the Administrative Violation Handling Ordinance;

In cases where administrative penalties are imposed along with the temporary detention of objects and means involved in administrative violations, but exceed the authority of the person issuing the temporary detention decision, the person issuing the temporary detention decision shall be responsible for preserving the objects and means involved in administrative violations until the administrative penalty decision is fully implemented;

5. Using templates for violation records and administrative penalty decisions

Violation records; temporary detention records for objects and means involved in administrative violations; administrative penalty decisions; temporary detention decisions for objects and means involved in administrative violations, and other related records and decisions shall be prepared in accordance with the template prescribed in Government Decree No. 134/2003/NĐ-CP dated November 14, 2003 detailing the implementation of certain provisions of the Administrative Violation Handling Ordinance 2002;

6. Use of seals on administrative penalty decisions

6.1. The administrative penalty decision of the Director of the Inspectorate (Deputy Director of the Inspectorate authorized) shall be stamped over the signature; the administrative penalty decision of the Inspector shall be stamped at the top left corner of the decision where the name of the penalizing agency and the number and code of the administrative penalty decision are recorded;

6.2. The authority responsible for imposing administrative penalties in the monetary and banking sector as stipulated in Clause 4, Article 37 of Decree No. 202/2004/NĐ-CP may use the seal of their own agency to stamp on the administrative penalty decision;

7. Administrative penalty case files

7.1. After issuing a decision on administrative penalty, the person authorized under Clauses 1, 2, and 3 of Article 37 of Decree No. 202/2004/NĐ-CP shall transfer the administrative penalty case file to the Banking Inspection at the same level.

7.2. After issuing a decision on administrative penalty, the person authorized to impose administrative penalties under Clause 4 of Article 37 of Decree No. 202/2004/NĐ-CP shall transfer the administrative penalty case file to the specialized department responsible for managing administrative penalties within the competent authority imposing such penalties.

7.3. The file includes:

- Record of administrative violations in the monetary and banking sector;

- Decision on administrative penalties in the monetary and banking sector;

- Record of confiscation of contraband items and means of administrative violations (if any);

- Related documents concerning the administrative violation.

III. IMPLEMENTATION

1. The Chief Inspector of the State Bank of Vietnam shall organize the implementation and instruct and guide units and individuals within the Banking Inspection system to thoroughly understand and strictly enforce administrative penalties.

2. The Governor of the State Bank of Vietnam branch in provinces and centrally-administered cities shall be responsible for:

2.1. Regularly inspecting administrative penalties within their jurisdiction; promptly addressing violations of laws and resolving complaints and denunciations in the handling of administrative violations as stipulated in Articles 50, 51, and 52 of Decree No. 202/2004/NĐ-CP.

2.2. Monitoring and reporting on the implementation of decisions on administrative penalties in the monetary and banking sector issued by the Chief Inspector of the State Bank of Vietnam to penalize violators listed in the decision within the jurisdiction of the State Bank of Vietnam branch in provinces and centrally-administered cities.

In cases where individuals or organizations subject to penalties do not voluntarily comply with the penalty decision, the Governor of the State Bank of Vietnam branch in provinces and centrally-administered cities shall request the Chief Inspector of the State Bank of Vietnam to issue a compulsory enforcement decision and organize its implementation; simultaneously reporting the results of the implementation to the Chief Inspector of the State Bank of Vietnam.

IV. EFFECTIVE DATE OF IMPLEMENTATION

This Circular takes effect fifteen days from the date of publication in the Official Gazette and replaces Circular No. 09/2000/TT-NHNN of the State Bank of Vietnam dated August 29, 2000, guiding the implementation of Government Decree No. 20/2000/NĐ-CP dated June 15, 2000, on administrative penalties in the monetary and banking sector.

During the implementation process, if there are difficulties or obstacles, units must promptly reflect them to the State Bank of Vietnam (through the Banking Inspection Department) for the Governor of the State Bank of Vietnam to consider and decide.