Circular No. 02/2014/TT-NHNN on the destruction of defective printed money, defective minted money, defective banknote paper, and defective coin metal.

CIRCULAR

Article 24Regarding the destruction of defective printed and minted currency, printing paper for defective currency,metallic material for defective minted currency, metal for coin casting with defectsg

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Pursuant to the Law on the State Bank of Vietnam No. 46/2010/QH131on June 16, 202010;

Pursuant to Decreeand amended and supplemented by certain articles related to conditions for investment and business and administrative procedures in the field of information and communications on November 7, 201856/201Government Decree No. 52/2016/ND-CP dated June 13, 2016 stipulating wages, remuneration, and bonuses for managers in limited liability companies with 100% state capital; 11 the 11 of 2013 of the Government stipulating functions, tasks, powers,uRights and duties and enterprises, of the Ministry of HealthDeputy ministers of ministerial-level agencies,and responsibilities; Decree No. 40/2012/NĐ-CP dated May 2, 2012 of the Government on currency issuance operations; storage and transportation of precious assets and securities within the State Bank of Vietnam, credit institutions, and foreign bank branches;âstate of Vietnam;

Decree No. The State Bank of Vietnam issues this Circular"b) In addition to the lists of public services issued according to the provisions of Clause 2, Article 4 of this Decree, specialized agencies under provincial People's Committees shall report to the provincial People's Committee for decision-making on amending, supplementing, or issuing the list of public services funded by the state budget within their jurisdiction and consistent with the local budget capacity within the approved budget by the Provincial People's Assembly, and send it to the Ministry of Finance and relevant ministries and sectors for supervision during implementation."regarding the destruction of defective printed and minted currency, printing paper for defective currency, and metallic material for defective minted currency. This Circular regulates the destruction of defective printed and minted currency, printing paper for defective currency, and metallic material for defective minted currency (referred to as defective printed and minted currency) made of cotton paper, polymer, and metal materials.

At the proposal of the Director of the Issuance and Treasury Department,

1. The Currency Destruction Committee (referred to as the Destruction Committee).g đNo.2. Relevant units under the State Bank of Vietnam (referred to as the State Bank).ệ3. Domestic printing and minting facilities and organizations and individuals related to the destruction of defective printed and minted currency. stipulating 1. "Defective printed currency" means printed currency products that do not meet technical standards as prescribed by the State Bank.on2. "Defective minted currency" means minted currency products that do not meet technical standards as prescribed by the State Bank. l3. "Printing paper for defective currency" means printing paper for currency that does not meet technical requirements of the State Bank, specifically: a) Paper with defects during production, packaging, and transportation by suppliers such as failing to meet technical parameters (size, quality, etc.), being damp, sticking together, torn, missing corners;

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

b) Paper damaged during storage due to high humidity causing creasing, wetness, tearing, and failing to meet technical standards for printing;

Article 2. Applicability

c) Paper damaged during printing due to equipment malfunction or operational errors such as tearing, winding around rollers, crushing, or soiling;

d) Printed paper rejected at production stages due to failing to meet technical standards;

đ) Other reasons causing damage to printing paper for currency.

Article 3. Explanation of Terms

In this Circular, the following terms are understood as follows:

4. "Metallic material for defective minted currency" means metallic material for minted currency that does not meet technical requirements of the State Bank, specifically:

a) Metallic material for minted currency with defects during production, packaging, and transportation by suppliers such as failing to meet technical parameters (size, shape, quality, etc.);

b) Metallic material for minted currency damaged during storage such as warping, bending, oxidizing, rusting, clumping, and failing to meet technical standards for minting;

c) Metallic material for minted currency damaged during printing due to equipment malfunction or operational errors;

d) Metallic material for minted currency rejected at production stages due to failing to meet technical standards;

đ) Other reasons causing damage to metallic material for minted currency.

5. "Destruction warehouse" is the warehouse used to store various types of defective printed and minted currency during the destruction process according to the requirements of the Destruction Committee.

6. "Waste destruction warehouse" is the warehouse used to store waste recovered during the destruction process according to the requirements of the Destruction Committee.

Article 4. Decision on the destruction of defective printed and minted currency

The Governor of the State Bank decides the time, location, and quantity of each type of defective printed and minted currency to be destroyed; decides to establish the Destruction Committee at the printing and minting facility.

b) Metal for coin casting damaged during storage such as warping, tilting, oxidizing, rusting, clumping, not meeting technical standards for casting;

c) Metal for coin casting damaged during printing due to equipment errors, machine operation errors;

d) Metal for coin casting that has been cast and rejected at production stages due to failing to meet technical standards;

đ) Metal for coin casting damaged due to other reasons.

5. "Destruction warehouse" is the warehouse used to store various types of defective printed and cast money during the destruction process according to the requirements of the Destruction Committee.

6. "Waste destruction warehouse" is the warehouse used to store waste recovered during the destruction process according to the requirements of the Destruction Committee.

Article 4. Decision on the destruction of defective printed and cast money

The Governor of the State Bank decides the time, location, quantity of each type of defective printed and cast money to be destroyed; decides to establish the Destruction Committee at the printing and minting facility.

Article 5. Principles for Destroying Defective Printed and Minted Currency

The organization of destroying defective printed and minted currency shall be carried out according to the following principles:

1. Ensuring absolute safety of assets and state confidentiality.

2. After destruction, defective printed and minted currency must become waste material and cannot be reused.

For defective printed currency and polymer-based defective printing paper, after cutting and destroying, the printing and minting facility must completely destroy (hydrolysis, high-temperature incineration, or other methods) before selling to scrap purchasing facilities.

3. Defective printed currency brought for destruction must have corners cut off or marked as defective. Ripped defective printing paper must be taped back together with the same type of paper, and if pieces are missing, there must be a record from the printing and minting facility. Defective minted currency and defective minted metal must be marked as defective before destruction.

4. Defective printed and minted currency destroyed pursuant to the Governor's Decision of the State Bank must be counted 100% and destroyed in accordance with the actual quantity after counting.

5. The handover, counting, cutting, and destruction of defective printed and minted currency must be carried out in separate rooms with doors and locks ensuring safety according to current regulations on handover and storage procedures of the State Bank.

Article 6. Supervision of Destroying Defective Printed and Minted Currency

1. The process of destroying defective printed and minted currency from the handover stage from the printing and minting facility's warehouse to the destruction committee's warehouse until the defective printed and minted currency is cut and destroyed into waste material must be supervised by the Defective Printed and Minted Currency Destruction Supervision Committee (referred to as the Supervision Committee) according to current regulations.

2. The complete destruction process (hydrolysis, high-temperature incineration, or other methods) for defective printed currency and polymer-based defective printing paper must be organized and supervised by the Director of the printing and minting facility.

Chapter II

DESTRUCTION MACHINE FOR DEFECTIVE PRINTED AND MINTED CURRENCY

Article 7. Destruction Machine for Defective Printed and Minted Currency

1. The Destruction Committee is established by the Governor of the State Bank based on the proposal of the Personnel Organization Department. The composition of the Destruction Committee includes:

a) Chairman: Director of the printing and minting facility;

b) Members:

- Head of Accounting-Finance Department of the printing and minting facility (serves as the secretary of the Destruction Committee);

- Head of Audit-Internal Control Department of the printing and minting facility;

- Head of Warehouse Department of the printing and minting facility;

- Head of Security Department of the printing and minting facility;

- One specialist from the Financial-Accounting Department (serves as the accountant of the Destruction Committee);

- One specialist from the Issuance and Treasury Bureau.

2. The supporting staff of the Destruction Committee is appointed by the Chairman of the Destruction Committee, consisting of some workers and security personnel from the printing and minting facility, forming teams corresponding to each stage of the destruction process of defective printed and minted currency to directly carry out the destruction work.

3. The warehouse manager of the Destruction Committee is appointed by the Chairman of the Destruction Committee, responsible for storing the defective printed and minted currency in the destruction warehouse.

4. The accountant of the Destruction Committee is responsible for recording books and preparing accounting reports related to the destruction process of defective printed and minted currency.

Article 8. Duties and Authorities of the Destruction Committee

1. Organizing the implementation of stages: handover, counting, cutting, and destruction of the process of destroying defective printed and minted currency.

2. Identifying existing issues and shortcomings in the process of destroying defective printed and minted currency; receiving proposals to resolve difficulties in the process of destroying defective printed and minted currency from relevant units, advising the Governor of the State Bank on measures to handle them.

3. Organizing summaries, evaluations, and recommending commendation forms in the work of destroying defective printed and minted currency.

4. Proposing appropriate forms of handling for individuals violating the provisions of this Circular from relevant units.

5. Reporting to the Governor of the State Bank the results of the work of destroying defective printed and minted currency.

6. Preserving and retaining relevant files and documents during the process of destroying defective printed and minted currency.

Article 9. Duties and Authorities of the Chairman of the Destruction Council

1. Direct the implementation of the duties and authorities of the Destruction Council as stipulated in Article 8 of this Circular.

2. Assign tasks to members of the Destruction Council's organizational structure as specified in Article 7 of this Circular.

3. Appoint staff to manage the keys for the "Destruction Warehouse" and "Destroyed Waste Warehouse" according to the current regulations on warehouse management systems of printing and minting facilities.

4. Provide working equipment, labor protection gear, and other necessary items to serve the destruction of defective printed and minted currency.

5. Propose measures for handling individuals related to excess or shortage of defective printed and minted currency discovered during the destruction process, and report to the Governor of the State Bank of Vietnam, the Supervisory Board on the results of such handling.

Chapter III

DESTRUCTION PROCESS OF DEFECTIVE PRINTED AND MINTED CURRENCY

Article 10. Stages of destroying defective printed and minted currency

1. For defective printed currency, defective paper currency made of cotton material, and defective minted currency, the destruction process includes three stages:

a) The handover stage carried out by the Handover Team;

b) The counting stage carried out by the Counting Team;

c) The cutting stage carried out by the Cutting Team.

2. For defective printed currency, defective paper currency made of polymer material, the destruction process includes four stages: handover, counting, cutting as stipulated in Clause 1 of this Article, and complete destruction carried out by the printing and minting facility.

Article 11. Handover Stage

1. Based on the quantity of each type of defective printed and minted currency approved by the Governor of the State Bank of Vietnam for destruction, the Director of the printing and minting facility shall handle the warehouse exit procedures and deliver the defective printed and minted currency to the Destruction Council according to the Destruction Council’s plan.

2. The Handover Team shall carry out the receipt of defective printed and minted currency from the printing and minting facility according to the following procedure:

a) Based on the warehouse exit form of the printing and minting facility, the Head of the Handover Team shall receive the defective printed and minted currency according to the method:

Defective printed currency shall be received in packages (10 bundles = 10,000 pieces) sealed intact; defective paper currency shall be received in packages (500 large sheets) sealed intact; defective minted currency and defective minted metal shall be received in boxes sealed intact (according to the packaging specifications of the printing and minting facility); if the package or box does not meet the quantity requirements, it shall be received based on the actual quantity sealed intact;

b) Check the sealing of the package or box must include all required elements such as: name, signature of the packer; date and year of sealing; quantity and type of defective printed and minted currency;

c) In case of surplus, shortage, or confusion, handle according to the provisions of Clause 1, Article 15 of this Circular;

d) Prepare a handover record between the printing and minting facility and the Destruction Council on the day with confirmation from the supervisor at the Handover Team (according to Form No. 01 attached to this Circular).

3. Transfer the received defective printed and minted currency from the printing and minting facility's warehouse to the Counting Team. Prepare a handover record between the Handover Team and the Counting Team on the day with confirmation from the supervisor at each team (according to Form No. 07 attached to this Circular).

Article 12. Counting Stage

1. The Head of the Counting Team shall receive the defective printed and minted currency from the Handover Team according to the procedures stipulated in point a and b, Clause 2, Article 11 of this Circular.

2. Defective printed currency shall be counted using a currency counter or manually for sticky currency. Defective paper currency shall be counted manually, with two people counting from both ends of the package. Defective minted currency and defective minted metal shall be counted using a currency counter or manually for corroded or sticky currency.

3. Conduct counting to determine the quantity and type of defective printed and minted currency:

For defective printed currency and defective paper currency: cut the binding of the bundle to count the pieces and sheets (without tearing the seal); after counting, if the quantity and type match, then tear the old seal;

For defective minted currency and defective minted metal: open the box or container (without tearing the seal); cut the wrapping paper around the metal bars, count the pieces; after counting, if the quantity and type match, then tear the old seal.

4. In case of surplus, shortage, or confusion, handle according to the provisions of Clause 2, Article 15 of this Circular.

5. Rebundle (package, bag) and reseal:

a) For defective printed currency and defective paper currency

For defective printed currency: 100 pieces make up one stack, 10 stacks make up one bundle. For defective paper currency: 500 large sheets make up one package.

Use a continuous string without knots, tie one horizontal and one vertical loop around the bundle or package; affix a new seal over the knot, the seal should include all elements: date, month, year; type of currency; quantity; name, signature of the counter. If the quantity is insufficient to make a bundle or package, seal according to the actual quantity;

b) For defective minted currency and defective minted metal

1,000 pieces make up one cloth bag, 10 bags make up one box. Use a continuous string without knots to tightly tie the mouth of the bag and the top of the box, affix a new seal over the knot (separate the two ends of the string so they are apart), the seal should include all elements: date, month, year; type of currency; quantity; name, signature of the counter. If the quantity is insufficient to make a bag or box, seal according to the actual quantity.

6. Deliver the counted defective printed and minted currency to the Cutting Team.

7. Prepare a handover record between the Counting Team and the Cutting Team with confirmation from the supervisor at each team (according to Form No. 07 attached to this Circular).

8. At the end of the day, any uncounted defective printed and minted currency must be placed in a locked iron cage, sealed (clearly marked as uncounted defective printed and minted currency; date, month, year; name of the team sending; type of currency; quantity; name, signature of the sender; signature of the supervisor confirming at the Counting Team), recorded in the handover log (according to Form No. 06 attached to this Circular) and stored in the destruction warehouse for safekeeping.

Any counted defective printed and minted currency that has not been fully handed over to the Cutting Team must be placed in a locked iron cage, sealed (clearly marked as counted but not yet handed over defective printed and minted currency; date, month, year; name of the team; type of currency; quantity; name, signature of the team leader; signature of the supervisor confirming at the Counting Team), prepare a handover record (according to Form No. 08 attached to this Circular) and return to the Destruction Council.

9. Prepare and submit the daily counting results record to the Destruction Committee with the signature of the supervisor at the team (according to Form No. 12 attached to this Circular).

Article 13. Cutting and Destruction Process

1. The Cutting Team receives from the Counting Team various types of defective printed and minted currency that have been counted, bundled, and newly sealed according to the provisions of Clause 5, Article 12 of this Circular.

2. In cases of doubt regarding excess, shortage, or error, handle them according to the provisions of Clause 3, Article 15 of this Circular.

3. Defective printed currency and defective printing paper are fed into the cutting machine to be cut into scrap pieces with a maximum width of 01 cm and a maximum length of 20 cm.

Defective minted currency and defective minted metal are fed into specialized destruction machines to be cut into scrap pieces (at least three pieces depending on the size of the coin). In cases where the method of stamping destruction or complete melting is used, follow the regulations of the State Bank.

4. At the end of the day, any remaining uncut defective printed and minted currency must be placed in a locked iron cage, sealed (clearly marked as uncut defective printed and minted currency; date, month, year; name of the sending team; type of currency; quantity; name and signature of the sender; signature of the supervisor at the Cutting Team for confirmation), recorded in the handover log (according to Form No. 06 attached to this Circular), and sent to the destruction warehouse for storage.

5. Scrap collected after destruction is packed into bags, the mouths of which are securely sewn shut, and then stored in the destruction scrap warehouse for preservation.

6. The Cutting Team prepares a daily cutting result record with the supervisor's confirmation (according to Form No. 13 attached to this Circular). At the end of each destruction phase for defective printed and minted currency, the Destruction Committee prepares a comprehensive report on the cutting results with the confirmation of the Supervisory Committee (according to Forms No. 15 and 16 attached to this Circular).

7. The Destruction Committee prepares a record of handover and transfer of all scrap material cut and packed in a day to the printing and minting facility with the confirmation of the Supervisory Committee (according to Form No. 14 attached to this Circular).

Article 14. Complete Destruction Process

For scrap materials already cut small using polymer material, the Director of the printing and minting facility is responsible for establishing specific procedures and organizing the complete destruction process.

Chapter IV

HANDLING EXCESS AND SHORTAGE; ACCOUNTING AND STATISTICAL REPORTING

Article 15. Handling Excess, Shortage, and Error in Handover, Counting, and Cutting

1. In cases of excess, shortage, or error during the handover process: The Handover Team receives bundles, packages, or boxes of currency with excess, shortage, or error according to the actual sealed quantity, while preparing three copies of the excess, shortage, and error record (according to Form No. 05 attached to this Circular). The warehouse manager of the printing and minting facility retains one copy, records it in the books, and reports to the Director of the printing and minting facility for handling; one copy is attached to the bundle, package, or box of currency with excess, shortage, or error; one copy is submitted to the Destruction Committee at the end of the workday.

2. In cases of excess, shortage, or error during the counting process: the counter records the excess, shortage, or incorrect denomination on the back of the old seal, signs for confirmation, and simultaneously informs the supervisor to check and sign for confirmation on the back of the old seal.

At the end of the workday, the Counting Team bases on the seals with excess, shortage, or error, prepares an inventory list (according to Form No. 09 attached to this Circular) and an excess, shortage, and error record to submit to the Destruction Committee (according to Form No. 10 attached to this Circular).

3. During the cutting process, if there is any doubt, the cutting staff rechecks; if there is excess or shortage, report to the Destruction Committee and the Supervisory Committee to prepare a record, find the cause, and take measures to handle it.

4. At the end of each destruction phase for defective printed and minted currency, based on the excess, shortage, and error records and daily sealed inventory lists from the sending teams, the Destruction Committee prepares a comprehensive record of excess, shortage, and error situations (according to Form No. 11 attached to this Circular); simultaneously requiring the printing and minting facility to handle the aforementioned cases.

Article 16. Registers for tracking, accounting, and reporting on the destruction results of defective printed and minted currency

1. At each working group, registers must be opened and maintained to record daily activities related to inventory entry, exit, counting, receipt and delivery, cutting and destruction, and re-entry into storage.

2. Accountants must promptly and accurately record the situation of inventory entry, exit, and stock of defective printed and minted currency in detail and summary registers in accordance with regulations (as per Forms 02A, 02B, 02C, 02D, 03A, 03B, 04A, 04B attached to this Circular).

3. Upon completion of the destruction phase of defective printed and minted currency, the Destruction Council shall prepare a report on the destruction results, confirmed by the Supervisory Council (as per Form 17 attached to this Circular), to report to the Governor of the State Bank and send it to relevant units: the Supervisory Council, the Internal Audit Department, the Finance and Accounting Department, the Issuance and Treasury Bureau, the printing and minting facilities.

4. All types of minutes, vouchers, registers, and reports used in the destruction work of defective printed and minted currency must have signatures from all specified parties as detailed in the attached report form model in this Circular and must be managed under the "Confidential" regime.

Article 17. Tracking and accounting for the destruction of defective printed and minted currency at printing and minting facilities

Printing and minting facilities must timely, fully, and accurately account for the quantity of defective printed and minted currency issued for destruction according to the current state accounting system. Costs incurred in the destruction process are accounted for as expenses, while income from selling scrap materials after destruction is accounted for as revenue of the unit.

Chapter V

RESPONSIBILITIES OF UNITS AND INDIVIDUALS RELATED TO THE DESTRUCTION WORK OF DEFECTIVE PRINTED AND MINTED CURRENCY DESTRUCTION WORK OF DEFECTIVE PRINTED AND CAST MONEY

Article 18. Responsibilities of the Director of the Printing and Minting Facility

1. Submit to the Governor of the State Bank (through the Internal Audit Department) for permission to destroy each type of defective printed and minted currency along with related documentation.

2. Organize the complete destruction process for defective printed currency and defective polymer banknote paper and report to the Governor of the State Bank.

3. Organize the management and sale of all recovered scrap materials after destruction.

4. Organize tracking and accounting at the printing and minting facility in accordance with Article 17 of this Circular.

5. Disciplinary action and demand for compensation for losses against individuals within the printing and minting facility who violate the provisions of this Circular.

Article 19. Responsibilities of the Internal Audit Department

1. Receive, inspect, and confirm the accuracy and completeness in terms of quantity of each type of defective printed and minted currency in the destruction application dossier of the printing and minting facility as stipulated in Clause 1 of Article 18 of this Circular.

In cases where the dossier is incomplete or the data is inaccurate, request the printing and minting facility to supplement the dossier or correct it to ensure accurate data.

2. Send to the Issuance and Treasury Bureau a confirmation letter and the destruction application dossier of the printing and minting facility that has been inspected as stipulated in Clause 1 of this Article within 10 working days from the date of receiving the complete dossier of the printing and minting facility.

Article 20. Responsibilities of the Issuance and Treasury Bureau

Submit to the Governor of the State Bank for a decision on the time, location, and quantity of each type of defective printed and minted currency to be destroyed within 10 working days from the date of receiving the confirmation letter from the Internal Audit Department.

Article 21. Responsibilities of the Cadre Organization Department

Within fifteen working days from the date of receipt of the Governor's Decision on the destruction of defective printed and minted currency, the Cadre Organization Department shall submit to the Governor of the State Bank for decision to establish the Destruction Council in accordance with Clause 1 of Article 7 of this Circular.

Article 22. Responsibilities of staff participating in the destruction of defective printed and minted currency

Staff participating in the destruction of defective printed and minted currency must wear uniforms prescribed by the Destruction Council; they may not carry bags, wallets, or personal items into the destruction warehouse, delivery and reception rooms, counting and cutting-off rooms. During breaks and lunchtime, all staff must leave their workrooms, the room supervisors must lock the doors, and the supervisory council members must seal the doors.

Article 23. Benefits of staff participating in the destruction of defective printed and minted currency

Members of the Destruction Council and staff participating in the destruction of defective printed and minted currency, in addition to their salary and allowances, are entitled to receive supplementary payments for their work in destruction according to the State Bank's regulations on expenditure levels for currency destruction work. If overtime work is required, they will be entitled to overtime pay according to current state regulations.

Chapter VI

IMPLEMENTING PROVISIONS

Article 24. Effective Date

1. This Circular takes effect from February 20, 2014.

2. Decision No. 57/2006/QĐ-NHNN dated December 15, 2006 of the Governor of the State Bank promulgating the Regulations on the destruction of defective printed currency and damaged printing paper at printing factories shall cease to be effective from the date this Circular takes effect.

Article 25. Implementation organization

The Director of the Office, the Director of the Currency Issuance and Treasury Department, the Head of the Internal Audit Department, the Head of the Cadre Organization Department, the Heads of relevant units under the State Bank, the Chairmen of the Management Boards, and the Directors of printing and minting facilities shall organize the implementation of this Circular.