Circular No. 03/2002/TT-NHNN guiding the management of deposit guarantees for travel businesses

CIRCULAR

Guidelines on managing deposit funds

of travel businesses

Pursuant to Article 4 and Article 6 of Decree No. 27/2001/NĐ-CP dated June 5, 2001 of the Government on travel business operations and tour guidance, the State Bank of Vietnam provides specific guidelines on managing deposit funds of travel businesses deposited at commercial banks as follows:

I. SCOPE AND APPLICABILITY

1. This Circular applies to all commercial banks operating in Vietnam (hereinafter referred to as "bank").

2. The opening of accounts and the deposit of guarantee funds by businesses to obtain permission to operate travel businesses in Vietnam must comply with the provisions of this Circular and the procedures for depositing and transferring money according to the regulations of the bank in accordance with current laws.

II. OPENING, USE, AND MANAGEMENT OF TRAVEL BUSINESS GUARANTEE FUNDS ACCOUNTS.

3. The guarantee fund of travel businesses must be deposited into an account (blocked) at the bank (where the business has its main transaction account) and the business may not use this guarantee fund during the entire period of its travel business operations.

4. Responsibilities of the business (account holder):

4.1. Not to misuse the travel business guarantee fund for purposes other than to settle and compensate tourists in cases where the business breaches contracts with tourists or unexpected risks occur to tourists while organizing tours.

4.2. To always maintain sufficient balance in the account in accordance with the prescribed level; if the balance falls below the prescribed level, the business must top up the account to meet the required guarantee fund level.

4.3. To fully comply with all current regulations related to the use of the guarantee fund account: opening, depositing funds, topping up the guarantee fund...

5. Responsibilities of the bank.

5.1. To guide travel businesses to properly implement regulations on opening accounts, depositing guarantee funds into accounts, using accounts, and other relevant regulations.

5.2. To block the travel business guarantee fund account and calculate interest on the balance of the guarantee fund at the rate applicable to non-term deposits at the bank. At the end of each month, the bank calculates and pays interest to the business and records it in the deposit account or pays it in cash.

5.3. Issue a certificate of the travel business guarantee fund to the business.

5.4. In case the business breaches a contract or unexpected risks occur to tourists and there is a decision by the competent state authority (tourism management agency or court) requiring the business to compensate for damages, the bank has the right to deduct from the guarantee fund account to make such payments, after deducting banking service fees.

5.5. Require the business to top up the full amount of the guarantee fund within one month (from the date the funds were deducted from the guarantee fund account to settle and compensate tourists). If the business does not top up the full amount of the guarantee fund within this period, the bank will notify the General Department of Tourism or the Tourism Department where the business is headquartered to take appropriate measures. 5.6. Refund the travel business guarantee fund to the business in the following cases:Notification from the General Department of Tourism that the business is not granted a Travel Business International Operation License;

Decision of the General Department of Tourism to revoke the Travel Business International Operation License of the business;

Decision of the business registration authority to revoke the business registration or remove the travel business operation from the business registration certificate of the business.

III. INFORMATION REPORTING AND VIOLATION HANDLING

3. Commitment to comply with declared quality standards. 6. Quarterly, no later than the 15th day of the first month of each quarter, commercial banks receiving travel business guarantee funds must prepare and submit comprehensive reports to the State Bank of Vietnam (Bank Inspection Department) on the situation of receiving travel business guarantee funds in their banking system.

7. Banks and businesses that violate the provisions of this Circular shall be subject to handling according to the current legal provisions depending on the severity of the violation.

8. This Circular takes effect from the date of signature.

9. Heads of units under the State Bank of Vietnam, Chairmen of the Board of Directors and General Managers (Directors) of commercial banks are responsible for organizing, guiding, and implementing this Circular./.

IV. IMPLEMENTATION PROVISIONS

8. This Circular takes effect from the date of signature.

9. The heads of units under the State Bank, the Chairmen of the Boards of Management and the General Directors (Directors) of commercial banks shall be responsible for organizing, guiding, and implementing this Circular./.