Circular No. 10/2022/TT-NHNN guiding foreign exchange management for the issuance of bonds to the international market by enterprises not guaranteed by the Government.

CIRCULAR

Guidelines on foreign exchange management for the issuance of bonds to the international market by enterprises not guaranteed by the Government            

Pursuant to the Law on the State Bank of Vietnam No. 46/2010/QH12 dated June 16, 2010;

Pursuant to the Law CAll credit institutions dated June 16, 2010; Law Amending and Supplementing Certain Provisions of the Law on Credit Institutions dated November 20, 2017;

Pursuant to the Foreign Exchange Decree dated December 13, 2005; Decree Amending and Supplementing Certain Provisions of the Foreign Exchange Decree dated March 18, 2013;

Pursuant to the Government's Decree No. 219/2013/NĐ-CP dated December 26, 2013 on foreign borrowing and repayment management for enterprises not guaranteed by the Government;

Pursuant to the Government's Decree No. 153/2020/NĐ-CP dated December 31, 2020 on the issuance and trading of corporate bonds in the domestic market and the issuance of corporate bonds to the international market;

Pursuant to Government Decree No. 16/2017/NĐ-CP dated February 17, 2017 on the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

At the proposal of the Director of the Department of Foreign Exchange Management;

The Governor of the State Bank of Vietnam issues this Circular guiding foreign exchange management for the issuance of bonds to the international market by enterprises not guaranteed by the Government.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

Article 1. This Circular stipulates procedures for registration and changes to the registration of bond issuance to the international market by enterprises not guaranteed by the Government.

Article 2. Other foreign exchange management contents related to foreign borrowing under the form of bond issuance to the international market shall be implemented according to the regulations on foreign exchange management for foreign borrowing and repayment by enterprises.

Article 2. Applicability

Clause 1. The issuer is a resident entity including joint-stock companies and limited liability companies established and operating under Vietnamese law.

Clause 2. Entities and individuals related to the issuance of bonds to the international market by enterprises not guaranteed by the Government.

Article 3. Explanation of Terms

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

Point 1. Bonds issued to the international market are bonds offered by the issuer to non-residents and not deposited with a depositary organization within the territory of Vietnam (hereinafter referred to as international bonds).

Point 2. The issuer is the borrower in foreign borrowing under the form of international bond issuance not guaranteed by the Government.

Point 3. International bond issuance amount is medium- and long-term foreign borrowing under the form of international bond issuance by the issuer not guaranteed by the Government.

Point 4. Banks providing account services are credit institutions and branches of foreign banks in Vietnam permitted to operate and provide foreign exchange services according to Vietnamese law where the issuer opens and uses foreign borrowing and repayment accounts to implement the issuance.

Point 5. The bond pricing determination date is the date when the issuer and investors agree on the interest rate applicable to the bonds and the quantity of bonds to be issued.

Point 6. The issuance limit confirmation document is a document from the State Bank of Vietnam (hereinafter referred to as the State Bank) announcing the value of the issuance amount within the total commercial foreign borrowing limit self-borrowed and self-repaid approved annually by the Prime Minister.

Point 7. The lender's representative is an organization representing the bondholders in implementing matters related to the international bonds of the issuer.

Article 4. Principles for the preparation and submission of documents

1. The issuer shall submit one set of documents to perform administrative procedures as prescribed in this Circular through one of the following three methods:

b) Submitting directly at the One-Stop Service Window of the State Bank;

c) Sending through postal services.

2. In cases where documents are submitted online via the National Public Service Portal or on the State Bank of Vietnam's Public Service Portal, electronic documents must be signed with a digital signature in accordance with the laws on performing administrative procedures in an electronic environment. In cases where the National Public Service Portal or the State Bank of Vietnam's Public Service Portal encounters technical issues or errors preventing the receipt and exchange of electronic information, the declaration, submission, receipt of results, exchange, and feedback of information shall be conducted through postal services or directly at the One-Stop Service Center of the State Bank of Vietnam.

3. Documents in the electronic dossier are scanned copies from the original or authentic versions (in PDF format), except for the Application for Registration of International Bond Issuance and the Application for Change of International Bond Issuance which are filled out on the State Bank of Vietnam's Public Service Portal.

Chapter II

PROCEDURE FOR REGISTRATION OF INTERNATIONAL BOND ISSUANCEINTERNATIONAL BOND

Article 5. Basis for considering and confirming the registration of international bond issuance

1. The amount of international bond issuance falls within the total annual self-borrowing and self-repayment limit for foreign trade loans approved by the Prime Minister.

2. The issuer complies with and fully meets current regulations on conditions for foreign borrowing, foreign exchange management for foreign borrowing and repayment activities not guaranteed by the Government, and current laws on issuing corporate bonds to the international market.

Article 6. Documents for registering international bond issuance

The documents for registering international bond issuance include:

1. The Application for Registration of International Bond Issuance according to Appendix 01 issued together with this Circular.

3. The original or certified copy of the approved international bond issuance plan that meets the current requirements for issuing corporate bonds to the international market.

4. The original or certified copy of the approval document of the competent authority regarding the international bond issuance plan in accordance with the laws on issuing corporate bonds, business laws, and the charter of the issuer.

5. The original or certified copy of the approval document of the competent authority regarding investment programs and projects of the issuer; plans to increase operational capital; restructuring of the issuer’s debt to be funded by the proceeds of international bond issuance, in accordance with current laws.

6. Report on compliance with the provisions on the ratio of foreign investor ownership as stipulated by law (applicable to issuers of convertible bonds or bonds attached with warrants).

7. Report on compliance with the limits on foreign borrowing as stipulated by the conditions for foreign borrowing; meeting the financial safety ratio and operational safety ratio as required by specialized laws at the end of the most recent three months prior to the date of submitting the application for registration of international bond issuance (for issuers that are credit institutions, reports should be made according to Appendix 02 issued together with this Circular).

9. Certified copy in the foreign language and Vietnamese translation of agreements related to the issuance period, including information on bond issuance terms and conditions; information on bond sale proceeds, principal and interest payments, fees; the organization acting as the lender's representative (if any); relevant agents depending on the structure of the issuance period.

10. Certified copy in the foreign language and Vietnamese translation of other contracts or agreements (if any) that the issuer has signed with foreign parties binding the issuer to pay fees related to the issuance.

Article 7. Procedures for registering international bond issuance

1. Before conducting the bond offering:

a) After the international bond issuance plan has been approved by the competent authority in accordance with the law and no later than 20 working days before the issuer conducts the bond offering on the international market, the issuer shall submit one set of registration documents for the international bond issuance as prescribed in Article 6 of this Circular (excluding the components specified in Clause 8, Clause 9, and Clause 10) to the State Bank (Department of Foreign Exchange Management).

2. When conducting the bond offering:

a) If the issuance amount falls within the total foreign commercial loan limit self-borrowed and self-repaid approved annually by the Prime Minister, after selecting the guarantors, agents, and legal advisors related to the issuance and before determining the bond price, the issuer shall submit the components of the documents as prescribed in Clause 8, Clause 9, and Clause 10 of Article 6 of this Circular. The Prime Minister approves annually, after selecting the issuing guarantee organizations, agents, and legal advisors related to the issuance amount, and before the bond pricing date, the issuing organization submits the application components as prescribed in Clause 8, Clause 9, and Clause 10 of Article 6 Clause 9 and Clause 10 of Article 6For the components of the documents prescribed in Clause 9 and Clause 10 of Article 6 of this Circular, Clause 9 and Clause 10 of Article 6 of this Circularthe issuer shall send the final drafts containing detailed conditions related to the bonds (hereinafter referred to as the preliminary registration documents).

b) After the components of the documents prescribed in Clause 9 and Clause 10 of Article 6 of this Circular have been officially signed by the relevant parties, the issuer shall complete the registration documents with the official components as prescribed in Clause 9 and Clause 10 of Article 6 of this Circular. In case the results of the issuance change the information in Part Three of the International Bond Issuance Registration Form, the issuer shall update and resubmit the International Bond Issuance Registration Form.

If the contents of the officially signed contracts and agreements differ from those of the drafts previously submitted to the State Bank and do not contravene relevant laws, the issuer shall submit a report detailing the differences between the officially signed contracts and agreements and the final drafts in the preliminary registration documents submitted to the State Bank.

3. Processing time for the registration procedure:

b) Within two working days from the date of receiving the official documents as prescribed in Subpoint b, Clause 2 of this Article, the State Bank shall issue a confirmation letter for the registration of the international bond issuance according to Appendix 04 issued together with this Circular to the issuer. In case of refusal, the State Bank shall issue a letter specifying the reasons.

Article 8. Coordination Responsibilities Among Units of the State Bank when Handling Registration Documents for International Bond Issuance by Credit Institutions

1. After receiving the registration documents for the bond issuance of credit institutions as prescribed in Clause 1 of Article 7 of this Circular, the Department of Foreign Exchange Management shall act as the lead unit, coordinating with the Banking Inspection and Supervision Authority or the State Bank Branches in provinces and centrally-administered cities (the units authorized to inspect and supervise micro safety for credit institutions applying for international bond issuance), the Monetary Policy Department, and other relevant units under the State Bank to review and process the registration documents for international bond issuance of credit institutions.

2. Within five working days from the date of receiving the request from the Department of Foreign Exchange Management:

a) The Banking Inspection and Supervision Authority or the State Bank Branches in provinces and centrally-administered cities shall provide supervisory opinions on compliance with legal provisions regarding safety ratios in banking operations of the credit institution seeking opinions. The scope of supervisory opinions includes individual and consolidated ratio indicators reported by the credit institution in Appendix 02 issued together with this Circular.

b) The Monetary Policy Department and other relevant units under the State Bank shall provide opinions on the contents included in the international bond issuance plan related to their functions and responsibilities.

Chapter III

PROCEDURE FOR REGISTERING CHANGES TO INTERNATIONAL BOND ISSUANCE

Article 9. Cases requiring registration for changes to international bond issuance tranches

1. Except for cases stipulated in Clause 2 of this Article, in the event of any change to any content related to international bond issuance tranches as stated in the document confirmed by the State Bank for registration or change registration, the issuer shall be responsible for registering the change to the international bond issuance tranche with the State Bank in accordance with the provisions of this Circular.

2. The issuer shall only notify in writing (through postal service or direct submission) to the State Bank (Department of Foreign Exchange Management) regarding the following changed contents without needing to register the change:

a) Changing the capital withdrawal and principal repayment time within ten working days from the plan already confirmed by the State Bank;

b) Changing the address of the issuer;

c) Changing the trading name of the bank providing account services where the issuer opens an external borrowing and repayment account;

d) Changing the interest and fee payment plan for the international bond issuance tranche compared to the plan already confirmed by the State Bank in the registration confirmation document or change registration confirmation document, but not changing the method of determining interest and fees specified in the terms and conditions of the bond. The issuer shall be responsible for preparing a calculation table of interest and fees payable to provide the bank providing account services with a basis for verification and monitoring when making payments;

đ) Changing (increasing or decreasing) the amount of capital withdrawal, principal repayment, interest, and fees within one hundred units of the foreign currency borrowed compared to the amount stated in the registration confirmation document or change registration confirmation document;

e) Changing the amount of principal repayment due to bond conversion or exchange for shares for international bond issuance tranches with conversion or exchange factors of public companies, securities companies, or investment fund management companies;

g) Changing the actual amount of capital withdrawal and principal repayment for a specific period to be less than the amount stated in the withdrawal and repayment plan in the registration confirmation document or change registration confirmation document.

3. For the change content stipulated in point g of Clause 2 of this Article, before implementing the withdrawal and repayment of the remaining amount of the period that has changed, the issuer shall be responsible for registering the change to the withdrawal and repayment plan for the remaining amount yet to be implemented in accordance with Articles 10 and 11 of this Circular.

Article 10. Documents for Registration of Changes to International Bond Issuance Tranches

The documents for registration of changes to international bond issuance tranches include:

1. Application for registration of changes to international bond issuance tranches according to Appendix 03 issued together with this Circular.

2. Copies in the foreign language and Vietnamese translations of any signed agreements on changes (if any).

3. Copies of the approval document from the competent authority agreeing to the issuer's international bond issuance plan for the change in the international bond issuance tranche (if any).

Article 11. Procedure for Implementing the Registration Process for Changing the Issuance of International Bonds

1. Within thirty days from the date of signing the agreement to change or before the implementation date of the change content (in cases where the change content does not require a change agreement but still ensures compliance with related contracts and agreements regarding the issuance), the issuer shall submit one set of registration documents for changing the issuance in accordance with Article 10 of this Circular to the State Bank of Vietnam (Department of Foreign Exchange Management).

Chapter IV

IMPLEMENTING PROVISIONS

Article 12. Effective Date

1. This Circular takes effect from September 15, 2022, except for the provisions of Clause 2 of this Article.

2. The provisions on the method of submitting online applications through the National Public Service Portal and the State Bank of Vietnam Public Service Portal take effect from January 1, 2023.

3. From the date this Circular takes effect, the following clauses and documents shall cease to be effective:

a) Circular No. 17/2013/TT-NHNN dated July 16, 2013, issued by the Governor of the State Bank of Vietnam guiding foreign exchange management for the issuance of international bonds by enterprises not guaranteed by the Government;

b) Article 12 of Circular No. 29/2015/TT-NHNN issued by the Governor of the State Bank of Vietnam amending and supplementing certain legal regulations of the State Bank of Vietnam concerning the components of documents with certified true copies of papers and documents.

Article 13. Transitional Provisions

For registration documents for issuance limits, registration of issuance amounts, and registration of changes to issuance amounts received by the State Bank of Vietnam before the date this Circular takes effect and which have not yet been reviewed and processed, they shall be implemented in accordance with Circular No. 17/2013/TT-NHNN dated July 16, 2013, issued by the Governor of the State Bank of Vietnam guiding foreign exchange management for the issuance of international bonds by enterprises not guaranteed by the Government.

Article 14. Responsibility for implementation

The Director of the Office, the Department Head of the Department of Foreign Exchange Management, and the Heads of units under the State Bank of Vietnam, and issuers are responsible for implementing this Circular.