Decision No. 112/2003/QD-NHNN on amending and supplementing certain articles of the Bank Guarantee Regulation issued together with Decision No. 283/2000/QD-NHNN14 dated August 25, 2000 of the Governor of the State Bank of Vietnam.

Pursuant to …;

Regarding amendments and supplements to certain provisions of the Bank Guarantee Regulation issued together with Decision No. 283/2000/QĐ-NHNN14 dated August 25, 2000 of the Governor of the State Bank of Vietnam

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GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to the Law on the State Bank of Vietnam No. 01/1997/QH10 dated December 12, 1997 and the Law on Credit Organizations No. 02/1997/QH10 dated December 12, 1997;

Pursuant to Decree No. 86/CP dated November 5, 2002 of the Government stipulating the functions, tasks, powers, and organizational structure of Ministries and ministerial-level agencies;

Pursuant to Decree No. 90/1998/NĐ-CP dated November 7, 1998 of the Government promulgating the Regulation on Management of Foreign Borrowing and Repayment;

At the proposal of the Director of the Credit Department,

Pursuant to …;

Article 1. Amending and supplementing certain provisions of the Bank Guarantee Regulation issued together with Decision No. 283/2000/QĐ-NHNN14 dated August 25, 2000 of the Governor of the State Bank of Vietnam as follows:

1. Article 4 is amended as follows:

"Article 4. Customers eligible for bank guarantees
1. Customers eligible for bank guarantees are domestic and foreign organizations and individuals. Credit institutions shall not provide guarantees for the following persons:
a. Members of the Board of Directors, Supervisory Board, General Director (Director), Deputy General Director (Deputy Director) of credit institutions;
b. Staff members of the credit institution who perform the tasks of assessing and deciding on guarantees;
c. Father, mother, wife, husband, son, daughter of members of the Board of Directors, Supervisory Board, General Director (Director), Deputy General Director (Deputy Director).
d. The application of the provision at Point c Clause of this Article to guarantors being father, mother, wife, husband, son, daughter of the Branch Director of credit institutions shall be decided by the credit institution. 2. The restriction on credit institutions providing guarantees to customers shall be implemented according to the provisions of Article 78 of the Law on Credit Organizations."

2. Article 8 is amended as follows:

"Article 8. Conditions for guarantee Credit institutions shall consider and decide to provide guarantees when customers meet all of the following conditions:
1. Having full civil legal capacity and civil conduct capacity as prescribed by law;
2. The purpose of requesting the credit institution to provide a guarantee is lawful;
3. Having a legal guarantee for the guaranteed obligation as prescribed in Article 21 of this Regulation;
4. Having financial capability to fulfill the guaranteed obligation within the commitment period;
5. In cases where the guarantee involves foreign elements (the beneficiary of the guarantee or the guaranteed party is a foreign organization or individual), in addition to the conditions prescribed in Clauses 1, 2, 3, and 4 of this Article, the customer must comply with regulations on foreign borrowing and repayment, foreign lending and recovery, foreign exchange management, and other relevant laws.
6. For cases involving bill of exchange and draft guarantees, the customer must ensure the conditions as prescribed by law on commercial bills."

3. Article 14 is amended as follows:

"Article 14. Joint Guarantees
1. Proposals, coordination, and procedures for organizing joint guarantees shall be carried out in accordance with the State Bank's regulations on joint financing. 2. Credit institutions participating in joint guarantees shall jointly bear responsibility for performing the guarantee obligations issued by the lead credit institution to the beneficiary, except where the parties have agreed otherwise. If the customer fails to perform or does not fully perform the obligations committed to the beneficiary, the lead credit institution issuing the guarantee shall be responsible for performing the guarantee obligation on behalf of the customer. Credit institutions participating in joint guarantees shall be responsible for refunding the lead credit institution the corresponding amount according to the agreed joint guarantee participation ratio."

4. Article 21 is amended as follows:

"Article 21. Guarantees for guarantees Credit institutions and customers may agree to apply or not apply security measures for guarantees. Forms of security for guarantees include: deposit, pledge of assets, mortgage of assets, third-party guarantee, and other security measures as prescribed by law."

Article 2. This Decision takes effect fifteen days from the date of publication in the Official Gazette.

Article 3. The Head of the Office, Heads of Departments under the State Bank of Vietnam, heads of relevant units of the State Bank of Vietnam, Governors of provincial and centrally-administered city branches of the State Bank of Vietnam, Chairmen of the Board of Directors, General Directors (Directors) of credit institutions are responsible for implementing this Decision.