Circular No. 12/2018/TT-NHNN amending and supplementing certain provisions of Circular No. 22/2014/TT-NHNN dated August 15, 2014 of the State Bank of Vietnam guiding the implementation of credit policies pursuant to Decree No. 67/2014/NĐ-CP dated July 7, 2014 of the Government on several policies for developing fisheries.

CIRCULAR

Provincial People's Committees set specific pricesamending and supplementing certain articles of Circular No. 22/2014/TT-NHNN dated August 15, 2014 of the State Bank of Vietnam guiding the implementation of credit policies under Decree No. 67/2014/NĐ-CP dated July 7, 2014 of the Government on certain policies for developing fisheries the 8 year guiding the implementation of credit policies according to Decree No. 67/2014/NĐ-CP dated July 7, 2014 of the Government on certain policies for developing fisheries the 7 year 2014 of the Government on some policies for developing aquaculture

Pursuant to the Law on the State Bank of Vietnam dated June 16, 2010;

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

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

Pursuant to Decree No. 67/2014/NĐ-CP dated July 7, 2014 of the Government on certain policies for developing fisheries; Decree No. 89/2015/NĐ-CP dated October 7, 2015 of the Government amending and supplementing some articles of Decree No. 67/2014/NĐ-CP dated July 7, 2014 of the Government on certain policies for developing fisheries; Decree No. 17/2018/NĐ-CP dated February 2, 2018 of the Government amending and supplementing some articles of Decree No. 67/2014/NĐ-CP dated July 7, 2014 of the Government on certain policies for developing fisheries;

At the proposal of the Director of the Department of Credit for Economic Sectors;

The Governor of the State Bank of Vietnam promulgates this Circular amending and supplementing some articles of Circular No. 22/2014/TT-NHNN dated August 15, 2014 of the State Bank of Vietnam guiding the implementation of credit policies according to Decree No. 67/2014/NĐ-CP dated July 7, 2014 of the Government on certain policies for developing fisheries (hereinafter referred to as Circular No. 22/2014/TT-NHNN).

Article 1. Amending and supplementing some articles of Circular No. 22/2014/TT-NHNN

1. Clause 1 of Article 1 shall be amended and supplemented as follows:

"1. Scope of regulation:

This Circular stipulates the provision of loans for ordering the construction and upgrading of fishing vessels operating in distant waters, and for working capital loans for distant water fishing operations and providing post-harvest services for distant water fishing operations according to Decree No. 67/2014/NĐ-CP dated July 7, 2014 of the Government on certain policies for developing fisheries (hereinafter referred to as Decree No. 67/2014/NĐ-CP), Decree No. 89/2015/NĐ-CP dated October 7, 2015 of the Government amending and supplementing some articles of Decree No. 67/2014/NĐ-CP (hereinafter referred to as Decree No. 89/2015/NĐ-CP) and Decree No. 17/2018/NĐ-CP dated February 2, 2018 of the Government amending and supplementing some articles of Decree No. 67/2014/NĐ-CP (hereinafter referred to as Decree No. 17/2018/NĐ-CP)."

2. Clause 2 of Article 3 shall be amended as follows:

"2. Working capital loans for ship owners engaged in distant water fishing operations and ship owners engaged in post-harvest services for distant water fishing operations as prescribed in Clause 3 of Article 4 of Decree No. 67/2014/NĐ-CP (amended by Clause 4 of Article 1 of Decree No. 17/2018/NĐ-CP)."

3. Clause 2 of Article 4 shall be amended as follows:

"2. For working capital loans: The ship owner borrowing working capital must comply with current laws governing lending activities of credit institutions to customers in the agricultural sector."

4. Clause 1 of Article 5 shall be amended as follows:

"1. The loan limit and interest rate shall be implemented in accordance with Point e and Point c of Clause 1 of Article 4 of Decree No. 67/2014/NĐ-CP (amended and supplemented by Clause 3 of Article 1 of Decree No. 89/2015/NĐ-CP)."

5. Clause 1 of Article 7 shall be amended as follows:

"1. The classification of debts, the establishment of provisions for risks, and the use of provisions to address risks shall be carried out in accordance with current regulations, including loans taken by new ship owners when they take over from old ship owners under the ship owner transfer mechanism prescribed in Clause 3 of Article 1 of Decree No. 17/2018/NĐ-CP."

6. Add Article 7a as follows:

"Article 7a. Mechanism for transferring loan debts The transfer of ships and loan debts for newly built or upgraded ships from ship owners who are no longer capable of continuing the project or have completed the construction but lack the capacity to operate (hereinafter referred to as the old ship owner) to new ship owners approved by provincial People's Committees (hereinafter referred to as the new ship owner) under the ship owner transfer mechanism prescribed in Clause 3 of Article 1 of Decree No. 17/2018/NĐ-CP shall be carried out as follows:

a) The new ship owner takes over all loan debts from the old ship owner, including overdue principal and accrued interest that the old ship owner has not paid to the lending bank before the transfer date (if any). Interest rate support for the new ship owner shall be implemented in accordance with the guidance of the Ministry of Finance;

b) Based on the agreement between the old ship owner and the new ship owner regarding the transfer of the ship and loan debts, commercial banks, the old ship owner, and the new ship owner sign an agreement to transfer the debt, specifying the outstanding loan balance, accrued interest (if any), loan period, collateral for the loan debt, rights and obligations of the parties, and other relevant contents in compliance with current laws;

c) The new ship owner and the commercial bank sign a loan agreement and a guarantee contract in accordance with current laws. The period for interest-subsidized loans for the new ship owner to continue building or upgrading the ship, if the old ship owner has not completed the construction or upgrade, shall be determined through negotiation between the bank and the new ship owner but shall not exceed the remaining period for interest-subsidized loans as stipulated in Point d of Clause 1 of Article 4 of Decree No. 67/2014/NĐ-CP (amended and supplemented by Clause 4 of Article 1 of Decree No. 89/2015/NĐ-CP) minus the period during which the old ship owner received interest-subsidized loans at the time of transferring the loan debt;

d) The signing of the loan agreement between the commercial bank and the new ship owner is not subject to the time limit for signing the credit contract for building or upgrading ships as stipulated in Clause 4 of Article 13 of Decree No. 67/2014/NĐ-CP (amended by Clause 19 of Article 1 of Decree No. 17/2018/NĐ-CP). The disbursement of interest-subsidized loans for the new ship owner to continue building or upgrading the ship, if the old ship owner has not completed the construction or upgrade, shall be carried out in accordance with Clause 2 of Article 11 of this Circular."

7. Clause 4 shall be added to Article 8 as follows:

"4. New ship owners who take over loan debts and assets formed from borrowed funds from old ship owners under the ship owner transfer mechanism prescribed in Clause 3 of Article 1 of Decree No. 17/2018/NĐ-CP shall be responsible for fully performing the rights and obligations of ship owners as prescribed in this Circular and related documents."

8. Article 9 shall be amended and supplemented as follows:

"Article 9. Responsibilities of commercial banks

1. To develop plans, allocate funds, and actively implement loans to ship owners in accordance with Decree No. 67/2014/NĐ-CP and this Circular.

2. Establish internal regulations to guide loans for ship owners to ensure a simple, quick, and safe loan capital process in accordance with this Circular and relevant laws.

3. Report to the State Bank of Vietnam when difficulties arise regarding loan capital for implementing credit policies as stipulated in this Circular, or when interest rates increase affecting business results, to be eligible for refinancing under the Decision of

9. Clause 2 of Article 11 shall be amended as follows:

"2. Commercial banks and ship owners shall enter into credit contracts for building new and upgrading ships in accordance with Clause 1 of Article 4 of Decree No. 67/2014/ND-CP until December 31, 2017, and disburse funds until December 31, 2018. For disbursements after December 31, 2018, the loan interest rate shall be agreed upon between commercial banks and customers in compliance with current laws, and ship owners shall not receive interest subsidy support."

Article 2. Repeal Clause 2 of Circular No. 22/2014/TT-NHNN and Clause 1, Clause 4, and Clause 6 of Article 1 of Circular No. 21/2015/TT-NHNN dated November 16, 2015, which amends and supplements certain provisions of Circular No. 22/2014/TT-NHNN.

Article 3. Implementation Provisions

1. This Circular shall take effect from April 27, 2018.

2. Regarding working capital loans, commercial banks and ship owners shall agree on continuing to implement the contents already signed or amend and supplement them in accordance with this Circular.

3. The Director of the Office, Heads of the Credit Department for Economic Sectors, and Heads of units under the State Bank of Vietnam; Governors of the State Bank of Vietnam branches in provinces and centrally-administered cities; Chairmen of the Board of Members, Chairmen of the Board of Directors, and General Directors of commercial banks are responsible for organizing the implementation of this Circular.