Decision No. 1278/2001/QD-NHNN On Issuing the Regulation on the Operation of the Management Board for State Foreign Exchange Reserves

DECISION OF THE GOVERNOR OF THE STATE BANK STATE
   On the issuance of the Regulation on the operation of

The Management Board for State Foreign Exchange Reserves

GOVERNOR OF THE STATE BANK OF VIETNAM

- Pursuant to Decree No. 100/1998/NĐ-CP dated December 10, 1998 of the Government on the financial regime of the State Bank;

- Pursuant to Decree No. 15/CP dated March 2, 1993 of the Government on the tasks, powers, and responsibilities of state management of ministries and ministerial-level agencies;

- Pursuant to Decree No. 86/1999/NĐ-CP dated August 30, 1999 of the Government on the management of State Foreign Exchange Reserves;

- Based on the proposal of the Director of the Department of Organization and Training and the Director of the Department of Foreign Exchange Management,

Pursuant to …;

Article 1. This Decision promulgates the "Regulation on the Operation of the Management Board for State Foreign Exchange Reserves."

Article 2. This Decision shall take effect from the date of signing.

Article 3. The Head of the Office, the Directors of the Departments of Organization and Training and the Department of Foreign Exchange Management, the Heads of units under the State Bank and the Management Board for State Foreign Exchange Reserves shall be responsible for implementing this Decision.

PART I

GENERAL PROVISIONS

Article 1. The Management Board for State Foreign Exchange Reserves (hereinafter referred to as the Management Board) is established by the Decision of the Governor of the State Bank to advise the Governor of the State Bank on the management of State Foreign Exchange Reserves and to direct the implementation of tasks related to the management of State Foreign Exchange Reserves as stipulated by the Governor of the State Bank.

Article 2. The Management Board is directed by its Chairman. The Vice-Chairman assists the Chairman.

Article 3. The Management Board operates under the principle of democratic centralism and the headship system. Matters are discussed collectively and consensus is reached at meetings. In cases where there are differing opinions, the Chairman makes the final decision.

Chapter II

SPECIFIC PROVISIONS

Article 4. The Management Board has the following functions and tasks:

1. Advise the Governor of the State Bank before submitting

a. The annual projected level of State Foreign Exchange Reserves.

b. The foreign exchange limit of the Fund for Stabilizing Exchange Rates and Gold Prices.

GOVERNOR HAS SIGNED REGULATION ON THE OPERATION OF THE MANAGEMENT BOARD FOR STATE FOREIGN EXCHANGE RESERVES (Issued together with Decision No. 1278/2001/QĐ-NHNN dated October 9, 2001 of the Governor of the State Bank)

Chapter c. The transfer from the State Foreign Exchange Reserve Fund to the Fund for Stabilizing Exchange Rates and Gold Prices.

Chapter d. New forms and business operations of foreign exchange reserve investment.

2. Advise the Governor of the State Bank:

a. To issue decisions on temporary advances from the State Foreign Exchange Reserve Fund to the State Budget according to the decision of

b. To decide on the export and import of international standard gold belonging to the State Foreign Exchange Reserves;

Chapter c. To decide on intervention measures in the domestic foreign exchange market;

Chapter d. To decide periodically every six months or when necessary, the standards, limits, and structure of State Foreign Exchange Reserve investments and the composition of the State Foreign Exchange Reserve Fund.

3. Annually or when necessary:

a. To approve reports on "The Implementation of State Foreign Exchange Reserve Management" and "The Actual Use of State Foreign Exchange Reserves" to submit to the Governor of the State Bank for approval before submission

b. To approve the report on "The Fluctuations in State Foreign Exchange Reserves" to submit to the Governor of the State Bank for approval before submission to the Government and the Standing Committee of the National Assembly.

Article 5. Duties and powers of the Head:

1. Direct and organize the implementation of the tasks stipulated in Article 4 of this Regulation.

2. Summon and chair meetings of the Management Board.

3. Decide on the following specific matters:

a. Decide on the structure of the Exchange Rate Stabilization Fund and Gold Price Fund.

b. Decide on the structure of the Foreign Exchange Reserve Fund for each period within the authority delegated by the Governor of the State Bank.

Chapter c. Decide on investment plans and investments (deposits, entrusted investments, foreign currency conversion...) with a value of US$20,000,000 (twenty million US dollars) or more.

Chapter d. Decide on the daily buying and selling of foreign currencies by the State Bank on the inter-bank foreign exchange market. e. Decide on transferring foreign exchange from the Exchange Rate Stabilization Fund and Gold Price Fund to the Foreign Exchange Reserve Fund when the level of foreign exchange in the Exchange Rate Stabilization Fund and Gold Price Fund exceeds the limit decided by the Prime Minister.
f. Direct relevant Departments and Trading Department to implement the standards and limits of State Foreign Exchange Reserves according to the Decision of the Governor of the State Bank.

4. Perform other tasks assigned by the Governor of the State Bank.

Article 6. Duties and powers of other members of the Management Board.

1. Duties and powers of the Deputy Head:

a. Assist the Head in managing certain aspects of the Board's work according to the division of labor by the Head and be responsible to the Head for the assigned tasks.

b. Fully participate in meetings of the Management Board.

Chapter c. In case the Head is absent, the Deputy Head shall act on behalf of the Head to perform the tasks delegated by the Head; summon and chair meetings of the Management Board and be responsible for the matters resolved when authorized, while also having the responsibility to report back to the Head when present (or report to the Governor of the State Bank for guidance on implementation if necessary).

2. Duties and powers of other members of the Management Board:

a. Fully participate in meetings of the Management Board. In case of absence, they may delegate their deputy to participate in the meeting of the Management Board upon approval by the Head or the meeting chairperson. Members of the Management Board must fully bear responsibility for such delegation.

b. Prepare related contents according to their functional and task responsibilities and participate in discussions during the Management Board meetings.

Chapter c. Retain their opinions when those opinions differ from the Head's decision.

Chapter d. Carry out other tasks assigned by the Head.

3. Duties of the Secretary of the Management Board:

a. Prepare relevant documents and information for the Management Board meetings; participate in Management Board meetings; record the minutes of the meeting and draft documents to be submitted to the Management Board.

b. Carry out other tasks assigned by the Head.

Article 7. Meeting Organization

1. The Management Board meets regularly once every six months. In case of necessity, extraordinary meetings can be held.

2. The Management Board discusses democratically during the meeting and unifies opinions to make decisions. In case there are differing opinions, the opinion of the Head shall be decisive. Opinions differing from the Head's decision will be retained and recorded in the meeting minutes.

3. Persons authorized (on behalf of Management Board members) may participate in discussions during the meeting.

4. Relevant Departments shall send representatives to attend Management Board meetings upon request by the Governor of the State Bank or the Head.

5. The results of the Management Board meetings are recorded in the meeting minutes. The meeting minutes include the content of the meeting, participants, issues approved, and issues with differing opinions.

Chapter III

IMPLEMENTING PROVISIONS

Article 8. The amendment and supplementation of this Regulation shall be decided by the Governor of the State Bank.