Circular No. 139/2015/TT-BTC guides the guarantee for loans of government foreign borrowing being refinanced, hereinafter referred to as the Circular.

CIRCULAR

Guidelines for securing loans for government foreign loan refinancing funds

Based on the Civil Code No. 33/2005/QH11 dated June 14, 2005;

Based on the Law on Public Debt Management No. 29/2009/QH12 dated June 17, 2009;

Pursuant to Decree No. 163/2006/NĐ-CP dated December 29, 2006 of the Government on secured transactions and Decree No. 11/2012/NĐ-CP dated February 22, 2012 amending and supplementing certain articles of Decree No. 163/2006/NĐ-CP;

Based on Decree No. 83/2010/NĐ-CP dated July 23, 2010 of the Government on registration of secured transactions;

Pursuant to Decree No. 78/2010/NĐ-CP dated July 14, 2010 of the Government on relending government foreign loan sources;

Pursuant to Decree No. 215/2013/NĐ-CP dated December 23, 2013, promulgated by the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

This Circular takes effect from February 15, 2025.

The Minister of Finance issues this Circular guiding the securing of loans for government foreign loan refinancing funds.

PART I
GENERAL PROVISIONS

Article 1. Scope and Applicability

1. This Circular guides the signing of loan security contracts; monitoring, supervising, handling collateral assets, reporting requirements, and the responsibilities of the parties regarding collateral assets for government foreign loan refinancing funds as prescribed by law.

2. This Circular applies to refinancing lending agencies, borrowers, and organizations, individuals related to loan security activities, management, and utilization of collateral assets for government foreign loan refinancing funds.

Article 2. Interpretation of Terms

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

1. Secured party: is the Ministry of Finance or the refinancing agency authorized by the Ministry of Finance to carry out refinancing according to the law or an organization representing the Ministry of Finance to perform loan security operations.

2. Guarantor: is the borrower or an individual or organization using their own property or land use rights to secure the borrower's obligations according to the law.

3. Loan security contract is a contract signed between the secured party and the guarantor to ensure the borrower's payment obligation to the Ministry of Finance or the refinancing agency according to the refinancing agreement already signed.

4. Collateral for government foreign loan refinancing funds: is the asset formed from the government foreign loan refinancing funds and/or other assets owned by the borrower or the owner of the asset (if any), used to secure the borrower's debt repayment obligations according to the law.

5. Project: is the refinancing program or project of a business with government foreign loan funds.

6. An organization representing the Ministry of Finance to perform loan security operations is a legal entity with the function of performing related operations in a secured transaction according to the law, entrusted to sign loan security contracts, monitor, supervise, and handle collateral assets during the performance of secured transaction operations on behalf of the Ministry of Finance.

7. Service contract for performing loan security operations is a contract signed between the Ministry of Finance, the guarantor, and the organization representing the Ministry of Finance to perform loan security operations to carry out secured transaction operations with the guarantor when the Ministry of Finance directly provides refinancing.

Article 3. Principles for signing contracts, monitoring, and supervising collateral assets

1. Securing loans for government foreign loan refinancing funds shall be carried out through loan security contracts covering 100% of the value of the refinancing.

2. Loan security contracts must be registered with the Registration Center for Secured Transactions under the National Registration Department for Secured Transactions (Ministry of Justice) or at the competent authority as prescribed by law on secured transactions, except where otherwise provided by law.

3. For assets not yet regulated by law on secured transaction registration, the guarantor or the refinancing agency reports to the Ministry of Finance to submit to the Prime Minister for the application of secured transaction registration regulations.

4. Collateral for government foreign loan refinancing funds is monitored, inspected, and handled based on the Certificate of Secured Transaction Registration issued by the secured transaction registration agency or the Application for Secured Transaction Registration certified by the secured transaction registration agency, and a list describing the registered secured transaction assets.

5. The guarantor bears all costs arising during the performance of loan security operations, including services paid to the organization representing the Ministry of Finance to perform loan security operations.

6. The Ministry of Finance or the organization representing the Ministry of Finance to perform loan security operations or the refinancing agency monitors and supervises collateral assets according to the law.

7. The value of collateral assets is determined:

a) According to the book value confirmed by an independent auditing company in cases where the Ministry of Finance directly performs loan security operations.

b) According to the principle applied by the organization representing the Ministry of Finance to perform loan security operations for regular credit customers.

In case the value of collateral assets is lower than the outstanding loan balance, the guarantor is responsible for supplementing assets to secure the loan obligation.

8. Collateral for government foreign loan refinancing funds is shared according to the risk-sharing ratio between the refinancing agency and the Ministry of Finance. In cases where the Ministry of Finance bears the entire credit risk, the Ministry of Finance is the recipient of the entire collateral for the refinancing loan.

9. If the guarantor wishes to use collateral for government foreign loan refinancing funds in a secured transaction with the Ministry of Finance or the organization representing the Ministry of Finance to perform loan security operations to secure a third party, they may only secure the portion of the value greater than the loan balance, ensuring full debt repayment, and must obtain prior written approval from the Ministry of Finance before proceeding.

10. Any transfer or assignment of projects or collateral assets by the guarantor must have prior written consent from the Ministry of Finance. The transferee or assignee assumes all obligations and liabilities of the guarantor regarding the collateral assets.

11. The independent auditing company conducting the audit to determine the value of collateral assets for projects must be included in the annual list of independent auditing companies qualified to audit public interest entities published by the Ministry of Finance according to current laws.

Article 4. Revocation and Termination of Asset Guarantee

The revocation and termination of the Loan Guarantee Contract for the payment obligation of the Guarantor shall be carried out in accordance with the current laws.

Chapter II
SPECIFIC PROVISIONS

Section 1
CONTRACTUAL GUARANTEE SIGNING, INSPECTION AND SUPERVISION ASSETS GUARANTEED FOR RELOANED LOANS FOREIGN LOANS OF THE GOVERNMENT

Article 5. Signing of Guarantee Contracts and Contract Appendices

1. In case the Ministry of Finance directly reloans:

1.1. The Guarantor proposes an Organization to act on behalf of the Ministry of Finance to perform loan guarantee operations, sign the guarantee contract, inspect and supervise the guaranteed assets for the reloaned foreign loans based on mutual agreement regarding service fees for performing such operations with the Organization and meeting the criteria set forth in Point 1.2 of Clause 1 of this Article.

1.2. The Organization acting on behalf of the Ministry of Finance to perform loan guarantee operations, inspect and supervise the guaranteed assets for the reloaned foreign loans must meet the following criteria:

a) Having the function and capability to perform loan guarantee operations, sign guarantee contracts, inspect, supervise, and handle guaranteed assets in accordance with the law.

b) Being a credit institution that meets the standards to perform banking services for government reloan projects announced by the State Bank in the year of selection or the preceding year; or being an organization with sound financial conditions and experience in managing guaranteed assets for government reloans.

c) Being approved in writing by the Guarantor and proposed to the Ministry of Finance.

1.3. Signing Service Contract for Performing Loan Guarantee Operations:

a) In case the Ministry of Finance accepts the Guarantor's proposal regarding the Organization to act on behalf of the Ministry of Finance to perform loan guarantee operations: The Ministry of Finance and the Guarantor jointly sign the Service Contract for Performing Loan Guarantee Operations with the Organization proposed by the Guarantor according to the model at Appendix 1 of this Circular.

b) In case the Ministry of Finance does not accept the Guarantor's proposal regarding the Organization to act on behalf of the Ministry of Finance to perform loan guarantee operations: The Ministry of Finance will respond in writing to the Guarantor and request the selection of another organization.

1.4. The loan guarantee contract is signed between the Organization acting on behalf of the Ministry of Finance to perform loan guarantee operations as stipulated in Point 1.3 of Clause 1 of this Article and the Guarantor, and implemented according to the principles applied by the Organization for loan guarantees of regular credit customers.

1.5. In special cases where it is impossible to delegate the Organization acting on behalf of the Ministry of Finance to perform loan guarantee operations, the Ministry of Finance directly performs related operations:

a) For formed assets: The Ministry of Finance and the Guarantor sign the Loan Guarantee Contract according to the model at Appendix 2 of this Circular based on the independent certified public accountant's confirmation of the book value of the asset used for loan guarantee as stipulated in Clause 11 of Article 3 of this Circular.

b) For future-formed assets:

(i) The Ministry of Finance and the Guarantor sign the Future-Formed Asset Guarantee Contract according to the model at Appendix 3 of this Circular.

(ii) The Ministry of Finance and the Guarantor sign the Appendix to the Future-Formed Asset Guarantee Contract according to the model at Appendix 4 of this Circular consistent with the actual progress of forming assets through government-guaranteed loans.

The Guarantor bears all costs incurred during the performance of loan guarantee operations (including inspection, supervision, and handling of guaranteed assets) as stipulated in Clause 5 of Article 3 of this Circular.

2. In case the Ministry of Finance delegates reloans through the Re-lending Agency:

a) The loan guarantee contract is signed between the Re-lending Agency and the Guarantor according to the Delegation Agreement for Re-loans signed between the Ministry of Finance and the Re-lending Agency and in accordance with the principles applied by the Re-lending Agency for the guarantee assets of its regular credit customers.

b) Fees for performing guarantee transaction operations are included in the reloan service fees that the Re-lending Agency receives and no additional payments are made as stipulated in this Circular.

Article 6. Time of Signing the Guarantee Contract

1. The loan guarantee contract or the future asset guarantee contract shall be signed between the guarantor and the guaranteed party no later than before the first withdrawal of the loan amount.

2. In cases where it is not possible to sign the loan guarantee contract or the future asset guarantee contract before the first withdrawal due to objective reasons, the relevant parties are responsible for reporting to the Ministry of Finance the reasons. The parties shall complete the signing before the second withdrawal.

3. In cases where the loan guarantee contract or the future asset guarantee contract is not signed according to the provisions of Clause 2 of this Article, the guarantor shall report to the Ministry of Finance to temporarily suspend the next withdrawal for the borrower (the guaranteed party) or report to the competent authority for consideration and decision.

Article 7. Guarantee Process for Loans Directly Implemented by the Ministry of Finance

1. For formed assets:

a) Within ten working days after the signing of the loan guarantee contract, the guarantor shall register the guarantee transaction.

b) Within five working days after receiving the Certificate of Registration of Guarantee Transaction issued by the registration agency or the Application for Registration of Guarantee Transaction certified by the registration agency, the guarantor shall submit to the Ministry of Finance.

2. For future assets:

a) Within ten working days after the signing of the future asset guarantee contract, the guarantor shall register the guarantee transaction.

b) Within five working days after receiving the Certificate of Registration of Guarantee Transaction issued by the registration agency or the Application for Registration of Guarantee Transaction certified by the registration agency, the guarantor shall submit to the Ministry of Finance.

c) The annex of the future asset guarantee contract signed annually between the Ministry of Finance and the guarantor shall be based on the confirmation of the independent auditing company (if there is any new occurrence) and completed before June 30 of the following year.

d) After the asset has been officially accepted, the guarantor shall send a list of all assets along with descriptions to the Ministry of Finance.

đ) If there are discrepancies compared to the time of registering the guarantee transaction for future assets after the asset has been officially accepted, the guarantor shall register changes to the content of the guarantee transaction.

e) Within five days after receiving the amended Certificate of Registration of Guarantee Transaction issued by the registration agency or the Application for Registration of Guarantee Transaction certified by the registration agency, the guarantor shall submit to the Ministry of Finance.

3. The Ministry of Finance is responsible for storing files related to guarantee contracts, guarantee transactions, and inspection and supervision records of guaranteed assets.

Article 8. Guarantee Process for Loans Repaid Through the Re-lending Agency or Organization Acting on Behalf of the Ministry of Finance in Guarantee Transactions

Within ten working days after the signing of the guarantee contract for foreign loans repaid by the Government, the guarantor shall cooperate with the re-lending agency or organization acting on behalf of the Ministry of Finance in guarantee transactions to register the guarantee transaction.

1. The re-lending agency or organization acting on behalf of the Ministry of Finance in guarantee transactions is responsible for storing files related to guarantee contracts, guarantee transactions, and inspection and supervision records of guaranteed assets.

2. Within five working days after receiving the certificate of registration of guarantee transaction from the competent authority, the re-lending agency or organization acting on behalf of the Ministry of Finance in guarantee transactions shall submit to the Ministry of Finance a copy (stamped by the submitting agency) of the signed guarantee contract and the Certificate of Registration of Guarantee Transaction issued by the registration agency or a copy (stamped by the submitting agency) of the Application for Registration of Guarantee Transaction certified by the registration agency, along with a list of formed guaranteed assets (if any) for coordination and monitoring.

Article 9. Reporting System

1. Periodic Reports:

a) Before April 15 each year, the guarantor is responsible for reporting to the Ministry of Finance (in cases where the Ministry of Finance directly re-lends) the status of guaranteed assets up to December 31 of the previous year, accompanied by the confirmation of the independent auditing company according to the form at Appendix 4 or Appendix 5 of this Circular or the re-lending agency or organization acting on behalf of the Ministry of Finance in guarantee transactions (cases where the Ministry of Finance assigns them to act on its behalf) according to the form prescribed by the re-lending agency or organization acting on behalf of the Ministry of Finance in guarantee transactions.

b) Before April 30 each year, the Ministry of Finance (in cases where the Ministry of Finance directly re-lends) or the re-lending agency or organization acting on behalf of the Ministry of Finance in guarantee transactions (cases where the Ministry of Finance assigns them to act on its behalf) is responsible for submitting to the Ministry of Finance a consolidated report on the status of guaranteed assets managed by delegation up to December 31 of the previous year, project by project and source of loan funds according to the form at Appendix 5 or Appendix 6 of this Circular.

2. Ad hoc reports:

When requested or when the value of the guaranteed assets fluctuates compared to the last report, the guarantor is responsible for reporting to the Ministry of Finance (in cases where the Ministry of Finance directly re-lends) or the re-lending agency or organization acting on behalf of the Ministry of Finance in guarantee transactions (cases where the Ministry of Finance assigns them to act on its behalf) about the changes related to the guaranteed assets according to the form at Appendix 5 or Appendix 6 of this Circular.

Section 2
GUARANTEED ASSET MANAGEMENT

Article 10. Disposal of Secured Assets

1. The disposal of secured assets shall be carried out in accordance with the provisions of Government Decree No. 163/2006/NĐ-CP dated December 29, 2006 on secured transactions and Government Decree No. 11/2012/NĐ-CP dated February 22, 2012 amending and supplementing certain articles of Government Decree No. 163/2006/NĐ-CP, and other amended and supplemented documents (if any).

2. The party receiving the guarantee has the right to dispose of the secured assets to recover debts for the Ministry of Finance.

Article 11. Authority for Disposal of Secured Assets

1. For government foreign loan refinancing loans directly provided by the Ministry of Finance: An organization representing the Ministry of Finance to perform loan security operations or a suitable organization assigned by the Ministry of Finance (in cases where the Ministry of Finance directly signs a Loan Security Contract) shall be responsible for resolving issues arising during the disposal of secured assets.

2. For government foreign loan refinancing loans entrusted by the Ministry of Finance to Refinancing Agencies: The Refinancing Agency shall propose to the Ministry of Finance a plan for disposing of secured assets, directly dispose of secured assets according to the Ministry of Finance's authorization, and report to the Ministry of Finance.

Article 12. Use of Revenue from Disposal of Secured Assets

After the disposal of secured assets, the revenue shall be prioritized for the following uses:

1. Repaying debts:

a) The guarantor repays temporary advances from the Debt Accumulation Fund to repay debts for government foreign loan refinancing loans;

b) State budget debts directly related to government foreign loan refinancing loans;

2. Repaying fees associated with refinancing loans related to the loan.

3. Repaying the Guarantor (if there is any surplus).

Section 3
RESPONSIBILITIES OF THE PARTIES

Article 13. Responsibilities of the Guarantor

1. Register secured transactions for loan guarantee contracts for government foreign loan refinancing loans in accordance with the law and service contracts stipulated in this Circular.

2. Regularly assess or inventory secured assets in accordance with accounting laws and report to the Ministry of Finance, the organization representing the Ministry of Finance performing loan security operations, or the Refinancing Agency about the assessment and inventory results; cooperate with the Ministry of Finance, the organization representing the Ministry of Finance performing loan security operations, or the Refinancing Agency to handle procedures related to the disposal of secured assets when it is necessary to dispose of them to recover debts for government foreign loan refinancing loans.

3. Pay all costs incurred in connection with loan security operations during registration of secured transactions, monitoring, and disposal of secured assets.

4. Purchase insurance for secured assets in accordance with the law.

5. Provide accurate, truthful, and timely information about the status of secured assets to the party receiving the guarantee and comply with full and timely reporting requirements as stipulated in this Circular.

6. Use assets formed from government foreign loan refinancing loans for their intended purposes.

Article 14. Responsibilities of the Ministry of Finance

1. Supervise secured assets for government foreign loan refinancing loans directly provided by the Ministry of Finance and directly signed loan security contracts.

2. Report to the Prime Minister special cases where it is impossible to register secured assets in accordance with the law.

3. Select or approve proposals from the guarantor regarding financial, credit organizations, or suitable organizations to perform loan security operations and resolve issues arising during the disposal of secured assets.

4. Report to the Prime Minister plans for disposing of secured assets to recover refinancing loans in cases where the borrower completely loses the ability to repay.

Article 15. Responsibilities of the Re-lending Agency

1. Fully and promptly fulfill the responsibilities stipulated in the re-lending mandate contract, supervise, inspect, and propose measures to handle collateral for government foreign loans under re-lending.

2. Regularly and urgently report to the Ministry of Finance on the status of collateral for government foreign loans under re-lending within the delegated responsibility as prescribed in Clause 9 of this Circular and assess related collateral risks (if any).

3. Propose solutions to handle collateral for government foreign loans under re-lending when it is necessary to process such collateral.

Article 16. Responsibilities of the Organization Representing the Ministry of Finance in Performing Loan Guarantee Services

1. Fully and promptly fulfill the responsibilities stipulated in the service contract for performing loan guarantee services, supervise, inspect, and propose measures to handle collateral for government foreign loans under re-lending.

2. Regularly and urgently report to the Ministry of Finance on the status of collateral for government foreign loans under re-lending within the delegated responsibility as prescribed in Clause 9 of this Circular and assess related collateral risks (if any).

3. Propose solutions to handle collateral for government foreign loans under re-lending when it is necessary to process such collateral.

Section 4
HANDLING VIOLATIONS

Article 17. Handling Violations by the Guarantor

In case the Guarantor fails to comply with the loan guarantee regulations stipulated in this Circular for government foreign loans under re-lending, the Ministry of Finance shall report to the Prime Minister to handle according to one or more of the following measures:

1. Temporarily suspend disbursement for ongoing withdrawal of the loan.

2. Recover the entire disbursed loan amount ahead of schedule.

3. Not approve new loans for the violating Guarantor.

4. Other forms appropriate under the law.

Article 18. Handling Violations by the Re-lending Agency or the Organization Representing the Ministry of Finance in Performing Loan Guarantee Services

In case the Re-lending Agency or the Organization Representing the Ministry of Finance in Performing Loan Guarantee Services does not comply with the regulations and fully fulfill the responsibilities assigned by the Ministry of Finance in the service contract, the Ministry of Finance shall report to the Prime Minister to handle according to one or more of the following measures:

1. Not delegate re-lending for new loans or select such Organizations to perform loan guarantee services for other projects.

2. Not approve these organizations as banks serving new projects.

Chapter III
IMPLEMENTING PROVISIONS

Article 19. Effective Date

1. This Circular takes effect from November 1, 2015.

2. In case the referenced documents in this Circular are amended, supplemented, or replaced, they shall be implemented according to the provisions of the amended, supplemented, or replacing documents.

Article 20. Transitional Provisions

1. Government foreign loans under re-lending that have signed re-lending agreements or re-lending mandate contracts before the effective date of this Circular, in accordance with the law on re-lending government foreign loans at the time of signing the re-lending agreement or re-lending mandate contract, which do not require collateral, shall continue to be implemented according to the law at the time of signing the agreement or mandate contract.

2. Government foreign loans under re-lending that have been approved for re-lending before the effective date of this Circular but have not yet signed a loan guarantee contract shall implement the signing of a loan guarantee contract in accordance with this Circular and the guidance of the Ministry of Finance.

Article 21. Organization of Implementation

1. The Ministry of Finance, the Re-lending Agency, the Borrower, and relevant agencies, organizations, and individuals shall be responsible for strictly implementing the provisions of this Circular.

2. During implementation, if there are difficulties, the related agencies, organizations, and individuals are requested to promptly reflect them to the Ministry of Finance for study and resolution./.