Decision No. 149/2001/QĐ-TTg Temporary

JOINT CIRCULAR

JOINT CIRCULAR NO. 02/2002/TTLT/NHNN-BTP OF THE STATE BANK OF VIETNAM AND THE MINISTRY OF JUSTICE ON GUIDELINES FOR IMPLEMENTING DECISION NO. 149/2001/QD-TTg OF THE GOVERNMENT ON PROCEDURES FOR SELLING SECURED ASSETS, NOTARIZATION, AUTHENTICATION OF SALES DOCUMENTS, AND TRANSFER OF ASSETS TO COMMERCIAL BANKS PURSUANT TO COURT JUDGMENTS AND DECISIONS

Pursuant to Clause 2 and Clause 4, Article 3 of Decision No. 149/2001/QD-TTg dated October 5, 2001 of the Prime Minister on approving the Scheme for Handling Overdue Debts of Commercial Banks (hereinafter referred to as Decision No. 149/2001/QD-TTg);
In order to implement the Scheme for Handling Overdue Debts of Commercial Banks approved by the Prime Minister, creating conditions for banks to publicly, quickly, and legally handle secured assets of overdue debts, the State Bank of Vietnam and the Ministry of Justice hereby jointly issue guidelines for implementing procedures for selling secured assets, notarization, authentication of sales documents, and transfer of assets to commercial banks pursuant to court judgments and decisions as follows:

I. SCOPE OF APPLICATION

1. This Circular shall be applied to handle secured assets according to the sale forms prescribed in Point 3.1.a, Clause 3, Article 1 of Decision No. 149/2001/QD-TTg for overdue debts with secured assets of commercial banks remaining outstanding until December 31, 2000.

2. Secured assets of overdue debts sold in accordance with the guidelines set out in this Circular include:

a. Assets secured that have been transferred to commercial banks by the courts pursuant to judgments and decisions of the courts that have taken effect;

b. Collateral, pledges, and assets assigned to commercial banks without disputes and under the jurisdiction of competent state agencies, including the following documents:

- Mortgage or pledge contracts (with or without notarization, certification);

- Certificates of ownership or use rights of assets or other valid documents.

Other valid documents may be those specified in Point 2, Clause 3, Article 1 of Decree No. 79/2001/ND-CP dated November 1, 2001 of the Government amending and supplementing certain Articles of Decree No. 17/1999/ND-CP dated March 29, 1999 of the Government on procedures for converting, transferring, leasing, subleasing, inheriting land use rights, and mortgaging, contributing capital with the value of land use rights or documents proving ownership and use rights of assets such as purchase contracts, gift contracts, donation contracts, and transfer contracts accompanied by original documents about the asset; sales invoices in accordance with the Ministry of Finance's regulations; payment receipts for goods purchased; property handover documents from competent state authorities for state-owned enterprises; completion certificates for construction projects; other valid documents (if any).

3. The sale of secured assets of commercial banks as stipulated in Clause 1 and Point a, Clause 34, Article 1 of Decree No. 178/1999/ND-CP dated December 29, 1999 of the Government on collateral for loans of credit organizations shall not apply the procedures for selling secured assets prescribed in Section II of this Circular.

II. PROCEDURES FOR SELLING SECURED ASSETS AS PROVIDED IN POINT 3.1.A, CLAUSE 3, ARTICLE 1 OF DECISION NO. 149/2001/QD-TTG

1. Commercial banks, Management Companies of Non-performing Loans of Commercial Banks, and branches authorized (hereinafter collectively referred to as Commercial Banks, Management Companies) are entitled to independently choose the form of selling secured assets as provided in Point 3.1.a, Clause 3, Article 1 of Decision No. 149/2001/QD-TTG, including: public sale on the market, sale through Auction Centers, sale to State-owned Debt Purchasing Companies.

In the case of public sale on the market, Commercial Banks, Management Companies must conduct it in the form of public auction.

2. Commercial Banks, Management Companies, as sellers, decide to put the asset up for public auction, directly sign sales documents or contracts, and handle the transfer of ownership and use rights of the asset to the buyer or transferee when conducting a public auction on the market or directly sign a contract to authorize the sale of the asset through an Auction Center or sell to a State-owned Debt Purchasing Company.

3. The General Director (Director) of Commercial Banks, the Director of Management Companies establish Asset Disposal Committees at each branch or local area where the secured assets are being disposed of when conducting a public auction on the market.

4. The Asset Disposal Committee has the following duties and powers:

a. Determine the starting price for publicly auctioning secured assets on the market based on the market price at the time of sale.

The starting price for selling the asset (sale price) may be higher or lower than the value of the overdue debt, the value of the asset determined at the time of lending, or the asset value determined by the court in its judgment or decision.

b. Appoint the person in charge of conducting the public auction of the asset;

c. Resolve complaints related to the public auction of the asset on the market;

d. May use the seal of the Commercial Bank, Management Company when performing the duties and powers under this clause.

5. When conducting a public auction on the market, Commercial Banks, Management Companies must perform the following procedures:

a. Publicly announce the sale of the asset at the headquarters of the Commercial Bank, Management Company, the location of the auction, and in local or central newspapers twice, each announcement separated by no more than three days (3 days), at least fifteen days (15 days) before the date of organizing the sale, including the following information:

- Information about the assets being sold, including: type of asset, characteristics, quantity, quality of the asset;

- Information on the sale of the asset, including: time and place to register to buy the asset, time and place to sell the asset, method of sale, starting price, conditions for buyers (if any), sale procedures, and other relevant information about the sale;

b. Organize the display of the asset, allow viewing of the asset or its documentation upon request of the buyer registrant;

c. Prepare a record confirming the list of eligible buyers. The buyer must register to purchase the asset no later than two days (2 days) before the auction date and deposit a prepayment amounting to five percent (5%) of the initial price of the auctioned asset.

An eligible buyer is a person who meets the conditions for purchasing the asset (if any), has completed the registration to purchase the asset and paid the prepayment before the registration period ends.

In the case where the asset is successfully purchased at the auction, the prepayment will be deducted from the purchase price; if not purchased, the prepayment will be refunded to the registered buyer immediately after the auction concludes.

If the buyer has deposited a prepayment but does not participate in the auction, the prepayment will belong to the Commercial Bank, Debt Management Company, except in cases where the non-participant proves that their inability to attend the auction was due to force majeure reasons (accidents, severe illness requiring hospitalization, natural disasters). In this case, the prepayment will be refunded to the non-participant.

đ. For movable assets with an initial price under ten million dong (10,000,000 dong), participants can directly participate in the auction without having to go through the registration process stipulated in point c of this clause.

6. The authorized notary or certifier for real estate must attend the auction upon request in writing from the commercial bank or Debt Management Company to witness the real estate auction.

7. At the auction, the auctioneer performs the following tasks:

a. Announce the decision to put the asset up for auction;

b. Call out the names of those who have registered as eligible buyers;

c. Introduce each auctioned asset, answer questions from bidders (if any), reiterate the initial price, and require bidders to bid at least the initial price;

d. Clearly and accurately announce the highest bid made, each time separated by thirty seconds (30 seconds);

đ. Announce the successful bidder if there is no higher bid after three announcements of the highest bid. In the event of multiple bidders offering the same price, the auctioneer will organize a draw among them and announce the winner as the successful bidder;

e. Record the auction results clearly in the Auction Record (prepared by the Auction Secretary) with signatures of the auctioneer, the successful bidder, the Auction Secretary, and the signature and seal of the person deciding to put the asset up for auction;

g. If there is no bid at least equal to the initial price, the auctioneer stops the sale. Reorganizing the auction follows the procedures and formalities specified in Clauses 5, 6, and 7 of this Section. If there is still no bid at least equal to the initial price at the subsequent sale, the Asset Disposal Council will reassess the initial price for the auction.

8. The authorized notary or certifier who witnessed the auction will certify the auction document, then sign and stamp it.

9. After the deadline for registering to participate in the auction, if only one person registers to buy the asset, the asset will be sold directly to the buyer, but the selling price must be at least equal to the initial price determined by the Council. The authorized notary or certifier for real estate must attend, witness the sale, and certify the purchase and transfer contract according to the written request of the Commercial Bank or Debt Management Company.

10. The Commercial Bank and Debt Management Company publicly announce the auction results at their headquarters and the location of the auctioned asset no later than three days (3 days) from the end of the auction.

11. Collection of debt from the disposal of collateral assets.

All proceeds from the disposal of collateral assets shall be used to settle the principal, interest, and overdue interest owed to the Commercial Bank and Debt Management Company after deducting actual and reasonable costs related to the disposal of collateral assets: storage costs, management, valuation, listing, public announcement of the sale of assets, transportation of assets, sale of assets, costs for transferring ownership rights and usage rights (if applicable), and other reasonable costs (if applicable). In the event that the proceeds exceed the outstanding debt and the aforementioned costs, the excess will be handled as follows:

a. In cases where the collateral assets are transferred to the Commercial Bank based on a court judgment or decision that has taken effect, the Commercial Bank and Debt Management Company temporarily hold the excess amount and immediately notify the enforcement agency.

b. In other cases, the Commercial Bank and Debt Management Company temporarily hold the excess amount and immediately notify the owner of the disposed collateral asset.

III. PROCEDURES FOR NOTARIZATION AND CERTIFICATION OF ASSET SALE DOCUMENTS

1. In cases where the Commercial Banks and Debt Management Companies have sold collateral assets before this Circular takes effect, the certification and authentication procedures for the sale documents shall be carried out as follows:

a. For collateral assets belonging to cases that have been adjudicated by the Court with a judgment or decision that has taken effect, the authorized notary or certifier, upon request of the Commercial Bank or Debt Management Company, will base on the Court's judgment or decision and the sale and transfer document to certify and authenticate the sale and transfer document;

b. For collateral assets without a Court judgment or decision transferring them to the Commercial Bank but with sufficient legal documentation, the authorized notary or certifier will carry out the certification and authentication of the sale and transfer document.

c. For collateral assets that do not have a court judgment or decision transferring them to a commercial bank and that are either incomplete in legal documentation or although complete in legal documentation, are currently subject to disputes being resolved by competent state authorities, then after completing the legal documentation or resolving the dispute, the authorized notary or certification body shall carry out the notarization or certification of the sale or transfer documents for such assets.

2. In cases where collateral assets are publicly sold by commercial banks or debt management companies from the date this Circular takes effect, the notarization and certification of the sale or transfer documents for such assets shall be carried out in accordance with the provisions of Section II of this Circular.

3. In cases where collateral assets are auctioned by the Center for Asset Sale Auctions, the notarization and certification procedures shall be conducted in accordance with the Auction Rules for Assets issued together with Decree No. 86/CP dated December 18, 1996 of the Government.

IV. PROCEDURES FOR TRANSFERRING ASSETS TO COMMERCIAL BANKS PURSUANT TO COURT JUDGMENTS AND DECISIONS

1. When enforcing judgments, enforcement agencies must strictly comply with current laws and the judgments pronounced. In cases where the judgment is unclear, causing difficulties and obstacles during enforcement, the enforcement agency shall request the court that issued the judgment or decision to provide an explanation. If the enforcement agency disagrees with the court's explanation, it shall report to the Ministry of Justice for review and resolution.

2. For assets that enforcement agencies have transferred or are yet to transfer to commercial banks but are incomplete in legal documentation, the enforcement agency shall coordinate with the commercial banks to request the People's Committees of provinces and centrally-administered cities and other competent state authorities to complete the legal documentation and procedures so that the commercial banks can sell the assets and recover funds.

3. For land, assets attached to land, and other assets that enforcement agencies have not yet transferred to commercial banks due to difficulties and obstacles (such as undefined boundaries, encroachment, insufficient compensation for land clearance...), the enforcement agency shall coordinate with the commercial banks to request the People's Committees of provinces and centrally-administered cities and other competent state authorities to focus on resolving these difficulties and obstacles, completing the procedures to immediately transfer the assets to the commercial banks.

V. EFFECTIVE DATE

This Circular shall take effect fifteen days (15 days) from the date of signature. During implementation, if there are any difficulties, commercial banks, debt management companies, notary offices, and enforcement agencies shall report them for inter-ministerial clarification, supplementation, and timely amendment. Any amendments or supplements to this Circular shall be decided by the Governor of the State Bank and the Minister of Justice.