Circular No. 19/2009/TT-NHNN guiding foreign exchange management for transactions involving government bonds denominated in foreign currency issued pursuant to Decision No. 211/QĐ-TTg dated February 13, 2009 of the Prime Minister.

CIRCULAR

Guidelines on foreign exchange management for transactions involving government bonds denominated in foreign currency issued pursuant to Decision No. 211/QĐ-TTg dated February 13, 2009 of the Prime Minister

Pursuant to the Law on the State Bank of Vietnam dated December 12, 1997 and the Law Amending and Supplementing Certain Articles of the Law on the State Bank of Vietnam dated June 17, 2003;

Pursuant to Decree No. 96/2008/NĐ-CP dated August 26, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

Pursuant to Decree No. 28/2005/PL-UBTVQH11 dated December 13, 2005 on Foreign Exchange;

Pursuant to Decree No. 160/2006/NĐ-CP dated December 28, 2006 of the Government detailing the implementation of the Decree on Foreign Exchange;

Pursuant to Decision No. 211/QĐ-TTg dated February 13, 2009 of the Prime Minister regarding the issuance of government bonds denominated in foreign currency on the domestic capital market;

The State Bank of Vietnam hereby issues guidelines on foreign exchange management for transactions involving government bonds denominated in foreign currency issued pursuant to Decision No. 211/QĐ-TTg dated February 13, 2009 of the Prime Minister for organizations and individuals as follows:

Article 1. Scope of Regulation and Applicability

1. This Circular applies to transactions involving government bonds denominated in foreign currency issued pursuant to Decision No. 211/QĐ-TTg dated February 13, 2009 of

2. The subjects to which this Circular applies are organizations and individuals residing in Vietnam who are legally operating and participating in transactions involving government bonds denominated in foreign currency.

Article 2. Sources of foreign currency for conducting bond transactions

1. Organizations and individuals residing in Vietnam may only use foreign currency held in foreign currency deposit accounts opened at credit institutions authorized to conduct foreign exchange operations to conduct transactions involving government bonds denominated in foreign currency.

2. Organizations are not allowed to use state budget funds or other government support funds to purchase government bonds denominated in foreign currency.

Article 3. Opening and using foreign currency deposit accounts for conducting transactions involving government bonds denominated in foreign currency

1. The Securities Depository Center and its depositary members shall open foreign currency deposit accounts at designated banks in accordance with current regulations on foreign exchange management to settle transactions involving government bonds denominated in foreign currency.

2. Organizations and individuals residing in Vietnam may only use foreign currency deposit accounts at credit institutions authorized to conduct foreign exchange operations in accordance with Clause 30 of Decree No. 160/2006/NĐ-CP dated December 28, 2006 of the Government to conduct transactions involving government bonds denominated in foreign currency. In relation to transactions involving government bonds denominated in foreign currency, the foreign currency deposit account shall be used for receipts and payments as follows:

a) Receipts on the foreign currency deposit account: Receipt of foreign currency from selling government bonds denominated in foreign currency; Receipt of interest and principal repayment of government bonds denominated in foreign currency upon maturity; Receipt from entrusting bidding for government bonds and other receipts related to transactions involving government bonds denominated in foreign currency.

b) Payments on the foreign currency deposit account: Payment of foreign currency to purchase government bonds denominated in foreign currency; Entrusted payment, transaction fees for government bonds denominated in foreign currency and other payments related to transactions involving government bonds denominated in foreign currency.

Article 4. Pledge of government bonds

Organizations and individuals residing in the country who own government bonds denominated in foreign currency may pledge such government bonds denominated in foreign currency to borrow funds from credit institutions authorized to conduct foreign exchange operations in accordance with current laws.

State-owned enterprises that have been assigned by the Ministry of Agriculture and Rural Development to conduct offshore wind power project surveys before the effective date of this Circular shall continue to implement according to the assigned documents; any new matters arising after the effective date of this Circular shall be implemented in accordance with the provisions of this Circular.

1. This Circular shall take effect from November 1, 2009.

2. The Director of the Office, Heads of the Department of Foreign Exchange Management, Heads of units under the State Bank, Governors of the State Bank branches in provinces and centrally-administered cities; Chairmen of the Board of Directors and General Managers (Directors) of credit institutions authorized to conduct foreign exchange operations are responsible for implementing this Circular./.