Decision No. 218/2002/QD-NHNN on the procedure for converting Vietnamese Dong to US Dollars and transferring abroad for projects guaranteed and committed by the Government.

Pursuant to …;

Regarding the procedure for converting Vietnamese Dong to US Dollars and transferring abroad for projects guaranteed and committed by the Government.

GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to the Law on the State Bank of Vietnam No. 01/1997/QH10 dated December 12, 1997,

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

Pursuant to the Decree No. 86/1999/NĐ-CP dated August 30, 1999 of the Government on the management of national foreign exchange reserves;

Pursuant to the Decree No. 24/2000/NĐ-CP dated July 31, 2000 of the Government detailing the implementation of the Law on Foreign Investment in Vietnam;

At the proposal of the Director of the Department of Foreign Exchange Management

DECISION:

Article 1. This Decision stipulates the procedure for converting Vietnamese Dong to US Dollars and transferring abroad for projects guaranteed and committed by the Government.

Article 2. In this Decision, the following terms shall be understood as follows:

1. GGU is the Government Guarantee and Commitment Agreement.

2. Project refers to special important projects guaranteed and committed by the Government.

3. Vietnamese Party means enterprises established and operating in Vietnam that purchase products from the Project.

4. Investor means foreign investors investing in the Project.

5. Conversion Bank means a bank permitted to conduct foreign exchange transactions (authorized bank) selected by the Investor to carry out the conversion of Vietnamese Dong to US Dollars for the Project.

6. Revenue means the amount of money received from selling products and services of the Project calculated in US Dollars and paid in Vietnamese Dong.

7. Exchange Rate Announcement Date means the date when the Conversion Bank informs the Investor of the exchange rate for converting Vietnamese Dong to US Dollars according to the GGU of each Project.

8. Forward Exchange Rate means the exchange rate determined by the Conversion Bank with a maximum term of nine working days.

9. Payment Date means the date when the Vietnamese Party transfers the amount of Vietnamese Dong into Account No. 1 of the Investor and is the date when the Conversion Bank begins to execute the transactions of converting Vietnamese Dong to US Dollars. The Payment Date must be within two (02) working days after the Exchange Rate Announcement Date..

10. Conversion Date means the date when the Conversion Bank executes the transactions of converting Vietnamese Dong to US Dollars. The Conversion Date is determined after the Payment Date and is specified in the GGU of each Project.

Article 3. Investors may transact with the Conversion Bank to convert Vietnamese Dong revenue to US Dollars and transfer abroad in accordance with this Decision.

Article 4. The procedure for converting Vietnamese Dong to US Dollars is as follows:

1. First month: The Investor provides products;

2. Second month: On a predetermined day of the second month (this day is determined according to the provisions of the GGU of each Project), the Investor must notify the Conversion Bank and the State Bank (Department of Foreign Exchange Management and Trading Department) of the forecasted amount of US Dollars needed to be converted from the Project's revenue in the previous month.

3. Third month: Month for executing the conversion of Vietnamese Dong to US Dollars. The conversion will be carried out in the following steps:

Step 1: Not later than noon on the "Exchange Rate Announcement Date," the Conversion Bank must inform the Investor of the exchange rate to prepare the official payment invoice and notify the Vietnamese Parties to proceed with the payment to the Investor.

Step 2:

Step 2.1: Not later than noon on the "Payment Date," the Vietnamese Party must transfer the full amount of Vietnamese Dong into Account No. 1 of the Investor at the Conversion Bank.

2.2. If the Conversion Bank has sufficient US Dollars to meet the Investor's conversion needs, the Conversion Bank must proceed with the transactions to convert the amount of Vietnamese Dong in Account No. 1 (after deducting expenses in Vietnamese Dong) to US Dollars within the number of days specified in the GGU for each Project after the Vietnamese Party transfers the Vietnamese Dong into Account No. 1 based on the exchange rate announced by the Conversion Bank.

Step 2.3: If the Conversion Bank does not have enough US Dollars to meet the Investor's conversion needs due to the foreign currency status on the Payment Date (after the Vietnamese Party transfers the Vietnamese Dong into Account No. 1 for the Investor), the Conversion Bank sends a letter requesting the State Bank to sell the insufficient amount of US Dollars to the Conversion Bank for the purpose stated in the documents submitted to the State Bank (Department of Foreign Exchange Management and Trading Department) including:

Request to purchase US Dollars to meet the Investor's conversion needs;

Payment invoice prepared by the Investor.

Step 3: Based on the provisions of the Government Guarantee and Commitment Agreement (GGU) and the foreign currency status of the Conversion Bank and the provisions of this Decision, the Trading Department checks the necessary documents, sells US Dollars from the Exchange Rate Stabilization Fund and Gold Fund to the Conversion Bank at the exchange rate announced by the Conversion Bank (as stipulated in Point 8, Article 2) within five (5) working days from the Payment Date to meet the Investor's conversion needs.

Step 4: Within two (2) working days from receiving the purchased US Dollars from the State Bank, the Conversion Bank converts the amount of Vietnamese Dong remaining on "Account No. 1" after deducting the Investor's expenses in Vietnamese Dong to US Dollars based on the exchange rate recorded on the payment invoice and transfers it to "Account No. 2."

Article 5. When transferring US Dollars from "Account No. 2" abroad at the Investor's request, the Conversion Bank must control the confirmation documents for periodic tax payments and other documents prescribed in the GGU.

Article 6. Responsibilities of the Trading Department, the Department of Foreign Exchange Management, and related departments of the State Bank in monitoring and reporting after converting US Dollars for the Investor:

1. Trading Department: Report to the Governor of the State Bank immediately after completing the sale of US Dollars; simultaneously, inform the Department of Foreign Exchange Management about the situation of selling US Dollars from the Exchange Rate Stabilization Fund and Gold Fund.

Carry out the transfer of US Dollars from the foreign exchange reserve fund to the Exchange Rate Stabilization Fund and Gold Fund according to the decision of the Governor after approval by the Prime Minister.

Maintain ledgers to monitor the process of selling US dollars as prescribed in this Decision. Perform accounting entries and statistics to track the following contents: date; the amount of US dollars sold to the Exchange Bank, the amount of US dollars transferred from the State Foreign Exchange Reserve Fund to the Exchange Rate Stabilization and Gold Price Fund, and implement the information and reporting system periodically as stipulated in Article 20 of the Regulation on Organizing the Implementation of Tasks Related to State Management of Foreign Exchange Reserves (annexed to Decision No. 653/2001/QĐ-NHNN dated May 17, 2001 of the Governor of the State Bank).

2. Department of Foreign Exchange Management:

When receiving the demand for US dollar conversion from Investors, calculate the amount of US dollars available in the "Exchange Rate Stabilization and Gold Price Fund." If it is insufficient to meet the Investor's conversion needs, immediately prepare a report to inform the Governor to request the Government's permission to transfer the required amount of US dollars from the State Foreign Exchange Reserve Fund to the Exchange Rate Stabilization and Gold Price Fund for sale to the Exchange Bank; Determine the foreign currency status of the Exchange Bank requesting to purchase US dollars to meet the Investor's needs;

Draft a report to the Prime Minister for submission to the Governor of the State Bank after each transfer of US dollars from the State Foreign Exchange Reserve Fund to the Exchange Rate Stabilization and Gold Price Fund;

By the latest on January 25 each year, submit a report to the Governor of the State Bank informing the Prime Minister about the situation of selling US dollars to Investors under this Decision;

3. Accounting Department: - of Finance:

Coordinate with the Trading Department to account for transactions arising from the transfer of US dollars from the State Foreign Exchange Reserve Fund to the Exchange Rate Stabilization and Gold Price Fund;

Article 7. In cases of delayed payment due to errors of the Vietnamese investing partner, notify the Exchange Bank in advance about the delayed payment. The Exchange Bank reports to the State Bank regarding the delayed payment for monitoring and coordination in resolving. The process of converting US dollars applies to cases of delayed payment according to the provisions in the third month and those in Articles 4, 5, and 6 of this Decision;

Article 8. By the latest on the 20th of each month, the Exchange Bank must report to the State Bank (Department of Foreign Exchange Management and Trading Department) on the situation of selling US dollars to Investors in that month; simultaneously, inform the State Bank (Department of Foreign Exchange Management and Trading Department) about the expected amount of US dollars needed for conversion for Investors in the following month;

At the end of each quarter, the Exchange Bank reports to the State Bank (Department of Foreign Exchange Management and Trading Department) on the anticipated need for US dollar conversion by Investors in the next quarter and the plan to balance US dollars to meet that need;

Article 9. THIS DECISION SHALL TAKE EFFECT 15 DAYS AFTER THE DATE OF SIGNATURE.

Article 10. The Director of the Office, the Heads of the Department of Foreign Exchange Management, the Trading Department, the Accounting and Finance Department, and the Heads of related units of the State Bank, and the General Directors of Banks authorized to be selected as the Exchange Bank are responsible for implementing this Decision./.