Circular No. 22/2015/TT-NHNN on the issuance and use of cheques

CIRCULAR

Regulations on the supply and use of checksspecialized agency under the People's Committee of the province/city.

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Pursuant to the Law on the State Bank of Vietnam No.No. 46/2010/QH12 dated June 16, 2010;

Based on the Law on Credit InstitutionsNo. 47/2010/Article 24H12 dated June 16, 2010;

Based on the Law on Transferable Securities 2005;

Pursuant to Decree No. 156/2013/NĐ-CP dated November 11, 2013, of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

Based on Decree No. 101/2012/NĐ-CP dated November 22, 11 2012 of the Government on non-cash payment methodsonWhen settling advance payments, units submit to the KBNN a Payment Settlement Form for Advance Payments.

At the proposal of the Department of Science and Technology, Director Payment Department;

The Governor of the State Bank of Vietnam issues this Circulary regulating the supply and use of checks.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular regulates the activities of supplying and using checks at banks, foreign bank branches operating within the territory of Vietnam.

Article 2. Applicability

1. The State Bank of Vietnam, commercial banks, policy banks, cooperative banks, foreign bank branches (hereinafter referred to as banks), credit unions, microfinance organizations, other organizations as prescribed by the State Bank of Vietnam (hereinafter referred to as the State Bank).

2. Organizations and individuals using checks and related to the use and settlement of checks, including: drawer, drawee, endorser, endorse, guarantor, guaranteed, beneficiary, lawful representatives of the aforementioned persons and other persons related to the use of checks.

Article 3. Explanation of Terms

In this Circular, the following terms shall be understood as follows:

1. Check is a negotiable instrument issued by the drawer ordering the drawee to pay a certain amount from the drawer's deposit account to the beneficiary.

2. Drawer is the person who issues and draws the check.

3. Drawee is the bank that opens a deposit account for the drawer and is responsible for paying the amount stated on the check according to the drawer's order.

4. Beneficiary is one of the following:

a) The person designated by the drawer to receive the amount stated on the check;

b) The person receiving the transfer of the check in accordance with the transfer methods stipulated in this Circular;

c) The holder of the check marked payable to the holder.

5. Related person is a participant in the check payment relationship by signing on the check as drawer, endorser, guarantor, or guarantor.

6. Collection Agent is a bank, credit union, microfinance organization, or other organization as prescribed by the State Bank providing collection services for checks on behalf of beneficiaries.

7. Guarantor is the person who commits to pay the full or partial amount stated on the check to the beneficiary when the guaranteed party fails to pay or pays insufficiently the obligation to pay the amount stated on the check upon maturity.

8. Guaranteed Party is the person whose payment obligation is undertaken by the guarantor for the benefit of the beneficiary.

9. Check Guarantee is the drawee's assurance of the ability to pay the check when it is presented within the presentation period for payment.

10. Issuance of Check is the act of the drawer signing and transferring the check to the beneficiary for the first time.

11. Transfer of Check is the act of the check beneficiary transferring ownership of the check to the endorse by signing on the back of the check and transferring it to the endorse.

12. Check Clearing Center is the State Bank or another organization authorized by the State Bank to organize and oversee the exchange, clearing, and settlement of checks, and to settle financial obligations arising from check clearing among members which are banks and permitted service providers.

13. Check supplier is the drawee.

14. MICR (Magnetic Ink Character Recognition): Is a character recognition system using special ink and characters.

Article 4. Issuing and Paying Checks with Foreign Currency Amounts

1. Issuing checks payable in foreign currency:

Checks shall be issued with amounts payable in foreign currency in accordance with the provisions of the law on foreign exchange management.

2. Paying checks payable in foreign currency:

a) Checks payable in foreign currency as prescribed in Clause 1 of this Article shall be paid in foreign currency recorded on the check when the final beneficiary is permitted to collect foreign currency in accordance with the provisions of the law on foreign exchange management;

b) Checks payable in foreign currency but where the final beneficiary is not permitted to collect foreign currency in accordance with the provisions of the law on foreign exchange management, the amount recorded on the check shall be paid in Vietnamese dong at the foreign exchange rate published by the State Bank at the time of payment or at the foreign exchange trading rate published by the bank conducting the payment at the time of payment.

Article 5. Recovery Due to Non-Payment of Check

1. In cases where a check is refused payment in whole or in part of the amount recorded on the check as provided for in this Circular, the beneficiary has the right to recover the lawful amount due to them. The objects, amounts, methods, and procedures for recovery shall be applied according to the provisions from Article 48 to Article 52 of the Law on Transferable Instruments.

2. A transferee who has paid money to the beneficiary has the right to recover from the issuer or the previous transferee.

Chapter II

CONTENTS OF CHECKS AND ISSUING CHECKS

Article 6. Contents on Checks

The contents of a check as stipulated in Article 58 of the Law on Transferable Instruments.

Article 7. Issuing and Issuing Checks

1. A check must be issued on a blank check form supplied by the drawee; if a check is issued on a blank check form not supplied by the drawee, then the drawee has the right to refuse payment of that check.

2. The elements on the check must be printed or written clearly with ink or ballpoint pen, not written with pencil or red ink, easily fading ink, without corrections, erasures. The writing on the check must be in Vietnamese. In case the check contains foreign elements, the check may use a foreign language agreed upon by the parties.

3. The designation of the beneficiary must be recorded in one of the three ways prescribed in Clause 1 of Article 60 of the Law on Transferable Instruments.

4. The amount written in figures on the check must match the amount written in words on the check.

The amount in figures on the check must be Arabic numerals: 0, 1, 2, 3, 4, 5, 6, 7, 8, 9; after thousands, millions, billions, trillions, quadrillion digits, a period (.) must be placed; when there are additional digits after the unit digit, a comma (,) must be placed after the unit digit.

The amount in words must be written clearly: the first letter of the amount in words must be capitalized and written at the beginning of the first line, without being written on separate lines, without spacing between letters, and without adding extra letters (on a different line) between two consecutive letters written on the check.

5. The place of payment is the location where the check is paid and is determined by the drawee. If the place of payment is not recorded on the check, the check can be paid at any business location of the drawee.

6. The date of issuance is the date recorded on the check by the issuer and must be written in figures.

7. The signature of the issuer is the handwritten signature directly on the check of the person having rights and obligations regarding the check or the authorized person to issue and sign the check. The signature of the issuer must be written with ink or ballpoint pen according to the registered specimen signature at the drawee, accompanied by their name and stamp (if any) of the organization in the case of the check signed by the legal representative of the organization or electronic signature (in the case of electronic payment processing).

8. To designate that the amount on the check cannot be paid in cash but must be transferred to the beneficiary's settlement account, the issuer or transferor writes or stamps the phrase "pay into account" on the front of the check immediately below the word "Check."

9. To designate that the amount on the check can only be paid to a bank or to a beneficiary with a settlement account at the drawee, the issuer or transferor draws two parallel diagonal lines across the front of the check from the top left corner to the bottom right corner.

10. To designate that the amount on the check can only be paid to a specific bank or to a beneficiary with a settlement account at that bank, the issuer or transferor draws two parallel diagonal lines across the check from the top left corner to the bottom right corner of the front of the check and writes the name of the designated bank between the two diagonal lines. A check with the names of two banks between the two diagonal lines is not valid for payment unless one of the two banks named between the two diagonal lines is the collecting bank for that check.

11. In cases where the check issuer is authorized by the settlement account holder, the settlement account holder must complete all notification, registration of specimen signatures, and specify limits (if applicable) with the drawee.

Article 8. Rights and Obligations of the Drawer

1. The drawer has the right to request the suspension of payment on a check that they have drawn by notifying in writing the drawee to suspend payment on the check when the check is presented for payment. The suspension notice shall only be effective after the presentation period for payment of the check as stipulated in Clause 1, Article 19 of this Circular, if the beneficiary or the person authorized by the beneficiary has not yet presented the check for payment at the drawee.

2. Draw checks in accordance with the provisions of Article 7 of this Circular.

3. Ensure sufficient capacity to pay the full amount recorded on the check to the beneficiary at the time the check is presented for payment within the presentation period. Payment capacity is the balance in the settlement account plus the overdraft limit that the drawer is permitted to use under an agreement with the drawee.

4. In case a check is refused payment due to non-compliance with regulations, if the beneficiary requests, the drawer must issue another check to replace it immediately on the day requested or the next working day following the request.

5. In case a check is partially or fully refused payment due to insufficient payment capacity of the drawer, the drawer must unconditionally refund the amount claimed on the check.

Chapter III

CHECK SUPPLY

Article 9. Blank Check Model

1. Organizations supplying checks decide on the design of blank check models supplied by themselves in accordance with Articles 58 and 59 of the Law on Transferable Instruments.

2. To ensure that a check can be processed through the Check Clearing Center, the paper quality of the check, the size of the check, and the elements and their positions on the blank check must be designed according to Appendix 01a and Appendix 01b attached to this Circular.

1. Commercial banks, policy banks, cooperative banks, and foreign bank branches must register blank check models at the State Bank before printing them for supply to customers. Supply organizations submit directly or send via postal service to the State Bank (Payment Department) one set of registration files for blank check models, which include:

a) A request for registration of blank check models according to Appendix 08 attached to this Circular;

b) The design model of the blank check, including: size, color, detailed elements of the blank check;

c) A copy from the original book or a certified copy or a non-certified copy submitted along with the original for verification of the business license of the supply organization (in the case of first-time registration) or a non-certified copy for subsequent registrations.

2. Within five working days from the date of receiving complete and valid files, the State Bank will issue a confirmation document regarding the registration of blank check models by the supply organization.

Article 11. Printing Blank Checks and Announcing Blank Check Models

1. After the blank check model is confirmed in writing by the State Bank, the supply organization proceeds with printing the blank checks. Before supplying blank checks to users, the supply organization must send the printed blank check model to the State Bank (Payment Department) for storage.

2. The supply organization may choose the printing location to sign a contract for printing blank checks based on its own responsibility to ensure technical factors and anti-counterfeiting factors of the blank checks supplied by itself.

3. The supply organization is responsible for informing relevant parties about its blank check model.

4. The supply organization is responsible for defining and agreeing with check users on the conditions and terms of using the checks supplied by itself:

a) Supplying the appropriate number of blank checks to customers based on ensuring suitability with the needs and reliability in payment of specific entities;

b) Establishing procedures and processes to ensure safety and define responsibilities of related parties in storing, preserving, circulating blank checks and checks during internal processing;

5. The supply organization is responsible for checking information about individuals requesting to be supplied with blank checks for the first time at the National Credit Information Center before deciding to supply blank checks to them.

6. The supply organization must promptly and fully report debits and credits to customers who open settlement accounts at their unit according to the agreed method and timing between the supply organization and the customer, in compliance with the law.

8. The supply organization must implement customer identification measures; monitor, detect, and report large-value transactions, electronic fund transfers, and suspicious transactions to competent state agencies in accordance with laws on anti-money laundering and other relevant laws.

Article 12. Procedures for Supplying Blank Cheques

1. When there is a need to use cheques, the account holder or the person authorized by the account holder shall submit a request form for supplying blank cheques to the cheque supplier organization.

2. Upon receiving the request form for supplying blank cheques, the cheque supplier organization shall be responsible for checking the conditions of the person requesting the supply of blank cheques.

3. Prior to supplying blank cheques to customers, the cheque supplier organization must be responsible for printing, stamping, or pre-writing the contents of the following elements: cheque number, name of the payee, name of the cheque drawer; these elements on the MICR band (if applicable). In cases where the cheque supplier organization has specific regulations regarding the payment location, the payment location must be printed, stamped, or pre-written on the blank cheque template.

4. The cheque supplier organization must monitor the name, address, and settlement account number of the person supplied with blank cheques, the quantity and serial numbers (series number, cheque number) of the supplied cheques.

Article 13. Responsibilities of the Person Supplied with Blank Cheques

1. The person supplied with blank cheques must count the number of cheques and verify the accuracy of the elements on the supplied blank cheque. If there are errors, they must immediately report to the cheque supplier organization to exchange for another cheque.

2. After receiving blank cheques from the cheque supplier organization, if errors occur or the cheques are misused, the person supplied with blank cheques shall bear full responsibility for any resulting damages.

Chapter IV

TRANSFER AND COLLECTION OF CHEQUES

Article 14. Transfer of Cheques

1. A cheque that has been endorsed for transfer shall have the continuity of the endorsement chain reflected as follows: in the first endorsement transaction of the cheque, the endorser's name must be the name of the beneficiary recorded on the front of the cheque; in the second endorsement transaction of the cheque, the endorser's name must be the name of the person who was endorsed in the first endorsement transaction; and so forth until the final endorsement transaction.

2. The beneficiary of a cheque that has been endorsed for transfer is the last person endorsed in the continuous endorsement chain as stipulated in Clause 1 of this Article.

3. The drawee, when settling a transferred cheque through endorsement, has the responsibility to check the continuity of the endorsement chain to ensure that the amount on the cheque is paid to the correct beneficiary.

Article 15. Collection of Cheques

1. To be settled for the amount recorded on the cheque, the beneficiary may endorse the cheque over to a collecting agent by endorsement according to a written agreement between both parties to collect the amount. The collecting agent has the right to decide whether to pay immediately to the endorser for collection or to pay after receiving the settlement result of the cheque from the drawee, based on their own responsibility for the cheque's payment capability and the ability to recover the amount recorded on the cheque in case of non-payment.

2. In cases where it is not possible to present directly at the designated payment location, the collecting agent has the right to transfer the cheque to another collecting agent with whom they have an agency relationship according to an agreement between both parties for that agent to present the cheque.

Chapter V

GUARANTEED CHEQUE PAYMENT

Article 16. Guaranteeing a Check

1. Conditions for Guaranteeing a Check

To implement check guaranteeing, the drawer must have sufficient funds in their settlement account to ensure the ability to pay the amount stated on the check, or if there are insufficient funds in the settlement account but the drawee agrees to allow the drawer overdraft up to a certain limit to ensure the ability to pay the amount stated on the check, the drawer may request the drawee to guarantee the check.

2. Procedures for Guaranteeing a Check

a) In case of check guarantee using a deposit

The drawer establishes and submits to the drawee a check that has been fully completed with all necessary elements, including signatures and seals (if applicable) on the front of the check along with a payment authorization (the amount of the payment authorization is determined by the drawee but must be sufficient to record the transaction and retain records). The drawee controls, compares, and checks if the conditions set out in Clause 1 of this Article are met, then signs, stamps the drawee's seal, and adds the phrase "Guarantee" on the front of the check, and processes the payment authorization forms as follows:

- One copy of the payment authorization serves as a debit entry for the drawer's settlement account, simultaneously recording a credit entry to the deposit account to ensure the payment of the drawer's check.

- One copy of the payment authorization serves as a notice of debit given to the drawer of the check;

b) In case of check guarantee by temporarily locking the amount in the settlement account

The drawer establishes and submits to the drawee a check that has been fully completed with all necessary elements, including signatures and seals (if applicable) on the front of the check. The drawee controls, compares, and checks if the conditions set out in Clause 1 of this Article are met, then temporarily locks the amount in the drawer's settlement account according to the written agreement between the drawer and the drawee, the locked amount being equal to the amount ensuring the payment of the check, and signs, stamps the drawee's seal, and adds the phrase "Guarantee" on the front of the check.

3. Once the check has been guaranteed, the drawee is responsible for ensuring the ability to pay the amount stated on the check until the presentation period of the check expires.

4. After the presentation period has expired and the check has not yet been presented for payment, the drawer has the right to request the drawee to terminate the temporary lock on the amount in the settlement account; terminate the use of the deposit account to ensure the payment of the check used to secure the payment of the check; the order to terminate the temporary lock, terminate the use of the deposit account to ensure the payment of the drawer is also an order to suspend the payment of the check.

Article 17. Guaranteeing a Check

1. To guarantee a check, the guarantor writes the phrase "guarantee," the amount of the guarantee, the name, address, signature of the guarantor, and the name of the beneficiary on the front of the check or on an attached document.

2. If the guarantee does not specify the name of the beneficiary, the guarantee is considered to be for the drawer.

Article 18. Rights and Obligations of the Guarantor

1. The guarantor only has the right to revoke the guarantee in the event that the check lacks the mandatory contents prescribed in Article 6 of this Circular.

2. The guarantor has the obligation to pay the check for the guaranteed amount if the beneficiary fails to perform or performs incompletely their payment obligations when the check becomes due.

3. After fulfilling the guarantee obligation, the guarantor may accept the rights of the beneficiary against related parties, handle the collateral of the beneficiary, and has the right to request the beneficiary, the drawer, and the joint acceptor to fulfill the payment obligation for the amount of the guarantee already paid.

4. The guarantee of checks by banks shall be carried out in accordance with the provisions of this Circular and other relevant laws.

Chapter VI

PRESENTATION AND PAYMENT OF CHECKS

Article 19. Presenting a Cheque

A cheque presented shall be a paper cheque (in the case of processing payments through negotiable instruments) or electronic data of the cheque (in the case of processing payments electronically) transferred to the presentation location specified in Article 20 of this Circular.

1. The period for presenting a payment request for a cheque is thirty days from the date of issuance (excluding the time during which force majeure or objective obstacles occur).

2. If a cheque is presented for payment after the presentation period but not more than six months from the date of issuance, the payee may still make payment if the payee has not received a notice of stop payment from the issuer and the issuer has sufficient funds in their settlement account to cover the payment.

3. The beneficiary may present a cheque for payment through a public postal service guarantee letter. The determination of the cheque presentation date for payment shall be based on the postmark date of the sending location.

Article 20. Presentation Location

The beneficiary or collecting agent shall present cheques at the following locations:

1. The payment location recorded on the cheque.

2. Any business location of the payee if the cheque does not specify a payment location.

3. In the case where the presenter of the cheque is a service provider organization, in addition to the aforementioned presentation locations, such organization may present the cheque at the Cheque Clearing Center if it is a direct member of the Cheque Clearing Center.

Article 21. Payment of Cheque at Payee

When a cheque is presented for payment within the prescribed presentation period and location under Articles 19 and 20 of this Circular, and the issuer has the ability to pay the amount stated on the cheque, the payee shall verify the legality and validity of the cheque and be responsible for paying the beneficiary or the person authorized by the beneficiary immediately upon presentation or on the next working day following the presentation date. The payee shall process the cheque as follows:

1. The payee shall carry out the receipt and verification of the cheque as follows:

a) Upon receiving the deposit slip and the cheque submitted by the beneficiary or collecting agent, the payee must check the elements on the cheque to ensure its legality and validity.

If errors are found in the deposit slip, the payee must return the cheque to the depositor and request them to prepare a new deposit slip that matches the valid cheques; if there are no errors, the payee shall sign to confirm the receipt of the cheque according to the request of the beneficiary or collecting agent.

The person receiving cash must clearly write their name, ID number, passport number with validity, or other valid identification number in the section designated for cash collection on the back of the cheque.

c) In cases where the regulations on cheque control are violated, causing abuse or loss of assets, the violator shall bear responsibility for compensation.

2. If the balance in the settlement account of the cheque issuer, or the balance plus the overdraft limit in the settlement account of the cheque issuer (in the case where the issuer is allowed overdraft), is sufficient to cover the full amount stated on the cheque, the payee shall handle as follows:

a) The cheques shall serve as debit entries in the settlement account of the issuer, or in the deposit account to secure cheque payment.

b) The deposit slips shall serve as credit entries in the appropriate accounts such as: the settlement account of the beneficiary (if the beneficiary has an account with the payee); cash (if the beneficiary receives cash); clearing payment, central bank deposit (if clearing payment or payment through the central bank is involved); the account of the collecting agent (if payment is made under agency agreement)... At the same time, appropriate payment vouchers shall be prepared to transfer for clearing (if the collecting agent participates in clearing) or prepare a transfer voucher to credit the beneficiary's account.

c) The payment procedures and document circulation in the case where both the issuer and the beneficiary have settlement accounts at the same branch of a bank, or two branches belonging to the same banking system, and such organization has an online payment system established and guided by the General Director (Director) of the unit or organization in accordance with the provisions of this Circular.

Article 22. Handling of Cheques Not Sufficient for Payment

1. A cheque presented within the payment period, but the amount that the drawer has available to cover the cheque at the drawee is insufficient to pay the full amount stated on the cheque, shall be considered as issuing a cheque not sufficient for payment. Cheques not sufficient for payment shall be handled as follows:

a) The drawee shall notify the drawer of the insufficiency of the cheque and shall have the responsibility to retain information about the drawer of the cheque not sufficient for payment in their own records. Such notification may be made by telephone, telegraph, or other appropriate means of communication.

At the same time, the drawee shall notify the presenter of the cheque (including the beneficiary or collecting agent) on the presentation date or the next working day after the presentation date of the cheque by the agreed method of communication between both parties.

Within five working days from the date of notifying the drawer of the cheque about its insufficiency, the drawee shall notify the National Credit Information Center of Vietnam of the information regarding the cheque not sufficient for payment according to Appendix 07 attached to this Circular. The National Credit Information Center shall have the responsibility to provide search services for the received information on cheques not sufficient for payment to cheque issuers immediately upon receipt of the request or on the next working day thereafter.

b) The beneficiary has the right to request or through the collecting agent to request the drawee to proceed with one of the following methods:

- Issue a refusal to pay certificate for the entire amount recorded on the cheque and return the cheque to themselves.

- Pay part of the amount recorded on the cheque up to the amount the drawer has available at the drawee and issue a refusal to pay certificate for the remaining unpaid amount on the cheque (In this case, the beneficiary shall issue a Collection Order according to the model in Appendix 03 attached to this Circular).

c) Upon receiving a Collection Order requesting partial payment of the amount recorded on the cheque from the beneficiary, the drawee shall process as follows:

- Debit the drawer's settlement account and credit an appropriate account (the beneficiary's settlement account; cash; clearing account; deposit account at the State Bank; the collecting agent's account...).

- Prepare a clearing payment voucher (if the collecting agent participates in clearing) or prepare a transfer voucher for the collecting agent to credit the beneficiary's account simultaneously:

+ Issue a refusal to pay certificate according to Appendices 05 and 06 attached to this Circular for the unpaid amount of the cheque and write the phrase "paid... (amount)..., refused... (amount)..., payment date..." on the front of the cheque, deliver the refusal to pay certificate along with the cheque and other payment vouchers to the beneficiary or collecting agent; deliver the refusal to pay certificate to the drawer.

+ Issue a notice of the cheque being refused payment, send it to the drawer to request them to fulfill their obligation to pay the refused amount of the cheque, accompanied by a warning of the consequences if they fail to fulfill their obligation to pay the refused amount.

The drawee must monitor partially paid cheques. Information related to the drawer of the cheque not sufficient for payment must be processed according to Clause 2 of this Article.

- When partially paying the amount recorded on the cheque, the drawee shall require the beneficiary (in the case of paying into the beneficiary's settlement account opened at the drawee or paying in cash) or the collecting agent (in the case of paying through the collecting agent) to make a receipt according to the model in Appendix 04 attached to this Circular to keep the record.

2. In cases where multiple cheques are submitted at the same time to claim money from one drawer and the drawer's ability to pay is insufficient to cover all cheques, the order of cheque payments shall be determined based on the issuance date and the sequence number of the issued cheques, the cheque with the earlier issuance date will be paid first, and if the cheques have the same issuance date, the cheque with the lower sequence number will be paid first.

Article 23. Collection of Cheques through Collecting Agents

1. The collecting agent has the right to stipulate service fees for collecting cheques from the beneficiary. In cases where the cheque is dishonored not due to the fault of the collecting agent, the collecting agent is not obligated to refund the collection fee to the beneficiary.

2. In cases where the cheque is dishonored due to the fault of the collecting agent, the collecting agent must bear responsibility for compensating the beneficiary according to the agreement between both parties. If no agreement can be reached, it shall be handled in accordance with the provisions of the law.

3. Procedures for delivering, receiving, and inspecting cheques at the collecting agent are as follows:

a) Based on the cheques, the beneficiary prepares a deposit slip for cheques according to Appendix 02 attached to this Circular. The number of copies of the deposit slip for cheques is determined by the drawer but must ensure sufficient funds for accounting, payment, and storage. The deposit slip for cheques is prepared separately for each drawer along with the cheques handed over to the collecting agent. All elements specified on the deposit slip for cheques must be fully and clearly recorded without alteration or erasure.

b) Upon receipt of the deposit slips for cheques together with the submitted cheques, the collecting agent must check the elements displayed on the cheque to ensure its legality and validity.

c) When discovering errors in the deposit slip for cheques or if the cheques do not meet all conditions, the collecting agent must return the cheques to the depositor and request the preparation of a new deposit slip for cheques that corresponds to the cheques meeting the conditions.

d) If there are no errors, the collecting agent signs to confirm the receipt of the collection as requested by the beneficiary and sends the cheques and deposit slip for cheques to the presentation location at the agreed time and manner with the beneficiary and in compliance with current regulations of the drawer.

4. Accounting procedures at the collecting agent for cheques:

a) In case of full payment of the amount stated on the cheque

Upon receipt of the payment voucher for the cheque sent by the drawer, the collecting agent uses these vouchers to record:

- Debit the appropriate account (settlement offset, deposit account at the State Bank, drawer's deposit...) and credit the beneficiary's settlement account.

- Send a credit notification to the beneficiary;

b) In case of partial payment of the cheque as notified by the drawer

Based on the amount already paid, the collecting agent uses the partial payment vouchers for the cheque sent by the drawer to record:

- Debit the appropriate account (settlement offset, settlement account at the State Bank, drawer's settlement account...) and credit the appropriate account (pending settlement account...).

The beneficiary or the collecting agent (acting as the beneficiary's authorized representative) must prepare a receipt according to Appendix 04 attached to this Circular to hand over to the drawer.

When the collecting agent receives the receipt from the beneficiary, based on the receipt, the collecting agent proceeds to prepare a transfer voucher, recording:

- Debit the pending settlement accounts (opening detailed accounts for each cheque beneficiary) and credit the appropriate account (beneficiary's settlement account; cash).

- Send one copy of the receipt to the drawer;

c) In case five working days have passed since the collecting agent sent the credit notification regarding the partial payment of the amount stated on the cheque, and the collecting agent does not receive the receipt from the beneficiary, then the collecting agent must return the partially paid amount of the cheque to the drawer, recording:

Debit the pending settlement accounts (opening detailed accounts for each cheque beneficiary) and credit the appropriate account (settlement offset, settlement account at the State Bank, drawer's deposit...).

Article 24. Organizations supplying cheques

1. Organizations supplying cheques shall be responsible for issuing internal regulations guiding the supply of cheques, cheque payment, and suspension of cheque payment at their organization in accordance with the provisions of this Circular.

2. Organizations supplying cheques have the right to negotiate with other organizations supplying cheques within the same locality or in different provinces/cities regarding the organization of cheque payments for customers of both parties, procedures, authorities, and responsibilities of the relevant parties based on self-responsibility for ensuring safety during cheque payments, while informing and disseminating to their customers to comply.

3. Cheque payments through the Cheque Clearing Center shall be carried out as follows:

a) For Cheque Clearing Centers of the State Bank, cheque payments through the Cheque Clearing Center shall follow the settlement process prescribed by the State Bank;

b) For Cheque Clearing Centers that are other organizations licensed by the State Bank to operate, cheque settlements shall be conducted according to agreements between such organizations and their members.

Article 25. Penalty interest rate

The penalty interest rate for late cheque payment as stipulated in Clause 2, Article 71 of the Law on Transferable Instruments shall be 150% of the interest rate of non-fixed-term deposits published by the cheque-supplying organization at the time of cheque payment.

Chapter VII

HANDLING OF LOST AND DAMAGED CHEQUES

Article 26. Lost cheques

1. In case of lost cheques, the following measures shall be taken:

a) If the drawer loses the blank cheque, the person losing the cheque must immediately notify the payee in writing or by other agreed methods;

b) If the person losing the cheque is the beneficiary, the person losing the cheque must immediately notify the loss of the cheque in writing or by other agreed methods to the payee; simultaneously, directly or through previous cheque transferees, notify the drawer to request the drawer to issue a stop-payment notice for the lost cheque to the payee.

2. After issuing a lost cheque notification, if the lost cheque has not been presented for payment, the person who lost the cheque has the right to request the drawer to reissue a cheque with the same content as the lost cheque, and the drawer has the obligation to fulfill this request.

3. Upon receiving a notification about the loss of a cheque, the payee must immediately verify information about the lost cheque and monitor the lost cheque.

The payee shall not make payment on a reported lost cheque. When a reported lost cheque is presented for payment, the payee shall be responsible for retaining the cheque and notifying the person who reported the lost cheque to resolve the matter.

4. The payee shall not be liable for damages caused by the misuse of a lost cheque if, before receiving the lost cheque notification, the cheque was presented and paid in accordance with the law.

If the payee makes payment on a reported lost cheque, the payee shall be responsible for compensating the beneficiary for the damage.

5. The payee shall be responsible for retaining information about reported lost cheques and reporting in writing to the National Credit Information Center.

Article 27. Damage to cheques

1. When a cheque is damaged, the beneficiary has the right to request the drawer to issue a new cheque with the same content to replace it.

2. The drawer of a cheque shall be obliged to reissue the cheque after receiving the damaged cheque if the damaged cheque still contains sufficient information or evidence to determine that the holder of the damaged cheque is the lawful beneficiary of the damaged cheque.

Chapter VIII

IMPLEMENTING PROVISIONS

Article 28. Effective Date

1. This Circular takes effect from January 12, 2016.

2. Decision No. 30/2006/QD-NHNN dated July 11, 2006 of the State Bank of Vietnam promulgating the Regulations on the supply and use of cheques; Point 2 of Circular No. 23/2011/TT-NHNN dated August 31, 2011 on the plan to simplify administrative procedures in payment activities and other fields according to the Government's Resolution on simplifying administrative procedures within the scope of management functions of the State Bank of Vietnam shall cease to be effective from the date this Circular takes effect.

Article 29. Implementation Organization

The Director of the Office, the Head of the Payment Department, the Heads of relevant units under the State Bank of Vietnam, the Governors of the State Bank of Vietnam branches in provinces and centrally governed cities, the Chairmen of the Management Boards, the Chairmen of the Member Councils, the General Directors (Directors) of commercial banks, foreign bank branches, policy banks, cooperative banks, people's credit funds, microfinance organizations are responsible for implementing this Circular./.