Circular No. 23/2024/TT-NHNN Amends and supplements certain provisions of Circular No. 10/2016/TT-NHNN dated June 29, 2016, issued by the Governor of the State Bank of Vietnam guiding certain contents stipulated in Decree No. 135/2015/NĐ-CP dated December 31, 2015 of the Government on indirect foreign investment.

CIRCULAR

Amending and supplementing certain Articles of Circular No. 10/2016/TT-NHNN dated June 29, 2016, issued by the Governor of the State Bank of Vietnam guiding certain contents stipulated in Decree No. 135/2015/NĐ-CP dated December 31, 2015, of the Governmenton indirect investment abroad

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Pursuant to the Law on the State Bank of Vietnam dated June 16, 2010;

Pursuant to the Law on Information Technology dated June 29, 2006The commercial banks on January 18, 2024;

Pursuant to the Investment Law No. 61/2020/QH14 dated June 17, 2020;

Pursuant to the Foreign Exchange Decree dated December 13, 2005; The Decree Amending and Supplementing Certain Provisions of the Foreign Exchange Decree dated March 18, 2013;

Pursuant to Decree No. 70/2014/NĐ-CP dated July 17, 2014, of the Government detailing and guiding the implementation of certain provisions of the Foreign Exchange Regulation and the Ordinance amending and supplementing certain provisions of the Foreign Exchange Regulation;

Pursuant to Decree No. 135/2015/NĐ-CP dated December 31, 2015, of the Government on indirect investment abroad;

Pursuant to Decree No. 102/2022/NĐ-CP dated December 12, 2022 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

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

The Governor of the State Bank of Vietnam issues this Circular amending and supplementing certain Articles of Circular No. 10/2016/TT-NHNN dated June 29, 2016 guiding certain contents stipulated in Decree No. 135/2015/NĐ-CP dated December 31, 2015, of the Government on indirect investment abroad.

Article 1. Amending and supplementing certain Points, Clauses, and Articles of Circular No. 10/2016/TT-NHNN

"2. Documents and materials confirming care, upbringing, and assistance include one of the following documents: confirmation by the People's Committee of the commune on care and upbringing; decision to accept by the head of a social welfare facility; decision to support by the People's Committee of the commune or other documents and materials as prescribed by law."

a) Amend and supplement Clause 2 as follows:

"2. A foreign organization with a stock option program issued abroad is an entity established under the laws of a foreign country (hereinafter referred to as a foreign organization)."

b) Amend and supplement Clause 3 as follows:

"3. An organization implementing a stock option program issued abroad (hereinafter referred to as an organization implementing a stock option program) is an entity established and operating in Vietnam, including:

a) The presence of a foreign organization in Vietnam in the following forms: A foreign-invested economic organization; Branch; Representative office; Management office of a foreign investor in a joint venture contract;"

b) An economic organization having relations with a foreign organization through ownership of shares, capital contribution, or other forms as prescribed by Vietnamese law."

2. Amend and supplement Article 8 as follows:

"Article 8. Principles for Implementing a Stock Option Program Issued Abroad

The implementation of a stock option program issued abroad must ensure the following principles:

1. A stock option program issued abroad with Vietnamese citizens as participants can only be implemented through an organization implementing a stock option program.

2. Foreign currency obtained from dividends and other lawful income related to a stock option program issued abroad must be transferred to Vietnamese citizens through the account specified in Article 12 of this Circular.

3. Compliance with regulations on foreign exchange management, tax obligations, and other relevant provisions of Vietnamese law."

3. Amend and supplement Article 9 as follows:

"Article 10. Forms of Awards

1. Direct award in the form of stocks.

2. Other forms of awards in stocks abroad that do not generate outflows of foreign currency."

4. Amend and supplement Article 10 as follows:

"Article 11. Rights of Vietnamese Citizens

1. To participate in a stock option program issued abroad according to the terms and conditions set by the foreign organization and not contrary to Vietnamese law.

2. To receive foreign currency obtained from dividends and other lawful income related to a stock option program issued abroad. The receipt of foreign currency obtained from dividends and other lawful income related to a stock option program issued abroad must be carried out in accordance with Clause 2 of Article 8 of this Circular."

5. Amend and supplement Article 12 as follows:

"Article 12. Opening and using accounts to implement the program

1. The organization implementing the stock option reward program must open one account to implement the program for conducting transactions of income and expenditure as prescribed in Clauses 2 and 3 of this Article.

2. Income transactions: Receiving dividends and other lawful incomes related to the stock option reward program issued abroad.

3. Expenditure transactions:

a) Paying foreign currency to authorized credit institutions to transfer to the VND accounts of Vietnamese employees participating in the stock option reward program issued abroad;

b) Transferring funds to the foreign currency accounts of Vietnamese employees participating in the stock option reward program issued abroad;

c) Other lawful expenditures related to the stock option reward program issued abroad."

6. Amend and supplement Point c Clause 1 Article 13 and Point c Clause 1 Article 15 as follows:

"c) A copy of the notification confirming the fulfillment of tax obligations at the most recent time according to the current laws on taxation;"

7. Amend and supplement Point b Clause 2 Article 22 as follows:

"b) The State Bank shall issue a confirmation letter based on the form attached as Appendix 17 accompanying this Circular or refuse to confirm the registration limit for proprietary trading no later than May 15th each year. In case of refusal, the State Bank shall issue a letter specifying the reasons."

"2. Within five working days from the date of receiving the application for temporary proprietary trading limit, based on the situation of indirect investment abroad in the previous year, the safe investment ratio of the proprietary trading organization, the State Bank shall issue a confirmation letter based on the form attached as Appendix 18 accompanying this Circular or refuse to confirm the temporary registration of the proprietary trading limit for the proprietary trading organization. In case of refusal, the State Bank shall issue a letter specifying the reasons."

9. Amend and supplement Point b Clause 2 Article 24 as follows:

"b) The State Bank shall issue a confirmation letter based on the form attached as Appendix 19 accompanying this Circular or refuse to confirm the registration no later than May 15th each year. In case of refusal, the State Bank shall issue a letter specifying the reasons."

"2. Within five working days from the date of receiving the application for temporary entrusted investment limit, based on the situation of entrusted indirect investment abroad in the previous year of the entrusted organization, the State Bank shall issue a confirmation letter based on the form attached as Appendix 20 accompanying this Circular or refuse to confirm the temporary registration of the entrusted investment limit. In case of refusal, the State Bank shall issue a letter specifying the reasons."

11. Amend and supplement Clause 2 Article 26 as follows:

"2. Verify and retain all documents and vouchers related to income and expenditure transactions conducted on proprietary trading accounts, entrusted accounts, and program implementation accounts presented by customers to ensure that foreign exchange services are provided in accordance with their intended purpose and comply with the provisions of the law.

Authorized credit institutions may only conduct income and expenditure transactions through the program implementation account based on:

a) Checking and comparing information and documents related to the stock option reward program and the participation of Vietnamese employees in the stock option reward program provided by the organization implementing the stock option reward program in accordance with Point b Clause 2 Article 28 of this Circular;

b) Requesting the organization implementing the stock option reward program to provide evidence proving that the organization implements the stock option reward program complies with electronic reporting to the State Bank as prescribed in this Circular (a screenshot of the report sent to the State Bank's email for the most recent reporting period) before providing foreign exchange services to the organization implementing the stock option reward program (except for the first time the stock option reward program is implemented in Vietnam)."

12. Amend and supplement Point b Clause 2 and add Clause 4 Article 28 as follows:

a) Amending and supplementing point b Clause 2 as follows:

"b) Present and supplement documents, files, and vouchers as required by the authorized credit institution where the organization implementing the stock option reward program opens the program implementation account related to the participation of Vietnamese employees in the stock option reward program including: documents showing the relationship between the foreign organization and the organization implementing the stock option reward program; documents describing the stock option reward program including key contents about the form and timing of rewards; list of Vietnamese employees eligible to participate in the stock option reward program and other relevant documents (if any)."

b) Supplement Clause 4 as follows:

"4. In case the organization implementing the stock option reward program ceases operations or dissolves, before ceasing operations or dissolution and before closing the program implementation account opened in accordance with Article 12 of this Circular, the organization implementing the stock option reward program must settle the rights related to the stock option reward program issued abroad for Vietnamese employees and transfer the entire amount received to Vietnamese employees participating in the stock option reward program issued abroad through the program implementation account."

13. Add Clause 5 Article 29 as follows:

"5. Take the lead and coordinate with relevant units of the State Bank to handle issues related to indirect investment abroad within the scope of this Circular."

14. Amend and supplement Article 35 as follows:

"Article 35. Reporting regime for organizations implementing stock option programs

Monthly, no later than the 12th day of the month following the reporting month, the organization implementing the stock option program shall report to the State Bank of Vietnam on the implementation of the stock option program issued abroad for Vietnamese citizens according to Model 16 attached to this Circular. The data cut-off date for the report is from the 1st to the last day of the reporting month. The report shall be sent electronically to the email address [email protected] of the State Bank of Vietnam and submitted in writing to the State Bank of Vietnam.

Article 2. Supplementing, replacing, and abolishing certain articles and appendices of Circular No. 10/2016/TT-NHNN

1. Abolish Article 11.

2. Abolish, replace, and supplement certain appendices as follows:

a) Abolish Appendix 02;

b) Replace Appendix 16 with Appendix 16 promulgated together with this Circular;

This Circular takes effect from December 25, 2025/.

The Director of the Office, Heads of the Department of Foreign Exchange Management, Heads of units under the State Bank of Vietnam, credit institutions, foreign bank branches, and related organizations and individuals are responsible for organizing the implementation of this Circular.

Article 4. Implementation provisions

1. This Circular takes effect from August 12, 2024.

2. One year after the effective date of this Circular, stock option programs with the form of stock purchase rights with preferential conditions that have been registered and confirmed by the State Bank of Vietnam before the effective date of this Circular may only be implemented in other forms of stock awards abroad that do not generate outward capital flows.