Decision No. 24/2008/QD-NHNN Issuing the Regulation on the Collection and Exchange of Banknotes Not Fit for Circulation

Pursuant to …;

Issuing regulations on the collection and exchange of money not meeting circulation standards

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GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to the Law on the State Bank of Vietnam 1997 and the Law Amending and Supplementing Certain Provisions of the Law on the State Bank of Vietnam 2003;

Pursuant to Decree No. 52/2003/NĐ-CP dated May 19, 2003 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

Pursuant to Decree No. 87/1998/NĐ-CP dated October 31, 1998 of the Government on the issuance, recall, and replacement of banknotes and coins;

At the proposal of the Director of the Issuance and Treasury Department,

Pursuant to …;

Article 1. This Decision promulgates the regulations on the collection and exchange of money not meeting circulation standards.

Article 2. This Decision shall take effect 15 days from the date of publication in the Official Gazette and shall replace Decision No. 1722/2004/QĐ-NHNN dated December 31, 2004 of the Governor of the State Bank of Vietnam promulgating the regulations on the recall and exchange of money not meeting circulation standards.

Article 3. The Heads of the Office, the Director of the Issue and Treasury Department, the Heads of relevant units under the State Bank of Vietnam, the Directors of the State Bank Branches, the General Directors (Directors) of credit organizations, and the National Treasury are responsible for implementing this Decision.

REGULATIONS

COLLECTION AND EXCHANGE OF MONEY NOT MEETING CIRCULATION STANDARDS

(Issued together with Decision No. 24/2008/QĐ-NHNN dated August 22, 2008

of the Governor of the State Bank of Vietnam)

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Chapter 1.

GENERAL PROVISIONS

Article 1. Scope of Regulation

These regulations specify the procedures for collecting and exchanging money not meeting circulation standards by the State Bank of Vietnam, credit organizations, and the National Treasury.

Article 2. Money Not Meeting Circulation Standards

Clause 1. Money not meeting circulation standards refers to banknotes (cotton and polymer) and coins issued by the State Bank of Vietnam that are currently legally circulating but are torn, damaged, or deteriorated, classified according to criteria established by the State Bank of Vietnam.

Clause 2. The State Bank of Vietnam publicly announces the criteria for money not meeting circulation standards as the basis for selecting and exchanging such money.

Article 3. Responsibilities for Collecting and Exchanging Money Not Meeting Circulation Standards

The State Bank branches at provincial and municipal levels (hereinafter referred to collectively as State Bank branches), the State Bank Trading Departments, credit organizations, and the National Treasury (hereinafter referred to collectively as exchange units) are responsible for collecting and exchanging money not meeting circulation standards for organizations and individuals and must publicly post information about the exchange of such money at designated locations as specified by the State Bank of Vietnam.

Chapter 2.

MONEY NOT MEETING CIRCULATION STANDARDS

Article 4. Classification of Money Not Meeting Circulation Standards

Clause 1. Money torn, damaged during circulation

Point a. Banknotes that have changed color, faded images, letters, or numbers; wrinkled, torn, blurred, dirty, old; torn into pieces or patched together, missing corners (each side of the note not exceeding 10mm).

Point b. Coins that are worn, partially or completely damaged in terms of images, patterns, letters, or numbers and the plating layer on the coin.

Clause 2. Money torn, damaged during storage

Point a. Banknotes stained, perforated, torn, burned, or deformed due to high heat exposure; printed paper, colors, and security features altered by chemicals (such as cleaning agents, acids, corrosive substances...); written, drawn, erased; the note is decayed or deformed for reasons other than deliberate destruction.

Point b. Coins bent, warped, changed shape, or design due to external force or high temperature; corroded by contact with metal-corrosive chemicals.

Clause 3. Technical defects caused by printing or minting errors by the manufacturer, such as folded paper causing loss of image or ink color, ink stains, and other printing or minting errors.

Chapter 3.

COLLECTION AND EXCHANGE OF MONEY NOT MEETING CIRCULATION STANDARDS

Article 5. Selection of banknotes not meeting circulation standards

During the process of receiving and paying cash to organizations and individuals (hereinafter referred to collectively as customers), exchange units must select and collect money not meeting circulation standards according to Clause 1, Article 4 of these regulations.

During the counting and transfer of cash between exchange units, State Bank branches, and State Bank Trading Departments, if money torn, damaged during storage is found mixed in bundles of money meeting circulation standards, they shall charge fees as stipulated in Article 8 of these regulations and report the fee for exchanging money not meeting circulation standards to the unit named on the seal.

Article 6. Exchange of banknotes not meeting circulation standards

Point 1. For money not meeting circulation standards as defined in Clause 1 and Clause 3, Article 4 of these regulations, exchange units must immediately exchange for customers without limiting quantity, requiring documentation, or charging fees.

Point 2. For money not meeting circulation standards as defined in Clause 2, Article 4 of these regulations, customers submit the items to exchange units. Exchange units accept and consider exchanging based on the following conditions:

- Money torn, damaged not due to deliberate destruction;

- In cases where a note is burned or torn with a part missing, the remaining area must be equal to or larger than 60% of the original note's area; if two or three pieces of a single original note are patched together, the remaining area must be larger than 90% of the original note's area while maintaining the layout and recognizable security features;

- For polymer notes burned or shrunk due to high heat exposure, the remaining area must be at least 30% of the original note's area, maintaining the layout and recognizable at least two of the following security features: hidden image in a small window: invisible ink that glows; glow of two serial number rows; portrait of President Ho Chi Minh.

Based on the exchange conditions stipulated in Clause 2 of this Article, exchange units will exchange for customers and charge fees for exchanging money not meeting circulation standards as stipulated in Article 8 of these regulations. If the conditions are not met, exchange units will return the money to the customer and inform them of the reason for non-exchange.

In cases where it is uncertain whether the notes meet the exchange conditions and require appraisal, customers must provide a request for exchange (according to Form No. 01 attached).

Article 7. Appraisal of banknotes not meeting circulation standards

1. In cases where it is not determined whether money meets the conditions for exchange, within three working days from the date of receiving the item from the customer, the credit organization or the State Treasury shall transfer the item along with the request for appraisal (in accordance with Form No. 02 attached) to the State Bank branch in the locality for appraisal. The State Bank Trading Department shall transfer the item along with the request for appraisal to the Currency Issuance and Treasury Department.

2. Within three working days from the date of receipt of the appraisal request from the collection unit, the State Bank branch shall notify the result of the appraisal in writing and return the item to the requesting unit. If the appraisal cannot be conducted, within ten working days from the date of receipt of the item and the appraisal request from the collection unit or the money exchange request from the customer, the State Bank branch shall transfer the item along with the appraisal request to the Currency Issuance and Treasury Department or the Currency Issuance and Treasury Sub-department in Ho Chi Minh City for appraisal.

3. Within five working days from the date of receipt of the appraisal request from the State Bank branch, the State Bank Trading Department, the Currency Issuance and Treasury Department, or the Currency Issuance and Treasury Sub-department in Ho Chi Minh City shall notify the result of the appraisal in writing and simultaneously return the item to the requesting unit.

4. The requesting unit shall decide on the method of transporting non-standard circulating money and bear responsibility for ensuring safety during transportation.

Article 8. Fees for exchanging non-standard circulating money

1. The fee for exchanging non-standard circulating money as stipulated in Clause 2, Article 6 of this Regulation is 4% of the total value of non-standard circulating money exchanged, but the minimum fee for one transaction is 2,000 VND.

2. The exchange fee for non-standard circulating money includes value-added tax and is recorded as income of the collection unit.

Article 9. Handling damaged money suspected of being destroyed by criminal acts

Upon discovering money that is deformed or damaged and does not meet the standard for circulation, suspected of being destroyed by criminal acts, the collection unit shall prepare a record, temporarily seize the item, and immediately transfer it to the police agency in the locality for investigation and appraisal. The conclusion of the police agency serves as the basis for the collection unit to proceed with exchanging for the customer or handling the item according to the law.

Chapter 4.

PACKAGING AND HANDLING OF NON-STANDARD CIRCULATING MONEY

Article 10. Packaging of non-standard circulating money

1. After collecting non-standard circulating money, the collection unit shall count, store, and submit to the State Bank Trading Department or the State Bank branch in the locality in accordance with the current regulations of the State Bank of Vietnam. The customer's money exchange request form shall be kept at the collection unit.

2. When receiving non-standard circulating money from the collection units, the State Bank branch or the State Bank Trading Department shall be responsible for checking if it meets the conditions for exchange as stipulated. If it meets the requirements, the State Bank branch or the State Bank Trading Department shall package the money in accordance with the current regulations on packaging and sealing cash of the State Bank of Vietnam.

In cases where deformed money cannot be bundled, the State Bank branch or the State Bank Trading Department shall package it according to the following method: 100 sheets of the same denomination into one small bag, 10 small bags into one large bag, 10 large bags into one bundle. The money bundle must be sealed and lead-sealed in accordance with current regulations.

3. The packaging of burned money or deformed money due to contact with high heat sources by the Central Treasury shall be carried out as stipulated in Clause 2 of this Article.

4. In cases where there is insufficient quantity to bundle (or package), the collection unit shall package and store separately for convenience in counting and handling.

Article 11. Handing over and receiving non-circulation-standard currency.

1. The handover and receipt of non-circulation-standard currency between exchange units and State Bank branch offices, State Bank trading departments shall be carried out periodically as prescribed by the Director of the State Bank branch office, the Director of the State Bank trading department.

2. The handover and receipt of non-circulation-standard currency between State Bank branch offices, State Bank trading departments and Central Treasury warehouses, and the State Bank branch office in the province of Bình Định shall be conducted in bundles of ten stacks, bags containing one thousand notes (or one thousand pieces) still sealed.

Chapter 5.

IMPLEMENTING PROVISIONS

Article 12. Handling Violations

Exchange units that violate the provisions of this Regulation shall be subject to disciplinary action, administrative penalties, compensation for damages, or criminal liability追究，具体措施依照法律规定执行。

Article 13. Implementation Organization

The Issuance and Treasury Department is responsible for guiding and supervising the implementation of this Regulation; the State Bank branch office shall inspect the handling of non-circulation-standard currency by exchange units within its jurisdiction.