Circular No. 34/2019/TT-NHNN guiding foreign exchange management for foreign currency capital of microfinance programs and projects of political organizations, socio-political organizations, and non-governmental organizations.

CIRCULAR

Guidelines on foreign exchange management for foreign currency capital

 of microfinance programs and projects of political organizations, political-social organizations, and non-governmental organizations

Political organizations, political-social organizations, and non-governmental organizations 

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

Pursuant to the Law on Credit Institutions dated June 16, 2010; The Law Amending and Supplementing Certain Provisions of the Law on Credit Institutions dated November 20, 2017;

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 the implementation of certain provisions of the Foreign Exchange Ordinance and the Ordinance Amending and Supplementing Certain Provisions of the Foreign Exchange Ordinance;

Pursuant to Government Decree No. 16/2017/NĐ-CP dated February 17, 2017 on the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

Pursuant to Decision No. 20/2017/QĐ-TTg dated June 12, 2017 of the Prime Minister on the operation of microfinance programs and projects of political organizations, political-social organizations, and non-governmental organizations;

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

The Governor of the State Bank of Vietnam issues this Circular guiding foreign exchange management for foreign currency capital of microfinance programs and projects of political organizations, political-social organizations, and non-governmental organizations.

Article 1. Scope of Regulation

This Circular guides foreign exchange management for foreign currency capital of microfinance programs and projects of political organizations, political-social organizations, and non-governmental organizations.

Article 2. Applicability

1. Political organizations, political-social organizations, and non-governmental organizations implement microfinance programs and projects.

2. Organizations and individuals related to the activity of raising funds in foreign currencies for microfinance programs and projects of political organizations, political-social organizations, and non-governmental organizations.

Article 3. General Principles

1. Political organizations, political-social organizations, and non-governmental organizations are only allowed to raise funds in foreign currencies in the form of receiving grants and non-refundable aid from organizations and individuals who are non-residents to implement microfinance programs and projects.

2. Political organizations, political-social organizations, and non-governmental organizations are responsible for complying with the regulations of specialized laws on receiving and using grant and non-refundable aid sources from organizations and individuals who are non-residents; regulations on foreign exchange management for foreign currency capital stipulated in this Circular and relevant laws when receiving and using grant and aid in foreign currencies to implement microfinance programs and projects.

3. Political organizations, political-social organizations, and non-governmental organizations are not allowed to raise funds in foreign currencies to implement microfinance programs and projects outside the forms prescribed in Clause 1 of this Article.

Article 4. Receiving grants and non-refundable aid in foreign currencies from organizations and individuals who are non-residents to implement microfinance programs and projects

Political organizations, political-social organizations, and non-governmental organizations use foreign currency settlement accounts or Vietnamese dong settlement accounts opened at commercial banks, branches of foreign banks operating foreign exchange business (hereinafter referred to as permitted banks) to receive transfers in foreign currencies from grants and non-refundable aid from organizations and individuals who are non-residents to implement microfinance programs and projects as follows:

1. In the case of receiving grants and non-refundable aid in foreign currencies through foreign currency settlement accounts, political organizations, political-social organizations, and non-governmental organizations shall comply with the regulations of the State Bank of Vietnam on opening and using foreign currency accounts of resident organizations.

The act of political organizations, political-social organizations, and non-governmental organizations selling foreign currencies on foreign currency settlement accounts to commercial banks, branches of foreign banks, and permitted non-bank financial institutions operating foreign exchange business (hereinafter referred to as permitted financial institutions) shall be carried out in accordance with the regulations of the law on buying and selling foreign currencies between permitted financial institutions and customers.

2. In the case of receiving grants and non-refundable aid in foreign currencies from organizations and individuals who are non-residents through Vietnamese dong settlement accounts, political organizations, political-social organizations, and non-governmental organizations sell foreign currencies to permitted banks.

Article 5. Obligation to present evidence

When receiving non-repayable foreign currency grants or aid from organizations or individuals who are non-residents, political organizations, political-social organizations, or non-governmental organizations, they shall be responsible for presenting documents and evidence proving that the funds are non-repayable grants or aid from organizations or individuals who are non-residents, and other documents as prescribed by authorized banks, and shall bear legal responsibility for the authenticity of the presented documents and evidence to authorized banks.

Article 6. Obligations of authorized credit institutions

When providing foreign exchange services to political organizations, political-social organizations, or non-governmental organizations (including receiving and repurchasing foreign currencies from non-repayable grants or aid from organizations or individuals who are non-residents), authorized credit institutions shall be responsible for examining, checking, and retaining documents and evidence consistent with actual transactions to ensure that the provision of foreign exchange services is carried out in accordance with their intended purpose and relevant legal provisions.

Article 7. Implementation Provisions

1. This Circular takes effect from February 14, 2020.

2. For foreign currency fundraising agreements entered into by political organizations, political-social organizations, or non-governmental organizations to implement microfinance programs before this Circular takes effect, such organizations shall continue to implement them in accordance with the legal provisions at the time of signing. Any amendments or supplements to these agreements after this Circular takes effect must comply with the provisions of this Circular and related legal provisions.

Article 8. Implementation organization

The Head of the Office, the Director of the Foreign Exchange Management Department, the Heads of units under the State Bank, the Governors of the State Bank's branches in provinces and centrally-administered cities, the Chairmen of the Boards of Directors, the Chairmen of the Boards of Members, and the General Managers (Directors) of credit institutions, foreign bank branches, political organizations, political-social organizations, and non-governmental organizations implementing microfinance programs shall be responsible for organizing the implementation of this Circular./.