Circular No. 40/2014/TT-NHNN guiding the deposit and management of deposit funds by labor leasing enterprises

CIRCULAR

Guidelines on the depositing and management of security deposits for labor dispatch enterprises

Pursuant to the Civil Code 2005;

Pursuant to the Labor Code 2012;

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

Pursuant to the Law on Credit Organizations No. 47/2010/QH12 dated June 16, 2010;

Pursuant to Decree No. 55/2013/NĐ-CP dated May 22, 2013 of the Government detailing the implementation of Clause 3, Article 54 of the Labor Code regarding the issuance of permits for labor dispatch activities, the depositing of security deposits, and the List of jobs that can be dispatched (hereinafter referred to as Decree No. 55/2013/NĐ-CP);

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 (hereinafter referred to as the State Bank);

At the proposal of the Payment Department Director;

The Governor of the State Bank issues this Circular guiding the depositing and management of security deposits of labor dispatch enterprises at commercial banks where such enterprises have their main transaction accounts (hereinafter referred to as receiving banks).

PART I
GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular guides the depositing and management of security deposits of labor dispatch enterprises (hereinafter referred to as dispatch enterprises) at commercial banks where such enterprises have their main transaction accounts (hereinafter referred to as receiving banks).

Article 2. Applicability

1. Dispatch enterprises.

2. Receiving banks.

3. Organizations and individuals related to the security deposit activities for labor dispatch.

Chapter II
SPECIFIC PROVISIONS

Article 3. Deposit of Security Deposits and Issuance of Security Deposit Certificate

1. When a dispatch enterprise requests to deposit a security deposit into its account at a bank, the receiving bank and the dispatch enterprise shall enter into a security deposit agreement in accordance with the provisions of this Circular and relevant laws.

2. A security deposit agreement must include at least the following contents:

a) Name, address, and representative of the dispatch enterprise and the receiving bank;

b) Amount of the security deposit;

c) Interest rate on the security deposit;

d) Payment of interest on the security deposit;

đ) Use of the security deposit;

e) Withdrawal of the security deposit;

g) Refund of the security deposit;

h) Responsibilities of the parties involved.

3. After receiving the full amount of the security deposit as prescribed in Clause 1, Article 16 of Decree No. 55/2013/NĐ-CP, the receiving bank shall issue a security deposit certificate for labor dispatch business to the dispatch enterprise according to the model attached as Appendix III to Decree No. 55/2013/NĐ-CP.

Article 4. Management of Security Deposits

1. The receiving bank is responsible for freezing the entire amount of the security deposit and managing it in accordance with the provisions of Decree No. 55/2013/NĐ-CP and the regulations on security deposits.

2. The receiving bank may deduct from the security deposit of the dispatch enterprise to settle and compensate for losses in cases specified in Clause 4, Article 22 of Decree No. 55/2013/NĐ-CP.

3. The receiving bank monitors the use of the security deposit of the dispatch enterprise in accordance with the law. In case the balance of the security deposit account is lower than the prescribed level, the receiving bank must notify the dispatch enterprise to replenish the full amount of the security deposit as required. Within thirty days from the date the money is withdrawn from the security deposit account, if the dispatch enterprise does not replenish the full amount of the security deposit, the receiving bank has the responsibility to promptly notify the Ministry of Labor, Invalids and Social Affairs to take appropriate measures.

4. Quarterly, no later than the 15th day of the first month of each quarter, the receiving bank reports to the Ministry of Labor, Invalids and Social Affairs and the State Bank on the situation of receiving security deposits for labor dispatch business within its banking system according to the form attached as Appendix IV to Decree No. 55/2013/NĐ-CP.

Article 5. Interest rate on escrow deposits and payment of interest on escrow deposits

1. The leasing enterprise shall be entitled to receive interest from the bank accepting the escrow deposit for the balance of the escrow deposit at the interest rate agreed upon by both parties, which must comply with the regulations on interest rates for Vietnamese dong deposits issued by the State Bank of Vietnam during each period.

2. Based on the agreement on the interest rate from the escrow deposit recorded in the escrow contract between the leasing enterprise and the bank accepting the escrow deposit, the bank shall calculate interest for the balance of the escrow deposit and pay it to the leasing enterprise according to the agreement.

Article 6. Procedures for withdrawing escrow deposits

1. When the leasing enterprise requests to withdraw escrow deposits for use in cases prescribed in Article 20 of Decree 55/2013/NĐ-CP, it shall implement the following procedures:

a) Prepare and submit to the bank a request letter and withdrawal documents for the escrow deposit in accordance with the model provided by the bank accepting the escrow deposit;

b) Present a document from the Minister of Labor, Invalids, and Social Affairs allowing the leasing enterprise to withdraw the escrow deposit;

c) Present personal identification documents (ID card or passport still valid) of the person withdrawing the escrow deposit who is the legal representative of the leasing enterprise. In case the person withdrawing the deposit is an authorized person, they must also present a power of attorney.

2. The bank accepting the escrow deposit shall have the responsibility to check the withdrawal documents for the escrow deposit and the necessary documents and papers mentioned above. If they are lawful and valid, the bank shall allow the leasing enterprise to withdraw the escrow deposit.

Article 7. Procedures for refunding escrow deposits

1. When the leasing enterprise requests the bank accepting the escrow deposit to refund the escrow deposit, it shall implement the following procedures:

a) Prepare and submit to the bank a request letter and refund documents for the escrow deposit in accordance with the model provided by the bank accepting the escrow deposit;

b) Present a document from the Minister of Labor, Invalids, and Social Affairs as prescribed in Article 19 of Decree 55/2013/NĐ-CP;

c) Present personal identification documents (ID card or passport still valid) of the legal representative of the leasing enterprise. In case the person is an authorized person, they must also present a power of attorney.

2. The bank accepting the escrow deposit shall have the responsibility to check the refund documents and the necessary documents and papers mentioned above. If they are lawful and valid, the bank shall refund the escrow deposit to the leasing enterprise.

Chapter III
IMPLEMENTING PROVISIONS

Article 8. Responsibilities of relevant units under the State Bank of Vietnam

1. The Payment Department shall be responsible for monitoring and compiling reports on the situation of receiving escrow deposits for labor leasing businesses from banks accepting escrow deposits, and regularly reporting to the Governor of the State Bank of Vietnam.

2. Banking inspection and supervision agencies, State Bank of Vietnam branches in provinces and centrally-administered cities shall be responsible for coordinating inspections and audits of the management of escrow deposits by leasing enterprises at banks in accordance with this Circular and related laws.

Article 9. Effective Date

This Circular takes effect from February 1, 2015.

Article 10. Implementation Organization

The Director of the Office, the Head of the Payment Department, the Director of the Banking Inspection and Supervision Department, the Heads of relevant units under the State Bank of Vietnam, the Directors of State Bank of Vietnam branches in provinces and centrally-administered cities; the Chairmen of the Board of Directors, the Chairmen of the Board of Members, the General Managers (Directors) of commercial banks; the General Managers (Directors) of labor leasing enterprises are responsible for organizing the implementation of this Circular./.