Decision No. 51-NH/QD on Issuing the Regulation on State Management of Precious Stone Trading

 Pursuant to …;

ISSUING REGULATIONS ON STATE MANAGEMENT OF PRECIOUS STONE TRADING

GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to Point 3, Article 50, Chapter V of the State Bank of Vietnam Ordinance promulgated by Decision No. 37/LCT-HĐNN dated May 24, 1990 of the Chairman of the Council of Ministers of the Socialist Republic of Vietnam;
Pursuant to Decree No. 196/HĐBT dated December 11, 1989 of the Council of Ministers on the tasks, powers, and responsibilities for state management of ministries;
Pursuant to Decree No. 138/HĐBT dated May 8, 1990 of the Council of Ministers on the functions, tasks, and organization of the State Bank of Vietnam;
Pursuant to Decision No. 333/HĐBT dated October 23, 1991 of the Chairman of the Council of Ministers on the organization and management of geological surveying, mining, processing, and trading of precious stones;
At the proposal of the Director of the Foreign Exchange Management Department:

Pursuant to …;

Article 1- Now hereby promulgating with this decision the "Regulations on State Management of Precious Stone Production and Trading."

Article 2- This decision shall take effect from the date of signing and replace all previous regulations issued by the State Bank of Vietnam related to precious stones.

Article 3- The Heads of the Office, the Director of the Foreign Exchange Management Department, the General Directors of the Vietnam Gold and Precious Stones Corporation, the Heads of units under the State Bank of Vietnam, and the General Directors of state-owned commercial banks are responsible for implementing this decision.

 

REGULATIONS

STATE MANAGEMENT OF PRECIOUS STONE TRADING
(Issued together with Decision No. 51 dated March 14, 1992)

Chapter 1

GENERAL PROVISIONS

Article 1- The State Bank of Vietnam shall uniformly manage state activities concerning the purchase, sale, processing, manufacturing, export, import, and opening of stores selling precious stones abroad for diamonds, rubies, sapphires, emeralds, and other natural precious stones of equivalent value, in their raw form (rough stones) or processed form. Enterprises (economic organizations and individuals) may only engage in precious stone trading if they have a permit issued by the State Bank of Vietnam. All permits for precious stone trading issued prior to the issuance of these regulations are invalid. Any trading of precious stones and export/import of precious stones without a permit issued by the State Bank is illegal and a violation of the law, except where permitted by law.

Article 2- The State recognizes the ownership rights of persons possessing precious stones. All purchases, sales, and exchanges of precious stones in their raw form within the territory of the Socialist Republic of Vietnam must be conducted at precious stone trading centers established by the State Bank of Vietnam. Strictly prohibited are any purchases, sales, and exchanges of precious stones outside these centers.

Article 3- The State Bank of Vietnam shall organize precious stone trading centers in regions with precious stones and major cities. Prices for purchasing and selling raw precious stones as well as processed precious stones at these centers are market prices, taking into account international prices.

Article 4- All enterprises permitted to trade in precious stones must comply with tax payments, fees (including inspection fees, permit issuance fees, participation in precious stone trading centers), financial management regulations, and other state documents.

Chapter 2

CONDITIONS FOR PRECIOUS STONE TRADING

Article 5- Enterprises meeting the following conditions and procedures will be considered by the State Bank of Vietnam for issuance of a permit for precious stone trading (including purchase, processing, and manufacturing):

a) Having legal entity status as stipulated in Decree No. 17/HĐBT dated January 17, 1990 of the Council of Ministers.

b) Having initial capital of at least 2 billion Vietnamese dong for economic organizations and 500 million Vietnamese dong for private entities.

c) Having a team of staff, technicians, and workers knowledgeable about precious stones (able to distinguish types, quality, and commercial value) confirmed by the State Bank authority.

d) Having a headquarters and specialized equipment for precious stone trading.

e) Having a production and business plan.

g) Submitting an application to the State Bank of Vietnam (Foreign Exchange Management Department) using the attached form. The application must be confirmed by the Head of the Ministry or Sector in charge or the Chairman of the People's Committee of the province or city and the Director of the local State Bank.

Article 6- Enterprises holding a precious stone trading permit issued by the State Bank may:

a) Purchase raw precious stones and sell processed precious stone products at precious stone trading centers organized by the State Bank of Vietnam. When purchasing precious stones, a receipt must be obtained to acquire a certificate of ownership of the stones, serving as a legal basis for processing, manufacturing, and export/import.

b) Accept processing and manufacturing according to the designs of domestic specialized organizations extracting precious stones as well as foreign organizations. Importing precious stones from abroad for re-export must comply with current foreign exchange management regulations, customs procedures of the Socialist Republic of Vietnam, and other relevant laws.

c) Open stores to sell processed precious stones.

d) Economic organizations with legal entity status from all economic sectors may engage in joint ventures with foreign entities in the field of precious stone trading in accordance with current investment laws.

Chapter 3

EXPORT AND IMPORT OF PRECIOUS STONES

The State Bank of Vietnam will issue permits for the export and import of processed precious stones and raw precious stones to organizations engaged in the production and trading of precious stones when they meet the required conditions and procedures as stipulated.

Article 7- Conditions and procedures for applying for a direct import and export gemstone permit:

a) Having a gemstone sales contract with foreign countries, the contract clearly states: name of goods (type of stone), quantity, weight, selling price, payment method, delivery conditions that both parties must fulfill.

b) Holding a gemstone business license issued by the State Bank of Vietnam or a gemstone mining permit issued by the Heavy Industry Ministry.

c) Possessing a property ownership certificate issued by the center.

d) Having a quality certification issued by the State Bank of Vietnam.

e) Submitting a gemstone export application to the Governor of the State Bank of Vietnam (according to the prescribed form). The application must clearly state the border gate for exporting gemstones.

Article 8- Conditions and procedures for applying for a gemstone import permit:

a) Holding a gemstone business license issued by the State Bank or a joint venture processing and manufacturing gemstone permit with foreign countries issued by the State Committee on Cooperation and Investment.

b) Having a contract with foreign countries.

c) Possessing a quality certification from the State Bank.

d) Submitting a gemstone import application to the Governor of the State Bank specifying the type of stone, quality, and quantity.

Chapter 4

GEMSTONE RAW MATERIALS TRADING CENTER

Article 9- The State Bank of Vietnam is the managing authority, organizing and directing the activities of the Gemstone Raw Materials Trading Center. The Gemstone Raw Materials Trading Center operates under the direction of a Management Board under the State Bank of the province or city. Economic organizations and individuals are eligible to participate in the Gemstone Raw Materials Trading Center upon receiving a card from the Management Board.

Article 10- Conditions for participating in the Gemstone Raw Materials Trading Center:

a) For domestic buyers, they must have:

- A gemstone business license issued by the State Bank.

- Registration of the location where the purchased stones will be moved.

For foreign buyers, they must have:

- Deposits at banks authorized to conduct foreign exchange transactions and presenting a copy of the deposit statement.

- A gemstone trading permit issued by the Governor of the State Bank.

b) For sellers, they must have:

- A mining permit issued by the Heavy Industry Ministry (if it is an economic organization).

- Identity card (if it is an individual).

- Registration of the quantity and types of stones to be sold.

Organizations and individuals meeting the stipulated conditions will be issued a card by the Management Board to enter the Gemstone Raw Materials Trading Center for trading purposes.

Article 11 - Provision of information classified as state secrets within the banking sector to foreign organizations and individuals. Organization of the Gemstone Raw Materials Trading Center's operations.

The State Bank collaborates with the Provincial People's Committee to determine the location and organize a security network for the Gemstone Trading Center's operations.

Customers must present their cards to the security office to enter the Gemstone Raw Materials Trading Center.

Customers buying or selling gemstones at the Center may open or rent counters for transactions.

During transactions, buyers and sellers independently determine prices and select trading partners.

After transactions, both parties must provide invoices and payment documents. Buyers of raw gemstones must submit a list attached with all invoices and documents to the Management Board of the Center to obtain a property ownership certificate as a legal basis for processing and manufacturing import and export. For foreign buyers, the State Bank will issue a permit to take gemstones out of the country after paying the export tax.

When having sufficient conditions and necessary means, local State Banks will organize classification, quality assessment, and valuation of gemstones for customers at the Center to facilitate trading. The Gemstone Trading Center operates on all working days. Customers conducting transactions must comply with the Center's operational regulations. If any member fails to comply, they will not be allowed to participate in the Gemstone Trading Center.

Chapter 5

OPENING GEMSTONE STORES ABROAD

Article 12: State-owned economic organizations engaged in gemstone trade, if meeting the conditions stipulated in Article 13 below, will be considered by the State Bank for issuing permits to open gemstone stores abroad (including participation in exhibitions) to sell products.

When taking gemstones out of the country, a permit from the State Bank is required. In the permit, the State Bank specifies permission to export for opening gemstone stores abroad.

Article 13: Conditions and procedures for issuing permits to open jewelry stores abroad:

- Submit an application to the Governor of the State Bank (according to the attached form) requesting permission to open a jewelry store abroad. The application must be confirmed by the head of the Ministry, Sector, or People's Committee of the province or city.

- Possess a business license for precious stones issued by the State Bank, or a mining permit issued by the Ministry of Industry.

- Obtain a permit from the foreign country allowing the opening of a jewelry store.

Article 14: All foreign currency proceeds from selling precious stones must be transferred back to the country in accordance with current foreign exchange management regulations.

Monthly, the entity must submit reports on the operation status and sales figures (actual revenue) of the store to the State Bank (Department of Foreign Exchange Management).

Chapter 6

SALE OF RAW PRECIOUS STONES BY AUCTION

Article 15- Economic organizations and individuals possessing high-quality raw precious stones may sell them through an auction process.

The sale of raw precious stones by auction will be organized in batches at trading centers for precious stones established by the State Bank.

Article 16- Economic organizations and individuals wishing to sell precious stones through an auction process must submit a request to the State Bank, clearly stating the quantity and types of stones requiring appraisal and auction organization.

Based on the requests of the aforementioned economic organizations and individuals, the State Bank will establish an appraisal team to classify and value the stones according to international gemstone appraisal standards.

After completing the appraisal, the State Bank will notify the economic organizations and individuals possessing precious stones of the results within three days. If the stones meet the criteria for auction, the State Bank will announce the time, location, and other details for organizing publicity and inviting domestic and foreign economic organizations and individuals engaged in the precious stone trade to participate in the auction.

Based on the quantity and quality of the precious stones and the number of participants requesting to join the auction, the State Bank will determine the quantity of raw precious stones to be put up for auction in each session to ensure the highest possible effectiveness of the auction.

Article 17- After the auction session, economic organizations and individuals selling the stones must pay a fee to cover the incurred costs.

For organizations and individuals purchasing the stones: if they are foreigners, the State Bank will issue a permit to export the stones after payment of export tax. If they are domestic entities, the State Bank will issue a purchase certificate.

Chapter 7

HANDLING VIOLATIONS

Article 18 - Economic organizations and individuals permitted to engage in the precious stone trade must comply fully with the provisions of this regulation and be subject to comprehensive management and inspection by the State Bank regarding the precious stone trade.

Based on Article 11, 13, 14, 15, and 16 of Chapter II of the Administrative Sanctions Ordinance, economic organizations and individuals violating the provisions of this regulation shall be subject to handling according to their level of violation, including warnings, fines, confiscation of contraband precious stones, revocation of licenses, and in cases of serious violations, criminal responsibility may be pursued.

Article 19 - Authority to impose penalties

Depending on the nature and degree of violation, the penalties shall be implemented by state agencies and authorized persons as stipulated in Article 17 of Chapter III of the Administrative Violations Sanction Ordinance.

Pending resolution, temporarily seized precious stones must be deposited with provincial or city treasury offices.

The fine money and confiscated precious stones, after deducting rewards according to prescribed regulations for units and individuals who have achieved success in detection, arrest, investigation, the remainder shall be paid into the state budget.

Chapter 8

IMPLEMENTING PROVISIONS

Article 20

- Quarterly (at the beginning of the next quarter), the Director of the Provincial or City Branch of the State Bank and the General Corporation of Gold, Silver, and Precious Stones of Vietnam shall prepare and submit a report on the implementation of Decision No. 333/CT and this Regulation to the State Bank (Department of Foreign Exchange Management).

Economic organizations and individuals who were previously granted a business license for precious stones, from the date this regulation takes effect, must complete necessary procedures for the State Bank to review and issue new licenses.