Decision No. 78/2000/QĐ-NHNN6 Issuing the Regulation on Classification, Inspection, Packaging, and Delivery of Precious Metals and Gemstones in the Banking Sector

Pursuant to …;

Issuing regulations on classification, inspection, packaging, delivery and receipt

of precious metals and gemstones in the banking industry

___________________

GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to the Law on the State Bank of Vietnam No. 01/1997/QH10 dated December 12, 1997;

Pursuant to Decree No. 15/CP dated March 2, 1993 of the Government on the tasks, powers, and responsibilities for state management of ministries and ministerial-level agencies;

Pursuant to the Decree No. 81/1998/NĐ-CP dated October 1, 1998 of the Government on printing, minting, storing, transporting, and destroying paper money and metallic currency; storing and transporting valuable assets and securities within the banking system;

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

Pursuant to …;

Article 1. The Decision hereby promulgates the "Regulations on Classification, Inspection, Packaging, Delivery and Receipt of Precious Metals and Gemstones in the Banking Industry."

Article 2. This Decision shall take effect fifteen days from the date of signature and shall replace Decision No. 005/NH-QĐ dated January 14, 1980 of the Governor of the State Bank of Vietnam, promulgating the Regulations on Delivery and Storage of Precious Metals and Gemstones at various levels of the State Bank of Vietnam.

Article 3. The Heads of the Office, Department Heads of Business Operations and Treasury, Accounting and Finance Department, General Supervision Department of the State Bank of Vietnam, Branch Governors of the State Bank, General Directors (Directors) of credit organizations, General Directors of the Vietnam Gold and Precious Stones Corporation are responsible for implementing this Decision.

REGULATIONS

Classification, inspection, packaging, delivery and receipt of precious metals,

gemstones in the banking industry

(Issued pursuant to Decision No. 78/2000/QĐ-NHNN6 dated March 6, 2000)

of the Governor of the State Bank)

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Chapter 1

GENERAL PROVISIONS

Article 1. These regulations stipulate the classification, inspection, packaging, delivery and receipt of precious metals and gemstones at the Central Bank Vault, Branches of the State Bank, Trading Departments of the State Bank, credit organizations, and the Vietnam Gold and Precious Stones Corporation (hereinafter referred to as banks).

Article 2. Precious metals and gemstones regulated herein include:

1. Precious metals: Gold, silver, platinum, and other precious metal types.

2. Gemstones: Diamond (brilliant), ruby (carmine), emerald (emerald), sapphire (sapphire), pearl (pearl), and other types of gemstones.

Article 3. Precious metals and gemstones must be classified, arranged, packaged, and sealed according to a catalog order for storage, inventory, and ease of entry and exit, inspection.

Determination of quantity, weight, quality, and size of precious metals and gemstones must be specific and accurate.

Chapter 2

CLASSIFICATION AND PACKAGING OF PRECIOUS METALS AND GEMSTONES

Article 4. Catalogue classification:

Precious metals and gemstones are classified into the following categories: Type, classification, or quality classification.

1. Type: Gold, silver, platinum, diamond, ruby, emerald, sapphire, pearl, and other precious metals and gemstones as prescribed by law.

2. Classification: Precious metals are classified as follows, similar to gold classification below.

a. Jewelry gold: Products made of gold with or without gemstones, precious metals, or other materials for personal adornment needs such as rings, necklaces, bracelets, earrings, brooches, and others.

b. Artistic gold: Products made of gold with or without gemstones, precious metals, or other materials for decorative purposes such as picture frames, statues, and others.

c. Gold bars: Gold pressed into various shapes with markings indicating weight, quality, and manufacturer's code.

d. Raw gold: Gold in forms such as blocks, ingots, sheets, grains, wires, solutions, powders, semi-finished jewelry products, but not international standard gold.

3. Quality classification: Types or classifications above are further classified by quality:

a. Precious metals: Classified based on the percentage (%) of pure precious metal content, as follows: Over 75%; between 30% and 75%; under 30%.

b. Gemstones:

- Class A: Best

- Class B: Good

- Class C: Average

- Class D: Poor

Article 5. Determination of quantity, weight, size, and quality of precious metals and gemstones:

1. Quantity determination:

a. Countable type: counted by ingot, sheet, piece, bead, bar, fragment.

b. Uncountable type (powder, grain, powder form): determined by item, package.

2. Weight and size determination:

a. Precious metals:

Using internationally recognized units of measurement such as kilogram (kg), gram (g), milligram (mg) or using commonly used units in Vietnam such as liang, jin, fen, li.

1 liang = 10 jin = 100 fen = 1,000 li = 37.5 g

1 jin = 10 fen = 100 li = 3.75 g

1 fen = 10 li = 0.375 g = 375 mg

1 li = 37.5 mg

b. Gemstones: Measured by carat (1 carat = 200 mg);

c. Pearls measured by millimeter (mm) for diameter.

d. Jewelry or artistic items with embedded gemstones that increase the value of the item compared to its value after separation from the gemstone; during inspection, the original shape must be maintained and the total weight of the item must be weighed, then the individual weight of each part must be determined (if possible).

3. Quality determination:

a. Precious metals: Determined based on the percentage (%) of pure precious metal content.

b. Gemstones: Determined based on chemical composition, utility value, color, size, shape, surface condition to classify into Class A, Class B, Class C, or Class D.

Article 6. Packaging and sealing:

1. Precious metals and gemstones are placed in polyethylene bags and stapled (or sewn, glued) at the bag opening. Outside the bag, they are wrapped in two layers of thick, durable paper. For gemstones, jewelry, and artistic items, they must be lined with cotton, fabric, or soft paper and placed in hard boxes to prevent scratches and damage.

Jewelry and artistic items must be packed individually or in sets. If they are identical in quality and weight, ten pieces can be packed into one set, and ten sets into one package.

Inside the package or box, there must be an inspection certificate and an inventory list. On the outside of the package or box, it must be sealed and clearly marked with the type, classification, quantity, weight, and quality.

2. The serial number of each package or box is recorded by the warehouse keeper matching the number on the warehouse card and tracking book, signed by the head of the Delivery and Receipt Team, the warehouse keeper, and the date of packaging and sealing.

3. One or more packages or boxes of the same type, classification, and quality are placed in a good-quality cloth bag (strong, durable) or wooden, non-rusting metal box, sealed, and lead-sealed. On the seal of the bag or box, the number of packages or boxes, their weight, and quality must be clearly marked. The head of the Delivery and Receipt Team and the warehouse keeper must sign and write their full names. Additionally, the warehouse keeper must record the number on each bag or box matching the number on the warehouse card and tracking book.

Chapter 3

ORGANIZATION AND PROCEDURES FOR TESTING, PACKING, HANDLING PRECIOUS METALS AND GEMS

PART I ORGANIZATION OF HANDLING

Article 7. The classification, testing, packing, and handling of precious metals and gems must be carried out by the Handling Team. The Handling Team shall be established pursuant to the Decision of the Head of the banking unit and shall consist of the following components:

1. Team Leader.

2. Skilled workers specializing in precious metals and gems (when receiving through physical inspection); in cases where the bank does not have dedicated skilled workers for precious metals and gems, it may mobilize skilled workers within the same system or hire from another bank. Skilled workers must hold a certificate of skill level issued by the competent authority.

3. Cash vault custodian - directly responsible for packing and sealing.

4. Record-keeping staff and report preparation personnel.

Article 8The tasks of the precious metals and gems handling team:

1. Ensuring accurate and safe counting of quantities, determination of quality, weight, size, classification, packing, and sealing of various types of precious metals and gems.

2. Fully implementing all procedures, processes, and regulations for handling precious metals and gems.

3. Maintaining confidentiality regarding assets and data.

Article 9: When handling precious metals and gems, it must be based on legal and valid documents; the figures on the documents must match the actual items. The handling process must fully implement procedures for classification, testing, packing, and sealing.

Article 10. Banks must arrange and organize places for classification, testing, packing, and handling of precious metals and gems conveniently and safely; equip necessary tools and means to ensure accuracy for testing, packing, and sealing operations.

Article 11. Depending on the situation and specific requirements of each handling case or at the request of the delivering party, banks may carry out handling either through physical inspection or sealed package inspection.

Classification, testing, packing, and handling are conducted sequentially for each customer, by type, and by category; only after completing the classification and testing of one category can the next category be handled; only after completing the handling of one person's items can the next person's items be handled to avoid confusion.

PART II PROCEDURE FOR RECEIVING PRECIOUS METALS AND GEMS

Article 12. The procedure for testing, packing, and receiving precious metals and gems is as follows:

Step 1. The Team Leader checks all valid and legal documents for the assets:

- Receiving precious metals and gems from agencies, units, and economic organizations deposited into the State Bank's warehouse must be accompanied by a designation document from the authorized state agency and relevant asset documentation.

- Receiving precious metals and gems from units within the same banking system must be accompanied by a Warehouse Release Order from the Head of the transferring unit.

- Receiving precious metals and gems from individuals or units used as collateral or pledge for loans must be accompanied by current credit regime documents.

An item list must accompany these documents.

Step 2. The Team Leader receives the quantity of items sequentially by type according to the item list, completing one type before moving on to the next.

Step 3. The Team Leader hands over each item sequentially according to the item list to the skilled worker. The skilled worker uses calibrated measuring tools with valid certification from the competent authority to determine the weight, quality, and size of various types of precious metals and gems accurately as stipulated in Article 4 and Article 5 of this Regulation (and must record in the report the name, serial number, calibration accuracy, and date of inspection of these tools).

After the skilled worker completes the quality check of each item, they must sign and clearly write their name on the inspection result form for each item. The inspection form is made in two copies, one copy attached to the item when packing, and one copy given to the accountant along with other submission documents. The inspection form must include all factors: item name, weight, quality, and size.

During inspection, if the skilled worker finds that an item is not a precious metal or gem, it must be returned to the delivering party, and this must be clearly recorded in the receipt and delivery report.

Step 4. After the skilled worker has determined the weight, quality, and size of each type and classified the precious metals and gems, the record-keeping staff prepares the report based on the inspection results form transferred by the skilled worker, recording the results in the item list. The item list includes two copies signed by the Team Leader and confirmed by the skilled worker. One copy is given to the cash vault custodian for re-inspection during packaging; the other copy is given to the record-keeping staff to prepare the report.

Step 5. The skilled worker re-checks the figures on the item list and the items, then transfers each type to the cash vault custodian. The cash vault custodian must re-check before packaging and sealing. The classification and packaging sealing, storage procedures are specified in Article 4 and Article 6 of this Regulation.

Step 6. After the sealed items of the delivering party are received, members of the Handling Team jointly re-check the figures on the item lists against the sealed packages and boxes. Based on the report and the warehouse entry form of the accountant, the cash vault custodian receives them to mark the serial number on each package and box (as stipulated in Clause 2 and 3, Article 6 of this Regulation) before placing them in a safe or iron box with locks in the warehouse.

Article 13. Preparing the report:

Based on the item list confirmed by the skilled worker, the record-keeping staff prepares the receipt and delivery report detailing:

- Date, month, year, location of receipt and delivery.

- Reason and basis for receipt and delivery (according to which Decision or Order).

- Delivering Party: Name, address, ID number of the deliverer.

- Receiving Party: Name, position, ID number of the receiver (Team Leader, skilled worker, cash vault custodian).

- Method of receipt and delivery: Physical inspection or sealed package inspection.

- Item name, quantity, weight, quality, size of each item.

- Necessary notes:

+ Differences in quantity, quality, weight, size compared to the original report or the deliverer's item list.

+ Inspection method and coding of the scales, measuring instruments used.

- Both the deliverer and the receiver (Team Leader, skilled worker, cash vault custodian) must sign the receipt and delivery report.

- The Head of the receiving organization must confirm the report.

The record shall be made in four copies: one copy for the person delivering the physical item to keep as a receipt; one copy handed over to the accountant together with other submission documents for inventory entry procedures and payment; one copy given to the warehouse custodian; one copy kept with the package of physical items (if received sealed).

In addition to the delivery record mentioned above, cases involving depositing with banks must also complete the procedure of signing a storage contract.

Article 14. Receive precious metals and gemstones in their original sealed packages or boxes.

The team leader shall ensure that all legal and valid documents for the delivered assets, as stipulated in Step 1, Article 12 of this Regulation, are fully checked. The person delivering sealed items must provide a detailed list of each item, including the name, quantity, quality, and weight if determinable.

The delivery team witnesses and guides the deliverer to pack and seal the items themselves. Inside the package or box, there should be a list and a record attached. The record shall be prepared according to the provisions of Article 13 of this Regulation, clearly stating that it is accepted based on sealed packages or boxes. The seal shall clearly state: the delivering authority, the deliverer, the name and signature of the person sealing the package or box (from the delivering side); the date of delivery, and the signature of the deliverer.

The bank accepting sealed packages or boxes will not be responsible for the quantity, quality, and weight of the items within the sealed packages or boxes.

For cases where branches or stores submit precious metals and gemstones in sealed packages back to the main office warehouse, if necessary or in doubt, the Head of the banking unit shall decide to organize a quality inspection as prescribed in Article 12 of this Regulation.

Article 15. Store precious metals and gemstones during the delivery process.

At the end of each working session or day, if the verification has not been completed, all precious metals and gemstones must be placed in bags or boxes, put into a locked safe, and carefully sealed. The deliverer must personally package and seal all their assets along with the asset list under the guidance and witness of the delivery team members. On the seal, there should be the signature of the deliverer and the packer, and the items must be stored in the vault. The team leader writes a receipt, signed by the warehouse custodian and the Head of the banking unit, to give to the deliverer.

When receiving the sealed package or box again for further verification, the deliverer must check the seal again. If correct, return the receipt to the team leader for cancellation and continue with the verification.

PART III PROCEDURE FOR DELIVERING PRECIOUS METALS AND GEMSTONES

Article 16. Delivering precious metals and gemstones must have the following types of documents:

- Warehouse release order from the Head of the bank;

- Warehouse release form;

- Introduction letter or power of attorney from the recipient or receiving agency (if receiving on behalf of another);

- Identity card of the recipient;

Article 17. Delivering inspected precious metals and gemstones:

Based on the warehouse release form, the warehouse custodian must update the tracking ledger and warehouse card before delivering the items. Before opening the package or box containing the items, the bank's warehouse personnel must recheck the seal, only proceeding if there are no doubts. After opening the package or box, they must refer to the delivery record, inspection form, and old list to verify the quantity, weight, and quality match before proceeding with the release according to the warehouse release form. A new record and list of the released items must be created. If not all items in the package or box are released, the remaining items represent the discrepancy between the initial inventory record and the current release record. The remaining items will be repackaged and resealed with the accompanying inventory and release lists. The warehouse card retains the original data.

Article 18. Delivering precious metals and gemstones in sealed packages or boxes:

When delivering items in their original sealed packages or boxes, the documents required include those specified in Article 16 of this Regulation, the previous delivery record, and storage contract (if applicable). For assets deposited in the State Bank's warehouse, a document from the competent authority is also required.

When delivering items, a record must be created and the original sealed package or box must be delivered according to the previously received record.

If the recipient requests only part of the contents in the package or box, the entire package or box must first be returned intact, followed by a new delivery and receipt procedure for the newly sealed package or box.

Opening sealed packages or boxes must be done by the person named on the seal or their authorized representative.

Prior to delivery, the bank requires the recipient to carefully inspect the seal and exterior of the package or box. After delivery, the recipient is solely responsible for the quantity and quality of the assets within the package or box. If deemed necessary, the recipient may invite an appraisal agency to inspect before opening the sealed package or box.

If the bank loses or damages the seal, making the content illegible, both parties must negotiate a solution or invite a representative of the relevant authority to appraise and witness the delivery and receipt of the assets.

Chapter 4

IMPLEMENTATION

Article 19. The General Director (Director) of credit organizations and the Vietnam Gold and Precious Metals Corporation shall base their guidance on the Vietnamese Standard for Gemstones - Terminology and Classification - TCVN 5855 - 1994 and this Regulation for the inspection, classification, packaging, delivery, and receipt of precious metals and gemstones, as well as the operational procedures for buying, pawning, and mortgaging loans with precious metals and gemstones at stores and counters within the system, to serve customers well and ensure asset safety.

Article 20. The preservation, transportation, inventory, handover, and handling of excess or shortage of precious metals and gemstones; services for preserving valuable assets are carried out according to the provisions in Chapters V, VI, VII of the Cash and Valuable Asset Storage, Transportation, and Inventory System issued by Decision No. 247/1999/QĐ-NHNN6 dated July 14, 1999 of the Governor of the State Bank.

Article 21. Any amendments or supplements to the provisions of this Regulation shall be decided by the Governor of the State Bank.