Decree No. 90/1998/ND-CP Issuing the Regulation on Management of Foreign Borrowing and Debt Repayment

Article 1. This Decree promulgates the Regulation on Management of Foreign Borrowing and Debt Repayment.

Article 2. This Decree takes effect fifteen days from the date of signature and replaces Decree No. 58/CP of the Government dated August 30, 1993.

Article 3. The Minister of Finance, Governor of the State Bank of Vietnam, Minister of Planning and Investment, and Heads of relevant agencies shall be responsible for implementing and guiding and supervising the implementation of the Regulation on Management of Foreign Borrowing and Debt Repayment issued together with this Decree.

Article 4. Ministers, Heads of ministerial-level agencies and agencies under the Government, Chairmen of People's Committees of provinces and centrally governed cities, and Heads of relevant agencies shall be responsible for implementing this Decree.

Article 1. In this Regulation, the following terms shall be understood as follows:

1. Foreign borrowing includes short-term, medium-term, or long-term loans (with or without interest) borrowed by the Socialist Republic of Vietnam, the Government of Vietnam, or Vietnamese legal entities (including foreign-invested enterprises) from international financial organizations, governments, foreign banks, or other foreign organizations and individuals (hereinafter referred to as foreign lenders).

2. Short-term borrowing refers to loans with a term of up to one year.

3. Medium-term or long-term borrowing refers to loans with a term exceeding one year.

4. Government foreign borrowing refers to loans contracted by authorized state agencies or the Government of Vietnam with foreign lenders in the name of the state or the Government of the Socialist Republic of Vietnam.

Government foreign borrowing includes concessional Official Development Assistance (ODA) loans, commercial loans, export credit, and loans from international capital markets through the issuance of bonds abroad in the name of the state or government (including convertible debt bonds).

5. Corporate foreign borrowing refers to loans directly contracted by enterprises established and operating under current Vietnamese laws (including foreign-invested enterprises) with foreign lenders on a self-borrowing and self-responsibility basis, or through the issuance of bonds abroad (corporate bonds, bank bonds...).

Corporate foreign borrowing includes:

Guaranteed loans;

Loans guaranteed by banks or other forms of guarantees as stipulated in Article 23 of this Regulation;

Unsecured loans.

6. Foreign loan guarantee is a commitment by the Guarantee Agency to the foreign lender regarding full and timely repayment of the borrower (enterprises). In case the borrower cannot repay the debt or repay insufficiently when due, the Guarantee Agency will assume responsibility for repaying the debt on behalf of the borrower.

There are two types of foreign loan guarantees:

Government guarantee: issued by the Ministry of Finance or the State Bank of Vietnam authorized by the Government according to the Government's foreign loan guarantee regulations.

Government-guaranteed loans are managed as government loans.

Bank guarantee: issued by Vietnamese banks according to the guarantee and re-guarantee regulations stipulated by the Governor of the State Bank of Vietnam. These guarantees are not considered government guarantees.

7. Rescheduling agreements include rescheduling contracts or supplementary agreements for rescheduling between agencies or organizations entrusted by the Government to implement rescheduling of government foreign loans with domestic organizations using such funds. The terms of rescheduling agreements may differ from those of the loan agreements signed with foreign lenders.

8. Domestic counterpart funds for projects utilizing foreign loans (hereinafter referred to as domestic counterpart funds) are the necessary domestic funds that Vietnam must allocate to implement the project along with foreign loans.

Domestic counterpart funds can be foreign currency (down payment, import of machinery and equipment not funded by loans...) or Vietnamese dong (for survey, design, land acquisition compensation, construction, taxes, and insurance...).

Article 2. The Government shall uniformly manage foreign borrowing and debt repayment nationwide and delegate tasks to ministries as follows:

1. The Ministry of Planning and Investment shall be responsible for:

Developing the national strategy on foreign borrowing and debt repayment and compiling the long-term plan on foreign borrowing and debt repayment nationwide in accordance with the national socio-economic development strategy at each stage and the national strategy on foreign borrowing and debt repayment.

Coordinating with the Ministry of Finance and the State Bank of Vietnam in macro-level foreign debt management.

Implementing tasks assigned by the Government under Article 13 of the Regulation on Management and Utilization of ODA issued together with Decree No. 87/CP dated August 5, 1997 of the Government.

2. The Ministry of Finance shall be responsible for:

Leading and coordinating with the State Bank of Vietnam and relevant agencies in formulating state policies and systems in the field of foreign debt management in line with the national strategy on foreign borrowing and debt repayment and national financial policy.

Leading and coordinating with the Ministry of Planning and Investment and the State Bank of Vietnam in drafting the annual plan for government foreign borrowing and repayment, submitting it to the Prime Minister for approval. Summarizing the annual situation of government foreign borrowing and debt repayment and coordinating with the State Bank of Vietnam to summarize the annual situation of foreign borrowing and debt repayment nationwide to report to the Prime Minister.

Managing financial matters related to foreign loans of the Government (including concessional ODA loans, Government commercial loans, and Government bond issuance loans), and providing Government guarantees for enterprises (excluding credit institutions) to borrow foreign capital as decided by the Prime Minister.

Implementing the repayment of foreign debts of the State and the Government from the State budget.

Carrying out tasks assigned by the Government under Article 14 of the Management and Utilization of ODA Regulations issued together with Decree No. 87/CP dated August 5, 1997 of the Government.

3. The State Bank of Vietnam shall be responsible for:

Managing foreign borrowing and repayment of enterprises of all economic sectors, providing Government guarantees for credit institutions to borrow foreign capital as decided by the Prime Minister, guiding and supervising the guarantees provided by commercial banks.

Taking the lead and coordinating with the Ministry of Planning and Investment and the Ministry of Finance to develop annual total limits on commercial borrowing plans for enterprises to submit to the Prime Minister for approval.

Summarizing the implementation of foreign borrowing and repayment annually for enterprise loans to report to the Prime Minister and simultaneously send to the Ministry of Finance for consolidation of the country's overall foreign borrowing and repayment situation annually.

Directing the annual total limit plan on commercial foreign borrowing for enterprises; organizing the registration of foreign borrowing by enterprises.

Carrying out tasks assigned by the Government under Article 15 of the Management and Utilization of ODA Regulations issued together with Decree No. 87/CP dated August 5, 1997 of the Government.

4. The Ministry of Justice shall be responsible for:

Participating in providing opinions on legal issues in agreements on foreign borrowing by the Government and enterprises guaranteed by the Government before submitting to the Prime Minister for consideration and decision.

Providing opinions on discrepancies between agreements on foreign borrowing by the Government and domestic laws; monitoring the handling of these issues during the implementation of commitments on borrowing and repayment of foreign debts.

Issuing legal opinions when necessary for agreements on foreign borrowing by the Government and enterprises guaranteed by the Government, or participating in opinions on other related legal issues at the request of state agencies or enterprises.

Article 3. Based on the actual needs of foreign debt management, the Prime Minister may establish an appropriate inter-ministerial mechanism for managing foreign debt. In the short term, when necessary, the Prime Minister may entrust the National Financial and Monetary Council (established pursuant to Decision No. 23/1998/QĐ-TTg dated January 31, 1998 of the Prime Minister) to advise on major issues related to foreign debt such as the national strategy on borrowing and repaying foreign debt, large-scale foreign loan projects, and foreign debt resolution.

Article 4. In cases where the terms proposed by the foreign lender in draft agreements, agreements, or guarantees on foreign borrowing are not in line with Vietnamese law, the leading agency negotiating the agreement must coordinate with relevant agencies (Ministry of Finance, Ministry of Planning and Investment, State Bank of Vietnam, Ministry of Foreign Affairs, Ministry of Justice) to unify opinions and report to the Prime Minister for consideration and decision, or propose to the Prime Minister to submit to the President for consideration and decision on terms that are inconsistent with legal documents and ordinances.

Article 5. The management of foreign loans and repayments by the Government must meet the following basic requirements:

1. Ensuring that foreign borrowing and repayment are carried out uniformly according to the national strategy on borrowing and repaying foreign debt to attract optimal suitable funds from abroad to serve the socio-economic development plan of the country in each period.

2. Allocating borrowed funds appropriately to priority project lists, repayment capabilities, and domestic capacity (counterpart funds, human resources) of each project to facilitate timely project implementation and effective use of borrowed funds, generating foreign exchange and domestic accumulated capital to meet development goals while ensuring repayment to foreign lenders.

Article 6. Basic principles of managing foreign loans and repayments by the Government:

1. The Government shall uniformly manage foreign loans and repayments of the Government based on the national strategy on borrowing and repaying foreign debt, monitor and supervise foreign loans and repayments according to annual and long-term limits and plans, apply financial policies and tools to ensure a reasonable structure, duration, and total amount of debt to meet macroeconomic balance requirements and development needs of the country in each period.

2. Administrative agencies at all levels, mass organizations, and administrative management agencies shall not be allowed to directly borrow from abroad.

3. State agencies, organizations, and units receiving and using foreign loans guaranteed by the Government must use borrowed funds strictly according to approved projects, and are responsible for fully and promptly recovering borrowed funds from the Government's re-lending funds to enable the Government to fulfill its commitments to foreign lenders.

Article 7. The management and utilization of foreign loans by the Government must comply with the State Budget Law and be implemented through the following financial mechanisms:

1. For loans for investment development projects:

a) The Government shall allocate funds from foreign loans according to the budget allocation regime for state-owned capital for infrastructure investment projects, social welfare projects, and other projects that do not have the ability to directly recover costs such as national and inter-provincial road bridge systems, urban public transportation networks, mountainous and rural roads, railway infrastructure projects, aviation, ports and harbors; rural and mountainous clean water distribution networks; urban drainage and waste treatment projects; investment construction projects in the health, education, scientific research, basic survey, environment, broadcasting and television sectors; forest protection planting projects, upstream forests, water conservancy projects, flood prevention projects.

The Ministry of Planning and Investment shall take the lead in coordinating with the Ministry of Finance to submit to the Prime Minister a specific list of projects to be allocated from the source of foreign loan capital of the Government before signing international agreements or agreements on project lists with foreign lenders.

b) For other development investment projects capable of recovering capital (including infrastructure projects): The Government will provide loans to these projects, recover the loaned amounts, and transfer them into the Debt Repayment Reserve Fund managed by the Ministry of Finance to repay foreign debts when due.

The Ministry of Finance shall guide and organize the re-lending of government foreign loan capital for development investment projects through the General Department of Investment Development. The General Department of Investment Development is responsible for managing and recovering capital from project sponsors to remit to the state budget, while also receiving fees for re-lending as stipulated by the Prime Minister.

Based on the loan repayment conditions signed with foreign countries and the ability of development investment projects funded by foreign loans to recover capital, the Ministry of Finance shall establish the conditions for re-lending for each specific loan according to the following main principles:

The re-lending period shall be consistent with the repayment time stated in the approved feasible project.

Re-lending interest rate:

For commercial loans from the Government: re-lending shall be calculated in foreign currency at the level of foreign loan interest rates plus service fees for domestic re-lending.

For ODA loans: re-lending shall be calculated in foreign currency or Vietnamese dong at the level of state investment credit interest rates (for each type of currency) decided by the Prime Minister. This interest rate includes domestic re-lending service fees.

In special cases where different re-lending conditions need to be established compared to the above principles, the Ministry of Finance shall submit to the Prime Minister for decision.

2. For loans under credit programs:

The Ministry of Finance shall sign contracts with appropriate banks to re-lend or provide lending services to the final users of the loan capital (enterprises, individuals, etc.) according to the re-lending conditions approved by the Prime Minister.

Except in cases where the Prime Minister clearly designates the final borrowers, banks that re-lend government loan capital for further lending may choose borrowers suitable for the agreed credit program with the foreign lender and bear all risks during the re-lending process to these borrowers.

3. For loans in foreign currency or goods not directly linked to specific projects:

a) Foreign currency loans, including those obtained through bond issuance, shall be transferred into the centralized foreign currency fund managed by the Ministry of Finance. Special foreign currency loans for supporting the balance of payments shall be transferred into the foreign exchange reserve fund managed by the State Bank of Vietnam. All foreign currency loans must be used according to specific decisions made by the Prime Minister.

b) For foreign currency loans in the form of goods:

For loans in goods with identified domestic users: The Ministry of Finance shall convert them into Vietnamese dong for accounting purposes for state budget revenue and expenditure for allocation or re-lending to the users.

For loans in goods without identified specific users: The Ministry of Finance shall take the lead in organizing the importation, auctioning, and remittance of proceeds into the state budget.

Article 8. Programs and development investment projects using government foreign loan capital must meet the following conditions:

a) The list of programs and projects must be included in the annual state investment development plan as well as the plans of ministries, sectors, and localities.

b) Programs and projects must be approved by the competent authority according to current regulations.

The agency designated to negotiate loan agreements is responsible for checking these conditions before signing loan agreements with foreign lenders.

In cases where foreign lenders require that sponsored projects or programs undergo their assessment and approval, the project sponsor must communicate with the foreign lender and report the results of the foreign assessment to the leading negotiation agency before signing specific loan agreements.

Article 9. Project sponsors or banks using government foreign loan capital through re-lending are responsible for repaying the loan to the state budget according to the provisions of the re-lending agreement. The sources of repayment for the state budget are basic depreciation and profits after tax payment according to the law. If the above revenues are insufficient at maturity, corporate reserves and other lawful sources of funds must be used to repay the loan.

Agencies and organizations authorized by the Ministry of Finance to carry out re-lending have the right to apply necessary measures in accordance with current credit regulations and laws to ensure full and timely debt recovery and repayment to the state budget.

Article 10. Based on the annual state budget plan for foreign debt repayment approved by the Government, the Ministry of Finance shall organize the repayment according to the Government's commitments to foreign lenders. In necessary cases, the Ministry of Finance shall lead negotiations with foreign creditors regarding appropriate debt repayment levels, terms, and forms (repayment in cash, goods, export services, or debt conversion into investment).

To ensure timely debt repayment and minimize risks to the state budget in foreign borrowing, establish a Debt Repayment Reserve Fund under the state budget managed by the Ministry of Finance based on revenues from loan projects refinanced from government foreign loans and grants, fees for government guarantees, and other sources as prescribed by the Prime Minister. The Minister of Finance shall draft the Management Regulation of the Debt Repayment Reserve Fund to be submitted to the Prime Minister for approval.

Article 11. All programs and projects utilizing government foreign loans must be adequately and promptly provided with counterpart funds.

Counterpart funds for projects funded by the state budget must be balanced within the annual state budget plan. Planning, approving, and disbursing counterpart funds for projects funded by the state budget must comply with the State Budget Law and related sub-law guiding documents and be consistent with the project implementation schedule.

For projects refinancing from government foreign loans, investors must secure their own counterpart funds and are prioritized to borrow from state credit sources or the National Investment Support Fund.

The Ministry of Planning and Investment and the Ministry of Finance are responsible for adequately and timely arranging counterpart funds in the annual state budget for projects funded by the state budget and guiding investors to apply for counterpart loans from state credit sources or the National Investment Support Fund.

Specific foreign loan agreements for projects can only be signed after the investor has confirmed sufficient counterpart funds.

Article 12. When establishing investment projects to borrow foreign capital, investors must calculate all types of taxes required by law.

In cases where there is insufficient funding to pay the required taxes, investors must recognize tax arrears with the state budget along with the loan and be responsible for repaying the state budget when the project begins operations, following the guidelines of the Ministry of Finance.

Article 13. Issuing various types of bonds in the name of the state or government to borrow capital on the international capital market shall be carried out in accordance with the current regulations of the Government on issuing international bonds. The Prime Minister decides on the use of funds raised from issuing international bonds.

Article 14. Principles for granting government guarantees:

Foreign loans of enterprises for production and business development through self-borrowing and self-responsibility for debt repayment must comply with the provisions of Chapter IV of this Regulation. If the foreign lender requires a bank guarantee, it shall be implemented according to the Guarantee and Re-guarantee Regulation issued by the Governor of the State Bank of Vietnam. For foreign commercial loan projects exceeding the guarantee capacity of banks and where the foreign lender officially requests the Vietnamese Government to provide a guarantee, the Government may consider granting commercial loan guarantees for the following special cases:

a) Projects of significant importance in the national economic development plan.

b) Projects importing high-tech equipment or producing export goods with priority demand.

c) Commercial loans accompanied by grants or ODA loans to form mixed credit financing.

Article 15. Recipients of guarantees:

The recipients of government guarantees are state-owned enterprises or state credit institutions permitted by the Government to directly borrow foreign loans on a self-borrowing and self-repayment basis to implement investment development projects, joint ventures with foreign partners, or expand credit activities. In special cases, upon actual needs and requests from the guarantee-granting agency, the Prime Minister may decide to grant government guarantees to specific entities outside those mentioned above.

Article 16. Conditions for granting government guarantees:

There must be a feasible project approved by the competent authority in accordance with current regulations, clearly stating the repayment plan for borrowed funds.

There must be a loan contract and/or commercial contract signed and approved by the competent authorities in accordance with current regulations.

For organizations and units currently operating: the business operations and financial status of the guaranteed entity must be in a normal state.

Article 17. The agency responsible for issuing government guarantees:

The Ministry of Finance, on behalf of the Government, examines and grants guarantees to enterprises (excluding credit institutions) according to the Prime Minister's decision.

In the case of guarantees for commercial loans accompanied by non-repayable aid or ODA loans to form a mixed credit financing source, the Prime Minister authorizes the Ministry of Finance to examine and decide on granting guarantees to enterprises under investment projects already approved by the Government.

The State Bank of Vietnam, on behalf of the Government, issues guarantees to credit institutions according to the Prime Minister's decision. After issuing the guarantee, the State Bank of Vietnam sends a set of guarantee files to the Ministry of Finance for general management of government guarantee issuance.

Article 18. Guarantee amount:

The total annual limit for government guarantees includes those issued by the Ministry of Finance and the State Bank of Vietnam, not exceeding 10% of the state budget revenue of that year. If the annual guarantee demand exceeds this maximum, the Ministry of Finance must submit it to the Prime Minister for decision.

The Government implements foreign loan guarantees on a per-loan basis. In cases where an enterprise borrows from multiple sources, the maximum total amount of loans guaranteed by the Government for one enterprise is defined as follows (except in special cases decided by the Prime Minister):

For enterprises in the energy, oil, gas, transportation, urban construction, steel industry, and information technology sectors: the maximum guarantee amount for one enterprise equals 12 times the current equity capital of the enterprise at the time of requesting the guarantee (including state budget capital transferred to the enterprise in the case of state-owned enterprises, enterprise funds, and additional capital from profits).

For enterprises in other material production sectors: the maximum guarantee amount for one enterprise equals six times the current equity capital of that enterprise.

For credit institutions: the total guarantee amount for one credit institution shall not exceed six times the self-owned capital of that credit institution.

The above total guarantee limits must be reduced by the outstanding balance of foreign loans not yet repaid by the enterprise or credit institution up to the date of guarantee issuance.

For investment projects to establish new enterprises, the guarantee amount is examined and decided by the Prime Minister for each specific case.

Article 19. The guaranteed party must pay a maximum guarantee fee of 1.5% per annum based on the remaining guaranteed amount to the government guarantee issuing agency. This fee is added to the Foreign Debt Repayment Reserve Fund mentioned in Article 10 of this Regulation, including when the guarantee issuing agency is the State Bank of Vietnam. The specific rate and payment period are determined by the guarantee issuing agency based on the ability to repay and the priority level of each loan project.

Additionally, the guaranteed party must pay a fixed application and processing fee to the guarantee issuing agency to cover costs incurred during the examination and issuance of guarantees. The collection rate and payment period are uniformly stipulated by the Ministry of Finance.

Article 20. The government guarantee issuing agency is the final authority to assess all guarantee application files to report to the Prime Minister for approval and is responsible for all obligations of the Guarantor towards the foreign lender. In the event that the guaranteed party is unable to repay overdue debts, the government guarantee issuing agency is responsible for implementing measures and financial instruments according to current laws to secure repayment. If all such measures and instruments have been utilized but there remains a shortfall or lack of repayment sources, the Foreign Debt Repayment Reserve Fund may be used.

Any disputes arising between the guaranteed party and the guarantee issuing agency will be handled in accordance with the Government Guarantee Regulations, consistent with current Vietnamese law and international practices.

Article 21. The Ministry of Finance will coordinate with the State Bank of Vietnam to develop the Government Guarantee Regulations to be submitted to the Prime Minister for promulgation, detailing the implementation of principles and provisions regarding government guarantees as outlined in this Chapter.

Article 22. The borrowing and repayment of foreign debts by enterprises shall be carried out in accordance with the following principles:

1. Enterprises belonging to all economic sectors established and operating under Vietnamese law have the right to directly borrow foreign capital on a self-borrowing, self-responsibility basis for repayment to foreign lenders according to agreed conditions. Under no circumstances can enterprise debt be converted into government debt, except for loans guaranteed by the Government as specified in Chapter III of this Regulation.

2. Medium and long-term foreign loans (including through the issuance of international bonds) of enterprises must be within the annual total limit plan approved by the Prime Minister and meet the conditions for medium and long-term loans stipulated by the State Bank of Vietnam in each period; they must be registered with the State Bank of Vietnam and confirmed by the State Bank of Vietnam; they must periodically report to the State Bank of Vietnam on the situation of capital withdrawal and repayment according to the reporting system prescribed by the Governor of the State Bank of Vietnam.

For state-owned enterprises: foreign loan agreements must be reviewed by the State Bank of Vietnam before signing. For cases where the Government provides guarantees, the provisions of Chapter III of this Regulation apply.

3. Short-term foreign loans of enterprises must comply with the conditions for short-term borrowing prescribed by the Governor of the State Bank of Vietnam for each period. The Governor of the State Bank of Vietnam shall submit to the Prime Minister for approval the annual limit on short-term outstanding debt, including the limit on delayed payment letters of credit for banks.

4. The withdrawal of loan funds and the transfer of foreign debt repayment by enterprises must be conducted through banks operating in Vietnam that are authorized to conduct foreign exchange transactions. In cases where the withdrawal of funds or repayment of debts using goods (tangible or intangible assets) does not go through a bank, the enterprise must report according to the regulations of the State Bank of Vietnam, and when necessary, must obtain the opinion of the relevant state management agency of the industry or sector.

5. Enterprises borrowing foreign capital have the obligation to use borrowed funds for their intended purposes, may not use short-term funds for investment in medium and long-term projects, and must repay principal and interest according to the commitments made in the loan contracts signed with foreign lenders, bear all risks and responsibilities under the law of the State during the implementation of the loan and repayment, and assume all risks and liabilities before the law of the State.

6. For medium and long-term loans of enterprises under this Regulation, banks may only implement the withdrawal of funds and the transfer of foreign debt repayment at the request of the enterprise when the loan has been registered and confirmed in writing by the State Bank of Vietnam.

The State Bank of Vietnam shall provide specific guidance on procedures, documents, and conditions for enterprises to borrow foreign capital in order to implement the above principles.

Article 23. Forms of guarantee for loans:

1. In cases where the foreign lender requires the enterprise's loan to be guaranteed by a bank, the guarantee will be implemented according to the Guarantee and Re-guarantee Regulations for Foreign Loans issued by the Governor of the State Bank of Vietnam.

Enterprises borrowing foreign capital may seek guarantees from Non-residents (banks, financial lending organizations, or foreign companies...), but must ensure that the guarantee conditions do not contravene current Vietnamese laws. For state-owned enterprises, the content of the guarantee letter must be reviewed by the State Bank of Vietnam.

2. In cases where the enterprise's loan requires a guarantee from the Government, the Ministry of Finance or the State Bank of Vietnam shall undertake the guarantee according to the provisions of Chapter III of this Regulation.

3. The guarantee bank is the final decision-maker and responsible party for the guarantee of foreign loans for enterprises. If it determines that the conditions for guaranteeing are not met according to the Guarantee and Re-guarantee Regulations, the bank must promptly inform the enterprise. The guarantee bank also has the right to choose and apply one or more debt repayment security measures as stipulated by law, such as collateral, pledge, or mortgage for each specific loan project.

4. In cases where the guaranteed enterprise cannot repay its foreign debt upon maturity, the guarantor agency must assume responsibility for repaying the debt on behalf of the enterprise; simultaneously, it has the right to take necessary measures appropriate to the provisions of credit laws and other Vietnamese laws to recover the debts repaid on behalf of the enterprise.

5. Enterprises may use assets formed from borrowed funds or other forms of security in accordance with Vietnamese law to secure foreign borrowing.

6. For foreign loans without guarantees or collateral, the parties involved in the loan shall negotiate and bear all risks themselves.

Article 24. Within thirty days from the date of signing the formal medium or long-term loan contracts (with or without bank guarantees), enterprises and lending financial institutions must provide certified copies of the signed documents with foreign lenders to the State Bank of Vietnam and the guarantor agency.

Article 25. Ministers of Ministries, Heads of agencies equivalent to Ministries, agencies under the Government, Chairmen of People's Committees of provinces and centrally-administered cities, and Heads of central agencies of mass organizations are responsible before the Prime Minister for inspecting and supervising the receipt and use of foreign loans by the Government or guaranteed by the Government for projects or programs within their jurisdiction.

Article 26. The Ministry of Finance, the State Bank of Vietnam, the Ministry of Planning and Investment, and the Office of the Government are responsible for guiding and assisting ministries, sectors, and localities in inspection and supervision work, and directly conducting inspections and supervision of the management and use of foreign loans by the Government and the fulfillment of obligations by enterprises using foreign loans as stipulated in foreign loan agreements or re-lending agreements.

Inspections and supervision of investment projects or construction works using foreign loans must comply with current regulations on investment and construction management.

Article 27. Periodic reporting on the implementation of programs and projects funded by foreign loans of the Government (including those guaranteed by the Government) shall be carried out in accordance with the provisions of Articles 28 and 29 of the Management and Utilization of ODA Regulations promulgated together with Decree No. 87/CP dated August 5, 1997 of the Government.

Article 28. Quarterly, annually, or as needed, enterprises directly borrowing foreign loans must report to the State Bank of Vietnam, the guarantor agency, and the direct management agency (for state-owned enterprises) on the implementation of loan contracts (situations regarding fund withdrawal, use of borrowed funds, and debt repayment) and be subject to inspection and audit according to the regulations of the Governor of the State Bank of Vietnam.

Article 29. Annually, the Ministry of Finance is responsible for compiling and reporting to the Prime Minister on the situation of foreign borrowing and repayment by the Government and the country as a whole, the situation of re-lending and recovery of Government loans, and sending the reports to the State Bank of Vietnam and the Ministry of Planning and Investment.

The State Bank of Vietnam is responsible for reporting to the Prime Minister on the situation of foreign borrowing and repayment by enterprises and credit organizations.

Article 30. The heads of the direct management agencies of state-owned enterprises and credit organizations borrowing foreign loans shall be responsible before the Government for the effectiveness of the borrowing projects they approve or propose to competent authorities to approve for foreign borrowing.

In cases where economic losses occur due to non-compliance with current regulations on the examination or assessment of investment plans funded by loans, or incorrect decisions on investment policies, the person drafting and the person approving the plan shall bear legal responsibility according to the extent of the damage caused.

Investors using foreign borrowed funds, including relending of government loans, if unable to repay debts due to subjective reasons such as inefficient use of capital, wastage, loss of capital, thereby affecting the Government's reputation and causing damage to the State budget, shall bear legal responsibility.

Organizations and individuals violating this Regulation and related legal documents shall be subject to administrative penalties or required to compensate for damages as stipulated by law, depending on the severity of the violation. Serious violations will be prosecuted criminally./.