On December 2, 2019, the State Bank of Vietnam (SBV) issued Circular No.25/2019/TT-NHNN, amending and supplementing a number of articles of the Governor’s Circular No. 40/2011 / TT-NHNN. The State Bank of Vietnam provides for the licensing and organization and operation of commercial banks, foreign bank branches, representative offices of foreign credit institutions and other foreign organizations engaged in activities in Vietnam.
Accordingly, the Circular has supplemented the provisions on the authority of the directors of the State Bank branches in provinces, cities directly under the Central Government, namely: “Issuing licenses, amending and supplementing licenses for representative offices ”(Point b Clause 2 Article 1). The current laws only stipulate the licensing competence of the Governor of the State Bank.
At the same time, it also amended the order and procedures for establishing representative office licenses as follows:
– Foreign credit institutions and other foreign organizations conducting banking activities shall compile dossiers of application for licenses under Article 13 and Article 18 of Circular 40/2011 / TT-NHNN and submit them directly or send via postal services to the State Bank branches in provinces, cities under the central Government’s management (hereinafter referred to as the State Bank branch) where the representative office is expected to locate its head office.
Within 30 days from the date of receipt of the application file for a License, the State Bank branch shall send a written request to the foreign credit institution and foreign organization engaging in banking activities to certify that it has received a complete and valid application file. rate. In case the dossier of application for a License is incomplete and valid as prescribed, the State Bank branch shall send a written request to the foreign credit institution or other foreign organization engaging in banking activities to request the supplementation of the dossier.
– Within 60 days from the date of sending the written confirmation of receipt of the complete and valid file, the branch State Bank shall issue the License as prescribed. In case of refusal to grant a license, the State Bank branch shall issue a written reply to foreign credit institutions and other foreign organizations engaging in banking activities, clearly stating the reason for not granting the License.
According to current regulations, the entity that receives, processes applications and issues licenses is the SBV.
Amending and supplementing a number of articles of Circular 40/2011 / TT-NHNN creates a clear legal corridor for foreign credit institutions, enhancing the role and responsibilities of the State Bank branches in provinces and cities cities under central authority in state management.