What are the regulations on time limit for sale of bordering currencies and required cash balance in Vietnam?
- What is included in the regulated entities of the Regulations on operation of bordering exchange agencies in Vietnam?
- What are the regulations on time limit for sale of bordering currencies and required cash balance in Vietnam?
- What are the responsibilities of bordering exchange agencies in Vietnam?
What is included in the regulated entities of the Regulations on operation of bordering exchange agencies in Vietnam?
On June 16, 2023, the State Bank of Vietnam issued Circular No. 04/2023/TT-NHNN on operation of bordering exchange agencies in Vietnam.
According to that, the regulated entities as prescribed in Article 2 of Circular No. 04/2023/TT-NHNN include:
- Business entities acting as bordering exchange agencies.
- Credit institutions that authorize business entities to act as bordering exchange agencies.
- Other organizations and individuals involved in operation of bordering exchange agencies.
What are the regulations on time limit for sale of bordering currencies and required cash balance in Vietnam? (Image from the Internet)
What are the regulations on time limit for sale of bordering currencies and required cash balance in Vietnam?
* Time limit for sale of bordering currencies
According to the provisions of Clause 1, Article 5 of Circular No. 04/2023/TT-NHNN, the time limit for sale of bordering currencies is prescribed as follows:
- The bordering exchange agency must sell all the bordering country cash (apart from the withholdable cash balance) to the authorized credit institution at the end of each working day.
- If the bordering exchange agency is located far from the authorized credit institution and travel is difficult, the authorized credit institution may agree with the business entity on a longer time limit for sale of the bordering currency, but not more than 7 working days.
* Required cash balance
In Clause 2, Article 5 of Circular No. 04/2023/TT-NHNN, the required cash balance is specified as follows:
- Bordering exchange agencies may maintain a daily cash balance of a bordering currency up to VND 40,000,000 (Forty million Vietnamese dong) for bordering currency exchange, under an agreement between the authorized credit institution and the business entity.
- If the bordering exchange agency needs to increase the cash balance, they must follow the legal procedures to revise the certificate of registration of the bordering exchange agency.
What are the responsibilities of bordering exchange agencies in Vietnam?
In Article 6 of Circular No. 04/2023/TT-NHNN, the responsibilities of bordering exchange agencies include:
- Bordering exchange agencies must publicly quote the buying rate of bordering currency in cash with Vietnam dong at the location where the bordering exchange agency is located. They must buy the bordering currency from customers according to the quoted exchange rate.
+ Bordering exchange agencies located at exit waiting areas at international checkpoints or main checkpoints must also publicly quote the buying and selling rates of bordering cash with Vietnam dong, and then buy and sell the bordering currency from/to customers at the quoted exchange rates.
- The buying and selling rates of the bordering currency between the authorized credit institution and the bordering exchange agency must comply with the agreement on bordering exchange agency between the authorized credit institution and the business entity acting as bordering exchange agency, in accordance with current regulations on foreign exchange management.
- Record purchase and sale invoices of bordering currencies, update accounting data and books according to the instructions of the authorized credit institution, in accordance with the applicable accounting and accounting regimes.
+ A bordering exchange agency of an authorized credit institution must use the invoice of that authorized credit institution. When exchanging a bordering currency, the agency must give a copy of the invoice to the customer.
- Bordering exchange agencies must strictly comply with agreements on bordering exchange agency contracts signed with authorized credit institutions and legal regulations on exchange of bordering currencies; they must also comply with the law on prevention and control of money laundering.
- In the course of operation, when detecting that a customer uses fake or invalid bordering currencies as a means of trading, the agency must make a record and temporarily seize the amount and notify the competent agency for investigation and sanctions.
- Bordering exchange agencies must implement the periodical reporting as prescribed in Clause 1, Article 9 of Circular No. 04/2023/TT-NHNN.
According to that, the periodical reporting as prescribed in Clause 1, Article 9 of Circular No. 04/2023/TT-NHNN is as follows:
- Business entities acting as bordering exchange agencies must submit written reports, in person or by post, to the State Bank branches in bordering provinces where the agencies are located. The reports must be submitted quarterly, before the first day of the first month of the next quarter. The reports must be on the operation of bordering exchange agencies in the quarter, and they must be submitted in the form of Appendix 01 issued with this Circular. The report data must be closed from the 15th day of the month preceding the reporting period to the 14th day of the last month of the quarter in the reporting period.
Circular No. 04/2023/TT-NHNN takes effect from August 1, 2023.
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