What are the regulations on money transfer to perform collateralized security obligations for foreign loans in Vietnam?
What are the regulations on the collateralized security obligation for foreign loans in Vietnam?
Pursuant to Article 36 of Circular No. 12/2022/TT-NHNN on the collateralized security obligation for foreign loans as follows:
Performance of security obligations in the form of collateralized security
1. When a collateralized security obligation arises for a foreign loan, the grantor shall perform the security obligation in accordance with the commitments in the loan agreement and the guarantee agreements which are not contrary to Vietnamese law on secured transactions and other relevant laws.
2. The transfer of the proceeds after realizing the collateral in the Vietnamese territory to the creditor or the creditor's representative to perform the obligation to secure the property (hereinafter referred to as the "money transfer to perform collateralized security obligation”) must be done through 01 bank providing secured transactions as prescribed in this Circular.
3. In case of realization of collateral in the form that the secured party receives the collateral itself to replace the performance of the obligation, the borrower is responsible for notifying the account service provider of information about the debt obligation that has been paid in the form that the secured party receives the collateral itself to replace the performance of the obligation.
Thus, the collateralized security for foreign loans is carried out in accordance with the above provisions.
What are the regulations on money transfer to perform collateralized security obligations for foreign loans in Vietnam? (Image from the Internet)
What are the regulations on money transfer to perform collateralized security obligations for foreign loans in Vietnam?
Pursuant to the provisions of Article 36 of Circular No. 12/2022/TT-NHNN on the transfer of money to perform the collateralized security obligations as follows:
Performance of security obligations in the form of collateralized security
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2. The transfer of the proceeds after realizing the collateral in the Vietnamese territory to the creditor or the creditor's representative to perform the obligation to secure the property (hereinafter referred to as the "money transfer to perform collateralized security obligation”) must be done through 01 bank providing secured transactions as prescribed in this Circular.
Pursuant to the above provisions, the collateralized security obligation for foreign loans is performed through the bank serving secured transactions.
Thus, the bank serving secured transactions is specified in Article 37 of Circular No. 12/2022/TT-NHNN on bank providing secured transactions in Vietnam as follows:
Bank providing secured transactions in Vietnam
1. Money transfer for performance of security obligations (including money transfer for performance of guarantee obligations and money transfer for performance of collateralized security obligations) must be done through 01 bank providing secured transactions, except for the cases specified in Clause 3, Article 36 of this Circular.
2. In case the bank providing secured transactions is also the bank providing account services of foreign loans, this bank is responsible for checking and keeping relevant documents in accordance with the provisions of this Circular when transferring money to perform security obligations as prescribed in this Circular.
3. In case the bank providing secured transactions is not a bank providing account services of foreign loans, when transferring money to perform security obligations, the bank shall have the following responsibilities:
a) Examine and keep documents and transfer money on the basis of documents mentioned in Clause 4 of this Article;
b) Within 07 working days from the date of money transfer to perform the security obligation, notify and send to the account service provider the documents proving the debt amount (principal, interest, fee) paid to the creditor through the performance of security obligations for the account service provider to monitor, determine the outstanding balance of principal, interest, and fees of the loan and serve as a basis for the transfer of funds to repay the indebtedness amount between the borrower and the grantor as prescribed in this Circular.
What documents are required to be authorized to perform a security obligation?
Pursuant to the provisions of Clause 4, Article 37 of Circular No. 12/2022/TT-NHNN on the performance of collateralized security obligations as follows:
Bank providing secured transactions
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4. Documents for the authorized bank providing secured transactions to transfer money to perform the security obligation for the foreign loan, including:
a) Foreign loan agreement;
b) Agreements on guarantee, collateralized security related to foreign loans;
c) A written request for performance of security obligations from the creditor (or the creditor’s representative or the creditor’s representative to realize the collateral) according to the agreement of the parties to the guarantee; realization of collateral, specifying the payment obligations that the borrower is unable to perform the obligations under the loan agreement;
d) A written certification of the borrower's account service provider on the withdrawal of loan proceeds and loan repayment up to the time of request for money transfer to perform security obligations;
dd) Written confirmation of registration or registration for changes of foreign loans issued by the State Bank, identifying the security interests for foreign loans (applicable to the case in which foreign loans are subject to registration with the State Bank);
e) Other documents (if any) as prescribed by the bank providing secured transactions.
5. The borrower is responsible for notifying the grantor of the bank providing account services, the bank providing secured transactions and fully declaring information about these banks when registering and registering the change of foreign loan (in case the loan is subject to foreign loan registration as prescribed in this Circular).
Thus, the borrower must provide enough documents as prescribed above, then the bank serving the security transaction will allow the money transfer transaction to perform the security obligation.
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