What are general regulations on state management of insurance business in Vietnam?

What are general regulations on state management of insurance business in Vietnam?

Pursuant to Article 151 of the Law on Insurance Business in 2022 (takes effect from 01/01/2023) stipulating general regulations on state management of insurance business in Vietnam as follows:

1. The Government shall carry out its uniform state management of insurance business.

2. The Ministry of Finance shall be held accountable to the Government for its state management of insurance business and shall have the following duties and entitlements:

a) Promulgate or seek competent authorities’ approval of promulgation and instructions on implementation of legislative documents on insurance business, formulation of strategies, projects and policies for development of Vietnam’s insurance market;

b) Conduct statistics and forecast of the insurance market;

c) Supervise insurance companies, reinsurance companies and foreign branches in Vietnam, mutuals providing microinsurance products and insurance brokerage companies through their rendering of services, financial status, corporate management, risk management and compliance with law on insurance business; supervise performance of foreign representative offices in Vietnam;

d) Supervise performance of insurance agents and insurance ancillary services through insurance companies, reinsurance companies and foreign branches in Vietnam;

dd) Examine and inspect insurance companies, reinsurance companies and foreign branches in Vietnam, mutuals providing microinsurance products and insurance brokerage companies; examine performance of foreign representative offices in Vietnam;

e) Ensure international cooperation in the insurance sector;

g) Settle disputes, claims and impose sanctions against administrative violations arising in the insurance business.

What are regulations on mechanism for cooperation in state management of insurance business in Vietnam?

Pursuant to Article 152 of the Law on Insurance Business in 2022 (takes effect from 01/01/2023) stipulating mechanism for cooperation in state management of insurance business in Vietnam as follows:

1. The Ministry of Finance shall cooperate with state foreign insurance authorities on management, supervision, inspection and examination of foreign branches in Vietnam in accordance with the Government’s regulations.

2. The Ministry of Finance shall establish the mechanism for sharing of administrative and supervisory information with the State Bank of Vietnam, Ministries, other central authorities and socio-professional organization in the insurance industry.

3. The Ministry of Finance shall cooperate with relevant Ministries and central authorities on affiliation and cooperation between the insurance sector and the social or health insurance sector under the state control.

4. Business registration agencies shall not be allowed to accept the use of the phrase or term “insurance", "reinsurance" or the like in a company’s name if such use can result in the confusion to such an extent that the company is wrongly considered an insurance company, reinsurance company or foreign branch in Vietnam.

5. Business registration agencies shall not be allowed to accept the use of the phrase or term “insurance brokerage", "reinsurance brokerage" or the like in a company’s name if such use can result in the confusion to such an extent that the company is wrongly considered an insurance brokerage company.

What are regulations on right to request provision of information of Ministry of Finance for use in examination, inspection and handling of administrative offences arising in the insurance business in Vietnam?

Pursuant to Article 153 of the Law on Insurance Business in 2022 (takes effect from 01/01/2023) stipulating right to request provision of information of Ministry of Finance for use in examination, inspection and handling of administrative offences arising in the insurance business in Vietnam as follows:

1. During the process of examination, inspection and handling of administrative offences arising in the insurance business, in addition to the duties and powers prescribed in law on inspection, law on handling of administrative offences and other regulatory provisions of relevant law, the Ministry of Finance shall have the following duties and powers:

a) Request shareholders, capital-contributing members, managers, controllers, staff members of insurance companies, reinsurance companies, foreign branches in Vietnam or insurance brokerage companies to give explanations about and provide information, documents and data related to the scope of inspection and examination activities;

b) Request entities and persons possessing information, documents and data related to the scope of inspection and examination of the insurance business to provide these information, documents and data, or request entities or persons to give explanations about and contact it to deal with issues related to the scope of examination and inspection;

c) Request credit institutions or foreign bank branches to provide information related to accounts of insurance companies, reinsurance companies, foreign branches in Vietnam, insurance agents, insurance brokerage companies, insurance ancillary service providers, fund management companies of insurance companies, foreign representative offices in Vietnam and entities or persons suspected of committing the prohibited acts specified in Article 9 herein, or committing violations against regulations on capital adequacy ratios, investment of insurance companies, reinsurance companies, foreign branches in Vietnam, financial safety and solvency referred to in Article 95, 99, 100, 109 and 110 herein. Procedures and processes for requesting and providing information shall be subject to regulatory provisions on banking.

2. Requesting entities and persons to cooperate and provide information, documents, data, explanation, or contact it to deal with issues concerned, as per this Article must be expressed in written documents specifying purposes, bases, content and scope of each request.

3. Information provided by credit institutions, foreign bank branches, entities and persons as per this Article must be secured as per regulatory provisions and can only serve the purposes of inspection, examination and sanctioning of administrative offences of related entities or persons.

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