Is it possible to agree on a loan interest rate of 5%/month in Vietnam?

Is it possible to agree on a loan interest rate of 5%/month in Vietnam?

I borrowed 300 million VND from a friend, and he asked me to agree on an interest rate of 5%/month. Is this legal?

Answer:

Pursuant to Clause 1 Article 468 of the Civil Code in 2015 stipulating interest rates as follows:

The rate of interest for a loan shall be as agreed by the parties.

The rate of interest for a loan agreed by the parties may not exceed 20% per year, unless otherwise prescribed by law. According to actual conditions and at the proposal of the Government, the Standing Committee of National Assembly shall adjust the above interest and send report to the National Assembly at the latest session.

If the agreed interest exceeds the maximum interest prescribed in this Clause, the agreed interest shall become invalid.

According to the regulations mentioned above, you and the lender may agree on the interest rate, but the interest rate agreed upon must not exceed 20%/year (equivalent to 1.67%/month).

Therefore, in your case, the interest rate of 5%/month is not in accordance with the law.

Is it possible to agree on a loan interest rate of 5%/month in Vietnam? - Source: Internet

How to resolve if parents do not agree on the ethnicity of their child in Vietnam?

It is known that the ethnicity of a child is determined by the agreement of the parents according to the ethnicity of the father or mother. In case parents do not agree on the ethnicity of their child, how does the law resolve it?

Answer:

Pursuant to Clause 2 Article 29 of the Civil Code in 2015 stipulating as follows:

Each individual shall have his/her ethnicity identified at birth in accordance with the ethnicity of his/her biological father and mother. Where the biological father and mother belong to two different ethnic groups, the ethnicity of the child shall be passed from the father’s or mother’s as mutually agreed between the parents; if the parents fail to agree, the ethnicity of the child shall be identified in accordance with relevant customary practices; if the customary practices are different, the ethnicity of the child shall be identified in accordance with the customary practice of smaller ethnic minority.

Therefore, the law has stipulated that in the case where the parents do not agree on the determination of the ethnicity of the child, the child's ethnicity will be determined according to the customs; in the case where the customs are different, the child's ethnicity will be determined according to the customs of the smaller ethnic group.

However, this case only occurs in the case where the ethnicity of the parents is different; in the case where the parents have the same ethnicity, the child naturally has that ethnicity.

Is it possible to agree on a late payment interest rate in commercial transactions in Vietnam?

Is it possible to agree on a late payment interest rate in commercial transactions in Vietnam? Thank you!

Answer:

Pursuant to Article 306 of the Law on Commercial in 2005 stipulating right to claim interest on delayed payment as follows:

Where a contract-breaching party delays making payment for goods or payment of service charges and other reasonable fees, the aggrieved party may claim an interest on such delayed payment at the average interest rate applicable to overdue debts in the market at the time of payment for the delayed period, unless otherwise agreed or provided for by law.

Based on this regulation, the late payment interest rate will be based on the average late payment interest rate on the market at the time of payment corresponding to the time of late payment or by agreement of the parties or other provisions of the law.

As regulations above, you may agree on a late payment interest rate in commercial transactions in Vietnam as prescribed in the Civil Code in 2015.

Pursuant to Clause 2 Article 357 of the Civil Code in 2015 stipulating liability for late performance of the obligation to pay as follows:

Interest arising from late payments shall be determined by agreement of the parties, but may not exceed the interest rate specified in paragraph 1 of Article 468 of this Code; if there no agreement mentioned above, the Clause 2 of Article 468 of this Code shall apply.

Pursuant to Clause 1 Article 468 of the Civil Code in 2015 stipulating interest rates as follows:

The rate of interest for a loan agreed by the parties may not exceed 20% per year, unless otherwise prescribed by law. According to actual conditions and at the proposal of the Government, the Standing Committee of National Assembly shall adjust the above interest and send report to the National Assembly at the latest session.

If the agreed interest exceeds the maximum interest prescribed in this Clause, the agreed interest shall become invalid.

Therefore, the parties may agree on a late payment interest rate, but it must not exceed 20%/year of the loan amount.

Best regards!