What is cancellation of foreign currency trade connection between the State Bank of Vietnam (SBV) and credit institutions permitted to engage in foreign exchange?
What is cancellation of foreign currency trade connection between the State Bank of Vietnam (SBV) and credit institutions permitted to engage in foreign exchange? What are cases of a permitted credit institution is exempted from producing reports in Vietnam?
Please advise.
1. What is cancellation of foreign currency trade connection between the State Bank of Vietnam (SBV) and credit institutions permitted to engage in foreign exchange?
Pursuant to Article 14 of Circular 26/2021/TT-NHNN stipulating trade suspension, cancellation of trade connection as follows:
1. SBV shall suspend trade with a permitted credit institution for 3 months when:
a) The permitted credit institution fails to submit reports in a timely fashion or fail to submit adequate reports in accordance with Clause 1 Article 15 hereof 3 times in a single quarter (except for cases under Clause 3 Article 15 hereof); or
b) The permitted credit institution fails to comply with regulations under Clause 2 Article 15 hereof.
2. SBV shall suspend foreign currency trade with a permitted credit institution when the permitted credit institution is:
a) placed under special control; or
b) suspended from engaging in foreign exchange.
3. SBV shall cancel foreign currency trading connection with a permitted credit institution if the permitted credit institution has their license revoked in accordance with the Law on Credit Institutions.
4. SBV shall notify permitted credit institutions in writing of the reasons for suspension of trade or cancellation of foreign currency trading connection.
2. What are cases of a permitted credit institution is exempted from producing reports in Vietnam?
According to Article 15 of Circular 26/2021/TT-NHNN stipulating communication and reporting policies as follows:
1. A permitted credit institution having foreign currency trading connection with SBV must report to SBV (via Central Banking Department) as follows:
a) If trading system of Refinitiv is not used, produce reports on foreign currency trading with other credit institutions in accordance with applicable reporting policies of SBV;
b) If trading system of Refinitiv is used, produce reports in accordance with guidelines of SBV on procedures for producing reports on trading foreign currency via trading system of Refinitiv.
From the point in which foreign currency trading is completed via Refinitiv trading system, the parties must report on trade completion via Refinitiv trading system within 15 minutes. If the parties do not trade via Refinitiv trading system, the report on trade completion must be made on Refinitiv trading system within 45 minutes.
2. Permitted credit institutions must submit written reports on changes to information registered to SBV under Appendix 1 and Appendix 2 attached hereto to SBV (via Central Banking Department).
3. A permitted credit institution is exempted from producing reports mentioned under Point b Clause 1 Article 15 hereof in case of any of the following force majeure:
a) A connection error from the server containing report data of the permitted credit institution to SBV caused by the internet service provider;
b) A technical error of Refinitiv trading system caused by the service provider of Refinitiv;
c) Power outage caused by the electricity service provider or other objective reasons;
d) A technical error of reporting server of SBV;
dd) Other cases originating from an objective cause.
4. As soon as incidents under Clause 3 of this Article are rectified, the permitted credit institution must immediate report on completed trades to SBV (via Central Banking Department). The steps for reporting on these trades shall comply with guidelines of SBV regarding procedures for producing report on trading foreign currency via Refinitiv trading system.
Best Regards!
