Cases of Termination of Membership in the People’s Credit Fund in Vietnam

Cases of Termination of Membership in the People’s Credit Fund in Vietnam​ (Image from the internet)

On June 28, 2024, the Governor of the State Bank of Vietnam issued Circular 29/2024/TT-NHNN regulating the people's credit fund.

Cases of termination of membership in the people's credit fund in Vietnam

According to Article 9 of Circular 29/2024/TT-NHNN regulating the termination of membership in the people's credit fund as follows:

- A member of the people's credit fund shall cease to be a member in the following cases:

+ Automatic termination:

(i) The member who is an individual has died or gone missing;

(ii) The member who is a legal entity has ceased to be a legal entity;

(iii) The member no longer meets the conditions to become a member as specified in Article 8 of this Circular, except for the case specified in point c(i) of this section;

(iv) The member has transferred all contributed capital to another person in accordance with the law and the charter of the people's credit fund;

+ Voluntary termination: The member voluntarily leaves and is approved by the Board of Directors to exit the people's credit fund;

+ Expulsion: The member is expelled from the people's credit fund by the General Meeting of Members for:

(i) Failing to ensure sufficient contributed capital as specified in clause 1, Article 10 of Circular 29/2024/TT-NHNN;

(ii) Committing acts of forgery, fraudulent member documents;

(iii) Other cases as prescribed in the charter of the people's credit fund.

- The Board of Directors decides on the termination of membership and compiles a list for reporting at the nearest General Meeting of Members.

- The handling of the contributed capital of the member upon termination of membership as specified in clause 1, Article 9 of Circular 29/2024/TT-NHNN shall be as follows:

+ In cases of termination of membership as specified in points a(i), a(ii), a(iii) of clause 1, Article 9 of Circular 29/2024/TT-NHNN:

(i) The contributed capital may be transferred as specified in clause 1, Article 12 of this Circular or be refunded as specified in clause 3, Article 12 of Circular 29/2024/TT-NHNN;

(ii) For members who are individuals that have died, gone missing, lost civil act capacity or had civil act capacity restricted: the rights and obligations of the member shall be exercised in accordance with civil law;

(iii) For members who are legal entities ceasing to be legal entities: shall comply with the law on reorganization, dissolution, bankruptcy;

+ In the case of voluntary termination as specified in point b, clause 1, Article 9 of Circular 29/2024/TT-NHNN: The member may transfer the contributed capital as specified in clause 1, Article 12 of Circular 29/2024/TT-NHNN or be refunded in accordance with clause 3, Article 12 of Circular 29/2024/TT-NHNN;

+ In the case of expulsion as specified in point c, clause 1, Article 9 of Circular 29/2024/TT-NHNN: The member is not allowed to transfer the contributed capital. The refund of the contributed capital shall be conducted in accordance with clause 3, Article 12 of Circular 29/2024/TT-NHNN.

- Members ceasing to be members shall receive benefits (if any) as decided by the General Meeting of Members after fulfilling all financial obligations as prescribed by law and the charter of the people's credit fund.

Conditions to become a member of the people's credit fund in Vietnam

- For individuals:

+ Vietnamese citizens who are 18 years of age or older, have full civil act capacity, registered permanent or temporary residence in the operating area of the people's credit fund. In the case of temporary residence registration, the individual must have production, business activities or be a laborer working in the operating area of the people's credit fund and must have documents proving this;

+ Officials and public employees working at organizations, and agencies headquartered in the operating area of the people's credit fund;

c) Not undergoing criminal prosecution, not serving a prison sentence; not under administrative handling measures at compulsory detoxification centers or compulsory educational institutions; not prohibited by the court from holding positions, practicing professions, or performing certain jobs; those convicted of serious crimes or higher but not yet having their criminal records expunged.

- For households:

+ Households with members permanently residing in the operating area of the people's credit fund; members of the household sharing assets for household production and business activities;

+ Members of the household must appoint a member to act as the representative to exercise the rights and obligations of the member of the people's credit fund. The household representative must be authorized in writing by the household members in accordance with the law and must meet the conditions stipulated in clause 1, Article 8 of Circular 29/2024/TT-NHNN.

- For legal entities:

+ Legal entities (except for Social Funds, Charitable Funds) that are legally operating and have their headquarters located in the operating area of the people's credit fund;

+ The representative of the legal entity participating as a member of the people's credit fund is the legal representative of the legal entity or an individual authorized by the legal representative of the legal entity.

- Individuals, households, legal entities must voluntarily apply for membership in the people's credit fund using the forms in Appendices 01, 02, and 03 issued together with Circular 29/2024/TT-NHNN, approve the charter, and contribute the required capital as stipulated in Article 10 of Circular 29/2024/TT-NHNN.

- Each object as stipulated in clauses 1, 2, and 3 of Article 8 of Circular 29/2024/TT-NHNN may only participate as a member of one (1) people's credit fund.

- The Board of Directors decides on the admission of members and compiles a list of admissions for reporting at the nearest General Meeting of Members.

- The people's credit fund must stipulate in the charter the conditions and procedures for member admission.

(Article 8 of Circular 29/2024/TT-NHNN)

Le Nguyen Anh Hao

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