Guidance on the use of non-refundable deposits from auction participants in Vietnam from January 22, 2025

Guidance on the use of non-refundable deposits from auction participants in Vietnam from January 22, 2025​ (Image from Internet)

On January 22, 2025, the Minister of Finance of Vietnam issued Circular 03/2025/TT-BTC providing guidance on financial policies in asset auction activities; stipulations on the collection, expenditure, management, and use of fees for auction participation dossiers, and non-refundable deposits from auction participants under the regulations of the law on asset auctions.

Guidance on the use of non-refundable deposits from auction participants in Vietnam from January 22, 2025

According to the provisions of Article 9 of Circular 03/2025/TT-BTC, the management and use of non-refundable deposits from auction participants shall be implemented as follows:

- In cases where the asset holder is allocated a state budget estimate for organizing asset auctions, within 5 working days from the day of the professional auction organization or Asset Auction Council transferring the money, the asset holder must remit the entire non-refundable deposit of the auction participant, as stipulated in Article 8 of Circular 03/2025/TT-BTC, into the state budget.

“Article 8. Transfer of Non-Refundable Deposits from Auction Participants to the Asset Holder

The professional auction organization or the Asset Auction Council is responsible for transferring the non-refundable deposits from auction participants, as stipulated in Clause 6, Article 39 of the Asset Auction Law (including any arising interest - if any) to the asset holder within 5 working days from the closing of the auction session or the price announcement session.”

- In cases where the funding source for organizing the asset auction is obtained from the auction proceeds held in a temporary account, within 5 working days from receiving the non-refundable deposit from the auction participant, the asset holder is responsible for depositing the non-refundable deposit stipulated in Article 8 of Circular 03/2025/TT-BTC into their temporary holding account or the temporary holding account of the agency or unit authorized to manage the funds obtained from asset handling opened at the State Treasury, as per legal regulations, and used to pay related auction costs before remitting to the state budget as stipulated at Point b, Clause 1, Article 5 of Circular 03/2025/TT-BTC.

“Article 5. Financial Regime in Asset Auction Activities for the Asset Holder

1. The funding sources for asset auction activities include:

…

b) Proceeds from auctions held in temporary accounts (including fees from auction participation dossiers for cases where the Asset Auction Council is established; non-refundable deposits from auction participants as stipulated in Clause 6, Article 39 of the Asset Auction Law) in cases where it is required to remit all proceeds from asset auctions into a temporary account at the State Treasury under the account management of the agency that established the Asset Auction Council or the temporary holding account of the agency, unit authorized to manage the account and deductible for asset handling costs before remitting to the state budget;”

- In cases of auctions for asset security handling and bad debt handling, the non-refundable deposit from the auction participant stipulated in Article 8 of Circular 03/2025/TT-BTC is integrated into the revenue from handling secured assets and bad debts to be managed and processed according to relevant legal regulations on asset auctions stipulated in Article 3 of Circular 03/2025/TT-BTC.

“Article 3. Financial Regime in Asset Auction Activities for Professional Asset Auction Organizations and Bad Debt Management Organizations

The management and use of revenues from asset auction service fees, asset auction costs, fees for auction participation dossiers, and other revenues (if any) are stipulated as follows:

1. Implement according to the Law on the financial autonomy mechanism of public service providers and relevant laws in cases where the professional asset auction organization is the Asset Auction Service Center.

2. Implement according to the Law on Enterprises in cases where the professional asset auction organization is an asset auction enterprise.

3. Implement according to the Law on Enterprises and the laws on credit institutions in cases where the bad debt management and handling organization self-organizes asset auctions as stipulated in Clause 2, Article 64 of the Asset Auction Law.”

- In cases not covered by clauses 1, 2, and 3 of Article 9 Circular 03/2025/TT-BTC, the management and use of non-refundable deposits from auction participants stipulated in Article 8 of Circular 03/2025/TT-BTC are implemented according to the financial mechanism applicable to the asset holder.

More details can be found in Circular 03/2025/TT-BTC, effective from January 22, 2025.

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