Vietnam: Contents must be included in the guarantee commitment

According to Circular No. 07/2015/TT-NHNN of the State Bank of Vietnam, the guarantee commitment must include the following contents:

- Applicable regulations;

- Serial numbers and guarantee commitment form;

- Information about parties in the guarantee relationship;

- Date of guarantee issuance, guarantee validity commencement and/or cases in which the guarantee validity begins;

- Date of validity termination and/or cases in which the guarantee validity is terminated;

- Guarantee sum and currency;

- Guarantee obligations;

- Conditions for fulfillment of guarantee obligations;

- Application for fulfillment of guarantee obligations;

- Approaches to checking the authenticity of the guarantee commitment.

Apart from matters stipulated above, the guarantee commitment may include other matters relevant to the guarantee commitment, and in compliance with regulations laid down in this Circular and applicable laws.

Things should be noted in the guarantee commitment:

- Any modification or annulment of agreed-upon matters shall be approved in compliance with the guarantee agreement and applicable laws.

- Credit institutions, or foreign bank branches, shall take into account matters agreed upon in the guarantee agreement or guarantee commitment stipulated in this Circular to design, print and issue the guarantee commitment template in response to the guarantee form and category which are consistently applied to the entire system of these credit institutions or foreign bank branches. Credit institutions, or foreign bank branches, must issue internal regulations on the process, responsibility for such design, printing, issuance and use of the guarantee commitment template in order to ensure the safety and compliance with legal regulations.

- Guarantee commitments issued through the international inter-bank communication network, credit institutions or foreign bank branches, shall take the form and follow the process of the guarantee commitment issuance accepted by the international inter-bank communication network. Credit institutions, or foreign bank branches, must issue the procedures for monitoring or administration of guarantee issuance operations to be applied in this circumstance in order to ensure the safety and efficiency.

View more details at Circular No. 07/2015/TT-NHNN of the State Bank of Vietnam, effective from August 09, 2015.

Le Hai

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