From December 1, 2023, transactions with value of 400 million VND or higher must be reported to the State Bank of Vietnam

From December 1, 2023, transactions with value of 400 million VND or higher must be reported to the State Bank of Vietnam

Pursuant to the provisions of Article 25 of the Anti-Money Laundering Law 2022, the reporting entities shall be responsible for reporting to the State Bank of Vietnam when conducting should-be-reported large transactions.

The Prime Minister shall decide the range of values of which transactions are classified as should-be-reported large transactions, depending on the socio-economic condition existing over time.

In which, a large-value transaction must be reported as a cash transaction or a cash foreign currency transaction performed one or more times in a day with a total value equal to or exceeding the prescribed limit.

On April 27, 2023, the Prime Minister of Vietnam issued Decision 11/2023/QD-TTg stipulating that large-value transactions must be reported to the State Bank.

Thus, from December 1, 2023, transactions with a value of 400 million VND or more must be reported to the State Bank.

(Currently, the value of large-value transactions to be reported to the State Bank is VND 300 million).

From December 1, 2023, transactions with value of 400 million VND or higher must be reported to the State Bank of Vietnam (Internet image)

Who are reporting entities?

Reporting subjects are financial institutions, organizations and individuals engaged in related non-financial businesses as prescribed in Clauses 1 and 2, Article 4 of the Anti-Money Laundering Law 2022, specifically as follows:

(1) Reporting entities are financial institutions licensed to conduct one or more of the following activities or operations:

- Acceptance of deposits;

- Lending;

- Financial leasing;

- Payment services;

- Payment intermediary services;

- Issuing negotiable instruments/transferable securities, bank cards, fund/money transfer/wire transfer orders;

- Bank guarantees and financial commitments;

- Providing foreign exchange services, money market instruments;

- Securities brokerage; advice to security investment, provision of security for securities issues;

- Investment fund and portfolio management;

- Life insurance business;

- Money and currency changing.

(2) Reporting entities are relevant non-financial businesses and professions subject to law that conduct one or more of the following activities or operations:

- Prize-awarding games, including electronic games; telecommunications network-based games, Internet-based games; casinos; lottery tickets; betting;

- Real estate business, except leasing or subleasing of real property and real estate consulting;

- Dealing in precious metals, jewels;

- Supply of accounting services; provision of notarial services; provision of legal services rendered by lawyers, legal professional organizations;

- Providing business formation, management and administration services; providing services of acting as (or arranging for another person to act as) a director or secretary of a company to third parties;

The reporting subject required to publish internal rules and regulations on Anti-Money Laundering (AML) in Vietnam

Pursuant to the provisions of Article 24 of the Anti-Money Laundering Law 2022, institutional reporting entities shall be required to publish internal rules and regulations on AML, mainly including:

(1) Institutional reporting entities shall be required to publish internal rules and regulations on AML, mainly including:

- Customer acceptance policy that covers stipulations about denial of account opening, establishment of business relationships, conduct of transactions, or termination of business relationship with customers that may be allowed if any reporting entity fails to identify customers due to these customers’ refusal to provide their information or inadequate provision of information;

- Customer identification procedures and processes;

- Risk management policies and procedures that encompass the matters prescribed in clause 1 of Article 16, clause 1 of Article 19 and clause 2 of Article 34 of the Anti-Money Laundering Law 2022;

- Procedures for reporting of should-be-reported transactions;

- Steps in examining, detecting, handling and reporting suspicious transactions; methods of contact with customers performing suspicious transactions;

- Storage, security and confidentiality of information;

- Application of provisional measures, principles of application of action in case of the postponement of transactions;

- Regimes for reporting or providing information to the State Bank of Vietnam and other competent state authorities;

- Recruitment and training of personnel specializing in AML activities;

- Internal control, audit of compliance with policies, regulations, regulatory processes and procedures relating to AML activities; responsibilities of each natural person or department for implementation of internal rules and regulations on AML.

(2) A reporting entity that is an extra-small enterprise, or a natural person, shall be required to publish internal rules and regulations on AML, containing the following contents:

- Customer acceptance policy that covers stipulations about denial of account opening, establishment of business relationships, conduct of transactions, or termination of business relationship with customers that may be allowed if any reporting entity fails to identify customers due to these customers’ refusal to provide their information or inadequate provision of information;

- Customer identification procedures and processes;

- Risk management policies and procedures that encompass the matters prescribed in clause 1 of Article 16, clause 1 of Article 19 and clause 2 of Article 34 of the Anti-Money Laundering Law 2022;

- Steps in examining, detecting, handling and reporting suspicious transactions; methods of contact with customers performing suspicious transactions;

- Storage, security and confidentiality of information;

Note:

- Internal rules and regulations shall enable prevention, detection, combat and handling of suspicious activities relating to money laundering; shall be consistent with the organization structure and size of business and level of risk of money laundering of the reporting entity, and should be applied and disseminated in the entire system and at its agencies.

- Each year, reporting entities shall be required to review their internal AML rules and regulations and modify or amend them as appropriate.

Mai Thanh Loi

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