Application for registration for changes of foreign loans in Vietnam

Application for registration for changes of foreign loans in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. What is a foreign loan?

According to Clause 1, Article 3 of Circular 12/2022/TT-NHNN, foreign loan is a generic term which means foreign loans that are not guaranteed by the Government (hereinafter referred to as conventional loan) and those that are guaranteed by the Government by means of foreign borrowing through borrowing contracts, deferred payment contracts for import of goods, lending entrustment contracts, contracts for finance leasing or debt instrument issuance on the international market of the borrower.

2. Application for registration for changes of foreign loans in Vietnam

Specifically, in Article 19 of Circular 12/2022/TT-NHNN, the application for registration of changes in foreign loans is as follows:

- The registration form for changes to loans stipulated in clause 1 Article 18 of Circular 12/2022/TT-NHNN.

- Copies and Vietnamese translations of agreements on changes to loans which have been registered.

- Copies of documents of competent authorities in accordance with laws on task and authority assignment in relation to implementation of authority, responsibilities and obligations of the state in state-owned enterprises and state-owned capital invested in enterprises on approval of changes of the foreign loan plan of the borrower who is a state-owned enterprise in case of increasing the loan proceeds or extending the loan term

(not applicable to loans of commercial banks in which the State Bank is a controlling owner representative and have been approved by the State Bank in accordance with regulations on management and use of state funds in enterprises).

- Required documents in the application as specified in clause 3 Article 16 of Circular 12/2022/TT-NHNN in case of increasing the loan proceeds, changing the loan use purpose as to the unrealized loan amount.

- Required documents in the application stipulated by clause 7 Article 16 of Circular 12/2022/TT-NHNN in the event that the borrower that is a credit institution, foreign bank branch increases foreign loan proceeds.

- Document issued by the account service provider regarding confirmation of withdrawal of loan proceeds and debt (principal and interest) repayment till the date of registration for changes of loans in the event of registration for changes of the loan proceeds, or the plan for withdrawal of loan proceeds or debt repayment, or the date on which the commercial bank provides account services.

In case the borrower cannot provide the confirmation of the account service provider according to the provisions of this clause because the account service provider has shuttered business or has suspended operations before the borrower changes another account service provider and/or the withdrawal of loan proceeds and repayment of foreign loans in the cases of withdrawal of loan proceeds and debt repayment which are not made through a foreign loan account as prescribed in Article 2 of Circular 12/2022/TT-NHNN, the borrower may choose to provide other documents as specified at Point d, Clause 8, Article 16 of Circular 12/2022/TT-NHNN.

3. Processes for registration for changes of loans in Vietnam

Processes for registration for changes of loans in Vietnam shall comply with the provisions of Article 19 of Circular 12/2022/TT-NHNN, specifically as follows:

(1) Preparing the application for registration for changes of foreign loans:

- If a borrower filled in the loan change declaration form on the website before submitting the application: then the borrower prints out that form from the website, and give their signature and stamp;

- If a borrower failed to fill in the loan change declaration form on the website before submitting the application: the borrower shall complete the application form for registration for change of foreign loan given in Appendix 04 to Circular 12/2022/TT-NHNN.

(2) Time limit for sending an application for registration for change of foreign loan:

Within 30 working days from the date on which:

- The parties sign an agreement to change or before the time the change is made (for the case where the change does not require such an agreement provided that the change is still consistent with the foreign loan agreement);

- The successor of obligation to repay the foreign loan is issued with a business registration certificate or the date on which the parties to sign an agreement on change of the borrower in a case where the former borrower is fully or partly divided, consolidated or acquired (whichever comes later) and before the withdrawal of loan proceeds and loan repayment continues;

- The borrower completes the update of information on name change and/or address change, moving the head office to another province or city on the National Business Registration Database;

- The creditor (or the organization representing the creditors in the syndicated loan - if any), the grantor (of security interest), the guarantor or other related parties mentioned in the written confirmation of registration, the written confirmation of the loan change registration sends a written notice to the borrower of the name change and before making related money transfers to these parties.

(3) The State Bank shall send approval or rejection of confirmation of registration for changes of loan (with clear explanation) within the following permitted periods:

- 12 (twelve) working days of receipt of valid and sufficient application from the borrower in the event that borrower filled in the loan change declaration form on the website before submitting the application, or;

- 15 (twelve) working days of receipt of valid and sufficient application from the borrower in the event that borrower failed to fill in the loan change declaration form on the website before submitting the application.

(4) Competent authorities referred to in Article 20 hereof shall assume the following responsibilities:

- Check consistency and accuracy of application for registration for change of the loan and information declared on websites; keep borrowers updated on the processing status of registration application on websites if they filled in loan declaration form on the website before submission of application for registration for change of the foreign loan;

- Input information regarding loans on websites to create loan codes and store information in the database of enterprise’s foreign loan or repayment of foreign loan which is not guaranteed by the Government in the event that the borrower failed to fill in loan change declaration form on the website before submission of application for registration for change of the foreign loan; update the application processing on the website in order for the borrower to check up.

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