Regulations on payment of draft to be collected in Vietnam

Regulations on payment of draft to be collected in Vietnam (Internet image)

1. Who is collecting person?

According to Clause 1, Article 3 of the Regulation promulgated together with Decision 44/2006/QD-NHNN, the collecting person is banks or other payment services suppliers which are permitted by the State Bank of Vietnam to provide the draft collection service.

2. Conditions of drafts to be collected by collecting person in Vietnam

According to Article 5 of the Regulations issued together with Decision 44/2006/QD-NHNN, the conditions of drafts to be collected by collecting person are as follows:

- Draft to be collected by the collecting person must fully satisfy following conditions:

+ The draft is drawn, issued, guaranteed, assigned, mortgaged in accordance with provisions of the Law on assignment instruments, guiding documents of the Law on assignment instruments and other provisions of rated laws on preparation of accounting vouchers.

The draft and subordinate sheet attached (if any) shall fully, clearly, accurately state the contents without any correction, erasure, wrinkling, smear, tearing, patching up, connecting in any form and must be supported by the signature and seal (if any) of the drawer (for bill of exchange) or of the issuer (for promissory note).

There shall not exist the word phrase “To give up, to cancel” or other phrases with the similar meaning

+ In respect of a bill of exchange that needs accepting prior to payment, it must be the draft that has been signed for acceptance by the drawee in compliance with the form and contents provided for in Article 21 of the Law on assignment instruments.

+ Payment term of the draft has not yet expired. The minimum effective payment time of the draft shall be agreed upon by the two parties providing that there will be enough required time to carry out the collection of draft under the Regulations issued together with Decision 44/2006/QD-NHNN.

+ The draft must not be in the list of drafts to be returned, to be refused for payment or not to be paid or to be informed by the Credit information Center of the State Bank of Vietnam of being lost.

- Besides the conditions provided for in Paragraph 1 of this Article 5 of the Regulations issued together with Decision 44/2006/QD-NHNN, the collection accepting person and collection asking customer shall be entitled to make further agreements about conditions of the draft if these agreements do not contrast with provisions of applicable laws

3. Regulations on payment of draft to be collected in Vietnam

Payment of draft to be collected in Vietnam according to Article 8 of the Regulations issued together with Decision 44/2006/QD-NHNN is as follows:

- Within a period of 3 working days from the receipt of the draft presented by the collecting person to be asked for collection, the payer shall make payment or refuse to make payment of the draft to the collection asking customer.

Where the draft is presented in the form of registered mail via public postal service, this time limit shall begin from the date when the payer acknowledges receipt of the draft.

The draft payment of the payer shall be performed by direct payment in cash to the collecting person to be asked for collection or preparing a Payment Order (Payment Proxy or other appropriate payment voucher) and asking account holder of the payer to deduct from the payer’s deposit account for payment of the amount stated in the draft.

- After a period of 3 working days since the receipt of the draft presented, if the payer fails to make payment of the draft (refuses to make payment, fails to prepare a payment order or has prepared the payment order but loses his payment capacity), the collecting person to be asked for collection shall carry out the draft treatment in accordance with Article 9 of the Regulations issued together with Decision 44/2006/QD-NHNN.

- If the collection accepting person carries out the draft presentation and the draft is paid, depending on each specific case to determine measures for treatment accordingly:

+ Where the total amount stated in the draft is paid and the payer has enough money to make payment, the collection accepting person shall

++ Use a sheet of the Payment Order as the voucher for Debiting against the payer’s deposit account. If the payer uses cash to make payment of the draft, the collection accepting person shall base on the Deposit Slip to Debit against the cash account; stamp the phrase “Totally paid” in the front side of the draft to be collected to deliver to the payer enclosed with the subordinate sheet and invoices, vouchers of delivery (if any).

++ Use 01 sheet of the payment order or cash Deposit Slip (in case of cash deposit) as a voucher to Credit the deposit account of the collection asking customer or appropriate account (if the collection asking customer does not have an account); send Credit Advice to the collection asking customer

++ Record out-entry in the book for following up drafts to be collected

+ Where only one part of the amount stated in the draft is paid and the payer has enough money to make payment, the collection accepting person shall:

++ Perform the accounting in accordance with provisions in Point a, Paragraph 3 of Article 8 of the Regulations issued together with Decision 44/2006/QD-NHNN

++ Stamp the phrase “already paid partially, amount......” in the front side of the draft. The collection accepting person shall retain the draft and the subordinate sheet attached (if any) and in the morning or the following working day at the latest shall return them to the collection asking customer with a notice clearly stating the reason of return (according to the Appendix No. 02).

Invoices, vouchers of goods delivery (if any) shall be used in accordance with the instruction in the draft collection Proxy.

+ For the draft which the payer has prepared a payment Order to make payment, but the payer does not have enough money to make payment (partially or totally amount stated in the draft), the collection accepting person shall keep documents of draft collection in the file of unpaid drafts and at once inform the collection asking customer, the payer for their knowledge and taking treatment measure.

When the payer has enough money for payment, the date of payment shall be stated in the front side of the draft for treatment in accordance with provisions at Points a or b Paragraph 3 of Article 8 of the Regulations issued together with Decision 44/2006/QD-NHNN.

After the period of 3 working days since the receipt of the presented draft, the payer still does not have enough money to make payment of the draft, the collection accepting person shall treat the draft in accordance with Article 9 of the Regulations issued together with Decision 44/2006/QD-NHNN.

- If the collecting person to be asked for collection carries out the draft presentation and the draft is paid:

+ At the collecting person to be asked for collection

++ Upon receipt of the draft collection Proxy, draft enclosed with invoices, vouchers of goods delivery (if any) from the collection accepting person, collecting person to be asked for collection must check to ensure that the draft fully satisfies conditions of collection in accordance with applicable provisions;

All contents on the draft collection Proxy have been clearly, fully and accurately stated; quality of invoices, vouchers of delivery attached is stated fully and in line with the draft collection Proxy.

++ If, after the presentation, total amount stated in the draft is paid and the payer has enough money to make payment, the collecting person to be asked for collection shall:

Basing on the Payment Order, Debit against the payer’s deposit account to transfer to the collection accepting person for making payment to the collection asking customer. Where the payer uses cash for draft payment, shall Debit against appropriate account (that was Credited previously upon collecting money from draft payer) to transfer for payment.

Stamp the phrase “Already paid totally” in the front side of the draft to deliver to the payer enclosed with the subordinate sheet and invoices, vouchers of goods delivery (if any);

++ Where only one part of the amount stated in the draft is paid and the payer has enough money to make payment, the accounting and voucher treatment shall be performed as for the case where the draft is paid totally, but the collecting person to be asked for collection shall retain the draft after it is stamped with the phrase “already paid partially, amount.......” and in the morning of the following working day at the latest shall return it to the collection accepting person with a notice clearly stating the reason of return (according to the Appendix No. 02). Invoices, vouchers of goods delivery (if any) shall be treated in accordance with the instruction in draft collection Proxy.

++ For the draft which the payer has prepared a payment order to make payment, but the payer does not have enough money to make payment (partially or totally amount stated in the draft), the collecting person to be asked for collection shall keep documents of draft collection in the file of unpaid drafts and inform the collection accepting person, the payer for their knowledge within the day when the draft is not paid or in the morning of the following working day at the latest.

When the payer has enough money for payment, the date of payment shall be stated in the front side of the draft for treatment in accordance with provisions at point c Paragraph 3 of this Article.

+ At the collection accepting person:

++ Upon receipt of transfer voucher from the collecting person to be asked for collection, the collection accepting person must inspect the legality, validity of the Money Transfer Order, if correct, that voucher shall be used as a basis to Debit against appropriate account, Credit the deposit account of collection asking customer or the account “payables to customers” (if the collection asking customer does not have an account) and send a Credit Advice to collection asking customer.

++ In case of receiving the notice of the draft return enclosed with the returned draft, the collection accepting person must immediately notify (by phone or other modes under agreement of parties) to the collection asking customer.

Quoc Dat

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