Thông tư 04/2000/TT-NHNN3

CIRCULAR

GUIDING THE IMPLEMENTATION OF DECREE NO.91/1999/ND-CP DATED 04/09/1999 OF GOVERNMENT ON ORGANIZATION AND OPERATION OF THE STATE BANK INSPECTORATE

On 4 September 1999, the Government has promulgated the Decree No.91/1999/ND-CP dated 04/09/1999 on The organization and operation of State Bank Inspectorate, the State Bank of Vietnam provided guidelines as follows:

Charter I

GENERAL PROVISIONS

1. The State Bank Inspectorate shall be the State Inspection specializing in banking, which is organized as a system in the organizational structure of the State Bank of Vietnam (hereinafter referred to as the State Bank) and has its own seal.

2. Subjects of the State Bank Inspectorate include:

2.1. The organization and operation of the credit institutions:

- State owned credit institutions (including: commercial banks, development banks, investment banks, policy banks and non-bank credit institutions);

- Joint stock credit institutions of the state and people (including: commercial banks and non-bank credit institutions)

- Foreign credit institutions operating in Vietnam (including: joint venture credit institutions, 100% foreign owned capital non-bank credit institutions, foreign bank branches in Vietnam, representative office of foreign credit institutions in Vietnam);

- Cooperative credit institutions;

2.2. Banking activities of organizations, which are not a credit institution and licensed by the State Bank.

2.3. State agencies, socio-economic organizations and individuals in their compliance with provisions of applicable laws on monetary, credit and banking activities.

3. Operation of the State Bank Inspectorate shall be as follows:

3.1. Regular supervision of the compliance with prudential regulations in the operation of credit institutions through the off-site supervision in accordance with provisions of the Governor of the State Bank.

3.2. Carrying out the inspection, examination, reexamination in respect of the compliance with the laws on monetary and banking activities, the compliance with the provisions provided for in the banking operation license by the entities stipulated in Point 2 of this Circular and the provision of applicable laws on the inspection.

3.3. Appraisal, verification, conclusion, suggestion of the settlement of the complaints, denunciation in accordance with the applicable provisions of the Law on complaints, denunciation relating to the banking organization and operation; assistance to the Governor of the State Bank in his directing the prevention and struggle against corruption in the banking sector.

3.4. Identifying, preventing and dealing with the administrative violations within their competence; suggesting to the competent bodies the settlement of violations of the applicable laws on monetary and banking activities.

3.5. Suggesting to the Governor of the State Bank, the General Manager of the State Bank Branches in provinces, cities, and other competent bodies and authorities to take measures to ensure the enforcement of applicable laws on monetary and banking activities.

4. Operational principles of the State Bank Inspectorate:

4.1 The inspection, supervision activities and settlement of complaints, denunciation by the State Bank Inspectorate shall strictly comply with provisions of applicable laws on the inspection, the Law on the State Bank, the Law on Credit Institutions and other related legal documents; and ensure the exactness, fairness, publicity, democracy and timeliness.

4.2. No agency, organization or individual can unlawfully intervene in the activities of the State Bank Inspectorate.

Charter II

DETAILED PROVISIONS

Section I. RIGHTS AND RESPONSIBILITIES OF THE BANKING INSPECTOR DURING THE INSPECTION

5. During the inspection, the State Bank Inspectorate shall have the following rights:

5.1. To request the inspected entities and the concerned parties to provide the documents, evidences and responses to matters relating to the inspection;

5.2. To prepare the minutes of the inspection, the inspection conclusion and to recommend measures to be taken;

5.3. To apply the preventive measures and to impose administrative sanctions in accordance with applicable provisions of the relevant laws;

5.4. To carry on other rights in accordance with the provisions of applicable laws on the inspection;

6. During the inspection, the State Bank Inspectorate shall be responsible for:

6.1 The presentation of the inspection decision (for the Head of the Inspection team) and inspector card;

6.2 The compliance with the proper inspection order and procedures in accordance with the regulations of the Governor of the State Bank, the State Inspectorate, and the legal documents of the inspection, not impeding ordinary banking activities, causing losses to the legitimate interests of the inspected entities;

6.3 The submission of reports to the person who has made the inspection decision, on the inspections results and recommending measures to be taken;

6.4 The compliance with provisions of the relevant laws, being responsible before the person who has made the inspection decision, and before the laws for their conclusions and any act, decision made by themselves.

Section II DUTIES AND RIGHTS OF THE CHIEF INSPECTOR OF THE STATE BANK, CHIEF INSPECTORS OF THE STATE BANK BRANCHES

7. The Chief Inspector of the State Bank shall have following duties and rights:

7.1. to decide plans, content and measures of the inspection according to the inspection program approved by the Governor of the State Bank;

7.2. to manage, direct and provide guidelines on the inspection of the settlement of complaint, denunciation against units of the State Bank;

7.3. to report periodically on the inspections result to the Governor of the State Bank and the State General Inspector in accordance with provisions of applicable laws on the inspection;

7.4. to decide to set up an inspection team or to appoint an Inspector to inspect the inspected entities;

7.5. to have right to call together inspectors from the State Bank Branches in provinces, cities for carrying out the inspection activity if necessary;

7.6. to request the credit institution to conduct the examination by themselves and to report the results to the State Bank Inspectorate;

7.7. to request a temporary cease of the implementation, the amendment or repeal of the regulations of credit institutions and other organization having banking activities if these regulations are contrary to the Law on the State Bank, the Law on Credit Institutions and the applicable law on the inspection; and report to the Governor of the State Bank;

7.8. to temporarily suspend the enforcement of a decision by Heads of units which are directly under the State management of the Governor of the State Bank on the disciplinary punishment, transfer of persons who are collaborating with the State Bank Inspectorate or subjects of the inspection, if considering the enforcement of that decisions shall complicate the inspection activity; the period of suspension shall cease on the date where the settlement decision is announced by the person who has made the inspection decision at the latest. Within 5 working days from the date of the temporary suspension, the suspension must be reported to the Governor of the State Bank; if the related decision is not made by Heads of units under the direct management of the Governor of the State Bank, to recommend to the competent authority for decision submit a report to the Governor of the State Bank;

7.9. to warn, temporarily suspend the work of officers of the units under the direct management of the Governor, who intentionally hinder the inspection or fail to comply with the requirements, suggestion, decision of the State Bank Inspectorate. The period of suspension shall cease on the date where the settlement decision is announced by the person who has made the inspection decision at the latest. Within 5 working days from the date of the temporary suspension, the suspension must be reported to the Governor of the State Bank; if that person is the Head of an units under the direct management of the Governor or a person not under the direct management by the Governor, to recommend to the competent authorities for decision and report to the Governor of the State Bank;

7.10. to temporarily suspend the activity of a person of the credit institutions and other organization having banking activities, if it is proved that such person has committed the violations of applicable laws on monetary and banking activities. The period of suspension shall cease on the date where the settlement decision is announced by the person who has made the inspection decision at the latest. Within 5 working days from the date of temporary suspension, the suspension must be reported to the Governor of the State Bank.

7.11. to temporarily suspend the erroneous banking activities of credit institutions and other organizations having banking activities, if it is proved that these activities are in violations of applicable laws on monetary and banking activities; and to report to the Governor of the State Bank;

7.12. to impose administrative sanctions according to the authorization and to recommend to the Governor the imposition of punishment for administrative violations in monetary and banking activities in accordance with applicable provisions of relevant laws;

7.13. to carrying out other rights provided for in Article 9 and 14 of the Ordinance on the inspection relating to the subjects of inspection and related organizations, individuals within the state management of the State Bank;

7.14. to manage officials, employees being inspector under his authority; to cooperative with related units to organize the implementation of the Regulation on the examination for the assignment of inspector ranking in accordance with applicable provisions of the State;

7.15. to coordinate with the relevant agencies, units (in and outside the banking sector) to organize training courses on the inspection activity for officials and employees in the system of the State Bank Inspectorate;

7.16. on behalf of the Governor of the State Bank, to sign official documents in accordance with the authority of Chief Inspector of the State Bank in accordance with applicable provisions of laws;

7.17. to carry out other works assigned by the Governor of the State Bank;

8. Chief Inspector of the State Bank Branch shall have following duties and right:

8.1. to organize and implement the inspection programs and plans of the State Bank Inspectorate for the organizations which are within the authority of the State Bank Branch;

8.2. to make decision or request the General Manager of the State Bank Branch in provinces, cities, to make decisions on the inspection, examination of credit institutions and other organizations having banking activities which are under the management responsibility of the State Bank Branch;

8.3. to temporarily suspend the implementation of the decision of credit institutions and other organization having banking activities in the event those decisions are contrary to the Law on the State Bank, the Law on Credit Institutions and the Ordinate on the Inspection. The period of suspension shall cease on the date where the settlement decision is announced by the person who has made the inspection decision at the latest, and the suspension must be reported the General Manager of the State Bank Branch and the Chief Inspector of the State Bank;

8.4. to recommend to the General Manager of the State Bank Branch following measures:

a. to suspend some banking activities of credit institutions and organizations having banking activities which are within the authority the competence of the General Manager of the State Bank Branch;

b. to revoke the establishment and operation License of credit institutions, banking operation license of other organizations which are within the authority of the General Manager of the State Bank Branch;

8.5. to impose punishment on administrative violation in accordance with his authority and recommend to the General Manager of the State Bank Branch the imposition of punishment on administrative violations in monetary and banking activities in accordance with provisions of applicable laws, and report at the same time to the Chief Inspector of the State Bank.

8.6. to temporarily suspend the enforcement of a decision by Heads of units under the direct management of the General Manager of the State Bank Branch on the disciplinary punishment, transfer of persons who are collaborating with the State Bank Inspectorate or the subjects of inspection, if considering the enforcement of that decisions shall complicate the inspection activity; the period suspension shall cease on the date where the settlement decision is announced by the person who has made the inspection decision at the latest. If the related decision is not made by Heads of units under the direct management of the General Manager of the State Bank Branch, to recommend to the competent authority for decision with report to be submitted to the General Manager of the State Bank Branch and the Chief Inspector of the State Bank.

8.7. to warn, temporarily suspend the work of a person who intentionally hinder the inspection or fails to comply with the requirements, suggestion, decision of the Banking Inspectorate. The period of suspension shall cease on the date where the settlement decision is announced by the person who has made the inspection decision at the latest. If that person is the Head of an unit under the direct management of the General Manager of the State Bank Branch or a person not under the direct management by the General Manager of the State Bank Branch, to recommend to the competent authorities for decision with report to the General Manager of the State Bank Branch and the Chief Inspector of the State Bank;

8.8. to temporarily suspend the erroneous banking activities of credit institution and other organizations having banking activities during the inspection, if it is proved that these activities are in violations of applicable laws on monetary and banking activities; and to report to the General Manager of the State Bank Branch and the Chief Inspector of the State Bank;

8.9. to carry out other rights provided for in paragraphs 1,2,3,4,5,8,9, Article 9 of the Ordinate on the Inspection and other rights assigned by the General Manager of the State Bank Branch;

Section III. SUBJECTS OF SUPERVISION AND INSPECTION BY THE STATE BANK INSPECTION AND THE STATE BANK BRANCH INSPECTION

9. The State Bank Inspection shall be responsible for the supervision and inspection of:

9.1. The state owned credit institutions: direct inspection of the Head office, operation center and their independent accounting subsidiaries of these institutions;

9.2. The central peoples credit fund;

9.3. Banking activities of organizations, which are not a credit institution and licensed by the State Bank;

9.4. Joint-venture banks operating in Vietnam, 100% foreign owned capital non-bank credit institutions; foreign bank branches;

9.5. Organizations which are under the supervision and inspection by the State Bank Branches in provinces, cities when considered necessary;

10. The State Bank Branch inspection in province, city shall be responsible for the supervision and inspection in their locality of the following:

10.1. The branches, subsidiaries of the state owned credit institutions;

10.2. Joint-stock credit institutions of the state and the people; branches of joint-stock credit institutions of the state and the people. For branches of a joint-stock credit institution of which the head office is located in other provinces, cities, the inspection file and conclusion shall be sent to the respective State Bank Branch in that province, city where the Head office is located for the coordination after the inspection is completed.

10.3. Representative offices of foreign credit institutions in Vietnam;

10.4. Branches of the central peoples credit fund, regional peoples credit funds, local peoples credit funds, cooperative banks, credit cooperatives;

10.5. Banking activities of organizations which are not a credit institution and licensed by relevant authorities (under authorization);

10.6. The agencies, socio-economic organizations and individuals in their compliance with provisions of applicable laws on monetary, credit and banking activities;

10.7. Organizations which are within the inspection responsibilities of the State Bank Inspection (if and when authorized).

11. Agencies carrying out the supervision, inspection provided for in paragraph 9, 10 of Section III shall organize regular supervision and direct inspection, timely detect and strictly deal with the violations in accordance with the provisions of applicable laws in respect of credit institutions and banking activities of other organizations and shall be responsible before the Governor of the State Bank, and the laws for their duties.

Section iV. ORGANIZATION OF STATE BANK INSPECTORATE

12. Organization of the State Bank Inspectorate

12.1. The State Bank Inspectorate shall be organized as follows:

a. The State Bank Inspectorate in the Head office of the State Bank shall be called as the State Bank Inspection.

b. The State Bank Inspectorate in the State Bank Branches in provinces, cities shall be called the State Bank Branch Inspection.

12.2. Organization of the State Bank Inspection:

a. Structure, organization, duties, authority of the State Bank Inspection shall be in compliance with the provisions of the Governor of the State Bank on the organization and operation of the State Bank Inspection.

b. The State Bank Inspection is headed by Chief Inspector and Deputy Chief Inspectors.

c. The appointment and dismissal of the Chief Inspector of the State Bank shall be made in accordance with Article 12 of Decree No 91/1999/ND-CP dated 4 September 1999 of the Government on the organization and operation of State Bank Inspectorate.

d. The appointment and dismissal of the Deputy Chief Inspector of the State Bank shall be decided by the Governor of the State Bank upon recommendation made by the Chief Inspector of the State Bank.

12.3. Organization of the State Bank Branch Inspection

a. The State Bank Branch Inspection shall be an unit in the organizational system of the State Bank Branch in a province or city;

b. The State Bank Branch Inspection is headed by the Chief Inspector and Deputy Chief Inspectors.

c. The appointment and dismissal of the Chief Inspector of the State Bank Branch shall be decided by the Governor of the State Bank on the recommendation by General Manager of the State Bank Branch which is submitted to the Governor by the Chief Inspector of the State Bank.

d. The appointment and dismissal of a Deputy Chief Inspector of the State Bank Branch shall be decided by the General Manager of the State Bank Branch.

12.4. Duties of the State Bank Branch Inspection shall be provided for by the General Manager of the State Bank Branch in accordance with provisions in Article 6, Decision No 25/1999/QD-NHNN dated 11/10/1999 of the Governor of the State Bank on the promulgation of Regulation on the organization and operation of the State Bank Branches in provinces, cities, Decree No 91/1999/ND-CP dated 4 September 1999 of the Government on the organization and operation of State Bank Inspectorate and this Circular.

Section V. BANKING INSPECTOR

13. Banking Inspector shall be a government official appointed under the Regulation on the State Inspector. The management of Inspectors shall be carried out in compliance with the provisions of applicable laws on the inspection.

14. The standards on the State Bank Inspector shall be implement in accordance with provisions in the Decision No 818/TCCC-VC dated 21/10/1993 of the Minister, Head of the Organization and Personnel Department of the Government on the promulgation of the professional standards of Government Official ranking for the State Inspectorate industry.

15. The State Bank Inspector shall be entitled to benefit under provisions of Regulation on the State Inspector and of the State Bank., and be equipped with the technical means which are necessary for the activities of a State Bank Inspector.

16. In the implementation of their duties, the State Bank Inspector shall have the rights provided for in Article 24.3 of the Ordinance on the Inspection dated 1 April, 1990, the Law on State Bank, Law on Credit Institutions dated 12 December, 1997 and this Circular.

Section VI. RELATIONS BETWEEN STATE BANK INSPECTORATE AND THE RELEVANT AUTHORITIES

17. The State Bank Inspectorate shall be subject to the direction and guidance by the State Inspection on the organization and inspecting operations and shall maintain other relations with the State Inspection in accordance with provisions of applicable laws on the inspection.

The State Bank Inspectorate shall have responsibility to submit to the State Inspection the annual inspection program, reports on results of inspection activities according to the provisions of the State Inspection.

The State Bank Inspectorate shall cooperate with the State Inspection in the assignment of inspector ranking, in the training and education of officials and employees in the system of the State Bank Inspectorate in their inspection profession.

The State Bank Inspectorate shall carry out other relations in accordance with provisions of applicable laws on the inspection.

18. The relations between the State Bank Inspectorate and the Inspection of other Ministries, ministry-level agencies, Government agencies, the State Inspection at the local level , legal protection agencies, shall be maintained in accordance with provisions in Article 20 and 21 of Decree-law on the Organization and Operation of the State Bank Inspectorate .

19. The State Bank Inspectorate shall be entitled to use associates in the inspection activities in accordance with applicable provisions of existing laws on the Inspection.

Section VII. IMPLEMENTATION OF REPORTING REGIME

20. The State Bank Inspection shall implement the reporting regime in accordance with provisions of the Governor of the State Bank and the provisions of applicable laws on the Inspection.

21. The State Bank branch Inspection in provinces, cities shall be responsible to submit to the State Bank Inspection consolidated reports on inspection activities of first quarter, of first six month, of third quarter and annual reports on the organization and operation of the inspection as follows (except for irregular cases and upon request by the Governor of the State Bank):

- The first quarter report to be submitted by 20 March in the quarter at the latest;

- The first six month report to be submitted by 10 June of the year at the latest;

- The thirst quarter report to be submitted by 20 September of the year at the latest ;

- The annual report to be submitted by 20 November of the year at the latest.

Section VIII. AWARD AND DISCIPLINARY PUNISHMENT IN ACTIVITIES OF STATE BANK INSPECTORATE

22. Government officials, associates and the inspection units, who have the achievements in the inspection, shall be awarded according to the current rewarding regime of the State and of the Governor of the State Bank.

23. Government officials, employees, who have acts of violations of provisions stated in Article 14 of the Law on the State Bank, lack in responsibilities during the performance of their duties, cover up the violation of provisions of applicable laws on monetary and banking activities and provisions of this Circular by any organization and individual; or misuse their position and authority for their own interests or their own purposes which violate the legal rights and interests of agencies, organization and citizens shall, depending on the seriousness of the violations, be subject to administrative sanctions, prosecuted for criminal liability or have to compensate for the damages in accordance with provision of applicable laws.

Persons, who hinder, bribe, revenge the State Bank Inspectors, shall, depending on the nature and seriousness of the violation, be subject to administrative sanctions, prosecuted for criminal liability in accordance with provision of applicable laws.

Charter III

IMPLEMENTING PROVISION

3. The Chief Inspector of the State Bank, Heads of Departments and units of the State Bank, General Manager of the State Bank Branches in provinces, cities, Chairman of Board of General Manager and General Manager (General Manager) of credit institutions shall be responsible for the implementation of this Circular.

4. This Circular shall be effective after 15 days from the date of its signing and shall replace Decision No. 85/NH-QD dated October 10,1990 of the Governor of the State Bank on promulgation of Regulation on the organization and operation of the State Bank Inspectorate, Decision No. 17/NH-QD dated February 28,1991 of the Governor of the State Bank on promulgation of Inspection Regime of the State Bank of Vietnam.

5. Any amendment of and supplement to this Circular shall be decided upon by the Governor of the State Bank.