Regulations on foreign loan registration

Question: What are the new regulations as stipulated in Circular 03?

Answer: The circular has the following highlights:

Unregistered foreign loans in the form of imports under a deferred payment term

Circular 03 requires a registration or an amendment registration with the SBV for the foreign loans that are not guaranteed by the Government including medium and long-term loans; extended short-term loans of which the total term is over 1 year, or short-term loans without a contract extension but will be outstanding at the time of a full year from the date of first drawdown (unless the repayment is completed within 10 days of the time of a full year from the date of first drawdown.)

However, in order to minimize the difficulties and confusion recently encountered by enterprise that have been involved in foreign loans in form of the imports under a deferred payment term, Circular 03 stipulates that these foreign loans are not subject to registration or amendment with the SBV. The SBV will conduct management of such loans through the corporate report on the implementation of foreign loans.  

As for the independently borrowed and repaid loans of a medium and long-term in the form of imports under deferred payment that have been confirmed by the SBV as foreign loans registered or registered for amendment, before April 15, 2016, the borrower continues conducting (drawdown and repayment) under the documents confirming registration and registration for amendment of foreign loans. As for the amendment contents arising after April 15, 2016, the borrower does so on the basis of agreement with the lender without registering with the SBV to amend foreign loans. Similarly for the independently borrowed and repaid loans of a medium and long-term in form of the imports under deferred payment term that are entered into within 30 days before April 15, 2016, enterprises may conduct any drawdown, transfer for loan repayment on their own and make reports on using loans.

Permitting the online declaration of loan registration information

Under Circular 03, the borrower can choose to declare the information on loan registration or loan amendment registration changes and report the implementation of independently borrowed and repaid loans by one of the following forms: (i) using an electronic page, called an “online form”; or (ii) not use an electronic page but through the “traditional form.” The SBV is especially encouraging borrowers to choose the online form, namely, the borrower can change the selection from traditional form to online form without permission to shift back to the former.

Circular 03 took effect from April 15, 2016, superseding Circular 09/2004/TT-NHNN dated December 21, 2004 and Circular 25/2014/TT-NHNN, dated September 15, 2014./.