Press Release on issuance of Circular No.06/2019/TT-NHNN
Hanoi, June 26, 2019 – The Governor of the State Bank of Vietnam (SBV) issued Circular No. 06/2019/TT-NHNN providing guidance for the foreign exchange management related to the foreign direct investment operations in Vietnam. The new Circular shall replace Circular No.19/2014/TT-NHNN dated August 11, 2014.
The issuance of Circular No. 06/2019/TT-NHNN is aimed at guiding the forex management related to the foreign direct investment operations in Vietnam in accordance with the applicable regulations on foreign exchange management as promulgated in the Foreign Exchange Ordinance (as amended and supplemented), Decree No.70/2014/ND-CP of the Government dated July 17, 2014 stipulating the implementation of several articles of the amended and supplemented Foreign Exchange Ordinance, and the 2014 Law on Investment. The main substances of the new Circular are as follows:
1. The new Circular provides a more specific definition of enterprises with foreign direct investment, which serves as a basis to determine which enterprises to be allowed to open direct investment accounts.
2. The new Circular specifies the receipts and expenditures on a direct investment account in foreign currencies and in Vietnamese dongs.
3. On transferring money for implementing investment preparation activities, the new Circular stipulates that a foreign investor is allowed to transfer money from overseas or from their payment account in a foreign currency or Vietnamese dongs, which has been opened at a licensed credit institution in Vietnam, for paying all legitimate costs in the preparation period for their investment in Vietnam.
4. The new Circular stipulates substances related to the payment of an investment value or a project transfer, including the accounts to be used, the terms currency, payments in the transfer transaction.
5. Apart from the above mentioned substances, the new Circular also stipulates the responsibilities of the licensed credit institutions, the enterprises with foreign direct investment and the foreign investors in order to create a legal basis and enhance the responsibilities of the relevant institutions and individuals for complying with the regulations on forex management related to foreign direct investment operations in Vietnam.
The new Circular takes effect from September 6, 2019.
Translated by Le Hang