The cases are permitted to use of foreign exchange within the territory of Vietnam

 Cases permitted to use foreign exchange within the territory of Vietnam

 Circular 32/2013/TT-NHNN dated 26th Dec 2013 of State Bank of Vietnam prescribes that within the territory of Vietnam, all transactions, payments, listings, advertisements, quotations, setting prices, and recording prices in contracts and agreements and other similar forms (including price conversion or adjustments of prices of goods, services, amount of contract, agreement) of residents and nonresidents must not be effected in foreign exchange except for cases permitted to use foreign exchange within the territory of Vietnamas as follows:

1. Customs, police, border soldier offices and other state agencies at the border gates of Vietnam and custom bond warehouses is permitted to list in foreign currencies and collect foreign currency by transfer or cash from non- residences for taxes, entry visa fees, service charge, other charges and fees prescribed by law.

2. Banks, non-bank credit institutions and branches of foreign banks which is permitted to trade, provide foreign exchange service (referred to as permitted banks) are permitted to carry out transactions, payment, listing, advertisements, quotations, setting prices, recording the price in the contract, agreement with foreign exchange in the business scope of providing foreign exchange services permitted by State Bank of Vietnam in accordance with law.

3. Other organizations are permitted to provide foreign exchange services are permitted to conduct transactions and list in foreign currencies in the business scope of providing foreign exchange services permitted by State Bank of Vietnam in accordance with law.

4. Residents being organizations with legal status are permitted to transfer internally foreign currency funds between accounts of such organization and their dependent units without legal status and vice versa.

5. Residents are permitted to contribute capital by transfer of foreign currency in order to implement the foreign investment projects in Vietnam.

6. Residents carrying out entrusted import export contracts shall comply with following provisions:

 a. Residents being entrusted import are permitted to record price in the entrusted  import contracts in foreign currencies and are paid by transfer of foreign currency for the amount of import contract from the entrusting import party;
 b. Residents being entrusted export contract are permitted to record price in the entrusted export contracts in foreign currencies and settle payments by bank transfer of foreign currency for the amount of export contracts for the entrusting export party.

7. Residents being local contractors, foreign contractors shall comply with the following provisions:

 a.  For oversea expenses related to the implementation of the tender package through international tender as specified in the Law on tendering: Contractors are permitted to offer in foreign currency and be paid by transfer of foreign currency from payment of the investor, the head contractor, pay and remit abroad.
 b. For the implementation of the tender package in accordance with law of oil and gas: contractors are permitted to offer in foreign currencies and be paid by transfer of foreign currency from the payment of investor, the head contractor, pay and remit abroad.

8. Residents being insurer shall be comply with following provisions:

 a. To quote, set prices, record price in foreign currency in insurance policies and be paid by transfers of foreign currency from insurance purchaser for goods and services which must be bought overseas reinsurance;
 b. In case of loss for oversea reinsurance part, resident being organizations purchasing insurance are permitted to receive insurance compensation by transfer of foreign currency from foreign reinsurers through an insurer to pay the expenses of recovering oversea losses.

9. Residents being organizations selling duty-free goods are permitted to list price of goods in foreign currencies and be paid by cash or transfers of foreign currency from the supply of goods. Foreign currency used in transactions at duty-free shops shall comply with the provisions of the law on business of tax exemption goods.

10. Residents being organizations providing services in isolation areas at the international border gates, organizations doing bond warehouse business are permitted to list, quote, set prices, record prices in foreign currency in contracts and be paid by cash or transfers of foreign currency from the providing goods and services.

11. Residents being agents for foreign carriers on the basis of the agency contract signed between the two parties shall comply with the following provisions:

 a. On behalf of foreign carriers to quote, set price, record price in the contract in foreign currency for fees of international transport of goods. The payment must be made in Vietnam dong

 b. Payment order by transfer of foreign currency to purchase goods and services at international seaports, isolation areas in international airports,

 c. Order to pay wages, bonuses, and allowances in foreign currency cash for non-residents authorized by foreign shipping firms.

12. Residents being enterprises in export processing zone shall comply with regulations:

  a. Be permitted to record price in foreign currency in contracts and settle payments in foreign currency by transfers when purchasing goods from the local market for the production, processing, recycling, and assembling goods for export or for export, except for goods subject to export prohibition. Domestic enterprises are permitted to quote, set price in foreign currency and be paid in foreign currency by transfers when selling goods for enterprises in export processing zone

  b. Be permitted to quote, set price, record prices in foreign currency in contracts and to pay, be paid by transfer of foreign currency to other enterprises in export processing zone.

13. Residents being organizations in the business field of air transportation, hotel, and tourism are permitted to list and advertise prices of goods and services in Vietnam dong and foreign currency equivalent on websites, professional publications (not including menu and list of service charges) which only use a foreign language.

14. Residents and non-residents being organizations may agree and pay wages and salary, bonuses and allowances in labor contracts by cash or transfers of  foreign currency to non -residents and resident foreigners who are working for such organizations.

15. Nonresidents are diplomatic missions, consular offices are permitted to list in foreign currency and collect charge of entry visas, the fees and other charges by cash or transfers of foreign currency.

16. Non-residents shall comply with following provisions:

  a. To transfer foreign currency to other nonresident;

  b. To record prices in foreign currency in contracts and settle payment for export of goods and services by transfer of foreign currency to residents. Residents are permitted to quote, set price in foreign currency and to be paid by transfer of foreign currency when providing goods and services to non-residents.

17. The other case permitted to use foreign exchange on the territory of Vietnam, State Bank of Vietnam Governor shall consider and approve based on the actual situation and characteristics of each case required.

This Circular takes effect from 10 Feb 2014.

 Comments: This Circular has not changes from current regulation on restricted use of foreign currency, except for point 13 above

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