THE STATE BANK OF VIETNAM

Circular No. 06/2013/TT-NHNN dated March 12, 2013 of the State Bank of Vietnam guiding the trade on gold bar in domestic market

Pursuant to the Law No. 46/2010/QH12 dated June 16, 2010 of the National Assembly on the State Bank of Vietnam;

Pursuant to the Law No. 47/2010/QH12 dated June 16, 2010 of the National Assembly on Credit Institutions;

Pursuant to Decree No. 96/2008/ND-CP dated August 26, 2008 of the Government defining the functions, tasks, powers and organizational structure of the State Bank of Vietnam;

Pursuant to Decree No. 86/1999/ND-CP dated August 30, 1999 of the Government on State management of foreign Transaction Department reserves;

Pursuant to Decree No. 24/2012/ND-CP dated April 3, 2012 of the Government on management of gold trading activities;

Pursuant to Decision No. 16/2013/QD-TTg of March 4, 2013 of the Prime Minister on the purchase and sale of gold bar in the domestic market of the State Bank of Vietnam;

At the proposal of Director of Foreign Transaction Department Management Department;

The Governor of State Bank of Vietnam has issued the Circular guiding the trade on gold bar in domestic market of the State Bank of Vietnam,

Chapter 1.

GENERAL PROVISION

Article 1. Regulation scope and application’s objectives

This Circular takes instruction on gold bar trades among the State Bank of Vietnam (here after called the State Bank) with other credit institutions and enterprises which are granted with permits on trading gold bars.

Article 2. Term definition

Term is defined as follows:

1. “Representatives of credit institutions and enterprises” is the legal representative in credit institutions and enterprises in trading gold bars with the State Bank.

2. “Direct trade of gold bars” is the trading form that the State Bank decides and announces the price, quantity, partners for purchasing and selling gold bars.

3. “Trading gold bars by bidding” is the trading form that the State Bank take bidding to determine partners, price and volume of gold bar.

4. “Bidding by price” is the bidding form that members in the bid shall offer bidding price in order to determine bid winning gold bar’s price and quantity.

5.  “Bidding by volume” is the bidding form that members in the bid shall register the bid volume to determine bid winning volume at the price made by the State Bank.

6. “Lot of gold bar” is the volume unit in the transactions of purchasing between the State Bank with other credit institutions and enterprises. Volume of a lot from the State Bank shall be decided and informed before the transaction time.

Chapter 2.

ESTABLISHING TRADING TRANSACTION RELATIONSHIP OF GOLD BAR AMONG THE STATE BANK AND CREDIT INSTITUTIONS AND ENTERPRISES

Article 3. Dossier and procedures for establishing trading transaction relationship of gold bar with the State Bank

1. Credit institutions and enterprises that trade gold bars and have demand on taking participate in trading transaction with the State Bank shall apply directly or send by post 01 (one) registration dossier for establishing trading transaction for gold bar to the State Bank (Transaction Department). The dossier includes:

a) Registration application for establishing trading transaction relationship of gold bar with the State Bank (in accordance with Appendix 1);

b) Enterprise Registration Certificate or Business Registration Certificate (certified copy);

c) Document for registering representative’s signatures of credit institutions and enterprises (In accordance with Appendix 2);

d) Authorization document of credit institutions and enterprises for transaction’s representative in the case that the representative is the authorized representative;

2. The State Bank (Transaction Department) shall inform credit institutions and enterprises in written form for the confirmation of establishing the trading relationship of gold bar with credit institutions and enterprises within 05 (five) working days from the date of receiving full valid dossiers (in accordance with Appendix 3);

3. In the case of having changes in document’s contents stipulated in point a, point b, clause 1 of this Article, credit institutions and businesses must inform in written form to the State Bank (Transaction Department) attached with relevant documents within 05 (five) working days from the date of changes.

Article 4. Transaction representative of credit institutions or enterprises

1. The transaction representative of credit institutions or enterprises is the legal representative of credit institutions or enterprises or the authorized representative.

2. Each credit institution or enterprise is permitted to register a maximum of 03 (three) transaction representatives.

3. In case the transaction representative of the credit institutions or enterprises is the authorized representative, the authorization document must be signed by the legal representative. The scope of authorization shall include the minimum contents as follows: signing and receiving documents and performing relevant duties during the process of bidding (for the form of bidding), receiving announcement of sale and purchase price of gold bar, signing application for registration of trading of gold bar, receiving announcement of volume of gold bar to be sold and purchased (for direct trading), signing confirmation document of trading of gold bar with the State Bank.

4. When changing transaction representative, the credit institutions or enterprises must notify in writing form to the State Bank (Transaction Department) together with authorization document (in case of authorization) and registration document of sample signature of the new transaction representative of the new transaction. The change of transaction representative is only valid from the time the State Bank (Transaction Department) receives notice, together with the relevant documents.

5. Each credit institution or enterprise is allowed to appoint only 01 (one) transaction representative in the list registered to participate in a transaction of trading of gold bar with the State Bank.

6. The transaction representative of credit institutions or enterprises upon participating in transaction must present identity card or passport.

Article 5. Suspension and cancellation of trading transaction relationship of gold bar

1. The State Bank shall suspend the trading transaction of gold bar with credit institutions and enterprises for 03 (three) months from detection of one of the following violations:

a) Credit institutions and enterprises violate the obligation of certification signing in accordance with process of gold bar’s trading transaction with the State Bank.

b) Credit institutions and enterprises violate obligation of payment, delivery and receiving of gold bar by transaction confirmation with the State Bank for 03 (three) times

c) Credit institutions and enterprises violate 03 (three) times regulations on information and report in this Circular.

d) Credit institutions and enterprises are subjected to administrative sanctioning in gold trading activities

2. The State Bank shall suspend the trading transaction of gold bar with credit institutions during these credit institutions are under special control statement.

3. The State Bank shall cancel trading transactions of gold bar with credit institutions and enterprises in the following cases:

a) Credit institutions and enterprises have been revoked their licenses for establishment and operation or business registration certificate, enterprise registration certificate.

b) Credit institutions and enterprises have been revoked their license for gold bar trading

4. Credit institutions and enterprises must not re-establish trading transaction relationship of gold bar with the State Bank within 01 (one) year from the date of cancellation. Dossier and procedures for re-establishing trading transaction relationship of gold bar from credit institutions and enterprises with the State Bank shall comply with the procedures prescribed in Article 3 of this Circular.

Chapter 3.

GOLD BAR TRADING OF THE STATE BANK

Article 6. Type of gold bar trading

The State Bank shall trade in gold bar with content of 99,99%, type of 01 (one) piece produced by the State Bank or permitted for production in the periods.

Article 7. Form of gold bar trading

1. Direct trading of gold bar;

2. Trading of gold bar through bidding by price or by volume

Article 8. Transaction documents

Gold bar trading each time between the State Bank with the credit institutions and enterprises shall be shown by documents as follows:

1. Direct trading:

a) Announcement of gold bar trading, announcement of trading price from the State Bank.

b) Registration application of gold bar trading of the credit institutions and enterprises;

c) Announcement on volume of gold bar volume from the State Bank;

d) Transaction confirmation

2. Trading by bidding

a) Bidding notice, notices of selling and purchasing prices (bidding by volume), floor price and ceiling price (for bidding by price) from the State Bank.

b) Bidding offer of the credit institutions or enterprises;

c) Announcement of bidding result from the State Bank;

d) Transaction confirmation

Article 9. Transaction account

1. The credit institutions or enterprises shall make deposits and payment to the State Bank by an account notified by the State Bank.

2. The State Bank shall return the deposit and make payment to the credit institutions and enterprises by accounts registered by the credit institutions and enterprises upon establishing trading relationships of gold bar.

Article 10. Deposit

1. Credit institutions and enterprises must make a deposit in order to secure confirmation and implementation’s obligations for gold bar trading with the State Bank.

2. Credit institution’s and enterprise’s credit values upon gold bar trading with the State Bank shall be calculated by the formula as follows:

Deposit value = Deposit ratio x Reference price x Reference volume

In which:

Deposit ratio: in percent (%);

Reference price: in VND/piece;

Reference volume: is the minimum volume of gold bar trading (direct trading), the minimum volume of gold bar bid of a credit institution and enterprise (bidding), or volume of gold bar which the credit institutions or enterprises have registered for trading (direct trading) or volume of gold bar bid of each credit institution and enterprise (bidding).

Deposit ratio, reference price and reference volume shall be noticed by the State Bank before each time of trading.

Article 11. Project on gold bar trading

1. Foreign Transaction Department Management Department shall coordinate with the Monetary Policy Department and the Transaction Department to submit to receive approval from the Head of Foreign Transaction Department Reserve’ s Executive Committee and submit  to the Governor for approval of the gold bar trading project to interfere into gold market in each period.

2. Project on gold bar trading includes contents as follows:

a) Time of interference;

b) Type of gold bars;

c) Total volume of interfered gold bar trading; Volume of gold bar lot. The maximum or minimum volume of gold bar in a transaction with a partner; price step, bidding volume step;

d) Trading form;

e) Expected subject of trading;

f) Principle to determine the trading price (direct trading); principle to define purchasing and selling prices (bidding by volume), Principle to determine the floor and ceiling price (bidding by price)

g) Deposit ratio, reference volume and principle to determine the reference price;

h) The principle and ground to determine the price and fluctuation of gold price to decide to stop the trading in case of direct trading or cancel the bidding.

i) The trading of gold on accounts in foreign countries or purchasing gold from foreign countries for gold import or making gold sale to foreign countries to correspond to the volume of interfered gold trading.

3. After the plan for trading of gold bar has been approved, the Transaction Department shall coordinate with Department and Administration concerned of the State Bank for implementation.

Article 12. Process of gold bar trading

1. The process of direct gold bar trading between the State Bank with credit institutions and enterprises shall be as follows:

a) The State Bank (Transaction Department) announces the trading of gold bar;

b) Credit institutions and enterprises make deposits;

c) State Bank (Transaction Department) checks and notifies the capacity for participating in trading of the credit institutions or enterprises;

d) The State Bank (Transaction Department) announces trading price;

e) Credit institutions and enterprises register trading volume;

f) State Bank announces the cancellation of trading (if any);

g) The State Bank (Transaction Department) determines and announces trading volumes to each institution or enterprise;

h) Trading Determination;

j) Gold bar’s payment, delivery and receiving.

j) Processing deposit;

2. Procedures of gold bar trading by bidding form between the State Bank and credit institutions and enterprises as follows:

a) State Bank (Transaction Department) announces the bidding on gold bar trading;

b) Credit institutions and enterprises make deposits;

c) Checking and announcing bidding capacity of credit institutions and enterprises;

d) State Bank (Transaction Department) announces trading price (bidding by volume) or floor ceiling and/or ceiling floor (bidding by price);

e) Credit institutions and enterprises shall submit their bidding offers for gold bar trading;

f) The State Bank evaluates the bid;

g) The State Bank informs to cancel the bid (if any);

h) The State Bank (Transaction Department) announces the bidding result;

i) Transaction confirmation

j) Gold bar’s payment, delivery and receiving

k) Deposit processing.

3. Contents specified at Point a, b, c, d, e, f, g, h, Clause 1 and Point a, b, c, d, e, f, g, h, i, Clause 2 of this Article shall comply with provisions of the Procedure of gold bar trading of the State Bank of Vietnam State Bank issued by the Governor.

Article 13. Transaction confirmation

The transaction representative of credit institutions and enterprises having gold bar trading (direct trading) or winning bid (bidding) must sign to confirm the gold bar trading with the State Bank within 30 (thirty) minutes from the time of notifying volume, purchasing price, selling price with each credit institution and enterprise (direct trading), bidding results(bidding).

Article 14. Transaction result’s announcement

The Transaction Department shall notify in writing form to the Foreign Transaction Management Department, Finance and Accounting Department, Issue and Treasury Fund Department on the trading results of gold bar with each credit institution and enterprise after signing transaction certification.

Article 15. Time for gold bar’s payment, delivery

1. In case that the State Bank sells gold bar:

a) Credit institutions and enterprises must pay full amount to purchase gold bar in accordance with transaction confirmation to the payment account of the State Bank at least in the next working day in accordance with the date of signing transaction confirmation.

b) At the end of the signing dated of transaction confirmation and at the end of the working day in accordance with the date of signing transaction confirmation, the Transaction Department makes a list of credit institutions and enterprises that have fully payment for purchasing gold bar in the day and notifies in writing form to the Finance and Accounting Department, the Issue and Vault Department to do the procedures on gold bar delivery  for credit institutions or enterprises prescribed in point (c) of this Clause.

c) In the next working day in accordance with the date of signing transaction confirmation, the State Bank (Issue and Vault Department) shall deliver gold credit institutions and enterprises that have payment for purchasing gold bar to the State Bank in the signing date of transaction confirmation; In the following second working day after the signing day of transaction confirmation, the State Bank (Issue and Vault Department) shall deliver gold to the credit institutions or enterprises that have payment for purchasing of gold to the State Bank in the working day in accordance with the date of signing transaction confirmation.

d) In case the delivery time is different from the time specified at point b and c, clause 1 of this Article, the State Bank shall notify credit institutions and enterprises in the announcement of gold bar or in the bidding notice.

2. In case that the State Bank purchases gold bar:

a) Credit institutions and enterprises shall deliver gold bars to the State Bank within 01 (one) working day after the date of signing transaction confirmation.

b) Right after the end of delivery and receiving of gold bar, the Issue and Vault Department shall notify in writing form to the Transaction Department for making payment to credit institutions and enterprises.

c) The State Bank (Transaction Department) shall make payment to credit institutions or enterprises within 01 (one) working day after the end day of gold bar delivery

Article 16. Processing deposit from credit institutions and enterprises

1. The State Bank shall not refund deposit and notify in writing form to the credit institutions or enterprises in case that credit institutions and enterprises that are allowed for trading of gold bar with the State Bank (direct trading) or winning bidding (bidding) violate their obligations prescribed in Article 13, point a, clause 1 and point a, clause 2, Article 15 of this Circular.

2. Except for the cases specified in clause 1 of this Article, the State Bank (Transaction Department) shall refund deposit to credit institutions and enterprises by accounts registered by credit institutions and enterprises with the State Bank in the period as follows:

a) In the transaction day for the case that the State Bank stops the trade or cancels the bidding and credit institutions or enterprises are not permitted for trading or has not won bidding.

b) In the working day after the transaction day for credit institutions or enterprises purchasing gold bar of the State Bank.

c) In 02 (two) working day after the transaction day for the credit institutions or enterprises selling gold bar of the State Bank.

Article 17. Gold bar delivery

Delivery in gold bar trading between the State Bank and credit institutions and enterprises are performed at the location announced and prescribed by the State Bank.

Article 18. Force Majeure or objective obstacles.

1. In case the parties cannot perform obligations in transaction, payment, delivery within the prescribed time limit due to force majeure or objective obstacles, then occurrence time of force majeure or objective obstacles may not included in the time limit specified in Article 13 and Article 15 of this Circular.

2. The parties shall immediately notify the other parties of the force majeure or objective obstacles.

Chapter 4.

RESPONSIBILITIES OF CREDIT INSTITUTIONS AND ENTERPRISES PERMITTED TO HAVE GOLD BAR TRADING WITH THE STATE BANK AND RESPONSIBILITIES OF UNITS DIRECTLY UNDER THE STATE BANK

Article 19. Responsibilities of credit institutions and enterprises permitted to establishing trading transaction relationship for gold bar with the State Bank.

1. Ensuring gold bar’s quality and quantity sold to the State Bank;

2. Ensuring gold bar’s safety from transportation to storage of the State Bank;

3. Making full payment and delivery on time prescribed in this Circular when purchasing and selling gold with the State Bank;

4. Taking responsibilities for competence authentication for the transaction representative in the gold bar trading with the State Bank; Taking responsibilities for the obligation arising from the behavior done by the transaction representative and from the trading of gold bar confirmed by the transaction representative with the State Bank as stipulated in this Circular;

5. Taking responsibilities for the truthfulness, accuracy and legality with respect to documents and dossiers sent to the State Bank related to gold bar trading with the State Bank;

6. In the case of division, separation, merger, consolidation, acquisition, transformation of legal form, dissolution, bankruptcy, the credit institutions or enterprises must notify in writing to the State Bank (Transaction Department) within 05 (five) working days from the date of the decision of the competent state agencies of the division, separation, merger, consolidation, acquisition, transformation of legal form, dissolution and bankruptcy.

7. After purchasing gold bar from the State Bank, before 14h00 every day, credit institutions and  enterprises shall make a report to the State Bank (Foreign Transaction Management Department) on the use the gold bar purchased from the State Bank in the preceding working day (under the form in Appendix 4 attached with this Circular). The report shall be ended when credit institutions and enterprises use up gold bar volume purchased from the State Bank.

8. Other responsibilities are specified in this Circular.

Article 20. Transaction Department’s Responsibilities

1. Coordinating with the Foreign Transaction Management Department to request the Governor of the State Bank to consider and suspend or cancel gold bar trading with credit institutions or enterprises as specified in Article 5 of this Circular; Notifying credit institutions and enterprises on the State Bank’s decision on the suspension or cancellation gold bar trading

2. Performing payment obligation of gold bar trading.

3. Notifying in writing form to credit institutions or enterprises of the non-refundable deposit.

4. Notifying and updating for the banking inspection and supervision agency, Foreign Transaction Management Department on the list of credit institutions and enterprises that have established their trading relationship of gold bar with the State Bank.

5. Coordinating with the Foreign Transaction Management and Monetary Policy Department make plans on trading of gold bar with the State Bank.

6. Coordinating with the Foreign Transaction Management Department determine the price of gold bar trading (direct trading and bidding by volume), floor and ceiling price (bidding by price) under the approved trading plan.

7. Other responsibilities prescribed in this Circular.

Article 21. Foreign Transaction Management Department’s Responsibilities

1. Assuming the prime responsibility and coordinating with units concerned to make plans on gold bar trading

2. Notifying in writing form to the Transaction Department on the provision violations specified in clause 7, Article 19 of this Circular.

3. Assuming the prime responsibility and coordinating with the Transaction Department to determine the trading price of gold bar (direct trading and bidding by volume), floor and ceiling price (bidding by price) under the approved trading project.

4. Implementing other duties prescribed in this Circular.

Article 22. Monetary Policy Department’s Responsibilities

Coordinating with the Foreign Transaction Management Department and Transaction Department to make plan on gold bar trading in accordance with the objectives of monetary policy in each period.

Article 23. Issue and Vault Department’s Responsibilities

1. Assuming the prime responsibility and coordinating with the relevant units to regulate the amount of gold bar in the storage to serve the gold bar trading of the State Bank.

2. Notifying in writing form to the Transaction Department on obligation violations to deliver gold bar of credit institutions and enterprises as a basis for deposit processing specified in Article 16 of this Circular and temporary transaction specified in Clause 1, Article 5 of this Circular.

3. Implementing other duties as prescribed in this Circular.

Article 24. Finance and Accounting Department’s Responsibilities

1. Guiding the accounting of trading operation of gold in the domestic and international market of the State Bank, including the accounting of income and the related incurred costs.

2. Co-operating with the Issue and Vault Department to implement the export and transfer of gold in the storage of the State Bank.

Article 25. Banking Inspection and Supervision Agency’s Responsibilities

1. Notifying in writing form to the Transaction Department  on S information specified at point d, clause 1, causes 2 and 3, Article 5 of this Circular.

2. Performing inspection and supervision on gold bar trading for credit institutions and enterprises with the State Bank as prescribed by law.

Chapter 5.

IMPLEMENTATION PROVISION

Article 26. Implementation effects and responsibilities

1. This Circular takes effect on March 13, 2013.

2. The Chief Officer, Director of Foreign Transaction Management Department and heads of units directly under the State Bank, Director of State Bank branches in central-affiliated provinces and cities; Chairman of the Board, Chairman of the member Council, Chairman of the company, General Director (Director) of credit institutions and enterprises trading in gold bar with the State Bank and other relevant organizations and individuals shall implement Circular./.

 

 

 

FOR THE GOVERNOR
DEPUTY GOVERNOR




Le Minh Hung

 

 

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