THE STATE BANK OF VIETNAM
Circular No. 07/2015/TT-NHNN dated June 25, 2015 of the State Bank of Vietnam stipulating the bank guarantee
Pursuant to the Civil Code No. 33/2005/QH11 dated June 14, 2005;
Pursuant to the Law on the State Bank of Vietnam No. 46/2010/QH12 dated June 16, 2010;
Pursuant to the Law on Credit Institutions No. 47/2010/QH12 dated June 16, 2010;
Pursuant to the Ordinance No. 28/2005/PL-UBTVQH11 dated December 13, 2005 on foreign exchange;
Pursuant to the Ordinance No. 06/2013/UBTVQH13 of the Standing Committee of the National Assembly dated March 18, 2013 on amendment and supplement to the Ordinance on Foreign Exchange;
Pursuant to the Government's Decree No. 156/2013/NĐ-CP dated November 11, 2013 on defining the functions, tasks, powers and organizational structure of the State Bank of Vietnam;
After considering the request of the Director of the Department of Credits for Economies,
The Governor of the State Bank of Vietnam hereby promulgates the Circular on stipulating the bank guarantee.
Chapter I
GENERAL PROVISIONS
Article 1. Scope of adjustment
This Circular provides for practices of the bank guarantee relationship between credit institutions or foreign bank branches and customers.
Article 2. Subject of application
1. Credit institutions including commercial banks, cooperative banks and finance companies (except specialized finance companies).
2. Foreign bank branches.
3. Organizations (including foreign credit institutions, if they enter into co-guarantee, counter-guarantee and guarantee confirmation arrangements), and individuals engaged in guarantee transactions.
Article 3. Interpretation of terms
Terms used herein shall be construed as follows:
1. Bank guarantee refers to a type of credit whereby the guarantor undertakes to act on behalf of the obligor to fulfill their financial obligations to the obligee in the event the obligor fails to fulfill or insufficiently fulfill their agreed-upon obligations to the obligee; the obligor must take on their debt obligations and repay the guarantor.
