THE MINISTRY OF FINANCE
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SOCIALIST REPUBLIC OF VIET NAM
Independence - Freedom - Happiness
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No. 155/2007/TT-BTC
Hanoi, December 20, 2007
 
CIRCULAR
GUIDING THE IMPLEMENTATION OF THE GOVERNMENT’S DECREE NO. 45/2007/ND-CP DATED MARCH 27, 2007, DETAILING THE IMPLEMENTATION OF A NUMBER OF ARTICLES OF THE LAWON INSURANCE BUSINESS
Pursuant to Law No. 24/2000/QH10 dated December 9, 2000, on insurance business;
Pursuant to the Governments Decree No. 45/2007/ND-CP dated March 27, 2007, detailing the implementation of a number of articles of the Law on Insurance Business;
Pursuant to the Governments Decree No. 77/2003/ND-CP dated July l, 2003, defining the functions, tasks, powers and organizational structure of the Ministry of Finance;
The Ministry of Finance provides specific guidance as follows:
I. GENERAL PROVISIONS
1. This Circular guides the implementation of the Government’s Decree No. 45/2007/ND-CP dated March 27, 2007, detailing the implementation of a number of the Law on Insurance Business regarding insurance business, re-insurance, insurance brokerage and insurance agents' activities carried out by insurance enterprises, insurance brokerage enterprises and insurance agents; the establishment and operation of Vietnam-based representative offices of foreign insurance enterprises and insurance brokerage enterprises.
2. Insurance enterprises, insurance brokerage enterprises, insurance agents and concerned organizations and individuals shall abide by the provisions of this Circular and relevant law; ensure cooperation, fair competition and anti-monopoly in insurance business activities.
3. The Vietnam Insurers Association shall enhance its self-management role and boost cooperation and fair competition among insurance enterprises and insurance brokerage enterprises for the sake of lawful rights and interests of organizations and individuals participating in insurance.
4. The Ministry of Finance shall create favorable conditions for insurance enterprises and brokerage enterprises to conduct business activities on an equal footing; protect lawful rights and interests of organizations and individuals participating in insurance and take measures to strictly handle violations of the law on insurance business.
II. ESTABLISHMENT AND OPERATION LICENSES
1. Licensing procedures.
1.1. The Ministry of Finance shall grant establishment and operation licenses (referred to as licenses for short) to insurance enterprises and insurance brokerage enterprises which satisfy the conditions specified in Article 6 and file dossiers of application for licenses as prescribed in Article 7 of the Government's Decree No. 45/2007/ND-CP dated March 27, 2007, detailing the implementation of a number of articles of the Law on Insurance Business (referred to as Decree No. 45/2007/ND-CP). Applications for licenses shall be made according to the form prescribed in Appendix l to this Circular (not printed herein).
1.2. Within 60 days after receiving a valid and complete dossier as prescribed, the Ministry of Finance shall grant a license or issue a written reply on its refusal to grant a license to an insurance enterprise or insurance brokerage enterprise. Licenses shall be made according to the form prescribed in Appendix 2 to this Circular (not printed herein)
2. Contents of appraisal of dossiers of application for licenses
2.1. Appraisal of the legal status
2.1.1. For investors being legal persons
a/ Notarized copies of the establishment decision, establishment and operation license and business registration certificate of the organization. For dossiers of application for licenses to establish foreign-invested enterprises, notarized copies of the establishment decision, establishment and operation license and business registration certificate of the insurance brokerage enterprise in the foreign country in which it is headquartered are required (the copy of the business registration certificate must be authenticated by the agency with which the organization has made registration within three months before the date of submission of the dossier application for a license);
b/ Organization and operation charters of organizations that contribute capital to establishing an insurance enterprise or insurance brokerage enterprise.
c/ The Investors’ paper of authorization to the representative (if any). For dossiers of application for licenses to establish enterprises with 100% foreign capital, the paper of authorization to the person expected to be appointed as general director (director) in Vietnam is required. The authorized person shall submit notarized copies of his/her personal certification papers as prescribed in Article 18 of the Government’s Decree No. 88/2006/ND-CP dated August 29, 2006, on business registration;
d/ The document of a competent authority permitting the enterprise to conduct insurance business or insurance brokerage business activities (if any). For dossiers of application for licenses to establish foreign-invested enterprises, the document of a competent authority of the country in which the enterprise is headquartered permitting the insurance enterprise or insurance brokerage enterprise to establish a foreign-invested insurance enterprise or insurance brokerage enterprise in Vietnam or certifying this permission is required;
e/ The document of a competent authority of the country in which the enterprise is headquartered certifying that the foreign investor is permitted to conduct the forms of insurance business proposed to be carried out in Vietnam, for dossiers of application for the establishment of foreign-invested enterprises;
f/ The joint-venture contract with principal contents specified in the Investment Law and its guiding documents, for dossiers of application for licenses to establish joint-venture enterprises;
g/ Minutes of investors' meetings agreeing on the establishment of an insurance enterprise or insurance brokerage enterprise, for dossiers of application for licenses to establish joint-venture enterprises or joint-stock enterprises;
h/ A document signed by investors being founding shareholders (members) authorizing a representative to:
- Finalize and submit the dossier of application for a license; sign the application for a license to establish an insurance enterprise or insurance brokerage enterprise;
- Sign documents to complete the dossier of application for an establishment and operation license of an insurance enterprise or enterprise brokerage enterprise until a license is granted by the Ministry of Finance;
- Sign documents requesting approval of the titles of chairman of the board of management, chairman of the members' council, company president (collectively referred to as president), and general director (director) of the insurance enterprise or insurance brokerage enterprise before it officially commences its operation;
- Open a frozen account at a commercial bank lawfully set up and operating in Vietnam and request investors to deposit money into this account according to the registered list and collect the bank's certifications of deposit amounts paid by investors;
- Convene and chair the first shareholders' or members' general meeting.
i/ The draft charter of the enterprise in conformity with the 2005 enterprise Law, the Law on Insurance Business and their guiding documents. The draft charter must be signed by at-law representatives of all founding shareholders, founding members or their authorized representatives.
2.1.2. For individual investors:
a/ Notarized copies of their lawful personal certification papers as prescribed in Article 18 of the Government’s Decree No. 88/2006/ND-CP dated August 29, 2006, on business registration;
b/ Judicial records, made according to the form prescribed in Circular No. 07/1999/TTLT-BTP-BCA of February 8, 1999, dated the Ministry of Justice and the Ministry of Public Security providing for the grant of judicial records to investors being founding shareholders (or members).
2.2. Appraisal of financial capacity
2.2.l. A list of organizations and individuals that contribute capital to establishing an insurance enterprise or insurance brokerage enterprise, specifying organizations and individuals being founding shareholders (members); levels of contributed capital; number and types of shares (for dossiers of application for licenses to establish joint-stock enterprises); modes of capital contribution; and corresponding time limit for capital contribution;
2.2.2. Founding shareholders shall jointly hold at least 50% of the insurance enterprise or insurance brokerage enterprise for at least three years (for dossiers of application for licenses to establish joint-stock enterprises);
2.2.3. The document of a competent authority of the country in which the enterprise is headquartered certifying that the foreign investor has a sound financial status and fully meets management requirements in its country by the end of the financial year preceding the year of application for a license;
2.2.4. Structure of capital contributed to establishing an insurance enterprise or insurance brokerage enterprise in accordance with the Government’s Decree No. 46/2007/ND-CP dated March 27, 2007, providing for the financial regimes applicable to insurance enterprises and insurance brokerage enterprises (referred to as Decree No. 46/2007/ND-CP for short) and its guiding document.
2.2.5. Proofs evidencing investors' capacity to remit adequate capital as registered for the establishment of an insurance enterprise or insurance brokerage enterprise:
a/ Financial statements of three consecutive years preceding the year of application for a license to establish an insurance enterprise or insurance brokerage enterprise certified by an independent audit organization, for organizations being founding shareholders (members) or contributing 10% or more of charter capital; the financial statement for three consecutive years preceding the year of application for a license to establish an insurance enterprise or insurance brokerage enterprise, for legal-person investors other than founding shareholders (members) or contributing less than 10% of charter capital;
b/ Capital contributed to establishing an insurance enterprise or insurance brokerage enterprise must come from lawful sources; it is not permitted borrowed capital or entrusted investment capital in any forms as capital contributed to establishing an insurance enterprise or insurance brokerage enterprise;
c/ The bank's certification of the charter capital amount already remitted into the frozen account by each organization and individual according to the registered list in the dossier of application for a license.
2.3. Appraisal of the feasibility of the business plan for the first five years
2.3.1. General assessment of the insurance enterprise or insurance brokerage enterprise’s business plan in light of general market circumstances, including potential challenges and prospects;
2.3.2. Assessment of the to be-established insurance enterprise or insurance brokerage enterprise’s competitiveness, proving its advantages when participating in the market;
2.3.3. Analysis of insurance operations, clients and networks to be established;
2.3.4. The insurance enterprise or insurance brokerage enterprise's strategy on the development and expansion of its operational network;
2.3.5. The accounting balance sheet and report on business results, turnover and indemnity of each insurance operation, plan on financial investment from own capital and operational reserves. Projected figures must based on grounded assumptions;
2.3.6. Draft processes of underwriting, survey, compensation, internal control, financial management and investment, and management of re-insurance programs;
2.3.7. Methods of deduction for setting up operational reserves as guided in Decree No. 46/2007/ND-CP and its guiding documents;
2.3.8. The expected solvency margin as guided in Decree No. 46/2007/ND-CP and its guiding document; plan on supplementation of capital in case the solvency margin is insufficient as prescribed by law;
2.3.9. Information technology: The estimated financial investment in information technology; the capacity of information technology application, stating the expected time of technology application; types of to be-applied technologies; to be-appointed employees and their capabilities for information technology application;
2.3.10. Conditions for performance of insurance operations, for operations subject to conditional performance;
2.3.11. Model organization, operational functions, structure and number of employees of each section; and the enterprise's plan on initial training and regular training.
2.4. Appraisal of the administration capacity of managers and executives of the insurance enterprise or insurance brokerage enterprise
2.4.l. The list of managers and executives of the insurance enterprise or insurance brokerage enterprise, their curricula vitae, judicial records and notarized copies of their diplomas evidencing their professional capacity and qualifications in conformity with Clause 1, Section IV, of this Circular.
2.4.2. Written commitments of individuals who will work as managers and executives if the insurance enterprise or insurance brokerage enterprise is licensed.
2.5. Appraisal of rules and terms of insurance operations proposed to be proposed to be performed.
Rules, terms and premium tariffs must be elaborated in accordance with Article 20 of Decree No. 45/2007/ND-CP.
In case the dossier of application for a license to establish an insurance enterprise or insurance brokerage enterprise also applies for permission to open branches besides the head-office, the appraisal of conditions for opening branches shall be conducted under Article 11 of Decree No. 45/2007/ND-CP and the guidance in this Circular.
3. Procedures to be carried out before the insurance enterprise or insurance brokerage enterprise officially commences its operation 3.l. Within 12 months after being licensed, the insurance enterprise or insurance brokerage enterprise shall complete the following procedures in order to officially conduct insurance business activities:
3.1.1. To remit into the state budget licensing fees as prescribed by law;
3.1.2. To fully pay a deposit at a commercial bank lawfully set up and operating in Vietnam as prescribed in Article 6 of Decree No. 46/2007/ND-CP.
3.l.3. To convene a meeting to elect the Board of Management, president and general director (director) as prescribed in its charter in accordance with law; and to complete procedures of application for approval of the president and general director (director);
3.l.4.To have a seal carved, register for a tax identification number and open a transaction account at a bank as prescribed by law;
3.l.5.To register with the Ministry of Finance the method of deduction for setting up operational reserves as prescribed by law. Life insurance enterprises shall send relevant dossiers to the Ministry of Finance for the latter to approve their insurance products to be provided and their actuaries. These provisions do not apply to insurance brokerage enterprises;
3.l.6.To announce its operation in accordance with Clause 1, Article 9, of Decree No. 45/2007/ND-CP.
3.2. The insurance enterprise or insurance brokerage enterprise may only use the capital amount already remitted into the frozen account as its charter capital after being officially licensed by the Ministry of Finance.
III.MODIFICATION AND SUPPLEMENTATION OF LICENSES
An insurance enterprise or insurance brokerage enterprise must obtain the Finance Ministry’s written approval before changing contents specified in Article 69 of the Law on Insurance Business. The procedures for approval for changes of contents stipulated in Article 69 of the Law on Insurance Business are specified as follows:
1.Change of an enterprise's name
An insurance enterprise or insurance brokerage enterprise that wishes to change its name shall send to the Ministry of finance the following documents:
1.1. A written request for approval for renaming of the enterprise, made according to Appendix 3 to this Circular (not printed herein);
1.2. The written approval of a competent authority, as prescribed in its charter for renaming of the enterprise.
2. Increase or decrease of an insurance enterprise or insurance brokerage enterprise's charter capital level.
An insurance enterprise or insurance brokerage enterprise that wishes to change its charter capital level shall send to the Ministry of Finance the following documents;
2.1. A Written request for approval for change of the charter capital level, made according to the form prescribed in Appendix 3 to this Circular (not printed herein);
2.2. The written approval of a competent authority, as prescribed in the enterprise’s charter for change of the charter capital level;
2.3. The plan on the increase of the insurance enterprise or insurance brokerage enterprise’s charter capital, clearly determining:
2.3.1. The need for capital increase and use of capital;
2.3.2. Business efficiency on the basis of the new charter capital: the estimated after-tax profit-to-own capital ratio after the increase of capital; the dividend level in the year right before the increase of capital; profit-to-capital and profit-to-total asset ratios; and solvency of the insurance enterprise. These figures must be estimated on the basis of grounded assumptions.
2.3.3. The enterprise’s administration, management and supervision capacity corresponding to its increased capital amount and expanded scope of operation;
2.3.4. The feasibility of the plan on capital increase: the total charter capital to be increased and modes of capital mobilization.
All cases of increasing charter capital by offering of securities to the public must comply with the law on securities and securities market. The State Securities Commission shall grant licenses for offering securities to the public on the basis of the Ministry of Finance’s approval.
2.4. The plan on the decrease of an insurance enterprise or insurance brokerage enterprise’s charter capital must prove the enterprise’s capacity to pay all its debts and other asset liabilities after its charter capital level is decreased. One-member limited liability companies may not decrease their charter capital.
3. Opening or termination of operation of branches or representative offices.
3.1. An insurance enterprise or insurance brokerage enterprise that wishes to open branches or representative offices must meet conditions specified in Article 11 dated Decree No. 46/2007/ND-CP and the following specific conditions:
3.1.1. Satisfying conditions on actual charter capital prescribed in Decree No. 46/2007/ND-CP and its guiding documents;
3.1.2. Having paid fines, if any, not exceeding VND 15 million for administrative violation of regulations on insurance business over the three last years up to the time of submission of the application for approval for opening of a branch or representative office.
3.2. A dossier of application for approval for opening of a branch or representative office of an insurance enterprise or insurance brokerage enterprise complies with Clause 2, Article 11, dated Decree No. 45/2007/ND-CP and the following specific guidance: 3.2.1 An application for approval for opening of a branch or representative office, made according to the form prescribed in Appendix 3 to this Circular (not printed herein).
3.2.2. The written approval of a competent authority as prescribed in the enterprise's charter for the opening of branches or representative offices;
3.2.3. The judicial record and diplomas evidencing the qualifications of the person to be appointed as head of the branch or representative office;
3.2.4. The regulation on organization and operation of the branch or representative office, covering the following principal contents:
a/ Specific regulations on the function and tasks assigned by the enterprise to the branch, including the function of authorized representation and responsibilities of the branch's head before clients and law;
b/ Specific regulations on the contents of authorized representation functions of the enterprise's representative office;
c/ Specific regulations on the supply of information, reporting, finance and accounting of operations of the branch or representative office to ensure that the enterprise's head office is capable of controlling all operational risks of its branch or representative office;
d/ Other regulations according to supervision and management requirements of each insurance enterprise or insurance brokerage enterprise.
3.2.5. Proofs on the right to use the venue where the branch or representative office is located (rented or owned).
3.3. The branch and representative office of an insurance enterprise or insurance brokerage enterprise must officially commence its operation within six (6) months after its opening is approved by the Ministry of Finance.
3.4. A dossier of application for approval for termination of the operation of a branch or representative office of an insurance enterprise or insurance brokerage enterprise consists of the following documents:
3.4.l. An application for approval for termination of the operation of a branch or representative office, made according to the form prescribed in Appendix 3 to this Circular (not printed herein);
3.4.2. The written approval of a competent authority, as prescribed in the enterprise's charter for termination of the operation of branches or representative offices;
3.4.3. The report on the operation of the branch or representative office over the last three years. If the branch or representative office has been operating for less than three years, a report on operation since opening is required;
3.4.4. Responsibilities and matters arising from the termination of the operation of the branch or representative office and plan to handle them.
3.5. A dossier of application for approval for opening of an overseas branch or representative office of an insurance enterprise or insurance brokerage enterprise complies with the law on offshore investment.
4. Relocation of head offices, branches or representative offices of insurance enterprises or insurance brokerage enterprises
An insurance enterprise or insurance brokerage enterprise that wishes to relocate its head office, branches or representative offices shall send to the Ministry of Finance the following documents:
4.1. An application for approval for relocation of the enterprise's head office, branch or representative office, made according to the form prescribed in Appendix 3 to this Circular (not printed herein);
4.2. The written approval of a competent authority, as prescribed in the enterprise's charter for relocation of head offices, branches or representative offices;
4.3. Proofs on the rights to use the venue where the enterprise's head office, branch or representative office is located (rented or owned).
5. Change of contents, scope or duration of operation
5. 1. An insurance enterprise or insurance brokerage enterprise that wishes to extend the contents, scope or duration of its operation must meet the conditions specified in Article 12 of Decree No. 45/2007/ND-CP and the following specific guidance.
5.1.1The actual charter capital meets the conditions specified in Decree No. 46/2007/ND-CP and guiding documents in case of expansion of the domains and scope of operation of the insurance enterprise;
5.1.2. Having paid fines, if any, not exceeding VND 15 million for administrative violations in the insurance business domain over the past three consecutive years up to the time of submission of the dossier of application for approval for expansion of the domains, scope and duration of operation;
5.l.3.In case of expansion of the domains and scope of operation, the insurance enterprise must have at least three staff members expected to work newly set up section. The head of that section must satisfy the criteria for managers or executives specified at Point 1.6, Clause 1, Section IV of this Circular;
5.2. A dossier of application for approval for modification of the domains, scope and duration of operation of an insurance enterprise or insurance brokerage enterprise complies with Article 12 of Decree No. 45/2007/ND-CP, and the following specific guidance:
5.2.l. A written application for approval for expansion (or downscale) of the contents, scope and duration of the enterprise's operation, made according to the form in Appendix 3 to this Circular (not printed herein).
5.2.2. A competent authority's written approval, as prescribed in the enterprise's charter for such expansion or downscale;
5.2.3. Diplomas or certificates evidencing the capacity and qualifications of the head of the section expected to be set up, in case of application for approval for expansion of the contents of operation.
6. Split, consolidation, merger, transformation, or transfer of contributed capital portions.
The split, consolidation, merger, transformation, or transfer of contributed capital portions, of insurance enterprises or insurance brokerage enterprises prescribed in Article 16 dated Decree No. 45/2007/ND-CP are specified as follows:
6.l. Split, consolidation, merger or transformation of enterprises
6.1.1. The split, consolidation, merger or transformation of insurance enterprises or insurance brokerage enterprises comply with the Enterprise Law and the 2004 Competition Law.
6.1.2. A dossier of application for approval for split, consolidation, merger or transformation of an insurance enterprise or insurance brokerage enterprise comprises;
a/ A written application for approval for split, consolidation, merger or transformation of the enterprise, made according to the form in Appendix 4 to this Circular (not printed herein);
b/ A competent authority's written approval, as prescribed in the enterprise's charter for such split, consolidation, merger or transformation;
c/ A report on the plan to divide and process valid contracts with clients, debts, obligations towards the State and commitments with laborers upon split, consolidation, merger or transformation of the enterprise;
d/ A list of shareholders and members, the charter capital and its structure of the organization formed after the split, consolidation, merger or transformation;
e/ A consolidation or merger contract, in case of consolidation or merger;
f/ Opinion of financial consultancy organization or audit organization lawfully setup and operating in Vietnam on the valuation and conversion rate of shares or capital portions, in case of consolidation or merger;
g/ Lawyers' opinions on the legality of the contract and dossier of the split, consolidation, merger, consolidation or merger;
h/ Audited financial statements of the three years preceding the year of application for approval for consolidation or merger, of the organization merged or consolidated with the insurance enterprise or insurance brokerage enterprise; if the duration from the final date of the annual term of the latest financial statement to the time of submission of the dossier of application exceeds ninety (90) days, that organization shall submit additional quarterly statements up to the latest quarter;
i/ Curricula vitae and lawful personal certification paper prescribed in Article 18 of the Government's Decree No. 88/2006/ND-CP dated August 29, 2006, on business registration, of new members (individuals), or copies of business registration certificates of new members (legal entities) that own 10% of the charter capital or more;
j/ Diplomas and certificates evidencing the capacity of the to-be-appointed manager or executive of the insurance enterprise or insurance brokerage enterprise after split, consolidation or merger.
6.l.3.Companies newly formed after split, consolidation, merger or transformation may conduct insurance business only when they meet the insurance business conditions specified in the Insurance Business Law and guiding documents.
6.2. Transactions resulting in a change of 10% or more of the actually contributed charter capital of an insurance enterprise or insurance brokerage enterprise are subject to prior approval of the Ministry of Finance.
6.2.1. Transactions resulting in a change of 10% or more of the actually contributed charter capital of an insurance enterprise or insurance brokerage enterprise include:
a/ Transaction making an individual or organization own 10% or more of the actually contributed charter capital of the insurance enterprise or insurance brokerage enterprise; or,
b/ Transaction making an individual or organization no longer hold 10% or more of the actually contributed charter capital of the insurance enterprise or insurance brokerage enterprise; or,
c/ Transfer of the right to own 10% or more of the actually contributed charter capital of the insurance enterprise or insurance brokerage enterprise.
6.2.2. A dossier of application for approval for a transaction resulting in a change of 10% or more of the actually contributed charter capital of an insurance enterprise or insurance brokerage enterprise comprises:
a/ A written application for approval for transfer of the contributed capital portion, made according to the form in Appendix 5 to this Circular (not printed herein);
b/ A competent authority's written approval, as prescribed in the enterprise's charter for transactions resulting in a change of 10% or more of the actually contributed charter capital of the enterprise;
c/ Proofs of the Financial capacity of the transferee:
- For organizations: audited financial statements of the three years preceding the year of application for approval for transfer receipt. If the duration from the final date of the annual term of the latest financial statement to the time of submission of the dossier of application exceeds ninety (90) days, that organization must submit additional quarterly statements up to the latest quarter;
- For individuals: the bank's certification of the deposit balance expected to be used for capital contribution;
d/ In-principle transfer contract (if any);
e/ Curricula vita and lawful personal certification papers as prescribed in Article 18 of the Government's Decree No. 88/2006/ND-CP dated August 29, 2006, on business registration, of new capital contributors (for individuals), or copies of business registration certificates of new capital contributors (for legal entities);
f/ A list of capital-contributing members (shareholders) and the charter capital structure after the transfer.
7. Replacement of presidents or general directors (directors)
7.1. Replacement of presidents or general directors (directors) is subject to approval of the Ministry of Finance.
7.2. A dossier of application for approval for replacement of the president or general director (director) comprises:
7.2. l. A written application for approval for replacement of the president or general director (director), made according to the form in Appendix 3 to this Circular (not printed herein);
7.2.2. A competent authority's written approval, as prescribed in the enterprise's charter for such replacement;
7.2.3. Judicial records; lawful personal certification papers prescribed in Article 18 of the Government’s Decree No. 88/2006/ND-CP dated August 29, 2006, on business registration; diplomas and certificates evidencing the professional capacity and qualifications of the person in replacement of the president or general director (director);
7.2.4. A written commitment of the to-be-appointed president or general director (director) of the enterprise once the Finance Ministry’s approval is obtained.
8. Time limit for settling license modification supplementation applications
Within 30 days from the date the Ministry of Finance receives a complete dossier of application for approval for license modification or supplementation from an insurance enterprise or insurance brokerage enterprise prescribed for at Points 1 thru 7 above, the Ministry of Finance shall give a written reply to approve or disapprove the enterprise’s application. In case of disapproval, it shall give a written explanation. In case of approval, it shall grant a modified license to the enterprise, made according to the form in Appendix 6 to this Circular (not printed herein) or issue a written approval.
IV. ORGANIZATION AND MANAGEMENT OF INSURANCE ENTERPRISES AND INSURANCE BROKERAGE ENTERPRISES
1. Criteria for managers and executives of insurance enterprises and insurance brokerage enterprises
1.1.General criteria
l.1.1. Not being banned from managing enterprises under Clause 2, Article 13 of the enterprise Law;
1.l.2. Being other than those who had been or are being examined for penal liability, had been sentenced to imprisonment or had their professional practice right deprived by the court in accordance with law;
l.1.3. Having never been representatives at law of bankrupt enterprises, except for bankruptcy due to force majeure causes; or managers or executives of insurance enterprises or insurance brokerage enterprises having operation licenses revoked due to
their violations in insurance business activities;
1.1.4 Having full civil act capacity.
1.2. Criteria for a president
1.2.1. Meeting the general criteria specified at Point 1.1 above;
1.2.2. Possessing a university or postgraduate diploma; having directly worked in the domain of insurance or banking for at least five years or having at least three years' managerial or executive experience at an enterprise with a charter capital equivalent to that of the insurance enterprise or insurance brokerage enterprise which he/she is expected to be in charge of.
1.3. Criteria for a member of the board of management or members' council
1.3.1. Meeting the general criteria specified at Point 1.1 above;
1.3.2. Possessing a university or postgraduate diploma; having at least two years' managerial and executive experience or having directly worked in the domain of insurance, finance or banking for at least three years.
1.4. Criteria for a general director (director) o representative at law
1.4.1. Meeting the general criteria specified at Point 1.1 above;
1.4.2. Possessing a university or postgraduate diploma; having directly worked in the domain of insurance, finance or banking for at least five years and having held for at least three years the position of a professional section or higher position at the headquarters, of an insurance enterprise or insurance brokerage enterprise;
1.4.3.Residing in Vietnam during his/her term of office.
1.5. Criteria for a deputy general director (deputy director), branch director, head of representative office, chief accountant or head of the Control Board:
1.5.1. Meeting the general criteria specified at Point 1.1 above;
1.5.2.Possessing a university or postgraduate diploma; having knowledge in the professional domain he/she will be in charge of, or having directly worked for at least three years in the domain of insurance, finance or banking and the professional domain he/she will be in charge of;
1.5.3.Residing in Vietnam during his/her term of office.
1.6. Criteria for the head of the section for insurance operations exploitation, insurance compensation, reinsurance or investment:
1.6.1.Possessing a university or postgraduate diploma;
1.6.2.Having at least three years' experience of working in the domain he/she is expected to be in charge of; possessing a diploma or certificate of training in the domain he/she is expected to be in charge of, which is granted by an accredited domestic or international insurance training institution.
1.7. Principles for appointing positions in insurance enterprises and insurance brokerage enterprises:
1.7.l. Members of the board of management or the members' council of an insurance enterprise or insurance brokerage enterprise may not concurrently be members of the board of management or members of the members' council of another insurance enterprise or insurance brokerage enterprise operating the same domain (reinsurance, non-life insurance, life insurance or insurance brokerage), except for dependent companies.
1.7.2. The general director (director) or deputy general directors (deputy directors) of an insurance enterprise or insurance brokerage enterprise may not concurrently work for another insurance enterprise or insurance brokerage enterprise operating in the same domain; the general director (director) of an insurance enterprise or insurance brokerage enterprise may not be a member of the Board of management or member of the Members' Council of another insurance enterprise or insurance brokerage enterprise operating in the same domain, except for dependent companies.
2. Internal supervision and control
Insurance enterprises and insurance brokerage enterprises shall conduct internal supervision and control in accordance with Article 15 of Decree No. 45/2007/ND-CP and the following guidance:
2.1. The internal supervision and control section must be suitable to the enterprise's operation scale, scope and characteristics; and is subject to direct management by the general director (director) of the insurance enterprise or insurance brokerage enterprise.
2.2. The internal supervision and control section shall inspect and supervise the observance of legal provisions, professional regulations and processes and internal regulations of the insurance enterprise or insurance brokerage enterprise; assist the general director (director) in conducting self-inspection in order to synthesize, review and assess the effectiveness and efficiency of the internal supervision and control system, aiming to detect, prevent, and propose in time the handling of, problems and violations in all operations and improve the internal supervision and control system.
2.3. The internal control process must ensure regular and continuous identification, measuring and assessment of all risks threatening to adversely impact the enterprise's operation efficiency and objectives in order to detect, prevent and take in time appropriate risk management measures.
2.4. Requirements on the internal supervision and control process:
2.4.l. Clear and transparent decentralization and authorization of duties and powers to all individuals and sections of an insurance enterprise;
2.4.2. Cross-check between individuals and sections participating in the same operational process;
2.4.3. Determination of responsibilities of each individual or section in conducting a transaction;
2.4.4. An insurance enterprise or insurance brokerage enterprise must ensure that all of its staff members are aware of the importance of, and actively participate in, internal supervision and control activities;
2.4.5. Managers of professionals sections and units and concerned individuals shall regularly consider and assess the effectiveness and efficiency of the internal supervision and control system; all errors of this system must be reported promptly to supervisors; errors that threaten to cause damage or risks must be reported immediately to the general director (director), the board of management (members' council, company president) or the control board;
2.4.6. Heads of sections of an insurance enterprise shall report and assess the results of internal supervision and control at their sections or according to their assigned tasks; propose measure to handle problems (if any) and regularly or irregularly send them to their direct leaders upon request;
2.4.7. The internal supervision and control process should specify forms of disciplining upon the occurrence of wrongdoings.
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