Can company in Vietnam take on foreign loans ?

Hi DMS Law firm in Vietnam! Can company in Vietnam take on foreign loans to fund business operations in Vietnam ? Can your lawyer office advise me about provisions of law in Vietnam on Vietnam’s enterprise’s borrowing and repayment of foreign loans ?

Hi!

Residents being enterprises, cooperatives, cooperative groups, credit institutions and foreign bank branches shall borrow and repay foreign loans with the principle of self-borrowing and self- responsibility of repayment in line with the provisions of law (Clause 1 Article 17 Ordinance on foreign exchange No. 07/VBHN-VPQH dated July 11, 2013).

Residents must comply with foreign borrowing and repayment conditions, register the borrowings with the State Bank of Vietnam, open and use accounts, withdraw and transfer for making repayment, and report the status of  loans in accordance with regulations of the State Bank of Vietnam. The State Bank of Vietnam certifies registered foreign loans within the total annual external borrowing limit approved by the Prime Minister (Clause 3 Article 17 Ordinance on Foreign exchange 07/VBHN-VPQH dated July 11, 2013).

Borrowers must regularly or extraordinarily report on the withdrawal of capital and self-payment of foreign debts under regulations of the State Bank of Vietnam (Clause 1 Article 16 Nghị định số 219/2013/NĐ-CP ngày 26/12/2013).

The borrower is allowed to take foreign loans for the purpose:

To implement the business plans or investment projects funded by foreign loans of the borrower (Point a Clause 1 Article 5 Circular No. 12/2014/TT-NHNN dated March 31, 2014).

The borrower may choose to declare registration information, register for change of the loan and report the status of the loan, self-borrowing, self-repayment in one of the following forms:

By website, called  online method.

By non-website, called traditional method (Article 5 Circular No.24/VBHN-NHNN dated April 29, 2016). 

In a nutshell, enterprises in Vietnam may take on foreign loans for the purpose of funding business operation project, concurrently must register the loan and other related issues according to regulations of the State bank of Vietnam./.

Consulting service:

Phone: 0914 165 703 or Email: dmslawfirm@gmail.com

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