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In brief

On 30 September 2022, the State Bank of Vietnam (SBV) officially issued Circular No. 12/2022/TT-NHNN providing instructions on foreign exchange administration regarding offshore borrowing and offshore debt repayment of enterprises (“Circular 12“).

Circular 12 came into effect on 15 November 2022, replacing Circular No. 03/2016/TT-NHNN and its amending circulars (“Circular 03“).

Key takeaways

Circular 12 has provided various significant changes to the regulations under Circular 03, as follows:

  • The regulations on the registration of offshore loans with the SBV have been amended and supplemented to be more specific and enable the borrower to flexibly perform the relevant procedures.
  • Most references to the term “guarantee” have been replaced with the term “security” so that the scope of security measures relating to offshore loans have been expanded (including both guarantee and other security measures).
  • Circular 12 has introduced the new concept of supporting security bank.
  • Circular 12 provides a set of detailed requirements on accounts serving overseas remittance in relation to the offshore loans.
  • Other issues in respect of interests rate applicable to indebtedness amounts between the borrower and the securing party have also been specified in Circular 12.

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Oanh Nguyen is a partner in Baker McKenzie Vietnam and has been practising capital markets, banking and finance, M&A, and commercial law for more than 25 years. Knowledgeable about all aspects of investments, she advises on all types of transactions, ranging from investment structures to project structures and their related financing. She has focused on public M&A matters, including major IPOs and projects finance.

Oanh is a respected presenter in the areas of finance and capital markets. In addition, she has lectured at the Ho Chi Minh City Bar Association. She also serves as a legal advisor to the Capital Market Committee of Ho Chi Minh City American Chamber of Commerce.

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