Decision 65 on 25 Feb-99 on foreign exchange rates
STATE BANK OF VIETNAM
DECISION ON PRINCIPLES FOR DETERMINATION OF FOREIGN CURRENCY BUYING AND SELLING RATES OF CREDIT INSTITUTIONS
AUTHORIZED TO CONDUCT FOREIGN CURRENCY TRADING
No. 65-1999-QD-NHNN7, Hanoi, 25 February 1999
(as amended 18 September 2001)
The Governor of the State Bank
Pursuant to the Law on the State Bank 01-1997-QH10 dated 12 December 1997 and the Law on Credit Institutions 02-1997-QH10 dated 12 December 1997;
Pursuant to Decree 15-CP of the Government on the duties, powers and responsibilities for State administration of ministries and ministerial equivalent bodies dated 2 March 1993;
At the proposal of the Director of the Department of Foreign Exchange Control;
Decides:
Article 1
General directors (or directors) of credit institutions authorized to conduct foreign currency trading shall be permitted to determine the SPOT buying and selling rates of Vietnamese dong against foreign currencies on the basis of the following principles:
1. In respect of United States (US) dollars: not exceeding one tenth of one (0.1) per cent of the average actual transaction rate published daily by the State Bank in the inter-bank foreign currency market of the preceding transaction day.
2. In respect of other foreign currencies: as determined by general directors (directors) of credit institutions authorized to conduct foreign currency trading.
3. The difference between the buying rate and the selling rate shall be determined by general directors (directors) of credit institutions authorized to conduct foreign currency trading.
Article 2
Rates applicable to FORWARD and SWAP transactions shall be implemented in accordance with the following principles:
1.* In respect of transactions between Vietnamese dong and US dollars: the maximum rate applicable shall not exceed the ceiling spot exchange rate at the date of signing the FORWARD or SWAP transaction contract, plus the permissible rate of increase (as a percentage of the ceiling spot exchange rate) for each term as follows:
· 0.40% of the ceiling spot exchange rate for a term from 7 to 30 days;
· 1.50% of the ceiling spot exchange rate for a term from 31 to 120 days;
· 2.35% of the ceiling spot exchange rate for a term from 121 to 180 days.
2. In respect of transactions relating to other foreign currencies: as determined by general directors (directors) of credit institutions authorized to conduct foreign currency trading.
Article 3*
General directors (directors) of credit institutions shall be permitted to conduct FORWARD and SWAP transactions in accordance with the following terms:
1. Minimum term: seven days from the date of signing the transaction contract;
2. Maximum term: one hundred and eighty (180) days from the date of signing the transaction contract.
* As amended by Decision 1198-2001-QD-NHNN of the State Bank of Vietnam dated 18 September 2001, effective as of date of signing.
Article 4
Credit institutions shall be permitted to charge a transaction fee (for SPOT, FORWARD and SWAP transactions) at the maximum rate of one twentieth of one (0.05) per cent of the amount of each transaction provided that such fee shall not exceed one million (1,000,000) Vietnamese dong and shall be calculated in Vietnamese dong.
Article 5
This Decision shall be of full force and effect as of 26 February 1999 and shall replace Decisions 267-1998-QD-NHNN7 dated 6 August 1998 and 289-1998-QD-NHNN7 dated 26 August 1998 of the Governor of the State Bank.
FORWARD and SWAP contracts entered into prior to 26 February 1999 shall not be governed by this Decision.
Article 6
The Head of the Office of the State Bank, the Director of the Foreign Exchange Control Department, directors of units under the Central State Bank, directors of State Bank branches in provinces and cities, and chairmen of boards of management and general directors (directors) of credit institutions authorized to conduct foreign currency trading shall be responsible for the implementation of this Decision.
For the Governor of the State Bank
Deputy Governor
LE DUC THUY
