(+84) 96 167 55 66
info@vietanlaw.com

Open account for foreign loans in Vietnam

A foreign loan and repayment account means a payment account of the borrower opened at a bank providing account services to withdraw capital, repay foreign loans and other money transfer transactions related to foreign borrowing and debt repaying activities, guaranteeing foreign loans.

For the borrower being a foreign direct investment enterprise

  • For foreign medium, long-term loans: The account for foreign borrowing and repayment is the direct investment capital account.
  • For foreign short-term loans: The borrowers can use their direct investment capital account or other foreign loan and repayment account (not the direct investment capital account) to perform revenue and expenditure transactions related to foreign loans.

Note: Each foreign short-term loan can only be performed through 01 (one) bank  providing account services. The borrower can use 01 (one) account for 01 (one) or more short-term foreign loans.

The borrower who is not a foreign direct investment enterprise must open a foreign loan and debt repayment account at a bank providing account services in order to conduct money transfer transactions related to the foreign loan (withdrawal of capital, repayment of principal and interest).

Note: Each foreign loan can only be performed through 01 (one) bank providing account services. The borrower can use 01 (one) account for 01 (one) or more foreign loans.

The content of the account’s revenues and expenditures

For foreign loan and debt repayment accounts in foreign currencies

Revenue transactions:

a) Revenues money to withdraw capital from foreign loans;

b) Revenues from buying foreign currency from a bank providing account services to transfer money to pay debt (principal, interest) of foreign loans, payment of fees according to loan agreements;

c) Revenues to convert foreign currencies from the source of the foreign loan capital withdrawal in case the disbursed currency from the lender is not the currency of the foreign loan and debt repayment account;

d) Revenues from the borrower’s foreign currency payment account opened at an authorized credit organization in Vietnam, the borrower’s foreign currency account opened in a foreign country.

Expenditure transactions:
  1. a) Spending on transferring money to pay the debt (principal and interest) of foreign loans;
  2. b) Spending on converting for overseas to pay the compulsory debt collection to the guarantor being a non-resident as prescribed.
  3. c) Spending on transferring to the borrower’s foreign currency payment account;
  4. d) Spending on selling foreign currencies to authorized credit organizations;

đ) Spending on transferring to foreign currency accounts of the borrower opened in foreign countries to fulfill commitments under foreign loan agreements;

  1. e) Spending on transferring money to pay fees under foreign loan agreements;
  2. g) Spending on converting foreign currencies to repay the debt (principal, interest) of the foreign loan in case the debt payment currency is not the currency of the foreign loan and debt repayment account.

For foreign loan and debt repayment accounts in Vietnamese dong

Revenue transactions:

  1. a) Collecting to transfer of money for withdrawal of foreign loans in case the lender uses a payment account in Vietnamese dong opened at a credit organization, foreign bank branch in Vietnam;
  2. b) Collecting capital withdrawal from selling foreign currencies to authorized credit organizations in Vietnam in case the lender does not use the payment account in Vietnamese dong opened in Vietnam to disburse the loan;
  3. c) Collecting to transfer money from the borrower’s Vietnamese dong payment account.

Expenditure transactions:

  1. a) Spending on transferring money to the lender’s Vietnamese dong payment account to pay off the debt (principal, interest) in case the lender uses the payment account in Vietnamese dong to recover the debt according to the loan agreement;
  2. b) Spending on purchasing foreign currencies to repay the debt (principal, interest) of the foreign loan in case the lender does not use the payment account in Vietnamese dong to recover the debt according to the loan agreement;
  3. c) Spending on paying the debt receipt to the guarantor according to regulations.
  4. d) Spending on payment of fees in Vietnamese dong, spending on purchasing of foreign currencies to pay fees in foreign currencies related to foreign loans;

đ) Spending on transferring money to the borrower’s payment account in Vietnamese dong.

Customers wishing to register for a foreign loan, please contact Viet An Law Firm for specific support!

Related Acticle

Vietnam Law on Real Estate Business 2024

Vietnam Law on Real Estate Business 2024

On November 28, 2023, the National Assembly passed the Real Estate Business Law 2023. With the introduction of this Law, regulations on real estate business, rights and obligations of organizations…
Dispute resolution for sale of goods in Ho Chi Minh City

Dispute resolution for sale of goods in Ho Chi Minh City

Ho Chi Minh City is the locality with the largest economy in Vietnam. Trading and commercial activities in Ho Chi Minh City always develop strongly and are very vibrant. However,…
Register a trademark in Vietnam for pet supplies

Register a trademark in Vietnam for pet supplies

The habit of keeping pets in the house has existed since ancient times, but Vietnamese youth are now turning this habit into a lifestyle. They care and give a lot…
Establishment of a foreign capital advertising agency in Vietnam

Establishment of a foreign capital advertising agency in Vietnam

Pursuant to the provisions  of the Law on Investment 2020, the Law on  Enterprises 2020, the Law on Advertising 2012, and Vietnam’s Schedule of commitments in the WTO, regulations on…
Forms of promotion registered at Vietnam Trade Promotion Agency

Forms of promotion registered at Vietnam Trade Promotion Agency

In the context of a competitive economy, many businesses organize promotional activities. Forms of promotion may or may not require registration at the Department of Industry and Trade where the…

CONTACT VIET AN LAW

Hanoi Head-office

#3rd Floor, 125 Hoang Ngan, Hoang Ngan Plaza, Trung Hoa, Cau Giay, Hanoi, Vietnam

info@vietanlaw.com

Ho Chi Minh city office

Room 04.68 vs 04.70, 4th Floor, River Gate Residence, 151 – 155 Ben Van Don Street, District 4, HCM, Viet Nam

hcm@vietanlaw.com

SPEAK TO OUR LAWYER

English speaking: (+84) 9 61 67 55 66 - Lawyer Dong Van Thuc ( Alex) (Zalo, Viber, Whatsapp, Wechat)

Vietnamese speaking: (+84) 9 33 11 33 66 - Dr. Lawyer Do Thi Thu Ha (Zalo, Viber, Whatsapp, Wechat)