Enhancing the Effectiveness of Enforcement of Monetary and Banking Law Provisions
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SBV [State Bank of Vietnam] announced that Decree No. 88/2019/NĐ-CP was researched and developed based on the Law on Credit Institutions (CIs) dated June 16, 2010, the Law amending and supplementing a number of articles of the Law on CIs dated November 20, 2017, and the Law on Prevention of Money Laundering dated June 18, 2012. However, these documents have been replaced, hence the need to review, amend, and supplement the Decree to align with the current regulations.
During the five years of implementing administrative sanctions in the monetary and banking field, the units encountered several difficulties and obstacles and proposed amendments and supplements to a number of provisions in the Decree, including remedial measures, principles of administrative sanctions, and sanctioning authority, among others.
The sanctions regime set out in Decree 88 is built upon the provisions on responsibilities, obligations, and prohibitions stipulated in the normative legal documents in the monetary and banking field. However, over time, a number of these normative legal documents have been amended, supplemented, or replaced, necessitating a review and revision of the Decree’s content.
Currently, Decree 88 has been amended and supplemented by Decree 143/2021/NĐ-CP dated December 31, 2021, and Decree No. 23/2023/NĐ-CP dated May 12, 2023. Therefore, replacing Decree 88 to review and consolidate the provisions will facilitate the study of the regulations on sanctions.
For the above reasons, the issuance of a decree replacing Decree 88/2019/NĐ-CP on administrative sanctions in the monetary and banking field is necessary to contribute to enhancing the effectiveness of enforcing the provisions of monetary and banking law, in particular, and the legal system, in general, while ensuring alignment with the objective development of practice.
Addressing Challenges in Implementing Administrative Sanctions in the Monetary and Banking Sector
The draft Decree is constructed based on the following orientations:
First, amend the provisions to align with the Law on Credit Institutions 2024 and the Law on Prevention of Money Laundering 2022 and their guiding documents.
Second, amend and supplement the sanctions regime to align with the provisions on obligations, responsibilities, and prohibitions stipulated in the current normative legal documents in the monetary and banking field, ensuring deterrence and stringent penalties.
Third, address certain challenges and obstacles faced by the units in charge of administering administrative sanctions, thereby facilitating the inspection and sanctioning processes.
Proposing Four Policies
Regarding administrative violations, forms of sanctions, sanction levels, remedial measures, authority to establish records, and authority to sanction administrative violations in the monetary and banking field, SBV proposes the following policies:
Policy 1: Amend, supplement, and revoke sanctioning provisions for certain violation acts stipulated in the Law on CIs to align with the Law on CIs 2024 regarding prohibited acts (Article 15), provisions on notifying SBV of the appointment of individuals assuming the role of legal representatives (Article 11), requirements for the inauguration of domestic branches and transaction offices of commercial banks, and independent re-audit in cases where the audit report contains exceptions by the independent audit organization.
Policy 2: Amend and supplement the sanctioning provisions for certain violation acts stipulated in the Law on Prevention of Money Laundering to align with the Law on Prevention of Money Laundering 2022 concerning the development of risk management procedures (Article 16), provisions related to foreign individual customers with political influence (Article 17), and provisions on new and existing products and services applying innovative technology and special monitoring of transactions (Articles 18, 19, and 20).
Policy 3: Amend and supplement the principles and remedial measures to align with the administrative violation acts.
Policy 4: Supplement provisions on the scope of adjustments for violations of regulations on the prevention of money laundering, terrorism financing, and financing the proliferation of weapons of mass destruction.
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