Dear: Golden Cake Co., Ltd

Regarding the proposal of Golden Cake Co., Ltd (hereinafter referred to as the Company) in Official Dispatch No. 15/2018/CV.BV-CP dated December 18, 12, the State Bank of Vietnam (NHNN) has opinion as follows:

1. According to Official Letter No. 15/2018/CV.BV-CP mentioned above, the Company has a foreign loan of EUR 2.500.000, paying interest every 3 months; the first time on March 01, 3, the last time on September 2016, 01. Due to the inability to arrange money to repay the debt, the interest payment period in September 9 was paid by the Company on October 2019, 09 through a payment account at Vietnam Maritime Commercial Joint Stock Bank (Maritime Bank).

2. Legal basis:

2.1. Relevant regulations on management of foreign loan repayment

a. About the responsibility to register and register for changes in foreign loans

The Company's loan is a medium-term and long-term foreign loan that is not guaranteed by the Government, so it is subject to foreign loan registration with the State Bank.

– Clause 1, Article 31 of Circular 03/2016/TT-NHNN dated February 26, 02 guiding some contents of foreign exchange management for foreign borrowing and repayment of enterprises (Circular 2016). : "first. For foreign loans that must be registered with the State Bank, the borrower may only withdraw capital and repay (principal and interest) of the foreign loan after the loan is certified by the State Bank for registration. signed, except for the case of capital withdrawal, partial repayment of principal and interest in the first year of the short-term loan, medium-term or long-term."

– Clause 1, Article 15 of Circular 03 stipulates: “… in case of any change in any loan-related content mentioned in the SBV's written confirmation of foreign loan registration, the borrower is responsible for registering the change in foreign loans with the SBV. in accordance with the provisions of this Circular.”

b. Regarding foreign debt payment accounts:

– Clause 1, Article 24 of Circular 03 stipulates “Foreign loan and debt repayment account is a payment account of the borrower opened at an account service provider to withdraw capital, repay foreign loans and other money transfer transactions related to foreign loans. activities of borrowing and repaying foreign loans, guaranteeing foreign loans.”

– Clause 1, Article 28 of Circular 03 stipulates “In case of change of account for foreign loan or debt repayment due to change of account service provider, the borrower who is not a commercial bank or foreign bank branch shall request the bank providing the service to the current account confirms the situation of capital withdrawal and debt repayment related to foreign loans so that the new account service provider will continue to monitor the implementation of foreign loans in accordance with current regulations on management. borrowing and paying foreign debts.”

– Clause 2, Article 1 of Circular 05/2016/TT-NHNN amending and supplementing Circular 03 (Circular 05) stipulates: "2. For the Borrower being a foreign direct investment enterprise:

a) For medium- and long-term foreign loans: The account for foreign loan and repayment is the direct investment capital account (...)"

– Clause 1, Article 6 of Circular 19/2014/TT-NHNN dated August 11, 8 guiding the management of foreign exchange for foreign direct investment activities in Vietnam (Circular 2014). “In order to carry out foreign direct investment activities in Vietnam, foreign direct investment enterprises and foreign investors participating in business cooperation contracts may open direct investment capital accounts by foreign currency, in Vietnam dong at an authorized bank to conduct revenue and expenditure transactions specified in Articles 01 and 7 of this Circular.”

– Clause 4, Article 6 of Circular 19 stipulates In case there is a need to open a direct investment capital account at another licensed bank, a foreign direct investment enterprise or a foreign investor participating in a business cooperation contract must close the account. opened direct investment capital, transfer the entire balance on this account to a new account…”.

2.2. Relevant regulations on handling of administrative violations

– Point h, Clause 2, Article 24 of Decree No. 96/2014/ND-CP dated October 17, 10 on penalties for administrative violations in the monetary and banking sectors (Decree 2014) provides:

“2. A fine ranging from VND 40.000.000 to VND 80.000.000 shall be imposed for any of the following violations:

(...)

dd) Failing to comply with the provisions of law on administrative procedures for the registration and registration of changes to foreign loans or international bond issuance; registration and registration for changes in offshore loans and guarantee debt recovery for non-residents; registration, registration for account change, investment capital transfer progress and other administrative procedures related to other capital transactions;

h) To withdraw capital and repay foreign loans; disbursement and debt recovery for offshore loans; collect guarantee debt for non-residents; conduct money transfer in service of foreign investment activities in Vietnam, investment of Vietnam abroad in contravention of the provisions of law;

– Point b, Clause 3, Article 3 of Decree 96 “b) The fine level specified in Chapter II of this Decree is the fine level applicable to individuals, except for cases where it is specified that the violator is an organization. The fine level for organizations is 02 times the fine level for individuals;”.

3. For actual transactions of the Company:

Pursuant to the above provisions of law and documents related to the Company's transactions, issued by the State Bank of Vietnam Branch. Ho Chi Minh City Branch (Branch) provided, in case the Company has not been able to arrange a source of money when it is due to pay interest on September 01, 9 and postpones the repayment schedule to October 2018, the Company needs to:

(i) register the change of interest payment plan for the September 9 interest payment period with the Branch;

(ii) after receiving a written confirmation of registration for change of the branch's interest payment plan, the Company presents this document at Sacombank - where the Company opens a direct investment capital account, which is also a bank account. foreign debt repayment so that Sacombank has a basis to transfer money to pay interest debt.

However, the Company did not register to change the interest payment plan. At the same time, because Sacombank refused to pay, the Company transferred the money to the current account opened at Maritime Bank. As such, the Company violated the following regulations:

– Failure to register changes to foreign loans with the State Bank as prescribed in Clause 1, Article 15 of Circular 03. Therefore, the Company did not comply with legal regulations on administrative procedures for registration. , register for changes in foreign loans under the provisions of Point dd, Clause 2, Article 24 of Decree 96.

– Failing to make loans via foreign loan and repayment accounts as prescribed in Clause 1, Article 24 of Circular 03 and Clause 2, Article 1 of Circular 05. Therefore, the Company has made debt repayment for these amounts. foreign loans in contravention of the provisions of law specified at Point h, Clause 2, Article 24 of Decree 96.

4. Because in the process of making foreign loans, the Company violated the above provisions of law, the SBV considers handling administrative violations in the Company's case according to the current regulations of the law on handling of foreign loans. fines for administrative violations in the monetary and banking sectors as referenced above.

In addition, because Maritime Bank transferred money to pay interest to the Company, the State Bank also sanctioned Maritime Bank administrative violations for providing payment and money transfer services for related transactions. related to foreign loans not in accordance with the provisions of law.

The State Bank of Vietnam notifies Vang Banh Co., Ltd.