Allow to use Yuan for payment at the border area from 12/10

The payment currency in trading activities at the border of Vietnam-China will include the freely convertible foreign currencies, VND or CNY. Source: Internet.

According to the State Bank of Vietnam (SBV), on 28/8, the Governor of the State Bank of Vietnam (SBV) signed the Circular No. 19/2018/TT-NHNN guiding the management of foreign exchange for border trade activities between Vietnam and China. This Circular will be valid on 12/10/2018.

Regarding the scope of regulation, the Circular 19 regulates the contents related to the foreign exchange management of border trade activities between Vietnam and China, including: Payment for trading activities of goods and services cross the border by a trader; Payment for activities of trading, exchanging goods and services of border residents; Payment for trading, exchange of goods and services at border markets; Other foreign exchange activities such as entrusted activities in CNY, export and import of cash in CNY and cash in VND, using CNY dong account at the border bank branch.

The subjects of application of this Circular are traders, border residents of Vietnam, traders and border inhabitants of China conducting border trade activities between Vietnam and China; Commercial banks and branches of foreign banks licensed to conduct foreign exchange transactions in Vietnam; Branches of licensed banks located in border areas and border-gate economic zones of Vietnam and China.

Besides that, there are also duty-free goods businesses, service providers in isolated areas at international border gates, organizations dealing in bonded warehouses in the border regions and economic zones of Vietnam - China and other organizations and individuals involved in payment activities in Vietnam-China border trade.

For payment activities in trading, exchange of goods and services across the Vietnam-China border by traders, the Circular stipulates the currency for payment, including freely convertible foreign currencies, VND or CNY.

For payment activities in trading, exchange of goods and services of border residents and border markets, the payment currency is VND or CNY.

Apart from the above-said contents, the Circular also provides for a number of other foreign exchange activities such as entrusted payment in CNY, export and import of CNY in cash and VND in cash.

At the same time, this Circular shall specify the responsibilities of the State Bank's branches in border provinces and licensed banks as well as other individuals, traders and organizations in order to strictly supervise and manage effectively the management activities of foreign exchange in the border trade between Vietnam and China.