Vietnam’s New Anti-Money Laundering Circular: What Foreign Firms Need to Know

The State Bank of Vietnam (SBV) recently issued Circular 09/2023/TT-NHNN, a new guideline aimed at helping businesses navigate the complexities of complying with Vietnam’s Anti-Money Laundering (AML) regulations. This article provides an overview of the key elements and their implications for foreign businesses.

Understanding Circular 09/2023/TT-NHNN

• Issued on July 28, 2023.
• Designed to help businesses comply with Vietnam’s AML law effectively.
• Covers essential areas such as assessing money laundering risks, reporting suspicious transactions, and client classification.

Assessing Money Laundering Risks in Vietnam

Businesses must consider several factors to evaluate money laundering risks:

1. Business sector.
2. Transaction location.
3. Type of customer.
4. Nature of the products or services.

For example, limited crypto transactions are riskier than credit card transactions. Use a scoring system (1-5) to assess the risk of each transaction.

Developing AML Procedures and Client Assessment

Implement AML procedures according to your operational scale and scope. Procedures should include objectives and scope, risk evaluation, customer ratings, handling of customers based on ratings, risk assessment for new products, and responding to suspicious electronic funds transfers.

Client Risk Ratings

Low-risk customers undergo simplified due diligence with fewer identification requirements and reduced monitoring. High-risk customers require enhanced due diligence, including additional verification steps and continuous monitoring.

Additional Compliance Requirements

• Yearly training for leaders and employees.
• Regular updates on regulations.
• Internal audit reports.
• Mandatory registration of AML compliance officers.

Reporting on Electronic Funds Transfers

Report electronic funds transfers when:

• Parties involved are in Vietnam.
• Transfer value exceeds VND 500,000,000 (approx. US$21,000).
• At least one party is outside of Vietnam.
• Transfer value is over US$1,000.

Reports should include detailed information on the financial institutions, parties involved, and transaction details.

Effective Dates

Most clauses will take effect on July 28, 2023. Regulations on risk management, large transaction reporting, reporting of electronic funds transfers, and suspicious transaction report forms come into effect on December 1, 2023.

Seeking Professional Assistance

To navigate Vietnam’s complex AML regulations, consider consulting professional advisory firms like Dezan Shira & Associates for guidance and support.

About Us

Vietnam Briefing is published by Dezan Shira & Associates, which aims to help foreign investors in Vietnam and throughout Asia succeed through actionable business intelligence, comprehensive due diligence, and expert advisory services on tax, legal, and regulatory matters. For more information, contact us at vietnam@dezshira.com or visit www.dezshira.com.