Chapter V
FOREIGN CURRENCY MARKET, EXCHANGE RATE MECHANISM AND MANAGEMENT OF GOLD IMPORT AND EXPORT
Article 37.- Vietnam's foreign currency market
1. Foreign currency market means the place where foreign currency sale and purchase take place. Participants in foreign currency market include the State Bank of Vietnam, licensed credit institutions, foreign exchange counters as well as organizations and individuals being residents and nonresidents in Vietnam.
The State Bank of Vietnam shall specify conditions, modes and types of foreign currency transactions in the foreign currency market.
2. Inter-bank foreign currency market means a market for transactions between the State Bank of Vietnam and licensed credit institutions and among licensed credit institutions. Members of the inter-bank foreign currency market may buy and sell foreign currencies by the modes and forms of professional transactions, based on the agreements and commitments between concerned parties in accordance with international practice and regulations of the State Bank of Vietnam.
3. When participating in the concentrated inter-bank foreign currency market organized and administered by the State Bank of Vietnam, licensed credit institutions must abide by the regulation on organization and operation of this market, issued by the State Bank of Vietnam.
Article 38.- Operations of the State Bank of Vietnam in the foreign currency market
Based on the exchange rate fluctuations in the foreign currency market and objectives of the monetary policy in each period, the State Bank of Vietnam shall formulate and implement a scheme of intervention by purchasing or selling foreign currencies in the domestic foreign currency market.
Article 39.- Exchange rate mechanism applicable to Vietnam dong
1. The exchange rate mechanism applicable to Vietnam dong shall be formulated on the basis of the foreign-currency market demand and supply, and regulated by the State. The State Bank of Vietnam shall regulate exchange rates through the use of monetary policy instruments and the implementation of the scheme on sale and purchase in the foreign currency market.
2. The exchange rate mechanism applicable to Vietnam dong is a floating exchange rate mechanism administered by the State Bank of Vietnam on the basis of the monetary baskets of the countries having trade, borrowing, debt-payment and investment relations with Vietnam according to specific macro-economic objectives in each period.
Article 40.- Management of the import and export of gold in bullions, bars, granules or pieces
Credit institutions and organizations licensed to trade in gold may import and export gold in bullions, bars, granules and pieces in accordance with regulations of the State Bank of Vietnam.