Chương II: Cấp giấy phép thành lập và hoạt động của doanh nghiệp bảo hiểm, chi nhánh nước ngoài, doanh nghiệp môi giới bảo hiểm

Chapter II

LICENSING OF ESTABLISHMENT AND OPERATION OF INSURANCE ENTERPRISES, FOREIGN BRANCHES AND INSURANCE BROKER ENTERPRISES

Part 1. LICENSING OF ESTABLISHMENT AND OPERATION

Article 6. General requirements for licensing of establishment and operation of insurance enterprises, foreign branches and insurance broker enterprises

1. For investors:

Organizations and individuals investing in the incorporation of an insurance enterprise or insurance broker enterprise must satisfy the following requirements:

a) Incur no prohibitions as defined in Section 2, Article 18 of the Enterprise Law;

b) Investors must actualize their capital contributions in cash, which must not be financed by a loan or investment trust from other entities;

c) Corporate investors contributing to 10% or more of the charter capital are required to have conducted a profitable business in 03 consecutive years immediately preceding the year that the application for licensing is submitted and to have not incurred cumulative losses prior to the application for licensing.

d) Corporate investors conducting business lines that require a legal capital must undertake that their owner’s equity less the minimum legal capital is at least equal to the planned amount of investment;

dd) If a corporate investor is an insurance enterprise, insurance broker enterprise, commercial bank, financial enterprise or securities enterprise, it must fulfill and maintain financial safety conditions and obtain permission by competent authorities to make the said investments as per specialized laws.

2. For insurance enterprises, foreign branches and insurance broker enterprises being incorporated:

a) Have the charter capital (for insurance enterprises and insurance broker enterprises) or allocated capital (for foreign branches) at least equal to the legal capital according to Article 10 of this Decree;

b) Have incorporated the type of business and charter (for insurance enterprises and insurance broker enterprises) or the regulation of organization and operation (for foreign branches) in conformity to this Decree and relevant laws;

c) Have planned managerial and operational personnel in conformity to this Decree.

3. Have applied for licensing in conformity to this Decree.

Article 7. Requirements for establishment of insurance enterprises

1. Requirements for establishment of insurance enterprises organized as a limited liability business:

Apart from general requirements defined in Article 6 of this Decree, founding investors of an insurance enterprise organized as a limited liability business must be organizations that meet the following requirements:

a) Foreign organizations:

- Trade in insurance abroad and have been permitted by foreign competent authorities to conduct expected business lines in Vietnam, or act as an outward investing subsidiary of a foreign insurance enterprise and have been mandated by the foreign insurance enterprise to invest in the incorporation of an insurance enterprise in Vietnam.

- Have operated for at least 10 years in the sector of business in which they intend to engage in Vietnam;

- Have total worth of assets of at least 02 billion US dollars in the year immediately preceding the year that the application for licensing is submitted;

- Have not seriously violated any laws on insurance business and other legal regulations of the home country for 03 consecutive years immediately preceding the year that the application for licensing is submitted.

b) Vietnamese organizations:

- Trade in finance, banking or insurance;

- Have total worth of assets of at least 2,000 billion Vietnam dongs in the year immediately preceding the year that the application for licensing is submitted.

2. Requirements for establishment of insurance enterprises organized as a joint-stock business:

Apart from general requirements defined in Article 6 of this Decree, an insurance enterprise organized as a joint-stock business must meet the following requirements:

a) At least 02 of its founding shareholders are organization, which meet the requirements stated in Section 1, Article 7 of this Decree and together hold at least 20% of shares in the insurance joint-stock company to be incorporated;

b) In 03 years after licensing, founding shareholders must together hold at least 50% of authorized ordinary shares in the insurance joint-stock company.

Article 8. Requirements for establishment of foreign branches

1. Foreign branches act as a subsidiary of a foreign non-life insurance enterprise, have no judicial personality and are guaranteed by the foreign non-life insurance enterprise to assume liability for all duties and commitments of such branches in Vietnam.

2. A foreign non-life insurance enterprise must meet these requirements to establish branches in Vietnam:

a) The requirements as stated in Point a, Section 1, Article 7 of this Decree;

b) Its head office is based in a country with which Vietnam has signed international trade agreements, particularly on the establishment of branches of foreign non-life insurance enterprises in Vietnam;

c) Permission has been given by foreign insurance-regulating authorities in the home country of the foreign non-life insurance for the establishment of branches in Vietnam to conduct permissible insurance business activities. Moreover, there is no restriction on funding by the foreign non-life insurance enterprise for its branches in Vietnam. Furthermore, every activity of the foreign non-life insurance enterprise can be supervised;

d) Insurance-regulating authorities in the home country of the foreign non-life insurance enterprise have entered written agreements with Vietnam’s Ministry of Finance for cooperation in administration and supervision of foreign branches’ activities;

dd) Have undertaken in writing to assume liability for all duties and commitments of the branches in Vietnam and have mandated the directors of such branches in writing to assume liability to the law of Vietnam for every operation of the foreign branches;

e) Funds for establishment of the foreign branches must be legitimate and not be financed by a loan or investment trust in any manner;

g) Have gained profit for 03 consecutive years immediately preceding the year that the application for licensing is submitted and have not incurred cumulative losses prior to the application for licensing.

Article 9. Requirements for establishment of insurance broker enterprises

1. Vietnamese organizations and individuals investing in the incorporation of an insurance broker enterprise must meet the requirements defined in Article 6 of this Decree.

2. Foreign organizations investing in the incorporation of an insurance broker enterprise must adhere to Article 6 of this Decree and meet the following requirements:

a) Such organizations are foreign insurance broker enterprises that are permitted by foreign competent authorities to broker insurance in Vietnam;

b) Have operated for at least 10 years in the sector of insurance brokerage;

c) Have not seriously violated any laws on insurance brokerage and other legal regulations of the home country for 03 consecutive years immediately preceding the year that the application for licensing is submitted.

Article 10. Legal capital of insurance enterprises, foreign branches and insurance broker enterprises

1. Legal capital of non-life insurance enterprises:

a) Provision of non-life insurance (except for Point b and Point c of this Section) and health insurance: 300 billion Vietnam dongs;

b) Provision of insurance according to Point a of this Section and aviation insurance or satellite insurance: 350 billion Vietnam dongs;

c) Provision of insurance according to Point a of this Section, aviation insurance and satellite insurance: 400 billion Vietnam dongs;

2. Legal capital of life insurance enterprises:

a) Provision of life insurance (except unit-linked insurance and retirement insurance) and health insurance: 600 billion Vietnam dongs;

b) Provision of insurance according to Point a of this Section and unit-linked insurance or retirement insurance: 800 billion Vietnam dongs;

b) Provision of insurance according to Point a of this Section, unit-linked insurance and retirement insurance: 1,000 billion Vietnam dongs;

3. Legal capital of health insurance enterprises: 300 billion Vietnam dongs;

4. Legal capital of foreign branches:

a) Provision of non-life insurance (except for Point b and Point c of this Section) and health insurance: 200 billion Vietnam dongs;

b) Provision of insurance according to Point a of this Section and aviation insurance or satellite insurance: 250 billion Vietnam dongs;

c) Provision of insurance according to Point a of this Section, aviation insurance and satellite insurance: 300 billion Vietnam dongs;

5. Legal capital of reinsurance enterprises:

a) Provision of non-life reinsurance or both non-life reinsurance and health reinsurance: 400 billion Vietnam dongs;

b) Provision of life reinsurance or both life reinsurance and health reinsurance: 700 billion Vietnam dongs;

c) Provision of life reinsurance, non-life reinsurance and health insurance: 1,100 billion Vietnam dongs;

6. Legal capital of insurance broker enterprises:

a) Brokerage of direct insurance or reinsurance: 4 billion Vietnam dongs;

b) Brokerage of direct insurance and reinsurance: 8 billion Vietnam dongs;

Article 11. Application for licensing of establishment and operation of insurance enterprises organized as a limited liability business

1. The filled-in form of application for licensing as prescribed by the Ministry of Finance.

2. The draft charter of the enterprise as per Article 25 of the Enterprise Law.

3. The operational scheme for first 05 years, which is commensurate with the business lines to be licensed. Such scheme shall specify the target market, distribution channels and methods for generating operating provisions, reinsurance plans, capital investment, business performance and financial capacity of the insurance enterprise.

4. Copies of citizen identity cards or ID cards or passports or other valid personal identification papers; judicial records, resumes, copies of degrees and certificates of individuals to be appointed as the Chairperson of the Enterprise or of the Member’s Council, General Director, actuaries or reserving actuaries, and chief accountant of the insurance enterprise.

5. The list of founders or contributors of 10% or more of the charter capital, with these documents:

a) Copies of incorporation decisions and certificates of business registration or equivalent documents;

b) The corporate charter;

c) Written decision(s) by competent persons of corporate investors on investment into the establishment of the insurance enterprise;

d) Written mandates and copies of the citizen identity cards or ID cards or passports or other valid personal identification papers of the representatives as mandated by corporate investors;

dd) Audited financial statements of 03 consecutive years that immediately precede the year that the application for licensing is submitted. If a foreign insurance enterprise mandates a subsidiary to invest in the incorporation of an insurance enterprise in Vietnam, the financial statements of that subsidiary shall be required;

e) Written mandates given by foreign insurance enterprises to outward investing subsidiaries and their undertakings to jointly assume liability for the latter’s investment and duties regarding the incorporation of the insurance enterprise in Vietnam (if foreign insurance enterprises mandate outward investing subsidiaries to establish insurance enterprises in Vietnam).

6. Rules, terms and fee schedules of insurance products to be deployed.

7. The written attestation by a bank licensed to operate in Vietnam of the charter capital of the enterprise deposited in a frozen account in such bank.

8. The partnership agreement as per Article 19 of the Enterprise Law (if a domestic organization and a foreign organization jointly invest in the incorporation of the limited liability company with 2 or more members).

9. The written record(s) of meeting of shareholders (for an application for establishment of a limited liability company with 2 or more members) with regard to:

a) The consent to contribute capital to the incorporation of the insurance enterprise organized as a limited liability business, with the list of founders or contributors of 10% or more of the charter capital;

b) The approval of the Corporate Charter.

10. The written confirmation by competent authorities in the home country of the foreign corporate investor of:

a) The permission for the foreign organization to establish insurance enterprises in Vietnam. If no regulation in the home country of the foreign organization requires such written confirmation, relevant evidence(s) must be provided;

b) The foreign organization’s ongoing operations in the sector that it intends to carry out in Vietnam;

c) The foreign organization’s financial soundness and fulfillment of administrative requirements in its home country;

dd) No serious violation of the foreign organization of any laws on insurance business and other legal regulations in its home country for 03 consecutive years immediately preceding the year that the application for licensing is submitted.

11. The written confirmation by competent government authorities of the Vietnamese organization's fulfillment of financial safety requirements and permission to invest in the establishment of the insurance enterprise according to specialized laws.

12. The written confirmation(s) by investors of their fulfillment of requirements for licensing as defined in Section 1, Article 7 of this Decree.

13. The written mandate by an investor to an individual or organization to handle formalities for licensing.

Article 12. Application for licensing of establishment and operation of insurance enterprises organized as a joint-stock business

1. The filled-in form of application for licensing as prescribed by the Ministry of Finance.

2. The draft charter of the enterprise as per Article 25 of the Enterprise Law.

3. The operational scheme for first 05 years, which is commensurate with the business lines to be licensed. Such scheme shall specify the target market, distribution channels and methods for generating operating provisions, reinsurance plans, capital investment, business performance and financial capacity of the insurance enterprise.

4. Copies of citizen identity cards or ID cards or passports or other valid personal identification papers; judicial records, resumes, copies of degrees and certificates of individuals to be appointed as the Chairperson of the Board of Directors, General Director, actuaries or reserving actuaries, and chief accountant of the insurance enterprise.

5. The list of founding shareholders and the following papers:

a) For individuals:

- The copy of the citizen identity card or ID card or passport or a valid personal identification paper; judicial record as per the law;

- The written attestation by a bank of the balance of deposit(s) in Vietnam Dong or freely convertible currencies in that bank.

b) For organizations:

- Copies of incorporation decisions and certificates of business registration or equivalent documents; those of foreign organizations must be consular legalized;

- b) The corporate charter;

- c) Written decision(s) by competent persons of corporate investors on investment into the establishment of the insurance enterprise;

- Written mandates and copies of the citizen identity cards or ID cards or passports or other valid personal identification papers of the representatives as mandated by corporate investors;

- Audited financial statements of 03 consecutive years that immediately precede the year that the application for licensing is submitted.

6. Rules, terms and fee schedules of insurance products to be deployed.

7. The written attestation by a bank licensed to operate in Vietnam of the charter capital of the enterprise deposited in a frozen account in such bank.

8. The written record(s) of shareholders’ meeting(s) with regard to:

a) The consent to invest in the establishment of the insurance enterprise organized as a joint-stock business, with the list of founding shareholders;

b) The approval of the Corporate Charter.

9. The written mandates by shareholders to an individual or organization to handle formalities for licensing.

10. The written confirmation by competent government authorities of the Vietnamese organization's fulfillment of financial safety requirements and permission to invest in the establishment of the insurance enterprise according to specialized laws.

11. If a foreign corporate investor is an insurance enterprise, the application must include written confirmation(s) by competent authorities in its home country of:

a) The permission for the foreign insurance enterprise to establish insurance enterprises in Vietnam. If no regulation in the home country of the foreign enterprise requires such written confirmation, relevant evidence(s) must be provided;

b) The foreign insurance enterprise’s ongoing operations in the sector that it intends to carry out in Vietnam;

c) The foreign insurance enterprise’s financial soundness and fulfillment of administrative requirements in its home country;

d) No serious violation of the foreign organization of any laws on insurance business and other legal regulations in its home country for 03 consecutive years immediately preceding the year that the application for licensing is submitted.

12. The written confirmation(s) by shareholders of their fulfillment of requirements for licensing as defined in Section 2, Article 7 of this Decree.

Article 13. Application for licensing of establishment and operation of foreign branches

1. The filled-in form of application for licensing as prescribed by the Ministry of Finance.

2. The draft regulation of organization and operation of the foreign branch, which has been endorsed by the foreign non-life insurance enterprise.

3. The operational scheme for first 05 years, which is commensurate with the business lines to be licensed. Such scheme shall specify the methods for generating operating provisions, reinsurance plans, capital investment, business performance and financial capacity of the foreign branch.

4. Copies of citizen identity cards or ID cards or passports or other valid personal identification papers; judicial records, resumes, copies of degrees and certificates of individuals to be appointed as the Director, actuaries or reserving actuaries, and chief accountant of the foreign branch.

5. Documents regarding the foreign non-life insurance enterprise:

a) Copies of incorporation decisions and certificates of business registration or equivalent papers certified by authorities, with which the foreign non-life insurance enterprise has registered, in at most 03 months prior to the date that the application for licensing is submitted;

b) The corporate charter;

c) The written decision(s) by competent persons of the foreign non-life insurance enterprise on the establishment of the branch in Vietnam;

d) Written mandates and copies of the citizen identity cards or ID cards or passports or other valid personal identification papers of the representative(s) as mandated by the foreign non-life insurance enterprise;

dd) Audited financial statements of 03 consecutive years that immediately precede the year that the application for licensing is submitted.

6. Rules, terms and fee schedules of insurance products to be deployed.

7. The written attestation by a bank licensed to operate in Vietnam of the funding deposited in a frozen account in such bank.

8. The written confirmation(s) by foreign insurance-regulating authorities in the home country of the foreign non-life insurance enterprise of:

a) The permission for the foreign non-life insurance enterprise to establish branches in Vietnam. If no regulation in the home country of the foreign non-life insurance enterprise requires such written confirmation, relevant evidence(s) must be provided;

b) The foreign non-life insurance enterprise’s ongoing operations in the sector that it intends to carry out in Vietnam;

c) The foreign non-life insurance enterprise’s financial soundness and fulfillment of administrative requirements in its home country;

d) No serious violation of the foreign non-life insurance enterprise of any laws on insurance business and other legal regulations of its home country for 03 consecutive years immediately preceding the year that the application for licensing is submitted.

9. The written undertaking(s) and mandate(s) of the foreign non-life insurance enterprise as per Section 2, Article 8 of this Decree.

Article 14. Application for licensing of establishment and operation of insurance broker enterprises

1. The filled-in form of application for licensing as prescribed by the Ministry of Finance.

2. The draft charter of the enterprise as per Article 25 of the Enterprise Law.

3. The operational scheme for first 05 years, which is commensurate with the business lines to be licensed. Such scheme shall specify the capital investment and business efficiency of the incorporation of the insurance broker enterprise.

4. Copies of citizen identity cards or ID cards or passports or other valid personal identification papers; judicial records, resumes, copies of degrees and certificates of the Chairperson of the Enterprise or Chairperson of the Member’s Council or Chairperson of the Board of Directors, General Director, and chief accountant of the insurance broker enterprise.

5. The list of founding shareholders (or members) or contributors of 10% or more of the charter capital, with these documents:

a) For individuals:

- The copy of the citizen identity card or ID card or passport or a valid personal identification paper; judicial record as per the law;

- The written attestation by a bank of the balance of each individual's deposit(s) in Vietnam Dong or freely convertible currencies in the bank.

b) For organizations:

- a) Copies of incorporation decisions and certificates of business registration or equivalent papers; however, copies of the certificates of business registration of foreign corporate investors must be certified by authorities, with which such organizations have registered, in at most 03 months prior to the date that the application for licensing is submitted;

- b) The corporate charter;

- Written decision(s) by competent persons of corporate investors on investment into the establishment of the insurance broker enterprise in Vietnam;

- Written mandates and copies of the citizen identity cards or ID cards or passports or other valid personal identification papers of the representatives as mandated by corporate investors;

- Audited financial statements of 03 consecutive years that immediately precede the year that the application for licensing is submitted;

- The written confirmation by competent government authorities of the Vietnamese organization's fulfillment of financial safety requirements and permission to invest in the establishment of the insurance broker enterprise according to specialized laws.

6. The written attestation by a bank licensed to operate in Vietnam of the charter capital of the enterprise deposited in a frozen account in such bank.

7. The partnership agreement as per Article 19 of the Enterprise Law (if a domestic organization and a foreign organization jointly invest in the incorporation of the limited liability company with 2 or more members).

8. Written records of founding members' or shareholders' meetings with regard to:

a) The consent to contribute capital to the incorporation of the insurance broker enterprise organized as a limited liability or joint-stock business, with the list of founding members or shareholders, or contributors of 10% or more of the charter capital;

b) The approval of the Corporate Charter.

9. The written mandates by founding members or shareholders to an individual or organization to handle formalities for licensing.

10. The written confirmation(s) by competent authorities in the home country of the foreign insurance broker enterprise of:

a) The permission for the foreign insurance broker enterprise to establish insurance broker enterprises in Vietnam. If no regulation in the home country of the foreign enterprise requires such written confirmation, relevant evidence(s) must be provided;

b) The foreign enterprise's ongoing operations in insurance brokerage;

c) No serious violation of the foreign organization of any laws on insurance brokerage and other legal regulations in its home country for 03 consecutive years immediately preceding the year that the application for licensing is submitted.

11. The written confirmation(s) by investors of their fulfillment of requirements for licensing as defined in Article 9 of this Decree.

Article 15. Procedure for licensing of establishment and operation

1. The application for licensing shall consist of 01 set of original documents and 02 sets of copies. The documents in each set of the application for licensing by a foreign entity shall include 01 original (or copy) in English or 01 translated copy in Vietnamese. Documents in the application for licensing, which bear signatures, titles and seals of foreign entities, must be consular legalized. Copies and translated copies in Vietnamese must be endorsed by Vietnamese notary agencies as per the law on notarization. Applicants shall be held liable for the accuracy of their application for licensing.

2. In 21 working days upon receiving an application for licensing, the Ministry of Finance shall notify in writing of its request for amendments to the documents that are inadequate and invalid. The investor shall be given 06 months upon such notification to revise and supplement the documents. If the investor fails to revise and supplement the application in the defined time, the Ministry of Finance shall reject the application in writing.

3. In 60 days upon receiving the valid and adequate application, the Ministry of Finance shall issue the license to the insurance enterprise, foreign branch or insurance broker enterprise. Ministry of Finance, if rejecting an application, shall provide explanations in writing. Ministry of Finance shall only refuse to license investors or insurance enterprises, foreign branches or insurance broker enterprises being incorporated if they fail the requirements for licensing according to this Decree.

Article 16. Procedure after the licensing of establishment and operation of insurance enterprises, foreign branches and insurance broker enterprises

1. In 30 days upon being licensed, an insurance enterprise, foreign branch or insurance broker insurance must publish primarily the following details on newspaper in 05 consecutive issues:

a) Name and address of the insurance enterprise or insurance broker enterprise, its head office, branches and representative offices; name and address of the foreign branch;

b) Content, scope and duration of operations;

c) Level and contributed amount of the charter capital of the insurance enterprise or insurance broker enterprise; the allocated capital of the foreign branch;

d) Full name of the legal representative of the insurance enterprise, foreign branch or insurance broker enterprise;

dd) Code and issue date of the License;

e) Licensed practices of insurance and insurance brokerage.

2. In 60 days upon being licensed, the insurance enterprise or foreign branch must deposit a part of its charter capital contributed or funded in a commercial bank operating in Vietnam. The deposit shall be 2% of the legal capital as defined in Article 10 of this Decree.

3. In 12 months upon being licensed, the insurance enterprise, foreign branch or insurance broker enterprise must fulfill these formalities to initiate official operations:

a) Convert the deposit in frozen account to the charter capital (or the allocated capital);

b) Register the seal and tax code, and open checking account(s) as per the law;

c) Set up the information technology infrastructure, equipment and software pertinent to corporate management and state management of insurance business;

d) Handle formalities to request the Ministry of Finance’s approval of methods for generating operating provisions, to register insurance products (for insurance enterprises and foreign branches) and to endorse managerial personnel;

dd) Promulgate processes for deployment, appraisal, claim payment, internal control, financial management and investment and administrant of reinsurance plans (for insurance enterprises and foreign branches).

4. If insurance enterprises, foreign branches and insurance broker enterprises fail to complete the formalities defined in Article 3 within 12 months upon being licensed, the Ministry of Finance shall revoke the license.

5. Insurance enterprises, foreign branches and insurance broker enterprises, during their operations, shall have all changes approved by the Ministry of Finance according to Section 1, Article 69 of the Law on business insurance and Section 9, Article 1 of the Law on amendments to the Law on insurance business. Moreover, they must announce such changes according to Section 1 of this Article.

Part 2. REVISION TO THE LICENSE OF ESTABLISHMENT AND OPERATION OF INSURANCE ENTERPRISES, FOREIGN BRANCHES AND INSURANCE BROKER ENTERPRISES

Article 17. Change of name of insurance enterprises, foreign branches and insurance broker enterprises

1. The application for change of name of an insurance enterprise, foreign branch or insurance broker enterprise shall include:

a) The filled-in form of application for business name change as prescribed by the Ministry of Finance;

b) The written decision by competent persons as per the corporate charter (of the insurance enterprise or insurance broker enterprise) or the regulation of organization and operation (of the foreign branch) on the change of the name of the enterprise or branch.

2. Ministry of Finance, in 14 working days upon receiving the valid and adequate application, shall issue its approval in writing. Ministry of Finance, if rejecting the application, shall provide explanations in writing.

Article 18. Adjustment of charter capital or allocated capital

1. The application for the Ministry of Finance’s approval in principle of an increase in charter capital (for an insurance enterprise or insurance broker enterprise) or in allocated capital (for a foreign branch) includes:

a) The filled-in form of application for adjustment of charter capital or allocated capital as prescribed by the Ministry of Finance;

b) The written decision by competent persons as defined in the corporate charter (for an insurance enterprise or insurance broker enterprise) or the regulation of organization and operation (for a foreign branch) on the increase in charter capital (or allocated capital). Such decision must specify the amount, method and time of increase.

c) The plan for mobilization and utilization of the charter capital or allocated capital;

d) The list of shareholders (or members) expectedly holding 10% or more of the increased charter capital of the insurance enterprise or insurance broker enterprise, and written evidences of their satisfaction of the requirements defined in Article 7, Article 8 and Article 9 of this Decree (depending on the type of business). This stipulation does not apply to shareholders (or members) who have held at least 10% of the charter capital of the insurance enterprise or insurance broker enterprise before the charter capital is increased through public offering of shares or offering of shares of a public listed joint-stock company.

2. The application for the Ministry of Finance’s approval in principle of a decrease in charter capital (for an insurance enterprise or insurance broker enterprise) or in allocated capital (for a foreign branch) includes:

a) The filled-in form of application for adjustment of charter capital or allocated capital as prescribed by the Ministry of Finance;

b) The written decision by competent persons as defined in the corporate charter (for an insurance enterprise or insurance broker enterprise) or the regulation of organization and operation (for a foreign branch) on the decrease in charter capital (or allocated capital). Such decision must specify the amount, method and time of decrease.

c) The scheme for decrease of charter capital or allocated capital must evince that the insurance enterprise, foreign branch or insurance broker enterprise meets all financial requirements defined in this Decree.

3. Ministry of Finance, in 14 working days upon receiving the valid and adequate application, shall issue its written approval in principle. Ministry of Finance, if rejecting the application, shall provide explanations in writing.

4. If the charter capital is increased through public offering of shares or offering of shares of a public listed joint-stock company, the insurance enterprise or insurance broker enterprise shall adhere to the Securities Law after acquiring the approval in principle of the Ministry of Finance.

5. In 06 months after obtaining the approval in principle by the Ministry of Finance of the application for adjustment of charter capital or allocated capital, the insurance enterprise, foreign branch or insurance broker enterprise shall complete such change and present 01 set of the following documents to the Ministry of Finance:

a) The summary report on the adjustment of the charter capital (or allocated capital) in comparison with the capital adjustment scheme approved by the Ministry of Finance;

b) The written attestation by a bank of shareholders’ or members' full deposit in the frozen account in such bank as the additional capital contribution to the insurance enterprise or insurance broker enterprise; or the bank's written attestation of the foreign non-life insurance enterprise's allocation of additional capital of the foreign branch into the frozen account. Such attestation is required in case of capital increase;

c) Evidences of the insurance enterprise’s or insurance broker enterprise’s settlement of all payments to shareholders (or members); or the foreign branch’s transfer of the full amount of capital decreased back to the foreign non-life insurance enterprise (in case of capital decrease);

d) Other documents as defined in Point d, Section 1 of this Article if the charter capital is increased through public offering of shares or offering of shares of a public listed joint-stock company.

6. Ministry of Finance, in 14 working days upon receiving the valid and adequate application, shall issue its approval in writing. Ministry of Finance, if rejecting the application, shall provide explanations in writing.

7. In 06 months after obtaining the approval in principle by the Ministry of Finance of the application for adjustment of charter capital or allocated capital, the insurance enterprise, foreign branch or insurance broker enterprise must report to the Ministry of Finance if the former fails to implement the approved scheme for capital adjustment.

8. Single-member limited liability companies cannot decrease the charter capital.

Article 19. Establishment and closure of branches, representative offices and business facilities

1. An insurance enterprise or insurance broker enterprise must satisfy the following requirements to establish a branch or representative office or convert a representative office to a branch:

a) The owner’s equity in the nearest financial statement is not lower than the legal capital defined in Article 10 of this Decree;

b) Adhere to regulations on solvency margin;

c) The total sum of fines, if incurred in 12 months prior to the application for establishment of the branch or representative office for any administration violations regarding insurance business, does not add up to VND 400 million;

d) Set up the regulation of organization and operation for the branch or representative office; have evidences of the right to use the location of the branch or representative office.

dd) Director of the Branch or Head of the representative office meets the requirements defined in Article 29 of this Decree;

e) Have submitted an application for establishment of the branch or representative office or for conversion of a representative to a branch according to Section 2 of this Article.

2. The application for establishment of a branch or representative office or for conversion of a representative office to a branch includes:

a) The filled-in form of application for establishment of the branch or representative office as prescribed by the Ministry of Finance;

b) The draft of the regulation of organization and operation of the branch or representative office as per the law;

c) Evidences of the insurance enterprise or insurance broker enterprise’s satisfaction of requirements for the owner’s equity and solvency margin according to Point a and b, Section 1 of this Article;

d) Judicial records, copies of citizen identity cards or ID cards or passports or other valid personal identification papers, resumes, copies of degrees and certificates of qualification and experience of individuals to be appointed as the Director of the branch or Head of the representative office;

dd) Evidences of the right to use the location of the branch or representative office.

e) The written decision by competent persons as defined in the corporate charter on the establishment of the branch or representative office.

3. An insurance enterprise or insurance broker enterprise must satisfy the following requirements to close a branch or representative office:

a) Have applied in writing for the closure of the branch or representative office according to Section 4 of this Article;

b) The closure of the branch or representative office does not impair the duties towards the state, policyholders' interests and other related entities.

4. The application for closure of a branch or representative office includes:

a) The filled-in form of application for closure of the branch or representative office as prescribed by the Ministry of Finance;

b) The written decision by competent persons as defined in the corporate charter on the closure of the branch or representative office.

c) Operational reports of the branch or representative office in 03 nearest years. If the operational time of the branch or representative office is less than 03 years, the report shall indicate activities since operational initiation;

d) The report(s) on responsibilities, issues and solutions related to the closure of the branch or representative office.

5. Ministry of Finance, in 14 working days upon receiving the valid and adequate application, shall issue its approval in writing. Ministry of Finance, if rejecting the application, shall provide explanations in writing.

6. Insurance enterprises, foreign branches and insurance broker enterprises can establish or close business facilities at their own discretion. In 10 working days upon deciding the establishment or closure of a business facility, an insurance enterprise, foreign branch or insurance broker enterprise shall notify the Ministry of Finance in writing. The notification of the establishment of a business facility shall specify:

a) Name and address of the business facility;

b) Activities of the business facility;

c) Full name and place of residence of the head of the business facility and the copy of his citizen identity card, ID card, passport or valid personal identification paper.

7. When establishing or closing an overseas branch or representative office, an insurance enterprise or insurance broker enterprise shall follow Section 1, Section 2, Section 3 and Section 4 of this Article and legal regulations on outward direct investment.

Article 20. Relocation of head office, branches, representative offices and business facilities

1. The application for change of address of the head office, branch or representative office includes:

a) The filled-in form of application for change of address of the head office, branch or representative office, as prescribed by the Ministry of Finance;

b) The written decision by competent persons as per the corporate charter (of the insurance enterprise or insurance broker enterprise) or the regulation of organization and operation (of the foreign branch) on the change of address of the head office, branch or representative office;

c) Evidences of the right to use the location of the head office, branch or representative office.

2. Ministry of Finance, in 07 working days upon receiving the valid and adequate application, shall issue its approval in writing. Ministry of Finance, if rejecting the application, shall provide explanations in writing.

3. In 10 working days upon deciding the change of address of a business facility, an insurance enterprise, foreign branch or insurance broker enterprise shall notify the Ministry of Finance in writing.

Article 21. Revision to the content, scope and duration of operations

1. Insurance enterprises, foreign branches or insurance broker enterprises must satisfy the following requirements to extend the content, scope or duration of operations:

a) The requirements as stated in Point a, Point b and Point c, Section 1, Article 19 of this Decree.

b) The head of the insurance service division invokes the Ministry of Finance's endorsement of eligibility as defined in Article 30 of this Decree.

c) For providers of retirement insurance:

- Have the solvency margin higher than the minimum solvency margin by VND 300 billion;

- Extract at least VND 200 billion from the owner’s equity to generate the voluntary pension fund;

- Operate the information technology system that monitors and manages details of every transaction of each retirement insurance account;

- Assign at least 05 persons managing directly the voluntary pension fund. Each person must have at least 05 years’ experience in managing a pension fund or policyholder fund.

d) For providers of unit-linked insurance:

- Have the solvency margin higher than the minimum solvency margin by VND 200 billion;

- Operate an information technology system suitable for managing and controlling unit-linked funds in prudent and effective manner;

- Be capable for valuing assets and units in a unit-linked fund in unbiased and precise manner on weekly basis, and publish the selling and purchase prices of units to the insurance buyers.

dd) For providers of universal life insurance:

- Have the solvency margin higher than the minimum solvency margin by VND 100 billion;

- Operate an information technology system suitable for managing and controlling universal life funds in prudent and effective manner;

e) Abide by guiding documents by the Government or Prime Minister on certain insurance products.

2. Insurance enterprises, foreign branches or insurance broker enterprises, when narrowing the content, scope or duration of their operations as defined in the license, must assure that such restraints do not impair the duties towards the state, policyholders' interests and related entities.

3. The application for change(s) to the content, scope and duration of operations includes:

a) The filled-in form of application for change(s) to the content, scope and duration of operations, as prescribed by the Ministry of Finance;

b) The written decision by competent persons as per the corporate charter (of the insurance enterprise or insurance broker enterprise) or the regulation of organization and operation (of the foreign branch) on changes to the content, scope and duration of operations.

c) Rules, terms and fee schedules of (any) insurance products to be deployed upon the extension of the content and scope of operations;

d) Written evidences of the insurance enterprise's, foreign branch's or insurance broker enterprise's abidance by the requirements defined in Section 1 of this Article for the extension of the content, scope and duration of operations;

dd) The report(s) by the insurance enterprise, foreign branch or insurance broker enterprise on responsibilities, issues and solutions for the shrinkage of the content and scope of operations.

4. Ministry of Finance, in 14 working days upon receiving the valid and adequate application, shall issue its approval in writing. Ministry of Finance, if rejecting the application, shall provide explanations in writing.

Article 22. Division, consolidation, merger, conversion, transfer of shares

1. Division, consolidation, merger and conversion of insurance enterprises, foreign branches and insurance broker enterprises as well as transfer of shares thereof shall:

a) Cause no damage to the legitimate rights and interests of insurance buyers, employees and the Government;

b) Adhere to relevant laws and regulations;

c) Obtain the written approval of the Ministry of Finance (except transfer of less than 10% of the charter capital);

d) The requirements defined in Article 7, Article 8 and Article 9 of this Decree (depending on the type of business) must be satisfied by organizations and individuals expectedly investing in an insurance enterprise, foreign branch or insurance broker enterprise after being divided, consolidated, merged, converted or transferred.

dd) The requirements defined in Article 7, Article 8 and Article 9 of this Decree (depending on the type of business ensuing after the division, consolidation, merger, conversion and share transfer) must be fulfilled by the insurance enterprise, foreign branch or insurance broker enterprise after being divided, consolidated, merged, converted or transferred.

2. The application for division, consolidation, merger, conversion or transfer of at least 10% of the charter capital includes:

a) The filled-in form of application for division, consolidation, merger, conversion and share transfer, as prescribed by the Ministry of Finance;

b) The written approval by competent persons as defined in the corporate charter (of the insurance enterprise or insurance broker enterprise) or the regulation of organization and operation (of the foreign branch) of the division, consolidation, merger, conversion or share transfer;

c) The report on arrangements for apportionment and settlement of insurance contracts in effect, liabilities, duties towards the state, and commitments to employees after the division, consolidation, merger, conversion or transfer of the insurance enterprise, foreign branch or insurance broker enterprise;

d) The list of shareholders (or members), amount and structure of the charter capital of the insurance enterprise or insurance broker enterprise after being divided, consolidated, merged, converted or transferred;

dd) The notarized copy of the principle contract for consolidation, merger or transfer (except insurance enterprises organized as a public listed joint-stock company);

e) Opinions of valuation bodies, which indicate the ratio of share conversion or value of sakes (in case of consolidation or merger) or the value of assets apportioned to parties involved (in case of division);

g) The notarized copies of the audited financial statements in 03 years immediately preceding the year that an organization offers its consolidation or merger with the insurance enterprise, foreign branch or insurance broker enterprise;

h) Written evidences of the adherence of the insurance enterprise, foreign branch or insurance broker insurance, after being divided, consolidated, merged or converted, its investors and managers to Section 1 of this Article;

i) Insurance enterprises organized as a public listed joint-stock company may not submit the documents defined in Point d, Point dd and Point h of this Article.

3. Ministry of Finance, in 30 days upon receiving the valid and adequate application, shall issue its approval in writing. Ministry of Finance, if rejecting the application, shall provide explanations in writing.

4. In 10 working days upon the completion of the division, consolidation, merger, conversion or share transfer according to the approved plan, the insurance enterprise, foreign branch or insurance broker enterprise must report the result of such process to the Ministry of Finance. Insurance enterprises organized as a public listed joint-stock company shall present the documents defined in Point d, Point dd and Point h, Section 1 of this Article. The insurance enterprise, foreign branch or insurance broker enterprise, if failing the approved plan, must report to the Ministry of Finance for solutions.

5. In 10 working days upon receiving the report and relevant documents from the insurance enterprise, foreign branch or insurance broker enterprise on the result of the division, consolidation, merger or conversion, the Ministry of Finance shall issue the license or amended license.

Article 23. Dissolution of insurance enterprises and insurance broker enterprises, shutdown of foreign branches

1. In the following events, an insurance enterprise or insurance broker enterprise shall dissolve or a foreign branch shall shut down:

a) The duration of operation, as shown in the license, expires without being extended or approved for extension;

b) The enterprise or branch is capable of repaying debts and voluntarily dissolves or shuts down;

c) The license is revoked;

d) Insolvency as determined by the Ministry of Finance (only applicable to foreign branches);

dd) The foreign non-life insurance enterprise is stripped of its license, dissolved or bankrupt or its duration expires (only applicable to foreign branches).

2. The application for dissolution of an insurance enterprise or insurance broker enterprise or shutdown of a foreign branch includes:

a) The filled-in form of application for dissolution or shutdown, as prescribed by the Ministry of Finance;

b) The written decision by competent persons as defined in the corporate charter (of the insurance enterprise or insurance broker enterprise) or the regulation of organization and operation (of the foreign branch);

c) The written decision by competent government authorities on the events as stated in Point a (i.e. rejection of the application for extension), Point c, Point d and Point dd, Section 1 of this Article;

d) Written evidences of the insurance enterprise’s, foreign branch's or insurance broker enterprise’s settlement of all debts and financial obligations and undertaking of no involvement in any disputes through any court or arbitration (in case of voluntary dissolution or shutdown as per Point b, Section 1 of this Article), as follows:

- The report on settlement of duties towards employees as per the law;

- The report of settlement of liabilities towards insurance buyers, which include the settlement of liabilities ensuing from insurance contracts and the transfer of insurance contracts as per regulations (for insurance enterprises and foreign branches);

- The report on settlement of duties towards the state and other creditors;

- The notarized copy of the written confirmation by tax authorities of the fulfillment of tax payments;

- Other written evidences (if any).

dd) The license of establishment and operation.

3. In 14 working days upon receiving the valid and adequate application, the Ministry of Finance shall issue a decision to dissolve the insurance enterprise or insurance broker enterprise or to shut down the foreign branch.