November 20, 2017 13:58

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The Ministry of Finance proposed to abolish the Decree on Debt Collection Services instead of amending it

09:58 | 09/08/2017

VCN- After a period of careful study, the Ministry of Finance decided not to amend Decree No. 104/2007 / ND-CP of the Government on Debt Collection Services as proposed before. 

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the ministry of finance proposed to abolish the decree on debt collection services instead of amending it
debt collection businesses only needed to maintain the regulations on security and order conditions.

According to the Ministry of Finance, Decree 104 promulgated regulations on conditions for debt collection business enterprises, including capital conditions, standards for managers and employees of joint ventures, debt collection service business; specified some contents of debt collection service business such as the principle of debt collection service activities, measures in debt collection services, responsibilities and rights of creditors and debtors.

After 10 years of implementation of the Decree, on the basis of the proposal of some localities, to suit the current situation and the current Law, the Ministry of Finance submitted to the Government a draft decree replacing the Government’s Decree 104. Accordingly, the Ministry of Finance proposed to abolish some regulations on business conditions such as capital conditions, standards for managers and employees of debt collection services in line with the spirit of the Enterprise Law of 2014 to increase the freedom of doing business in accordance with the Law, creating favourable conditions for enterprises in business activities and reducing the level of intervention by the State, and adding conditions for security and orders.

Thus, if the Decree replaces the Government's Decree104 is issued, the conditions for doing business with debt collection service enterprises are only conditions on security and order as provided in the Decree. 96/2016 / ND-CP of the Government stipulating conditions on security and orders for some businesses subject to conditional investment.

On 10th April 2017, the Deputy Prime Minister, Mr. Truong Hoa Binh chaired the meeting on the Decree of the Government in replacement of Decree 104 and assigned the Ministry of Finance to assume the prime responsibility and coordinate with the related ministries to report to the Government towards not promulgating the Decree replacing Decree No. 104 to ensure that it conforms to the spirit of the Constitution on human rights, property rights of citizens, the provisions of civil Law and other relevant regulations.

Based on the direction of the Deputy Prime Minister and the study of current legislation, the Ministry of Finance found that in the absence of a Decree that replaces Decree No. 104, it was not necessary to maintain the business conditions for debt collection services such as capital conditions, standards for managers and employees of debt collection services, the Ministry of Finance proposed to abolish this Decree.

As for the impact, the Ministry of Finance found that most of the provisions of Decree 104 had been adjusted in the current documents, so that debt collection businesses only needed to maintain the regulations on security and order conditions; transactions between debt collection service businesses with creditors and debtors shall be made in accordance with the agreement between the parties in accordance with the provisions of the Civil Code, so there is no need for a separate decree on debt collection services.

Therefore, the abolition of Decree 104/2007 / NĐ-CP still ensures strict State management of the Ministry of Public Security for this activity, not creating holes for abuse, ensuring social security, life, health and dignity of citizens. Also, it does not impact the rights and obligations of parties involved in debt collection service activities (creditors and debtors of debt collection services) when performing the contracts signed between the parties as defined in the Civil Code.

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Information from the Department of Banking Finance and Financial Institutions – under the Ministry of Finance and most of the ministries (the Ministry of Public Security, the Ministry of Planning and Investment, the People's Supreme Court, the State Bank of Vietnam) agree with this new proposal of the Ministry of Finance.

By Hong Van/ Hoang Anh