According to current regulations, what is the procedure for setting up a foreign insurance business branch? Let’s find out with Lawyer X the following article:
Legal grounds
Consolidation document No. 06/VBHN-VPQH
Consolidation document No. 08/VBHN-BTC
Conditions for establishing a foreign insurance business branch
– Foreign branch is a dependent unit of a foreign non-life insurance enterprise, has no legal status, is guaranteed by the foreign non-life insurance enterprise to be responsible for all obligations and commitments. branch in Vietnam.
– A foreign non-life insurance enterprise that establishes a branch in Vietnam must satisfy the following conditions:
+ Eligibility to establish an insurance business in Vietnam
+ Having its head office in a country where Vietnam and that country have signed international treaties on trade, including an agreement on establishing a branch of a foreign non-life insurance enterprise in Vietnam;
+ Besides, the foreign insurance regulatory agency where the foreign non-life insurance enterprise is headquartered has signed a Memorandum of Understanding on cooperation with the Ministry of Finance of Vietnam on management and supervision of its operations. foreign branches;
+ Having a written commitment to take responsibility for all obligations and commitments of the branch in Vietnam;
+ The source of capital for the establishment of a foreign branch must be a lawful source and must not use borrowed money or investment trust in any form;
+ Having made a profit for 03 consecutive years preceding the year of submitting the application for a license and having no accumulated loss up to the time of applying for a license.
Procedures for establishing a foreign insurance business branch
Prepare profile
– The dossier of application for a license is made in 3 sets, of which 1 is the original and 2 is a copy.
+ Vietnamese copies and translations from foreign languages into Vietnamese must be certified by a Vietnamese notary public by the law on notarization.
– Moreover, for the application file for a license of a foreign organization or individual, each set includes 01 copy in Vietnamese and 01 copy in English.
+ Documents with foreign signatures, titles, and seals in the license application dossier must be consular legalized.
Apply to the application-receiving agency of the Ministry of Finance.
Processing records
+ Within 21 working days from the date of receipt of the application for a license, if the application is incomplete and invalid, the Ministry of Finance shall notify in writing of the request for supplementation or modification of the application.
+ The maximum time limit for supplementing or amending the investor’s dossier is 6 months from the date of notification.
Issuing a license to operate
+ Within 60 days from the date of receipt of complete and valid dossiers, the Ministry of Finance shall grant a license to the insurance enterprise.
+ In case of refusal to grant a license, the Ministry of Finance shall issue a written explanation clearly explaining the reason.
Procedures after being granted an operating license
Within 60 days from the date of issuance of the license
– Within 30 days from the date of issuance of the foreign branch license, it must publish daily in 05 consecutive issues of the newspaper with the following main contents:
+ Firstly, name and address of the foreign branch;
+ Secondly, content, scope, and duration of operation;
+ Then, amount of capital allocated by the foreign branch;
+ Full name of the legal representative of the foreign branch.
+ Not last, license number and date;
+ Licensed insurance and insurance brokerage operations.
– Within 60 days from the date of issuance of the License, the foreign branch must use part of the contributed charter capital or the allocated capital to deposit at a commercial bank operating in Vietnam. The deposit level is equal to 2% of the legal capital.
Within 12 months from the date of issuance of the license
Within 12 months from the date of issuance of the License, the foreign branch must complete the following procedures to officially operate:
+ Above all, convert the capital deposited in the escrow account into charter capital (or allocated capital);
+ Then, register seal samples, register tax identification numbers, open transaction accounts at banks by the law;
+ Establishing a system of information technology infrastructure, equipment, and software to meet the requirements of corporate governance and state management of insurance business activities;
+ After that, carry out procedures to request the Ministry of Finance to approve the method of setting up professional reserves, approve and register insurance products; and approve administrative and executive positions;
+ Lastly, issuing procedures for exploitation, assessment, compensation, internal control, financial and investment management, reinsurance program management.
Related article:
Dossier of licensing of insurance LLC establishment in Vietnam
Conditions for establishing an insurance business in Vietnam
Frequently asked questions
If within 12 months from the date of issuance of the License, the foreign branch fails to complete the prescribed procedures to start its operation, the Ministry of Finance will revoke the granted License.
Legal capital of the foreign branch:
(1) Business in non-life insurance (except for the cases specified in items (2), (3)) and health insurance: 200 billion Vietnam dong;
(2) Insurance business as prescribed in item (1) and aviation insurance or satellite insurance: VND 250 billion;
(3) Particularly, insurance business as prescribed in item (1), aviation insurance and satellite insurance: VND 300 billion.
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