NEW REGULATIONS ON REGISTRATION OF SECURED TRANSACTIONS

On November 30, 2022, the Government issued Decree No. 99/2022/ND-CP on registration of security interests (“Decree 99”), replacing Decree No. 102/2017/ND-CP (“Decree 102”) dated September 1, 2017.

Decree 99 has some notable amendments and supplementations as follows:

Supplement subjects of security interest registration as securities

Registration of secured transactions in case of securities is a controversial issue that is still absent from Decree 102. Decree 99 has solved this matter by allowing the types of securities to be subject to registration as follows:

• Securities registered at the Vietnam Securities Depository and Clearing Corporation in accordance with the law on securities;
• Securities that have yet been registered, including dividends, property rights arising from securities.

Supplement cases of security interests registration based on land and land-attached asset use rights

1. Cases of compulsory registration: besides cases specified in Decree 102 (mortgage of land and land-attached asset use rights), Decree 99 also added the following case: Mortgage of housing construction investment projects, non-residential construction investment projects, agricultural investment projects, forest development projects, and other investment projects using land concurrently with land use rights are allocated with land use levy or leased with full one-off rental payment for the entire lease period by the State.
2. Cases of registration upon request: Previously, Decree 102 only stipulated in general the case of mortgage of assets attached to land to be formed in the future. Decree 99 clarifies these types of assets as follows:

• Mortgage of houses to be formed in the future and other assets attached to land to be formed in the future;
• Mortgage of established land-attached assets that are not houses but are not required to be registered by law and have yet been registered upon request, except for cases where land-attached assets is an annual crops as prescribed.

Supplement a way to determine the effect against a third party of the security interest registration for cases of change in legal status or existence of assets

Accordingly, the security transaction registration of the original registrar is still valid in the following cases:

1. Securities that have yet been registered but have already been registered for security transactions, but then are converted into registered securities (and vice versa), and continue to be used to secure the obligation performance of the original secured part(y/ies);
2. Goods circulated in the process of production and trading, components and supplies have been registered, then assembled, manufactured, processed or otherwise to form a new asset and this asset is used to secure the obligation performance, is registered, but the value of the goods circulated in the process of production and business or the value of components and supplies continues to be used to secure the obligation performance of the original secured part(y/ies);
3. Property rights arising from a house purchase contract or from a sale contract or another contract of transfer of ownership rights to other properties attached to land which have been registered and then transferred to mortgage registration of houses or other properties attached to land.

Regarding other amendments and supplementations related to procedures for registration of security assets, please seek for the official document.

Decree 99 shall take effect from January 15, 2023.