Opening the market for banking services in line with the commitments made by vietnam on its WTO accession

Joint Swedish-Vietnamese Master’s Programme MASTER’S THESIS N guyen H ong V an Opening The Market for Banking Services in line with the Commitments made by Vietnam on its WTO Accession THUVIÊN TRUONG OAI HOC LUÂT HÀ NÔI L ph o n g d o c S u p e r v is o r s : Prof Christina Moëll Dr Bui Ngoc Cuong Préfacé and Acknowledgements The author would like to express many thanks to Professor Christina Moëll, Faculty of Law, Lund University, Sweden; Doctor Bui Ngoc Cuong, Hanoi Law University, and my teachers, relatives, friends and colleagues for their support during the process o f writing this thesis Table of Contents Préfacé and Acknowledgements Table of Contents Abbreviations .4 Introduction Overview of banking services and international commitments of Vietnam on opening banking services market in the WTO’s framework 1.1 1.1.1 1.1.2 1.2 1.2.1 1.2.2 1.2.3 1.2.4 Overview of banking services and the opening up o f banking services as part o f globalization Overview o f banking services Opening up the banking services market in the context o f globalization 14 International commitments of Vietnam on opening up its services market within the WTO’s framework 18 Commitment on licensing foreign crédit institutions to supply banking services in Vietnam 22 Commitment on regulating the form o f fmancial companies are licensed to operate in Vietnam 25 Commitment on regulating the form of financial services that can be provided in Vietnam .25 Commitment on regulating the capital ratio o f foreign banks may own in a Vietnamese bank 26 The current situation regarding Vietnamese law on banking services and completing the implementation o f the commitment to open up the banking services market within the WTO framework 27 2.1 2.1.1 The current situation regarding Vietnamese Law on banking services 27 Current overview of the banking system and the Vietnamese Banking Law 27 Influence of international commitments on opening banking services on Vietnam L aw .30 The adaptation of Vietnamese Law on Banking in line with its commitments on joining the W TO 32 2.1.2 2.1.3 2.2 2.2.1 2.2.2 Completing the work on Vietnamese Law to fully implement the commitments on opening up the banking services market within the WTO framework 40 Completion criteria for various régulations of Vietnamese Law and the international commitments on opening up the banking services market 40 Proposai of solutions to the correct implementation of the international commitments on opening up the banking services market of Vietnam 41 Conclusion 44 Table of Statutes and other Légal Instruments 46 International Treaties and Conventions 46 National Législations .46 Vietnam 46 Bibliography 47 Official Reports and other Documents 47 Monographs .47 Articles in Joumals, Anthologies etc 48 Abbreviations ASEAN Association of South East Asian Nations GATS General Agreement on Trade in Services GDP Gross Domestic Product FDI Foreign Directive Investment IMF International Monetary Fund NA National Assembly of Vietnam SRV Socialist Republic of Vietnam WTO World Trade Organization WB World Bank VND Vietnam dong USD US dollar Introduction Rationale * L Vietnam was officially recognized as the 150 _ member o f the World Trade Organization (WTO) on 11111 January 2007 This event marked a new stage in the process o f integrating Vietnam into the international economy in général and the banking sector in particular However, faced with the need to implement the commitment undertaken as part o f the intégration process, Vietnamese banking services régulations were found to contain many weakness These régulations contain many contradiction, Vietnamese financial ability is generally weak, the management mechanism for banking activities has not caught up with modemization nor conformed to international practices and standards and many forms o f banking services have no adequate légal framework These shortcomings make it hard for Vietnam to implement its commitments effectively and to make full use o f the advantages that intégration brings A sériés o f questions arise What was the real situation o f the law on banking services in Vietnam when it joined the WTO? What problems were identified when implementing the commitments? How can Vietnam overcome these shortcomings? Ail o f these problems need to be studied carefully and then resolved both in theory and in practice Purpose The purpose o f this thesis is to clarify the theory and practice o f modifying the law on banking services in accordance with Vietnam’s commitments on WTO accession and with international practice in général This involves the following tasks: Clarify the concept o f banking service according to international practices (the WTO agreement) and the particular requirements o f member countries wishing to open up their banking service market Clarify Vietnam’s commitments on opening up the banking service market in the framework of the WTO agreement Clarify the situation o f Vietnamese Law when linked to its international commitments within the WTO framework Such an analysis is the scientific foundation needed to help reform the law in the direction o f opening up the banking service market Délimitation The thesis will focus on the commitments on opening up banking services market undertaken following WTO accession and on how Vietnam is in fact implementing these commitments However, because the régulations on opening up the banking services market are based on the law of banking services in général, this research needs to be seen against the background of a study of régulations of Vietnamese and WTO régulations o f banking services in the light of of the commitments undertaken: (i) commitment on licensing foreign crédit institutions to supply banking services in Vietnam, (ii) commitment on regulating the form of financial companies licensed to operate in Vietnam (iii) commitment on regulating the form o f financial services that can be provided in Vietnam, (iv) commitment on regulating the capital ratio of foreign bank ownership of a Vietnamese bank Method This thesis combines the analyzing, comparing and synthesizing methods The analyzing method is used to evaluate the current State of the law on banking services in Vietnam The comparing method is used to compare Vietnamese régulations with the WTO régulations as well as international practice The synthesizing method is used to evaluate and draw conclusions on each matter studied and give recommendations for improvement Moreover, to strengthen our argument, we provide illustrative statistics where necessary Base on this research, the thesis hope to give an overview o f the theory and practice o f the current law on banking services in Vietnam and makes some proposais aimed at effectively implementing the commitments made on WTO accession and strengthening the compétitive capacity of the banking service sector Overview of banking services and international commitments of Vietnam on opening banking services market in the WTO’s framework 1.1 Overview of banking services and the opening up of banking services as part of globalization 1.1.1 Overview of banking services 1.1.1.1 The concept o f Banking Services a The concept o f “Services”: Today, service activities are developing strongly and are now playing an important part in the economy of most nations In the 1990s, services made up 40% o f GDP in Uganda, 50% o f GDP in Zambia, more than 60% o f GDP in Korea and Brazil and 80% o f GDP in Canada (In Vietnam, according to the General Statistics Office , services made up 37,98% o f GDP in 2004) However, there are many différent concepts of services, none o f which is accepted globally According to many researchers, services can be understood in both a broad and a narrow sense - In the broad sense, services are considered the third economic sector, which includes ail economic activities other than industry and agriculture This point of view is held by economists such as Allan Fisher and Colin Clark3 Clark defined services as “form s o f economic activities which are not included in the first and second sectors (industry and agriculture) - In the narrow sense, services are understood to be the “software” of visible products, closely related to the production process and visible product exchange An example is the Honda product warranty service which is a service connected to the sale of Honda motors, carried out after sales in order to support and enhance sales activity overall In Vietnam, there are various ways o f understanding the concept According to the Vietnamese encyclopedic dictionary, services are activities to meet the demand o f National Committee on international economic coopération (2005), General view of service commercial liberalization, National Politics Publishing House, p.21 National Committee for International Economic Coopération Office (2006) “WTO intégration documents o f Vietnam”, p 182 James R Melvin, History and Measurement in The Service Sector: a review, Review of Income and Wealth, sériés 41, number4, December 1995, p.484 production, business and life4, such as entertainment, health and éducation services in daily life; transport, information and Consulting services in business According to Prof, PhD Nguyen Thi Mo: “Services are laboring activities crystallized into invisible products which, although o f value, cannot be touched”.5 Compared with the encyclopedia définition this makes it clearer that services consists o f invisible products International organizations like the International Monetary Fund (IMF) or World Trade Organization (WTO) define the concept by determining the areas which are regarded as services and then just listing and classifying them The General Agreement on Trade in Services (GATS)6 GATS does not define the term but indirectly refers to the concept by way of the modes for providing services Modes of providing services according to GATS: (a) Cross- border supply: In this mode, the service provider the and customers are each in their own country but the service is provided from the territory o f one country to that of another For example, express-service or transporting oil through a pipeline (b) Abroad consumption: In this mode, customers have to go to the country o f the provider to buy the service, such as the service o f being examining and medically treated in a foreign country or studying abroad (c) Commercial presence: In this mode, service providers set up their presence in the country of the customer through a légal entity such as a branch, représentative office or subsidiary company For example, banking services, distribution services Encyclopédie dictionary, p 167 Prof PhD Mo, Nguyen Thi, “Choosing steps and solutions for Vietnam to open trade in services”, Political Argument Publishing House, 2005, p 14 GATS is a system o f régulations o f the WTO multilatéral adjustment to trade services This Agreement dérivés from the Uruguay round negotiations and includes obligations and principles, the index o f each field and the spécifié commitments by each country aimed at opening markets 29 terms o f GATS applies to ail service sectors including the banking service sector These provisions state the principle that ail Member States must comply with: (1) Most-FavoredNation, (2) Transparency, (3) National treatment, (4) Market access most-favoured nation treatment in commercial services Therefore, considérations relating to the files and procédures when foreign crédit institutions apply for an operating license will be based the current légal documents of Vietnam, especially the Crédit Institution Law Based on the current régulations on licensing foreign crédit institutions as well as the actual situation relating to such licensing, we can see several major shortcomings in the licensing of crédit institutions in Vietnam légal documents when compared with international practice: On régulations relating to the légal form o f a crédit institution: The Crédit Institution Law and guidance documents of this law (Decree 13/1999/ND-CP on 17/03/1999) not mention the form of sub-bank with 100% foreign capital nor they regulate the licensing conditions or the filing procédure for it, while the bilatéral and multilatéral commitments On régulations relating to the légal capital o f a crédit institution: Régulations on the légal capital o f crédit institution in Vietnamese Law are not adequate and clear + The Crédit Institution Law and Decree no 82/1998/ND-CP on 03/10/998 does not regulate légal capital of the form of sub-banking with 100% foreign capital + The Crédit Institution Law also does not regulate banks for investment or banks for development, but Decree no 82 does regulate the légal capital of this form On régulations relating to procédures and files when licensing crédit institutions to operate The licensing procédure is still verbose as crédit institutions have to apply for a sub license for each opération with conditions regulated by légal documents, although crédit institutions can prove they are able to meet the conditions Further, applying for an operating license is not implemented through one centre - the state bank -to operate in Vietnam, crédit institutions have to submit forms to the People’s committee where their head office is located This will cause inconvenience to crédit institutions asking for a license to operate in Vietnam + The current time for appraising licensing files is 90 days (once the file is considered valid and sufficient) 35 + Régulations on “Project of operating in the fïrst three years, in which the effectiveness and economic benefits of banking opération are mentioned” regulated the operational but not the establishment sector o f banks Therefore, there is a lack of sufficient data and other information on this + The régulations that require documents proving the capacity and professional skill o f the persons who establish crédit institutions are irrational and contradict previous régulations on the conditions regarding persons who establish crédit institutions (they can be organizations or individuals with prestige and the requisite financial capacity) Only managers of crédit institutions need to have documents proving capacity and professional skill + Some régulations are too abstract and lack détail and clear guidance; it is especially unclear which opérations need a sub-license and which opération have enough met conditions This has an effect on transparency in the régulations relating to licensing On régulations relating to the form and content o f licenses fo r operating crédit institutions + Régulations on the content of operating licenses are not in accordance with the changed régulations currently in force law as they are not updated in a timely way Many crédit institutions, especially branches of foreign banks are implementing opérations that are not based on their license but on current régulations + The sample form of operating license issued for crédit institutions has not been modified or supplemented to be in accordance with régulations and this for many reasons For example, many professional skills and concepts included in bilatéral and multilatéral commitments are not clearly understood and the officiais o f the State Bank have not grasped the nature o f these professional compétences + Current licenses emphasize listing profession compétences but not regulate the main operational content Each form of bank has to have one kind of license, and this also applies to banks for investment and banks for development Up to now Vietnamese Law has not regulated on the professional compétence needed by a bank for investment or a bank for development + In line with international intégration, Vietnam’s banks will come to diversify their activities and expand their service forms They will then be activities that just need to be subject to général conditions and there will be others that need more précisé restrictions (opération required sub-license) However, at present the distinction between opération needing only conditions and those ones need sublicenses is not clear and this can lead to problems in the administrative procédures or there may even be opérations that banks themselves cannot control 36 + The opération content regulated in the license shows there is still discrimination between Vietnam crédit institutions and foreign ones: Vietnam crédit institutions can implement some opérations that foreign ones cannot or only with restrictive conditions, such as allowing them to receive deposits in Vietnam dong (Vietnam crédit institutions can this without restriction while foreign ones are subject to conditions), or to put in automatic teller machines- ATM ( Vietnamese crédit institutions can put them in various places while foreign ones are only allowed to have them at head office) However, this discrimination must stop according to route in order to be compatible with the situation of Vietnam in the WTO Point a, Item 1, Article 22 of Crédit Institution Law regulates that one of the conditions for alicense establishing and operating crédit institutions is “having economic demand in the location” This régulation is not compatible with the WTO intégration commitment of Vietnam under the principle “verifying economic demand” regulated at Point a, Item of GATS and the Commitment Schedule of intégration commitment o f Vietnam (2) On regulating the form offinancial companies licensed to operate in Vietnam (a) Régulations accordance with Vietnamese Law: Article 3, Decree no 22/2006/ND-CP41 on 28/2/2006 regulates that: foreign crédit institutions are allowed to establish commercial presence in the following forms: joint venture banks, branch o f foreign bank, bank with 100% foreign capital They can have a représentative office in Vietnam Article 53, Circular 03/2007/TT-NHNN42 on 5/6/2007 a guide to implementing several articles o f Decree no 22 on the rate and mode of contributing charter capital in the following way: Rate and mode of contributing charter capital of members in banks with 100% foreign capitals, of foreign party and Vietnam party in joint venture banks are together agreed by ail parties and written clearly in Régulations of Joint Venture Bank, banks with 100% foreign capital, based on ensuring to conform principles: - For banks with 100% foreign capital: ensure that the rate of contributing capital of the parent bank is over 50% of the charter capital 41 Decree no 22/2006/ND-CP41 on 28/2/2006 of the Government on organizing and opération of braches of foreign banks, joint venture banks, banks with 100% foreign capital, représentative office of foreign crédit institutions in Vietnam 42 Circular 03/2007/TT-NHNN42 on 5/6/2007 of State Bank of Vietnam guides to implement several articles of Decree no 22 regulating rate and mode of contributing charter capital 37 For joint venture banks: ensure that the rate of contributing capital of the foreign party is under 50% of the charter capital (except for spécial cases decided by the prime minister) In général, the current régulations Law on financial companies wishing to operate in Vietnam are close to the WTO intégration commitments (b) Différent régulations compared with the WTO intégration commitments: Current régulations on the opération, management and monitoring of crédit institutions are classified according to the form o f ownership Chapter contains régulations on the operating form, operating content, financial receipts and expenses of foreign crédit institutions and their représentative offices Domestic ones are covered by régulations scattered across chapter to chapter 11 o f this Law This is not compatible with the WTO principle of no discrimination and does not ensure the transparency and predictability of régulations (3) On regulating the form offinancial services that can be provided in Vietnam (a) Régulations in accordance with Vietnam Law: Légal document no 1210/NHNN-CNH43 on 7/2/2007 gives instructions to be received by VND deposit branches and they are to follow the same route as in Vietnam’s commitments generally So this was introduced to apply directly to the State Bank of Vietnam (b) Différent régulations compared with the WTO intégration commitments: The law goveming the Vietnam State Bank and the Law o f current crédit institutions both use the term “banking opération” (the content mainly covers receiving deposits, issuing crédit and supplying payment service) instead o f the term “banking service” as in the Agreement o f trade service The différence between these two terms has caused some difficulty in implementation According to GATS/WTO, foreign service suppliers are allowed to appear in the capacity of a crédit institutions with 100% foreign capital with a view to supplying one or more than one banking services The recent implementation of laws goveming crédit institutions has shown that using the term “banking service” creates difficulties in determining the operating 43 Légal document no 1210/NHNN-CNH43 on 7/2/2007 of State Bank of Vietnam sent to branches of foreign banks in Vietnam with instructions to receive by VND 38 scale and services supplied by différent forms of crédit institutions, such as trade banks and non-banking crédit institutions In addition, the present Banking Law does not fully classify banking services as per the GATS’s annex on financial services (4) On regulating the capital ratio offoreign banks owning part of a Vietnamese bank (a) Régulations under Vietnamese Law: Decree no 69/2007/ND-CP on 20/4/200744 on foreign investors buying stocks of Vietnam Trade bank contains principles on foreign investors owning these stocks According to this, the total amount of stock owned by foreign individuals or légal entities is not allowed to exceed 30% of the charter capital of the bank, unless Vietnam has another régulation or it is permitted by an appropriate Vietnamese authority In this field, the régulations are close to the WTO intégration commitments (b) Différent régulations compared to the WTO intégration commitments: Besides enforcing régulations relating to Vietnam’s commitments to the WTO, Decree no 69/2007/ND-CP also contains several restrictions that are not compatible with national treatment principle and market accessing principle In particular, Article o f the decree regulates that: “The stratégie investor is only allowed to buy stocks in one Vietnamese bank” or “a foreign crédit institution is allowed to participate in the boards of directors o f no more than two Vietnamese banks” These shortcomings need to be modified in the near future 44 Decree no 69/2007/ND-CP on 20/4/2007 of the Government of Vietnam on foreign investors buying stocks of Commercial bank of Vietnam 39 2.2 Completing the work on Vietnamese Law to fully implement the commitments on opening up the banking services market within the WTO framework 2.2.1 Completion criteria for various régulations o f Vietnamese Law and the international commitments on opening up the banking services market The completion of the relevant régulations o f Vietnamese Law to fit with the international commitments on opening up the banking services market should be based on the following criteria: Régulations have to be close to international standards and practices (CAMELS 45, BASEL II 46), commitments between Vietnam and other countries, or International Organizations (such as the Trade Agreement Vietnam-America, WTO commitments, Promotion and Protection of Investment between Vietnam and Japan, etc.) to avoid conflicts and create favorable conditions for crédit institutions to get international access in a convenient way Guidance documents need to be consistent and avoid contradictions between General Law and Professional Law Régulations covered in more than one of the Civil Law, Law on State Bank o f Vietnam and Enterprise Law are unnecessary and the contents to applied to crédit institutions should be in spécifié régulations only The Crédit Institution Law should have général régulations applicable to ail crédit institutions and particular régulations for each kind o f crédit institution One should also change the approach from one specifying what is permitted or banned, to one allowing crédit institutions to anything except things that are banned In addition, the Crédit Institution Law need to correct other shortcomings in the current Vietnamese banking nowadays, such as limiting the number of guidance documents under law, regulating clearly who has the compétence to enforce guidance documents, regulating the organization and the operational and managing activity of each kind o f crédit institutions, removing ail forms of national discrimination and creating equality among crédit institutions based on the principle of establishing a transparent and equal business environment in banking and other monetary opérations 45 CAMELS is the abrreviations of Capital, Assets, Management, Eamings, Liquidity and Sensitivity That are abrreviation standing for indexes that form ranking system for a Bank 46 BASEL II Agreement is an international agreement about capital secure standard, enhance managing the financial globalization as we as exploiting interest potential and reduce risks This is considered solution to improve Asian Banks 40 2.2.2 Proposai o f solutions to the correct implementation o f the international commitments on opening up the banking services market o f Vietnam 2.2.2.1 In terms o f licensing foreign crédit institutions to supply banking services in Vietnam (a) Licensing Conditions: For joint-venture crédit institutions and 100% foreign owned crédit institutions: + Amend the régulations on the licensing conditions at Article 106 of Law on Crédit Institutions affecting: First, the requirement on the capital of the parent crédit institution According to Vietnam’s signed or negotiated bilatéral and multilatéral commitments, the parent crédit institution must have at least USD 10 million in capital and its assets must be at least USD 10 million Second, the requirement on performance of the parent crédit institution In détail: (1) the capital adequacy ratios should be ensured to be in accordance with international practices and the régulations of the State Bank for three years in a row before applying for a license, (2) no administrative penalties at the highest level according to laws o f the home country for at least three years in a row before applying for a license, (3) good rating by well-known international rating agencies for at least three years in a row before applying for a license (examples of wellknown international rating agencies are Moody’s or Standard&Poor) + A commitment o f the Supervising Authority o f the home country with the State Bank o f Vietnam to cooperate in the control, supervision and exchange of and responsibility for information related to the parent crédit institution + The parent crédit institution is permitted by the competent authority of the home country to establish joint-venture crédit institution or a 100% foreign owned crédit institution in Vietnam - For branches o f foreign crédit institutions: Amendment to régulations: the parent crédit institution accepts material responsibility for its branch’s opérations in Vietnam because the branch in Vietnam is not a fully separate légal entity For représentative offices of foreign crédit institutions: Amendment to régulations: the crédit institution is permitted by the competent authority of its home country to establish a représentative office in Vietnam 41 (c) Procédures: Continue reforming administrative procédures, minimizing the time and number of steps relating to banking opération (especially notarizing procédures and guaranteeing transactions), limiting secondary papers Recommendation relating to licensing procédures: the licensing review period should be shortened to 60 working days from the receipt of a complété application file (d) Application file: Amendments to régulations on application file for Crédit Institutions provided in Article 108 of the Law on Crédit Institution as follows: need to supplément certain documents like that: ( 1) Charter o f the foreign crédit institution (2) Operating license of the foreign crédit institution (3) The following documents of the foreign competent authority: + Approving the establishment o f the joint-venture crédit institution or the 100% foreign owned crédit institution in Vietnam + Stating its commitment to the State Bank to cooperate in the supervision, control and exchange o f information regarding the performance o f the parent foreign crédit institution, and to be responsible for the opérations o f the parent crédit institution + Confirming the sound financial status o f the parent foreign crédit institution and that it has not been penalized at the highest level according to laws of the home country for the three years in a row before applying for a license (4) Financial Statement of the last three years o f the foreign parent crédit institution in accordance with international standards and with Vietnamese accounting standards (5) Confirmation by international rating agencies like Moody’s or Standard & Poor Also needing to be supplemented are: requirements regarding the joint-venture contract (for the joint-venture crédit institution) and The provision regarding a list, curriculum vitae and certificates of the founding member, members of the Board of Directors and the Board o f Controllers should be replaced by the requirement of the curriculum vitae and certificates proving the capability and professional compétence of the General Director (Director) of the foreign crédit institution^ branch (for branches of foreign crédit institutions) 42 2.2.2.2 In terms o f regulating the form o f financial companies licensed to operate in Vietnam Relating to the inadequacy mentioned above in provision 2(b) part 2.1.2.2, Vietnam needs to amend and modify the Law on Crédit Institutions so that existing régulations on the form and content of activities o f the kind crédit institutions, apply to both domestic and foreign crédit institution to be compatible with the non- discrimination and transparency principles of the WTO 2.2.2.2> In terms o f regulating the form o f financial services that can be provided in Vietnam Relating to the inadequacy mentioned above in provision 3(b) part 2.1.2.2, Vietnam needs to promulgate new Laws on the State Bank of Vietnam and on Crédit Institutions In which there should be a clear définition of "banking services", including provisions on the organization and opération of différent Crédit Institutions to ensure transparency as stipulated by the WTO 2.2.2.4 In terms o f regulating the capital ratio foreign banks may own in a Vietnamese bank Relating to the inadequacy mentioned above in provision 4(b) part 2.1.2.2, Decree 69/2007/ND-CP needs to be amended to be compatible with the National Treatment principle and market access raies o f the WTO 43 Conclusion In the current phase of globalization, opening up markets is an indispensable trend It must be said that this is also an opportunity for each nation to review its law system and make it conform to international practice which may assist the development of national economy In 2008, the Vietnamese economy is facing problems: the micro economy is unstable, inflation is increasing, the paying capacity of some banks shows difficulties Up to now, the economy in général and the banking system in particular had to face the many challenges and obstacles that the financial crisis and world economic slowdown brought However, the year 2008 has also shown that Vietnam takes very seriously the WTO intégration commitments with the resuit that banks with 100% foreign capital were licenses to operate in Vietnam The appearance of more and more foreign crédit institutions show the attractiveness of the Vietnamese market and indicates that competitiveness will increase in the financial and banking sector According to the latest statistics on the operating situation o f foreign crédit institutions in Vietnam, there are 33 foreign banks licensed to open branches, joint venture banks with 19 branches, banks with 100% foreign capital, non-banking crédit institutions and 54 représentative offices in Vietnam In 2008, in spite of the loss o f some branches o f foreign banks and financial companies, the total pre-tax profit was over 1.400 billion VND 47 As a member o f the WTO, the Vietnamese Government has been crafting policies with a view to creating a level playground for ail forms o f crédit institutions in Vietnam’s financial market and making it a more and more convenient investment environment with the hope that foreign investors in général and foreign financial institutions in particular will participate in the market with new products, modem services and the best banking practices In the future, the State Bank o f Vietnam needs to propose and enforce policies following international standards, enhance competitiveness and create favourable conditions for crédit institutions to develop stably and strongly thus contributing actively to the development of the Vietnamese economy and international economic intégration 47 See Report on Foreign Policy of State Bank of Vietnam and the activities of foreign crédit institution in Vietnam, http://www.sbv.gov.vn/vn/home/tinHDNH.isp?tin=3975 assessed 13 December 2008 44 Through this thesis, the author would like to make contribution to clarify both theoretical and practical matters of building and completing légal framework of banking services, so that it can meet the demand of implementing commitments made by Vietnam on joining the WTO However, Banking Law is a complicated area which is hard to be treated thoroughly in the scale o f this thesis Therefore, it is necessary to continue researching these matter 45 Table of Statutes and other Légal Instruments International Treaties and Conventions General Agreement on Trade in Services (GATS), available at:< http://www.wto.org/english/tratop_e/serv_e/serv_e.htm> National Législations Vietnam The law on the State Bank of Vietnam (1997), amendment 2003 The law on crédit 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Daniel.C (2007), Banks in China’s commitments of integrating the WTO: “Same bed but différent dreams” in Chinese financial service area, International Law Magazine, Vol 11, no 1, Oxford University Publishing 49 ...Joint Swedish-Vietnamese Master’s Programme MASTER’S THESIS N guyen H ong V an Opening The Market for Banking Services in line with the Commitments made by Vietnam on its WTO Accession THUVIÊN... reform the law in the direction o f opening up the banking service market Délimitation The thesis will focus on the commitments on opening up banking services market undertaken following WTO accession. .. Overview of banking services and international commitments of Vietnam on opening banking services market in the WTO? ??s framework 1.1 Overview of banking services and the opening up of banking services