CIRCULAR

GUIDING THE CRITERIA FOR DETERMINING PRESTIGE INSURANCE ORGANIZATION IN THE MARINE DOMAIN UNDER THE PROVISIONS IN THE ORDINANCE ON ARREST PROCEDURES OF SEAGOING SHIPS

Pursuant to the Law on Insurance Business No.24/2000/QH10 dated December 09, 2000;
Pursuant to the Ordinance on Arrest Procedures of the Seagoing Ships of the Standing National Assembly No.05/2008/NQ-UBTVQH12 dated August 27, 2008;
Pursuant to the Decree No.46/2007/ND-CP dated March 27, 2007 of the Government providing for financial regime for insurers and insurance brokers;
Pursuant to the Decree No.118/2008/ND-CP dated November 27, 2008 of the Government providing for the functions, tasks, powers and organizational structure of the Ministry of Finance;
Pursuant to the Decree No.57/2010/ND-CP dated May 25, 2010 of the Government detailing and guiding the implementation of the Ordinance on Arrest Procedures of the Seagoing Ships;
Pursuance to the instruction opinion of the Prime Minister in the Official Dispatch No.2068/TTg-PL dated November 02, 2009 of the Government Office on making document to guide the implementation of the Ordinance on Arrest Procedures of the Seagoing Ships;
The Ministry of Finance guides the criteria for determining prestige insurance organization in the marine domain under the provisions in the Ordinance on Arrest Procedures of Seagoing Ships as follows:

Article 1. Scope of governing 

This Circular provides for the criteria for determining prestige insurance organizationfor the insurers established and operating in Vietnam allowed guaranteeing the implementation or issuing the guarantee commitment letter in case ships are arrested in the territory of the Socialist Republic of Vietnam.

Article 2. Subjects of application

This Circular applies to the insurers established and operating in Vietnam, domestic, foreign organizations, individuals relating to ships arrested in the territory of the Socialist Republic of Vietnam.

Article 3. Guarantee of implementation and issuance of commitment letter

1. To settle complaint on marine, ships being arrested shall be released after the obligations on property of ship owners, ship renters or ship operators were guaranteed to perform by the others or by commitment letter of the prestige insurers and agreed in writing by the plaintiff.

2. The organization that guarantees or issue commitment letter must be accepted in writing by the court where issued the decision to arrest ship before implementing the guarantee or issuing commitment letter.

Article 4. Criteria to determine the prestige insurance organization in the marine domain

The Vietnam insurers are determined being the prestige insurance organizations in the marine domain if meeting the following criteria:

1. The contributed charter capital of the insurers before the time of publishing the list of prestige insurers in the maritime domain must reach from 300 billion dong or more.

2. Solvency margin of the insurers before the time of publishing the list of prestige insurers in the maritime domain is not less than the minimum solvency margin. The minimum solvency margin of non-life insurance enterprises is the larger one of one of the following two calculation results:

- 25% of total premium retained at the time of calculating solvency margin;

- 12,5% of the total original premium and re-insurance fees at the time of calculating solvency margin.

Solvency margin of the insurers is the difference between value of assets and the payable debts of the insurers at the time of calculating solvency margin. The liquidity of the assets when calculating the solvency margin is determined by the guidelines in Clause 4, Item V of the Circular No.156/2007/TT-BTC dated 20/12/2007 of the Ministry of Finance guiding the implementation of the Decree No.46/2007/ND-CP dated 27/3/2007 of the Government stipulating the financial regime for insurers and insurance brokers.

3. The head of department of freight insurance operations or department of hull insurance operations and civil liability of ship owners or department of marine insurance operations has at least 03 years of experience working directly in the domain being in charge of or has a degree or certificate of training in the domain being in charge of.

Article 5. Effect

1. This Circular takes effect on March 01, 2011.

2. After April 01 of every year, the Ministry of Finance shall consider, valuate and publish the list of prestige insurance organization as provided in the ordinance on arrest procedures of seagoing ships. Within 90 days since the date of ending the fiscal year, the insurers are obliged to prepare and submit to the Ministry of Finance records, documents proving the meet of the human resource standards as prescribed in clause 3, Article 4 of this Circular.

3. The ministries, ministerial-level agencies, Governmental agencies, the People's Committees of provinces and cities directly under the Central Government, insurers, relative organizations and individuals are responsible for implementation of this Circular.

4. In the process of implementation, if any problems arise, promptly report to the Finance Ministry for study and settlement./.

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