Washington International Law Journal


Due to its WTO obligations, by 2010 Vietnam must open its banking system to the world. As a result, the nation attempted to drastically modernize its state owned banks through partial privatization. This partial privatization, locally translated as equitization, proposed serious challenges to the existing legal infrastructure facilitating banks. To cope with these new challenges, in September 2009, Vietnam’s new banking law, Decree 59/2009/ND-CP, was passed. An important change in the new banking law is its stricter regulation on the qualifications of managers. It is suspected that such regulation signals the nation’s resistance to surrender control over its banks and commit to reforms. The new banking law also further relies on the problematic Penal Code and the Criminal Procedure Code. Faulty Penal and Criminal Procedure Codes can lead to fraudulent lawsuits and managers losing their positions. In spite of its problems, the new banking law is workable and a step in the right direction. By relying on existing management laws, as opposed to those introduced by the new banking law, and upgrading the Penal and Criminal Procedure Codes, many of the potential problems created by the new banking law can be resolved

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