Shipping companies have said that they will not accept payments for transportation fees in VND, asking customers to pay the fees in U.S. dollars with the black market exchange rate, the Vietnam News newspaper reported June 15.
Mediterranean Shipping Company S.A (MSC) on June 5 asked Vietnamese companies to make payments for shipping fees and other surcharges in dollars at the black market exchange rate.
It also informed them that it would stop accepting payments in VND immediately as the company had locked its VND account in order to avoid losses.
Le Trieu Phuong, deputy general director of MSC, said that the move was just a temporary measure to help rescue the company, though it did not come in line with the current laws.
Phuong showed the loss of VND3 billion for the company in May 2008 because of VND/USD exchange rate fluctuations.
“If MSC continues accepting payments in VND, it will go bankrupt, as it has to pay foreign partners US$4 million a month,” Phuong said, adding that MSC is facing difficulties as commercial banks are refusing to sell it dollars. It needs US$2 million to pay foreign shipping firms.
Tran Huu Huynh, head of the Legal Department under the Vietnam Chamber of Commerce and Industry (VCCI), said that the move by MSC was a serious violation of Vietnamese laws.
In principle, the Vietnam dong is accepted in payment for transactions carried out in territory of Vietnam.
If MSC unilaterally applied the exchange rate of VND18,000/US$1 as applied on the black market on June 7, it would violate the current Ordinance on Forex Management, and must be heavily punished, Huynh stressed.
The exchange rate announced by the State Bank of Vietnam for June 7 was VND16,132/US$1.
Many companies which are clients of MSC have voiced protests against MSC’s decision, as it may cause huge losses to them.
The Vietnamese companies MSC denied undertaking transactions in VND threatened to petition the Ministry of Transport and relevant ministries.
After the strong protest from clients, on June 10, MSC resumed accepting payments in VND, but asked them to check on the actual exchange rate at commercial banks.
MSC is not the only shipping agency that has demanded payments in dollars. China Shipping Vietnam on June 10 sent a notice to clients, asking them to make payments in dollars instead of VND.
The notice said that if clients make payments in VND, the exchange rate for payment will be the exchange rate announced by Vietcombank plus the surcharge of 10 per cent.
Jardine Shipping on June 10 also refused payment in VND. (VNS, VnExpress.Net)
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