Page 258 - CRC_One Report 2021_EN

Business Overview and Performance Corporate Governance Financial Statements Enclosure

control, any person or organisation may exchange 5.3 Legal Disputes

the dong into a foreign currency at the exchange rate
set by the lending institutions that are authorised The Company or its subsidiaries may occasionally face
to offer the foreign exchange service in Vietnam. legal proceedings or become a litigant in legal cases
Such person or organization, however, is required stemming from normal business operations of the
to specify the objective of foreign-currency spending Company or its subsidiaries. As of 31 December 2020,
and reasonably submit related documents as proofs. the Company or its subsidiaries has no legal case or
The objective of spending the said foreign currency must dispute that is still ongoing, which may have a negative
be for transactions permitted for payment with foreign impact on the assets of the Company or its subsidiaries
currencies under the rules regulating foreign currency in the tune of over 5 per cent of shareholders’ equity
exchange, such as for repayment of foreign debts or (based on the Company’s consolidated financial
international debentures. Foreign currencies may be statement for the year ending 31 December 2020), or
freely exchanged into the Vietnamese dong or any other which may significantly impact the business operation
foreign currency based on the exchange rates set by of the Company or its subsidiaries, or which may stem
the authorised lending institutions mentioned above. from the normal business operation of the Company or
its subsidiaries, except the followings:
Overseas borrowing refers to a foreign legal entity
lending money to a domestic legal entity. An overseas 5.3.1 Dispute About Improvement of

loan refers to either of the following: (1) Short-term loan, a Shopping Mall in Italy
with repayment due within 12 months or shorter; or
(2) Long-term loan, with repayment due beyond A shopping mall belonging to the Group that is located
12 months. Long-term loans must be registered with the at Via del Tritone in Rome (“the Tritone branch”)
State Bank of Vietnam-a process actually tantamount a building with historical significance rented from
to seeking approval from the central bank. Money Rina Estate Italia S.r.l. (“REI”), a company under
borrowed as a long-term loan can be withdrawn only the Central Group-is being involved in a legal dispute
after its registration with the State Bank of Vietnam. in Italy. (At the Company’s request), REI carried
Short-term loans are not required to be registered, out construction and modification of the building
except in a case where the repayment period is extended (“construction and modification work”) after obtaining
beyond 12 months. Any subsequent change from construction permit from the Municipality of Rome and
the original information in the registration with the Heritage Office, which are local authorities
the State Bank of Vietnam shall be updated through (“original construction permit”). Later, in 2012, the owner
formal revision with the State Bank of Vietnam. of a nearby building (“the plaintiff”) protested that
the original construction permit was not lawful.
Money borrowers are allowed to seek loans from In January 2018, Italy’s Council of State issued Order
overseas in these following cases: (1) To implement No. 405/2018 annulling the original construction
their “plan for business and production or an investment permit. Later, in February 2018, the plaintiff petitioned
project” or that of the company in which they invest to Italy’s Council of State seeking an order to dismantle
(this applies to long-term loans only); and the construction and modification work covering
(2) To restructure their overseas debts without increasing about 4,000 square metres of the building’s area, or
the cost of borrowing. an equivalent of about 32.4 percent the net sale surface
of the Tritone branch.
The borrowers must open a current account for foreign
currency deposits with authorised lending institutions In April 2018, the Municipality of Rome issued
in Vietnam to receive and send money internationally a new permit for construction and modification to
regarding their overseas loans. Any withdrawal or rectify errors in the previous permit based on the opinions
repayment of an overseas loan must be done through of the Heritage Office (“new construction permit”).
such an account in compliance with the existing rules The plaintiff later petitioned to the Administrative
regulating foreign currency exchange. For enterprises Court of Rome against the Heritage Office’s view and
invested by foreigners, such accounts are also intended the issuance of a new construction permit. The plaintiff
for their investment money.

258 Annual Report 2021 (Form 56-1 One-Report)