Amongst other changes, Decree 73 imposes restrictions, in
certain circumstances, on the amount of risk and premium that can
be transferred by insurers operating in Vietnam to their
reinsurers, and could therefore have an impact on foreign insurers
operating in Vietnam, who may now be more restricted in ceding
liability and transferring premium to their parent companies
overseas through overseas reinsurance contracts. It is thought that
the implementation of these restrictions under Decree 73 might be
the result of concerns raised by the Vietnam Insurance Supervisory
Authority ("ISA"), which operates under the Ministry of
Finance ("MOF"), as to the amount of foreign currency
that local insurers transfer to their partners abroad through the
use of overseas reinsurance contracts. Reports indicate that the
Association of Vietnam Insurance ("AVI") estimates that
approximately one third of all insurance revenue in 2015 was
transferred outside of Vietnam.
