Lending activities are strictly managed by the State to ensure security and order for society. The laws are intended to prevent the phenomenon of “exploitation” or social evils through which lending activities intentionally cause injury, such as appropriating or extorting property if the borrower fails to pay, pay on time,or pay the debt in full.
In business operations, it often occurs that enterprises engage in one or several loan activities to provide support to partners or to establish a partnership relationship, or simply as a business that has additional capital that makes a lending decision in order to generate more revenue. During these transactions, the parties will agree on an interest rate, which may be greater than the bank’s. Most of the time, this is an entirely lawful and acceptable practice. Nevertheless, businesses frequently lack experience or expertise in lending activities, and loan durations are frequently short. Therefore regulatory limitations on the maximum interest rate are of little significance to them. This has resulted in a number of cases in which businesses or individuals have set interest rates that are 05 times or more than the highest interest rate specified in the Civil Code, thus violatingthe criminal law and making individuals liable for the offence of usury in civil transactions.
Our law firm, Le & Tran, with extensive experience in financial and corporate consulting, can assist businesses in preparing property loan contracts and advising on reasonable interest rates in accordance with the law by viewing the loan from the perspective of a client. Furthermore, with a team of experienced litigators, we can represent and defend businesses in disputes regarding property loan contracts, as well as individuals involved in suspected and/or alleged acts of usury. Furthermore, Le & Tran is uniquely equipped to assist clients in the collection of evidence and preparation of explanations to combat unfounded suspicions or allegations arising from an investigation agency.