Will securities placed under special control be suspended from trading by the Ho Chi Minh City Stock Exchange?
Will securities placed under special control be suspended from trading by the Ho Chi Minh City Stock Exchange?
Pursuant to Clause 1, Article 24 of the Regulations promulgated together with Decision No. 85/QD-SGDHCM in 2018 stipulating cases of securities placed under special control as follows:
Securities placed under special control
1. Cases in which securities (except ETF certificates) are placed under special control:
1.1. The listed enterprise/ fund management company/ securities investment company still violates information disclosure rules after receiving warnings;
1.2. Securities shall be placed under special control in cases where Ho Chi Minh City Stock Exchange (HOSE) deems it necessary to protect investors after obtaining an approval from State Securities Commission of Vietnam (SSC).
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Thus, cases in which securities (except ETF certificates) are placed under special control include:
- The listed enterprise/ fund management company/ securities investment company still violates information disclosure rules after receiving warnings;
- Securities shall be placed under special control in cases where HOSE deems it necessary to protect investors after obtaining an approval from State Securities Commission of Vietnam.
According to the provisions of Point 1.2, Clause 1, Article 25 of the Regulations issued together with Decision No. 85/QD-SGDHCM in 2018 as follows:
Suspended trading
1. HOSE shall consider suspending the trading of listed securities in the following circumstances:
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1.2. The listed enterprise/ fund management company/ securities investment company still violates information disclosure rules after its securities are placed under special control;
Thus, when a listed enterprise/ fund management company/ securities investment company still violates information disclosure rules after its securities are placed under special control, the Stock Exchange shall consider suspending the trading.
Will securities placed under special control be suspended from trading by the Ho Chi Minh City Stock Exchange?
In which case shall the Ho Chi Minh City Stock Exchange suspend trading of listed securities?
Pursuant to Clause 1, Article 25 of the Regulations on listing of securities on Ho Chi Minh City Stock Exchange issued together with Decision No. 85/QD-SGDHCM in 2018 on this content as follows:
Suspended trading
1. HOSE shall consider suspending the trading of listed securities in the following circumstances:
1.1 There are considerable changes in prices or trading volume of securities;
1.2. The listed enterprise/ fund management company/ securities investment company still violates information disclosure rules after its securities are placed under special control;
1.3 The listed enterprise performs a stock split or reverse stock split or is partially divided;
1.4 Convertible bonds are partially converted into shares;
1.5 A listed enterprise makes a capital reduction as regulated in Point a Clause 5 Article 111 of the Law on enterprises in 2014 but is not subject to compulsory delisting after the capital reduction as regulated in Clause 1 Article 60 of Decree No. 58/2012/ND-CP as amended in Clauses 20 and 24 Article 1 of Decree No. 60/2015/ND-CP;
1.6 HOSE may suspend trading of securities in other cases if deeming it necessary to either protect investors or ensure the market stability after obtaining an approval from SSC.
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Thus, the Ho Chi Minh City Stock Exchange shall consider suspending the trading of listed securities in the following circumstances:
- There are considerable changes in prices or trading volume of securities;
- The listed enterprise/ fund management company/ securities investment company still violates information disclosure rules after its securities are placed under special control;
- The listed enterprise performs a stock split or reverse stock split or is partially divided;
- Convertible bonds are partially converted into shares;
- A listed enterprise makes a capital reduction as regulated in Point a Clause 5 Article 111 of the 2014 Law on Enterprise of Vietnam (this provision has been replaced by point a, clause 5, Article 112 of the 2020 Law on Enterprise of Vietnam) but is not subject to compulsory delisting after the capital reduction as regulated in Clause 1 Article 60 of Decree No. 58/2012/ND-CP (this provision is replaced by Article 120 of Decree No. 155/2020/ND-CP);
- HOSE may suspend trading of securities in other cases if deeming it necessary to either protect investors or ensure the market stability after obtaining an approval from State Securities Commission of Vietnam.
In which case shares and bonds of listed enterprises are subject to warnings?
Pursuant to Clause 1, Article 22 of the Regulations issued together with Decision No. 85/QD-SGDHCM in 2018, shares and bonds will be subject to warnings in the following cases:
- The paid-in charter capital of an enterprise that has shares or bonds listed falls below VND 120 billion as expressed in its latest financial statements;
- After-tax profit in the fiscal year expressed in the enterprise's audited financial statements is a negative balance (with due account taken of the auditor’s qualified opinions).
If the listed enterprise is a superior accounting unit that has inferior accounting units, the after-tax profit shall be determined according to its general financial statements. If the listed enterprise has subsidiaries, profits after tax earned by shareholders of the parent company as expressed in the consolidated financial statements shall be considered;
- Undistributed after-tax profit expressed in the enterprise's audited financial statements is a negative balance (accumulated losses) (with due account taken of the auditor’s qualified opinions). If the listed enterprise is a superior accounting unit that has inferior accounting units, the accumulated losses shall be determined according to its general financial statements. If the listed enterprise has subsidiaries, the accumulated losses shall be determined according to its consolidated financial statements;
- The listed enterprise suspends or is requested to suspend its main business operations for three (03) months or longer;
- The listed enterprise submits its audited annual financial statements or reviewed half-year financial statements more than fifteen (15) business days late after the prescribed deadline for information disclosure.
- The listed enterprise fails to comply with information disclosure rules 04 times or more during a year;
- Stocks have not been traded within the past six (06) months;
- Warning is given in other cases where HOSE deems it necessary to protect investors after obtaining an approval from SSC.
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