Circular No. 30/2023/TT-BTC Provides New Guidance on Corporate Bond Transactions in the Domestic Market
Circular 30/2023/TT-BTC has been issued to guide the registration and payment of corporate bond transactions in the domestic market.
On May 17, 2023, the Ministry of Finance issued Circular 30/2023/TT-BTC guiding the registration, depository, exercise of rights, transfer of ownership, payment of transactions, and the organization of the corporate bond trading market sold privately in the domestic market.
Circular 30/2023/TT-BTC guides the registration, depository, exercise of rights, transfer of ownership, payment of transactions, and organization of the corporate bond trading market sold privately in the domestic market, issued per Decree 153/2020/ND-CP which regulates the issuance and trading of privately placed corporate bonds in the domestic market and the sale of corporate bonds in the international market.
The depository and trading of privately placed corporate bonds issued before Decree 153/2020/ND-CP took effect and remaining debt will continue to be implemented according to the approved bond issuance plan.
To be specific, Circular 30/2023/TT-BTC guides several contents regarding privately placed corporate bonds, as follows:
- Guidance on the registration, depository, exercise of rights, transfer of ownership for privately placed corporate bonds.
- Guidance on organizing transactions, canceling the registration of privately placed bond transactions.
- Guidance on payment of privately placed corporate bond transactions.
- Handling of errors occurring during trading of privately placed corporate bonds.
Circular 30/2023/TT-BTC has been issued for new guidelines on corporate bond transactions in the domestic market?
How are cases of insolvency in private bond transactions handled?
According to the latest guidance in Article 19 of Circular 30/2023/TT-BTC on handling cases of insolvency in private bond transactions as follows:
- The settlement bank for depository members and direct account-opening institutions can lend funds to these entities to settle private corporate bond transactions in cases of temporary insolvency, based on a payment support agreement signed between the parties following legal regulations on credit institutions and other relevant legal regulations.
- In case the payment support agreement allows the use of securities deposited at the Vietnam Securities Depository and Clearing Corporation (VSDC) as collateral for loans, the VSDC will proceed with blocking the securities as requested by the payment bank.
- If by the payment deadline the depository members or direct account-opening institutions do not have sufficient funds, the VSDC will cancel the transaction settlement.
- The handling of insolvency of transactions, asset handling mechanism, timing, and procedure for insolvency settlement will be governed by the registration, depository, and settlement regulation for privately placed corporate bonds of the VSDC.
What are the cases where corporate bond ownership cannot be transferred through the trading system?
This is one of the notable contents in Circular 30/2023/TT-BTC. To be specific, Article 9 of Circular 30/2023/TT-BTC stipulates cases where the VSDC will not execute the transfer of ownership for privately placed corporate bonds through the trading system, including:
- Gifting or inheriting privately placed corporate bonds per the Civil Code.
- Division, separation, merger, consolidation, reorganization of enterprises or public service providers; dissolution of enterprises, dissolution of business households per the Enterprise Law and other related regulations.
- Transfer of ownership according to court verdicts or decisions, arbitration awards, or enforcement agency decisions.
- Transfer of ownership due to handling collateral that is privately placed corporate bonds registered at VSDC and blocked per Point c, Clause 1, Article 23 of Circular 119/2020/TT-BTC.
- Transfer of ownership due to asset division between spouses during marriage per the Law on Marriage and Family.
- Transfer of ownership of privately placed corporate bonds when dividing, separating, merging, consolidating, dissolving securities investment funds; establishing or increasing charter capital of privately placed securities investment companies; increasing or decreasing charter capital of member funds; repurchasing bonds from open-ended funds.
- Transfer of ownership of privately placed corporate bonds arising when the issuing enterprise implements the provisions of Article 1 of Decree 08/2023/ND-CP.
Circular 30/2023/TT-BTC will take effect from July 01, 2023.
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