Are the representatives of bondholders responsible for handling the assets on behalf of the bond owners in Vietnam?
What are the regulations on representatives of bondholders in Vietnam?
Pursuant to the provisions of Clause 13, Article 3 of Decree No. 155/2020/ND-CP, representatives of bondholders in Vietnam are depository members of Vietnam Securities Depository and Clearing Corporation or the appointed securities investment fund management company, or the person appointed to represent the interests of bondholders.
At the same time, the representatives of bondholders must not be payment guarantor, owner of the collateralized assets, major shareholder or related person of the issuer.
Are the representatives of bondholders responsible for handling the assets on behalf of the bond owners in Vietnam? (Image from the Internet)
Are the representatives of bondholders responsible for handling the assets on behalf of the bond owners in Vietnam?
Pursuant to Clause 3, Article 24 of Decree No. 155/2020/ND-CP stipulating the responsibilities of representatives of bondholders as follows:
Representatives of bondholders
1. Before the bonds are issued, the issuer shall appoint representatives of bondholders.
2. The representatives of bondholders must not be payment guarantor, owner of the collateralized assets, major shareholder or related person of the issuer.
3. The bondholders’ representative has at least the following responsibilities:
a) Supervise the adherence to commitments of the issuer in the bond offering application;
b) Ac as the intermediary between the bond owners, the issuer and other relevant organizations;
c) Request the payment guarantor to fulfill the guarantor’s obligations when the issuer fails to pay or properly pay the principal and interest of the bonds;
d) In case the bonds are secured by assets, the bondholders’ representative that is the organization responsible for management of the collateralized assets shall handle these assets on behalf of the bond owners in accordance with the concluded contract and regulations of law on implementation measures for assuring performance of civil obligations, except in the case specified in Point dd of this Clause;
dd) In case the bondholders’ representative is not allowed to receive the collateral as prescribed by relevant laws, the bondholders’ representative shall appoint a third party to receive the collateral. The third party shall cooperate with the bondholders’ representative in management and settlement of the collateral in accordance with the concluded contract and regulations of law on implementation measures for assuring performance of civil obligations;
e) Report to State Securities Commission when an issuer is found to be infringing upon the interests of bondholders.
4. The bondholders’ representative shall be changed when it is approved by a number of bondholders that represents at least 65% of total bonds of the same type. Changes to other terms and conditions in the bondholders’ representative’s contract are subject to approval by the superior authority of the issuer.
Thus, in case the bonds are secured by assets, the bondholders’ representative that is the organization responsible for management of the collateralized assets shall handle these assets on behalf of the bond owners in accordance with the concluded contract and regulations of law on implementation measures for assuring performance of civil obligations in accordance with specialized laws.
Can the bondholders’ representative be changed?
Pursuant to Clause 4, Article 24 of Decree No. 155/2020/ND-CP stipulating that the bondholders’ representative shall be changed when it is approved by a number of bondholders that represents at least 65% of total bonds of the same type. Changes to other terms and conditions in the bondholders’ representative’s contract are subject to approval by the superior authority of the issuer.
At the same time, when there is a change in the bondholders’ representative, the bond issuer shall disclose ad hoc information to bondholders and send the disclosed information to the Stock Exchange within 24 hours from the occurrence of one of the events as specified in Article 22 of Decree No. 153/2020/ND-CP (amended by clause 17, Article 1 of Decree No. 65/2022/ND-CP).
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