What are the conditions for issuance of the establishment and operation license to a public securities investment company in Vietnam?
- What is a public securities investment company in Vietnam?
- What are the conditions for issuance of the establishment and operation license to a public securities investment company in Vietnam?
- What is the application for issuance of the establishment and operation license to a public securities investment company in Vietnam?
What is a public securities investment company in Vietnam?
Pursuant to the provisions of Article 114 of the 2019 Law on Securities in Vietnam on public securities investment companies, it can be understood that a securities investment fund that is reorganized into a joint-stock company to invest in securities. A securities company can be a private investment company or public investment company. Investment companies shall be licensed by State Securities Commission. After being licensed by State Securities Commission, the investment company shall apply for enterprise registration in accordance with the Law on Enterprises.
According to that, in order to be granted an establishment and operation license, a public securities investment company must meet the conditions specified in Article 115 of the 2019 Law on Securities in Vietnam as well as ensure the performance of obligations of the public company according to the provisions of point a, point b and point c, clause 1 and clause 2, Article 34 of the 2019 Law on Securities in Vietnam as follows:
- After the State Securities Commission confirms the public company registration, the public company shall have the following rights and obligations:
+ Disclose information;
+ Comply with regulations on company administration in the 2019 Law on Securities in Vietnam;
+ Apply for share registration at Vietnam Securities Depository and Clearing Corporation as prescribed in Clause 1 Article 61 of this Law;
- A public company also has the rights and obligations specified in the Law on Enterprises and relevant laws.
What are the conditions for issuance of the establishment and operation license to a public securities investment company in Vietnam?
What are the conditions for issuance of the establishment and operation license to a public securities investment company in Vietnam?
Pursuant to the provisions of Article 259 of Decree No. 155/2020/ND-CP, in order to be issued with establishment and operation license, a public securities investment company must satisfy the following conditions:
- Capital: Actual contributed charter capital shall be at least 50 billion. A public investment company shall authorize a securities investment fund management company to manage its capital. All assets of the public investment company shall be deposited at the supervisory bank.
- There are premises for securities investment operations. The public investment company or investment company may use the premises of the securities investment fund management company that is authorized to manage its capital as its headquarters.
- Personnel: The public investment company must not recruit personnel and Director/General Director, Deputy Director/Deputy General Director that are executives appointed by the securities investment fund management company.
- Shareholders: The public investment company shall have at least 100 shareholders that are not professional securities investors;
- At least two thirds of the members of the Board of Directors of the public investment company shall be independent from the securities investment fund management company, supervisory bank.
What is the application for issuance of the establishment and operation license to a public securities investment company in Vietnam?
According to the provisions of Article 260 of Decree No. 155/2020/ND-CP, in order to be issued with an establishment and operation license, a public securities investment company needs to prepare the following documents:
Application for issuance of the establishment and operation license to a public investment company
1. The application form No. 92 in the Appendix hereof.
2. The offering result report according to form No. 102 in the Appendix hereof and the confirmation of the supervisory bank that the revenue from the offering has been frozen and the quantity of shares sold.
3. The list of shareholders according to form No. 105 in the Appendix hereof.
4. The records on opinions of shareholders about designation of members of the Board of Directors and other issues, personal information sheets and judicial records of members of the Board of Directors (if any).
However, Clause 2, Article 260 of Decree No. 155/2020/ND-CP stipulates that in the documents that need to be prepared there is an offering result report, which means that in order to be issued with an establishment and operation license, a public securities investment company must make an initial public offering of shares.
At the same time, Article 10 of Decree No. 155/2020/ND-CP also stipulates one of the forms of initial public offering of shares for the purpose of establishing a securities investment fund.
Public offering forms
1. Initial public offering (IPO) of securities includes:
a) IPO for raising additional capital to the issuer;
b) IPO to become a public company by changing ownership structure without increasing the issuer’s charter capital;
c) Combination of (a) and (b);
d) Initial public offering of fund certificates for establishment of a securities investment fund.
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