What regulations must a member of a securities company ensure? Are employees of a securities company required to hold securities practicing certificates in Vietnam?
On what principles is the charter of securities companies formulated?
Pursuant to the provisions of Article 5 of Circular No. 121/2020/TT-BTC on the charter of securities companies in Vietnam as follows:
Company charter
When formulating its corporate Charter, in addition to complying with regulations of this Circular, a securities company must adhere to the following principles:
1. Its corporate Charter is not in breach of regulations of the Law on Securities and the Law on Enterprises.
2. If it is a public company, it must consult regulations of the Law on Securities, the Law on Enterprises and this Circular to draw up its corporate Charter. When formulating its corporate Charter, it must refer to the sample Charter applicable to public companies under regulations of corporate governance laws applied to public companies.
3. If it is a joint stock business not yet going public, or a limited liability company, when formulating its corporate Charter, it must ensure that its corporate Charter is conformable to the Law on Securities and the Law on Enterprises.
4. When drawing up its corporate Charter, it must consult clause 2 and 3 of this Article. In addition, the corporate Charter must contain the following details:
a) Operating network;
b) Business scope;
c) Operating principles;
d) Licenses for establishment and operation of securities business activities;
dd) Governing Board/Members’ Council; eligibility requirements or standards of its members;
e) Board of General Directors (Board of Directors), eligibility or qualification requirements or standards of its members; the Supervisory Board or Internal Control Board, eligibility or qualification requirements or standards of its members;
g) Audit Committee, eligibility or qualification requirements or standards of its members;
h) Prevention of conflicts of interests;
i) Reorganization, comprising: business split-up, split-off, amalgamation, merger or transformation.
5. It must publish the full text of its corporate Charter on its official website.
Thus, when a securities company formulates its charter, it needs to meet the requirements prescribed by the securities law, the Enterprise Law and other relevant legal documents.
What regulations must a member of a securities company ensure? Are employees of a securities company required to hold securities practicing certificates in Vietnam?
Are employees of a securities company required to hold securities practicing certificates in Vietnam?
Pursuant to Article 3 of Circular No. 121/2020/TT-BTC guiding the rules of management of securities companies in Vietnam as follows:
Rules of corporate governance, management and operations functions of securities companies
1. Securities companies must comply with the provisions of the Securities Law, the Enterprise Law, their charters and regulations of other relevant laws on corporate governance.
2. A securities company must clearly define the different responsibilities of the General Meeting of Shareholders, the Members’ Council, the Owner(s), the Governing Board, the Supervisory Board or the Board of Directors in accordance with the Securities Law, the Enterprise Law and other relevant laws.
3. A securities company must set up a system of communication with its shareholders or members to give them adequate information and fair treatment, and protect their rights and interests.
4. Securities companies must establish systems for internal control or audit, management of risks, surveillance, monitoring, prevention or mitigation of conflicts of interest from within or transactions with related persons.
5. Securities companies must ensure that employees working in their departments or divisions must hold suitable securities practicing certificates in accordance with regulations of securities and securities market laws.
Thus, according to the provisions of Clause 5, Article 3 of Circular No. 121/2020/TT-BTC, employees working in their departments or divisions must hold suitable securities practicing certificates.
What regulations must members of a securities company ensure?
Pursuant to Article 6 of Circular No. 121/2020/TT-BTC on members and shareholders of securities companies in Vietnam as follows:
Shareholders and/or members
1. Shareholders and/or capital contributing members of a securities company must observe regulations laid down in subparagraphs c, d of paragraph 2 of Article 74 in the Law on Securities.
2. Shareholders and/or capital contributing members owning at least 10% of a securities company's charter capital are not allowed to improperly use their position to harm the rights and interests of the company and other shareholders and/or members.
3. Shareholders, capital contributing members owning at least 10% of a securities company's charter capital must fully notify the securities company within 24 hours after receiving information about the following situations:
a) The number of their shares or contributed capital is frozen, pledged or otherwise encumbered according to the court's decisions;
b) Shareholders and/or members that are entities decide to change their names, or are split up, split off, dissolved or bankrupted.
4. Securities companies must report to the State Securities Commission on the situations specified in Clause 3 of this Article within 05 days after receiving notices from their shareholders and/or members.
Thus, members of a securities company must ensure compliance with regulations on equity ratio and regulations on foreign investors and the provisions of Article 6 of Circular No. 121/2020/TT-BTC.
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