Vietnam: A securities company’s shareholders that are organizations owning more than 15% of equity must notify the securities company when changing their name?
- What are the rules of corporate governance, management and operations functions of securities companies in Vietnam?
- What are the rules for rendering services and business lines?
- A securities company’s shareholders that are organizations owning more than 15% of equity must notify the securities company when changing their name?
What are the rules of corporate governance, management and operations functions of securities companies in Vietnam?
Pursuant to Article 3 of Circular No. 121/2020/TT-BTC stipulating the rules of corporate governance, management and operations functions of securities companies as follows:
Rules of corporate governance, management and operations functions of securities companies in Vietnam
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, 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.
At the same time, 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.
- 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.
- 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.
- 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.
Vietnam: A securities company’s shareholders that are organizations owning more than 15% of equity capital must notify the securities company when changing their name?
What are the rules for rendering services and business lines?
Pursuant to Article 4 of Circular No. 121/2020/TT-BTC, when rendering their core business functions, securities companies must adhere to the following principles:
- Designing and putting to use processes and procedures.
- Issuing and adopting codes of ethics or practice.
- Both securities companies and their employees are not allowed to make investments on behalf of their customers, except in case of the authorized custody of investors’ personal accounts as prescribed in Article 19 of this Circular.
- Being honest with their customers, avoiding any infringement upon their customer’s assets, other rights and interests. Managing each customer’s assets, assets of their customers' and theirs separately.
- Entering into contracts with customers when providing services to them; providing complete and authentic information to customers.
- Unless otherwise provided by law, when providing services to customers, they are not allowed to perform, whether directly or indirectly, the following acts:
+ Deciding to invest in securities on behalf of customers;
+ Agreeing with customers on sharing of profits or losses;
+ Advertising or declaring that contents, effectiveness or methods of their analyses on securities are of greater value than those of other securities companies;
+ Providing false information to seduce or pester customers to buy and sell a certain type of securities;
+ Giving false, fraudulent or misleading information to customers;
+ Performing other acts in contravention of laws.
- Carrying out accounting, auditing, statistics regimes and financial obligations in accordance with laws.
- Making public disclosure of information and reports in a timely, adequate and accurate manner in accordance with laws.
- Setting up stand-by information technology systems and databases to ensure safety, prudence and continuity for their business activities.
- Supervising securities trades or transactions according to regulations of the Minister of Finance.
- Securities companies must set up specialized departments in charge of communicating with customers and dealing with customer's inquiries and complaints.
- Discharging other obligations prescribed by the securities law and other relevant laws.
A securities company’s shareholders that are organizations owning more than 15% of equity must notify the securities company when changing their name?
Pursuant to Clause 3, Article 6 of Circular No. 121/2020/TT-BTC stipulating this content as follows:
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, 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 change of name.
After that, securities companies must report to the State Securities Commission on the situations within 05 days after receiving notices from their shareholders and/or members.
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