What is the form of information disclosure statement about the share repurchase in Vietnam?
- Public company in Vietnam: To report to the State Securities Commission before repurchasing its shares at shareholders’ request?
- Vietnam: Does a public company that repurchases its own shares at the request of shareholders need to satisfy the conditions for share repurchase?
- What are the share repurchase at shareholders’ request in Vietnam?
- What is a public company in Vietnam?
What is the form of information disclosure statement about the share repurchase in Vietnam?
Pursuant to the provisions of Clause 2, Article 9 of Circular 118/2020/TT-BTC, Before repurchasing its shares as prescribed in Point a Clause 2 Article 36 of the Law on Securities or repurchasing employees’ shares in accordance with the regulations on employee share ownership as prescribed in Point b Clause 2 Article 36 of the Law on Securities, the public company shall send the information disclosure statement about the share repurchase made according to the form in Appendix No. 36 of Circular 118/2020/TT-BTC to SSC.
Accordingly, the Form of information disclosure statement about the share repurchase shall be made according to the Form in Appendix No. 36 issued with Circular 118/2020/TT-BTC.
Download Form of information disclosure statement about the share repurchase
What is the form of information disclosure statement about the share repurchase in Vietnam?
Public company in Vietnam: To report to the State Securities Commission before repurchasing its shares at shareholders’ request?
Pursuant to the provisions of Clause 2, Article 9 of Circular 118/2020/TT-BTC, Before repurchasing its shares as prescribed in Point a Clause 2 Article 36 of the Law on Securities or repurchasing employees’ shares in accordance with the regulations on employee share ownership as prescribed in Point b Clause 2 Article 36 of the Law on Securities, the public company shall send the following documents to SSC:
- The information disclosure statement about the share repurchase made according to the form in Appendix No. 36 enclosed with Circular 118/2020/TT-BTC;
- A decision of the Board of Directors or General Director (Director) to approve the share repurchase plan.
Vietnam: Does a public company that repurchases its own shares at the request of shareholders need to satisfy the conditions for share repurchase?
Pursuant to Article 36 of the Law on Securities 2019, it is stipulated:
Share repurchase by a public company
1. In order to repurchase its own shares, a public company shall satisfy the following requirements:
a) There is a decision of the General Meeting of Shareholders to approve the share repurchase to reduce its charter capital and a repurchase plan which specifies the repurchase quantity, time and price;
b) The company has sufficient funds to repurchase its shares from the following sources: share premium, development investment funds, undistributed post-tax profits, other equity funds used for charter capital increase as prescribed by law;
c) A securities company is assigned to carry out the transaction, unless the repurchasing company is a member of VSE;
d) All conditions are satisfied if the public company has conditional business lines;
dd) It is not the case specified in Clause 3 of this Article.
2. The requirements specified in Points a, b, c, d Clause 1 of this are waived in the following cases:
a) The share repurchase is repurchased by the shareholders as prescribed by the Law on Enterprises;
b) The employees’ shares are repurchased in accordance with the regulations on employee share ownership or under a scrip issue plan or share issuance from equity;
c) The share repurchase is meant to fix a transaction error or is an odd lot buyback.
3. A public company must not repurchase its own shares in the following cases:
a) The company has overdue debts according to the latest audited annual financial statement. In case the expected repurchase date is later than 06 months from the end of the fiscal year, overdue debts will be identified according to the latest audited or examined biannual financial statement, except for the case in Point c Clause 2 of this Article;
b) Shares are being offered or issued to raise additional capital, except for the cases specified in Point c Clause 2 of this Article;
c) The company’s shares are being offered in a tender offer, except for the cases specified in Clause 2 of this Article;
d) There was a share repurchase or an additional share issuance to increase capital over the last 06 months, except for the cases in Clause 2 of this Article.
4. Unless shares are repurchased according to the investors’ holdings in the company, under an effective court decision, court judgment or arbitral decision, or through order matching, a company must not repurchase shares from:
a) Internal actors and their related persons defined by this Law;
b) Holders of shares restricted from transfer as prescribed by law and the company’s charter;
c) Major shareholders prescribed by this Law.
5. A public company that repurchases its own shares as prescribed in Clause 1 and Point a Clause 2 of this Article shall follow procedures for reducing its charter capital according to the total value of shares repurchased within 10 days from the day on which payment for the repurchased shares is fully made.
6. In case the employees’ shares are repurchased in accordance with the regulations on employee share ownership:
a) The total quantity of employees’ shares being repurchased by the company to reduce charter capital shall be reported at the annual General Meeting of Shareholders;
b) The company shall reduce its charter capital according to the total value of repurchased shares at their nominal value within 10 days from the day on which it is reported at the annual General Meeting of Shareholders as prescribed in Point a of this Clause.
7. A securities company or public company that repurchases its own shares may sell the shares right after they are repurchased in the following cases:
a) The repurchase is meant to fix a transaction error or is an odd lot buyback;
b) The public company repurchases odd lot shares under a scrip issue or plan for share issue from equity;
c) The share repurchase is requested by the company’s shareholders.
8. The Minister of Finance shall promulgate specific regulations on share repurchase by public companies.
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Thus, based on the above regulations, a public company that repurchases shares at the request of shareholders according to the provisions of enterprise law will be exempt from the conditions for repurchasing shares at points a, b, c. and d Clause 1, Article 36 of the Law on Securities 2019.
What are the share repurchase at shareholders’ request in Vietnam?
Pursuant to the provisions of Article 132 of the Law on Enterprises 2020, share repurchase at shareholders’ request is carried out as follows:
- The shareholders that have voted against the resolution on reorganization of the company or change of shareholders’ rights and obligations in the company's charter are entitled to request the company to repurchase their shares.
The request shall be made in writing and specify the shareholder’s name and address, quantity of shares of each type, offered prices, reasons for requesting the repurchase. The request shall be sent to the company within 10 days from the day on which the previously mentioned resolution is ratified by the GMS.
- The company shall repurchase shares at the request of its shareholders in accordance with Clause 1 of this Article at market prices or at the prices calculated in accordance with the rules in the company's charter within 90 days from the receipt of the request.
In case an agreement on the prices cannot be reached, the parties may hire a valuation organization to determine the price. The company shall introduce at least 03 valuation organizations for the shareholders to make the final decision.
What is a public company in Vietnam?
Pursuant to the provisions of Clause 1, Article 32 of the Law on Securities 2019, a joint-stock company will become a public company in one of the following cases:
- The company has a contributed charter capital of at least 30 billion VND and at least 10% of the voting shares are being held by at least 100 non-major shareholders;
- The company has successfully made its IPO by registration with SSC as prescribed in Clause 1 Article 16 of this Law on Securities 2019.
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