Conditions for Increasing or Decreasing the Charter Capital of a Member Fund?
Based on Article 224 of Decree 155/2020/ND-CP stipulating the following conditions:
The fund charter includes provisions for increasing or decreasing the charter capital.
Approval from the General Meeting of Fund Investors for the increase or decrease in charter capital, the plan for increasing or decreasing charter capital, and the amended fund charter.
After adjusting the capital, the fund still meets the requirements of Article 113 of the Securities Law.
In the case of increasing capital, the securities investment fund management company complies with the provisions of Clause 2, Article 222 of this Decree. The capital contribution is made in cash or listed securities, registered for trading on the Stock Exchange. Capital contributions in securities must ensure:
a) The investor contributing capital is not restricted in transferring the assets intended to be put into the fund; the assets are not secured for collateral, mortgage, deposit, guarantee, frozen, or involved in other secured transactions as per civil law provisions;
b) The assets contributed to the fund must comply with the fund charter, investment objectives, and policies of the fund; they must not be assets that are in the fund's investment portfolio but are about to be liquidated or divested; they must not be securities that are suspended, temporarily halted from trading, delisted, or securities of issuing organizations in liquidation, dissolution, or bankruptcy;
c) The capital contribution in assets must be approved by all the fund's investors and is only considered completed after the legal ownership of the contributed assets has been transferred to the fund. The transfer of ownership is executed according to the guidelines of the Vietnam Securities Depository and Clearing Corporation;
d) The valuation of the contributed assets must follow the fund charter and other relevant legal provisions. The value of assets put into the fund is determined based on the end-of-day price on the day the ownership transfer procedures are completed at the Vietnam Securities Depository and Clearing Corporation.
In the case of decreasing capital, the assets allocated to investors are in cash or other assets. The securities investment fund management company and the custodian bank are responsible for allocating assets fairly in proportion to the capital contribution ratio of each investor in the fund.
Sincerely!
