Conditions for public offering of securities in Vietnam

Forms of public offering of securities include the first-time public offering of securities, additional offering of shares or rights to buy shares to the public, and other forms. So, how are Vietnam’s regulations on conditions for public offering of securities?

According to Article 12 of the Law on Securities 2006 of Vietnam, conditions for public offering of securities are specified as follows:

- Conditions for public offering of stocks include:

+ The offering enterprise has a charter capital contributed at the time of offering registration of VND 10 billion or more accounted according to the book value;

+ Its business operation in the year preceding the year of offering registration is profitable and, at the same time, it has no accrued loss up to the year of offering registration;

+ Its issuance plan and plan on the use of capital generated from the sale offering are adopted by the Shareholders' General Assembly.

- Conditions for public offering of bonds include:

+ The offering enterprise has a charter capital contributed at the time of offering registration of VND 10 billion or more accounted according to the book value;

+ Its business operation in the year preceding the year of offering registration is profitable, and at the same time it has no accrued loss up to the year of offering registration and has no payable debt which has been overdue for more than one year;

+ Its issuance plan and plan on use and repayment of capital generated from the sale offering are adopted by the Board of Directors, the Council of Members or its owner;

+ It undertakes to perform the obligation of an issuing organization towards investors in terms of issuance and payment conditions, assurance of legitimate rights and benefits of investors and other conditions.

- Conditions for public offering of fund certificates to the public include:

+ The total value of fund certificates registered for offering is at least VND 50 billion;

+ There is an issuance plan and a plan on investment of capital amount generated from the offering of fund certificate in accordance with the Law on Securities 2006.

The Government shall provide the conditions for public offering of securities which must be satisfied by state enterprises, foreign-invested enterprises transformed into joint-stock companies, newly established enterprises in the fields of infrastructure construction or high technologies; for the offering for sale of securities overseas and other specific cases.

View relevant provisions at: The Law on Securities 2006 of Vietnam was promulgated on June 29, 2006 and effective from January 01, 2007.

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