Heavy fines for preparing an application for registration of provision of securities depositing services with false information in Vietnam

Recently, the Government of Vietnam has issued the Decree No. 156/2020/NĐ-CP prescribing penalties for administrative violations against regulations on securities and securities market.

lập hồ sơ ĐKHĐ lưu ký có thông tin sai lệch, Nghị định 156/2020/NĐ-CP

According to Article 38 of the Decree No. 156/2020/NĐ-CP of the Vietnam’s Government, violations against regulations on registration of provision of securities depositing, clearing and payment services are stipulated as follows:

- A fine ranging from VND 30.000.000 to VND 50.000.000 shall be imposed upon a securities company, commercial bank or foreign bank branch (FBB) that has been issued with certificate of securities depository registration or certificate of eligibility to provide securities clearing and payment services for failing to apply for registration of depository member/ clearing member and provide securities depositing, clearing and payment services within the prescribed time limit..

- A fine ranging from VND 50.000.000 to VND 70.000.000 shall imposed upon a securities company, commercial bank, FBB or branch of the securities company or commercial bank for providing securities depositing, clearing and payment services without satisfying requirements laid down in law, or before obtaining certificate of securities depository registration, decision to approve the provision of securities depository services, or certificate of eligibility to provide securities clearing and payment services, or before being recognized as a member by the Vietnam Securities Depository and Clearing Corporation (VSDCC).

- A fine ranging from VND 400.000.000 to VND 500.000.000 shall be imposed upon a securities company, commercial bank or FBB for preparing an application for registration of provision of securities depositing services, or clearing and payment services that contains false information or conceals true information.

Thus, any securities company, commercial bank or FBB commits the act of preparing an application for registration of provision of securities depositing services, or clearing and payment services that contains false information or conceals true information shall be fined up to VND 500 million. Concurrently, securities depositing, clearing and payment services shall be suspended for a period of 01 - 03 months in case a securities company, commercial bank or FBB has been issued with certificate of securities depository registration or certificate of eligibility to provide securities clearing and payment services.

More details at the Decree No. 156/2020/NĐ-CP of the Vietnam’s Government, effective from January 01, 2021.

Ty Na

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