Principles in managing securities depository accounts in Vietnam from February 15, 2021

According to Article 16 of the Circular No. 119/2020/TT-BTC of the Ministry of Finance of Vietnam, the Vietnam Securities Depository and Clearing (VSDC) manages securities depository accounts according to the following principles:

- Securities deposited with VSDC are assets owned by clients and managed separately from assets of VSDC;

- VSDC may only use clients’ securities in the cases specified at Points h, i, k, l, m, Clause 1, Article 156 of Decree No. .../2020/ND-CP dated ... of the Government on elaboration of the Law on Securities.

Note: VSDC only does accounting on the securities depository account when the accounting vouchers are complete, valid and are original documents.

Besides, the total balance of securities depository accounts of clients opened at depository members (DMs) must always match the balances of securities depository accounts of DMs opened at VSDC. The detailed balance on each client's securities depository account at a DM must match that client's ownership data at VSDC.

Concurrently, when there is any change or error in securities depository account information, the DM, direct account holder is obliged to report and modify immediately with VSDC. The modification to securities depository account information shall comply with VSDC's regulations on depository activities. When detecting errors in information in the securities depository account of a DM, direct account holder or a client of a DM, VSDC must immediately notify the DM or direct account holder for proper modification.

More details at the Circular No. 119/2020/TT-BTC of the Ministry of Finance of Vietnam, effective from February 15, 2021.

Ty Na

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