Rules for foreign investors to participate in buying shares of securities companies in Vietnam

According to Article 77 of the Law on Securities 2019 of Vietnam, foreign investors may contribute capital, buy shares and stakes in securities companies and fund management companies as follows:

- A foreign investor that is an organization satisfying the requirements specified in Clause 2 of this Article and its related persons may hold up to 100% of charter capital of a securities company or fund management company. In case the requirements in Clause 2 of this Article are not fully satisfied, the foreign investor that is an organization and its related person may only hold up to 49% of charter capital of a securities company or fund management company;

- A foreign investor that is an individual and his/her related persons may hold up to 49% of charter capital of a securities company or fund management company;

- Foreign investors shall comply with regulations that shareholders and contributing members holding at least 10% of charter capital of 01 securities company or fund management company; their related persons (if any) do not hold more than 5% of charter capital of another securities company or fund management company.

Besides, in order to hold 100% charter capital of a securities company or fund management company by contributing capital or buying shares/stakes, a foreign organization shall:

- Be licensed and has been continuously operating in the field of banking, securities, insurance for 02 years before the year in which capital is contributed or shares/stakes are purchased;

- The home country’s licensing authority and State Securities Commission (SSC) has entered into a mutual or multilateral agreement on information exchange, management, inspection, supervision of securities activities and securities market;

- The organization’s business has profit in 02 years prior to the year in which capital is contributed or shares/stakes are purchased, and the latest annual financial statement has been audited and received unqualified opinions.

View more details at the Law on Securities 2019 of Vietnam, effective from January 01, 2021.

Ty Na

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