Vietnam: 02 cases of compulsory termination of derivative trading operations

According to Article 8 of the Decree No. 158/2020/NĐ-CP of the Vietnam’s Government, the derivative trading organization is required to terminate derivative trading operations in the following cases:

- It fails to rectify the causes of suspension of derivative trading operations by the end of suspension period;

- It is dissolved, declared bankrupt, or has its operations suspended or its license for establishment and operation revoked; the organization established after full or partial division, consolidation or merger fails to meet one of the requirements as prescribed.

Note: Within 30 days from the day on which the derivative trading organization is determined to fall in one of the cases mentioned above, the State Securities Commission of Vietnam (SSC) shall request the derivative trading organization in writing to follow procedures for termination of derivative trading operations.

Concurrently, from the receipt of SSC’s request for compulsory termination of derivative trading operations, the derivative trading organization shall disclose information and send notification to clients as prescribed in Clause 5 Article 7 hereof. The derivative trading organization shall comply with regulations laid down in Clauses 6, 7 Article 7 hereof for following procedures for termination of derivative trading operations and send reports on results to SSC.

Moreover, within 05 business days from the receipt of reports on termination of derivative trading operations, SSC shall revise the certificate of eligibility to trade derivatives (if one or some derivative trading operations are terminated) or issue a decision to revoke the certificate of eligibility to trade derivatives (if all derivative trading operations are terminated).

More details at the Decree No. 158/2020/NĐ-CP of the Vietnam’s Government, effective from January 01, 2021.

Ty Na

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