Vietnam: 04 principles of the payment of dividends of investment companies

According to Article 11 of Circular No. 227/2012/TT-BTC of the Ministry of Finance of Vietnam, investment companies may pay dividends to their shareholders according to the profit distribution policy prescribed in their charter, and the distribution plan passed by the latest General meeting of shareholders. The dividends paid to shareholders are extracted from the profit in the period, or from the cumulative profit after all funds are established (if any) according to the charter, and all tax liability and financial obligations are fulfilled (if any) as prescribed by law.

Dividends may be paid in cash or by additional shares. At least 15 days before the date on which dividends are distributed, the asset management company must notify all investors. The Notice of dividend payment must contain the information in Annex 22 enclosed with this Circular.

Note: The payment of dividends of investment companies must ensure that:

1. It is conformable with the profit distribution policy prescribed in the charter of the securities company, the prospectus, and the summary prospectus;

2. It is done after the investment company has fulfilled all tax liability and other financial obligations as prescribed by law, and established all funds prescribed in its charter (if any);

3. After the payment, the securities company is still able to pay the due debts and other financial obligations, and the net asset value does not fall below VND 50 billion;

4. The dividend rates are decided by the General meeting of shareholders or the Board of Directors of the investment company, in accordance with the investment targets and its charter applicable to the profit distribution policy.

View more details at Circular No. 227/2012/TT-BTC of the Ministry of Finance of Vietnam, effective from July 01, 2013.

Le Vy

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