Vietnam: A depository member shall have its securities depository registration certificate revoked if it fails to commence securities depository operation within 12 months

According to Vietnam’s current regulations, a depository member shall have the securities depository registration certificates suspended or revoked in certain cases. To be specific:

- A depository member shall be suspended from securities depository operation for a maximum duration of ninety days in the following cases:

+ It frequently breaches the depository members' obligations specified by the securities depository center;

+ It lets errors occur, causing heavy losses to its customers.

- A depository member has its securities depository registration certificate revoked in the following cases:

+ Upon the expiration of the depository suspension duration, it still fails to remedy breaches specified in Clause 1 of this Article;

+ It fails to commence securities depository operation within twelve months after it is granted a securities depository registration certificate.

+ It has its establishment and operation license revoked;

+ It is divided, split, merged, consolidated, transformed, dissolved or bankrupt;

+ It voluntarily terminates the securities depository operation after obtaining consent of the State Securities Commission.

When having their securities depository registration certificates revoked, depository members shall carry out procedures for finalizing their securities depository accounts according to regulations of securities depository centers.

This is the content specified in Article 51 of the Law on Securities 2006 of Vietnam, effective from January 01, 2007.

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