Vietnam: Sanctions for violations against regulations on issuance of bonds in the international market

Recently, the Government of Vietnam has issued the Decree No. 156/2020/NĐ-CP prescribing penalties for administrative violations against regulations on securities and securities market.

phát hành trái phiếu ra thị trường quốc tế, Nghị định 156/2020/NĐ-CP

According to Article 11 of the Decree No. 156/2020/NĐ-CP of the Vietnam’s Government on violations against regulations on issuance of bonds in the international market, offering of securities overseas, and issuance of securities used as the basis for offering of depositary receipts overseas or provision of assistance in issuing depositary receipts overseas on the basis of shares issued in Vietnam:

(1) A fine ranging from VND 100.000.000 to VND 200.000.000 shall be imposed for failing to revise the application for issuance of bonds in the international market, offering of securities overseas, issuance of securities used as the basis for offering of depositary receipts overseas or provision of assistance in issuing depositary receipts overseas on the basis of shares issued in Vietnam when finding inaccurate or inadequate information or any new information related to the submitted application.

(2) A fine ranging from VND 300.000.000 to VND 400.000.000 shall be imposed for committing one of the following violations:

- Conducting issuance of bonds in the international market, offering of securities overseas, and issuance of securities used as the basis for offering of depositary receipts overseas or provision of assistance in issuing depositary receipts overseas on the basis of shares issued in Vietnam without meeting requirements set forth in law;

- Conducting issuance of bonds in the international market, offering of securities overseas, and issuance of securities used as the basis for offering of depositary receipts overseas or provision of assistance in issuing depositary receipts overseas on the basis of shares issued in Vietnam without applying for registration thereof with a competent authority or before obtaining approval or written consent from a competent authority.

(3) A fine ranging from VND 400.000.000 to VND 500.000.000 shall be imposed for failing to preparing or making certification on the application for issuance of bonds in the international market, offering of securities overseas, issuance of securities used as the basis for offering of depositary receipts overseas or provision of assistance in issuing depositary receipts overseas on the basis of shares issued in Vietnam, which contains false information or conceals true information.

Particularly, the violating entity is compelled to remove or correct information in case of commission of the violation as mentioned in (3).

More details at the Decree No. 156/2020/NĐ-CP of the Vietnam’s Government, effective from January 01, 2021.               

Phuong Thanh

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