Vietnam: Supervisory banks do not have the right to vote at meetings of the Board of Directors of the investment company

Specifically, according to Article 32 of Circular No. 227/2012/TT-BTC of the Ministry of Finance of Vietnam, responsibilities of depository banks and supervisory banks when depositing assets of investment companies include:

- Request the investment company and asset management company (if any) to register the assets of the investment company as soon as possible in accordance with the economic contract signed by the investment company and its partners, and relevant laws; ensure that all assets of the investment company that are generated within Vietnam’s territory are registered and deposited at the depository bank and supervisory bank;

- Assets of the investment company must be separate from that of other organizations and individuals, including assets of the depository bank and supervisory bank;

- Unless the investment company manages its own, the asset management company shall be the authorized representative that makes the transactions of the investment company. The transfer of assets of the investment company in investments or disinvestment is only carried out under written directives from the asset management company and the asset controller in accordance with the depository contract and supervisory contract;

- The payment for the transactions of listed and registered securities must comply with the “cash on delivery” principle, and other offset and payment principles as prescribed by law. All bank transfers, payments, and asset transfer must be made to the correct partners of the investment company and its accounts. The payment value must be congruent with the asset quantity and prices, and consistent with the amounts in invoices;

- Correctly, completely, and promptly execute the orders and directives of the investment company and the asset management company (if any) in order to completely and promptly exercise the rights and fulfill the obligations related to the asset ownership of the investment company, including the procedure for paying and settling tax of the investment company;

- Certify the reports on assets of the investment company, ensure that the quantity of assets in the report is correct and consistent with the assets deposited at the bank;

- Provide adequate information in General meetings of shareholders and meetings of the Board of Directors of the investment company, but do not vote.

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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