Vietnam: What are the penalties for violations against regulations on offering and transfer of shares?

According to Article 11 of Decree No. 88/2019/ND-CP of Vietnam’s Government, penalties and remedial measures for violations against regulations on offering and transfer of shares in the monetary and banking sector are specified as follows:

- Firstly, a fine ranging from VND 150.000.000 to VND 200.000.000 shall be imposed for transferring shares while holding a position as prescribed in Clause 1 Article 56 of the Law on Credit Institutions.

- Secondly, a fine ranging from VND 250.000.000 to VND 300.000.000 shall be imposed for transferring shares while implementing remedial measures according to a resolution of the General Meeting of Shareholders or SBV's decision due to personal responsibility of a member of Board of Directors or Board of Controllers, or General Director (Director), except the cases prescribed in Points a, b and c Clause 2 Article 56 of the Law on Credit Institutions.

In addition to fines, these violations are also subject to the following remedial measures:

- Enforced retrieval of shares transferred as prescribed in this Article within a maximum duration of 06 months from the effective date of the decision on administrative penalty imposition;

- Proposed suspension of violating entities and/or persons responsible for the violation from holding the management or supervision position for 01 – 03 months, proposed dismissal or prohibition from holding the management or supervision position at a credit institution or FBB if any of the violations prescribed in this Article is committed. Proposed dismissal and implementation of other appropriate measures against violating entities within the competence of a credit institution or FBB.

View full text at Decree No. 88/2019/ND-CP of Vietnam’s Government, effective from December 31, 2019.

Thu Ba

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