Vietnam: When is the certificate of registration of representative office operation of the representative offices of securities companies suspended?

According to the Decree No. 156/2020/NĐ-CP of the Vietnam’s Government, the representative offices of securities companies, securities investment fund management companies, foreign securities companies and foreign fund management companies in Vietnam shall have the certificate of registration of representative office operation suspended for a period of 18 - 24 months if the securities trading organization commits one of the following violations:

- Preparing or certifying the application for certificate of registration of representative office operation which contains false or inaccurate information;

- Running the representative office for wrong purposes or against the certificate of registration of representative office operation.

Besides, the representative offices of securities companies, securities investment fund management companies, foreign securities companies and foreign fund management companies in Vietnam shall be sanctioned for administrative violations of the following acts:

- A fine ranging from VND 10.000.000 to VND 30.000.000 shall be imposed for failing to follow procedures for modification or re-issuance of certificate of registration or termination of representative office operation as prescribed by law.

- A fine ranging from VND 30.000.000 to VND 50.000.000 shall be imposed upon the chief representative or an employee of the representative office for holding multiple positions in case such multiple position-holding is prohibited.

- A fine ranging from VND 50.000.000 to VND 70.000.000 shall be imposed for committing one of the following violations:

+ Failing to meet requirements when running a representative office; failing to apply for registration of representative office operation or running a representative office before obtaining approval or certificate of registration of representative office operation;

+ Representing another organization; transferring certificate of registration of representative office operation to another entity;

+ Erasing or altering contents of the certificate of registration of representative office operation.

- A fine ranging from VND 100.000.000 to VND 200.000.000 shall be imposed upon the chief of the representative office of a foreign securities company or foreign fund management company in Vietnam for performing business operations in Vietnam beyond the licensed scope of operation of the representative office.

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

Ty Na

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