Cases of suspension or cancellation of a public offering in Vietnam

Cases of suspension or cancellation of a public offering in Vietnam (Internet image)

1. What is a public offering?

According to Clause 19, Article 4 of the Law on Securities 2019, public offering means the offering of securities:

- Through mass media;

- To at least 100 investors, not including professional investors; or

- To unidentified investors.

2. Cases of suspension of public offering in Vietnam

Cases of suspension of a public offering of securities specified in Article 27 of the Law on Securities 2019, include:

- SSC is entitled to suspend a public offering for up to 60 days in the following circumstances:

+ The public offering application contains inaccurate or inadequate information that might affect investors’ decisions and cause damage to investors;

+ The securities are not distributed in accordance with Article 26 of the Law on Securities 2019.

- Within 07 working days from the suspension date, the issuer shall announce suspension in accordance with Clause 3 Article 25 of the Law on Securities 2019, withdraw the issued securities if requested by the investors, and refund the payment to the investors within 15 days from the day on which the request is received.

- After the causes of the suspension have been rectified, SSC shall issue a notice to lift the suspension.

- Within 07 working days from the issuance date of the notice of lifted suspension, the issuer shall announce it in accordance with Clause 3 Article 25 of the Law on Securities 2019.

3. Cases of cancellation of public offering in Vietnam

Cases of cancellation of a public offering of securities are specified in Article 28 of the Law on Securities 2019, including:

- SSC shall issue a decision to cancel a public offering in the following cases:

+ If the causes of the suspension are not rectified by the deadline mentioned in Clause 1 Article 27 of the Law on Securities 2019, the public offering shall be cancelled;

+ The quantity of voting shares being sold to at least 100 non-major shareholders of the issuer is below the ratio specified in Point d Clause 1 Article 15 of the Law on Securities 2019;

+ The follow-on offering fails to raise adequate capital to execute the issuer’s project as prescribed in Point d Clause 2 Article 15 of the Law on Securities 2019.

- The public offering is cancelled under an effective court judgment or decision, arbitral decision or decision of a competent authority in cases other than those specified in Clause 1 of Article 28 of the Law on Securities 2019.

- Within 07 working days from the cancellation date, the issuer shall announce cancellation in accordance with Clause 3 Article 25 of the Law on Securities 2019, withdraw the issued securities if requested by the investors, and refund the investors within 15 days from the cancellation date.

If the investors are not refunded by this deadline, the issuer shall pay damages as agreed with the investors.

Diem My

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