Supplementing regulations on cancellation of private placement of securities in Vietnam from January 01, 2025

Le Truong Quoc Dat

13:47, 17/12/2024

Supplementing regulations on the cancellation of private placement of securities in Vietnam from January 01, 2025 e from January 1, 2025, is the content of the Law amending and supplementing a number of articles of the Law on Securities, the Law on Accounting, the Law on Independent Auditing, the Law on State Budget, the Law on Management and Use of Public Assets, the Law on Tax Administration, the Law on Personal Income Tax, the Law on National Reserves, and the Law on Handling Administrative Violations 2024 (hereinafter referred to as the Amended Law on 9 Laws 2024) was passed by the National Assembly on November 29, 2024.

Supplementing regulations on cancellation of private placement of securities in Vietnam from January 01, 2025

The Law on Amendments to 09 Law 2024 has added Article 31b to the Law on Securities 2019 regarding the cancellation of private securities offerings as follows:

- The State Securities Commission shall decide to cancel the private securities offering registered with the State Securities Commission under the following circumstances:

+ The suspension period as stipulated in Clause 1, Article 31a of the Law on Securities 2019 (amended by Law on Amendments to 09 Law 2024) has expired, and the issuing organization fails to rectify deficiencies leading to the suspension of the private securities offering;

+ After the conclusion of the private share offering, where the shares are not listed or registered for trading, it is discovered that the offering violates the provisions of Clause 1, Article 31a of the Law on Securities 2019 (amended by Law on Amendments to 09 Law 2024);

+ After the conclusion of the private bond offering, it is discovered that the offering violates the provisions of Clause 1, Article 31a of the Law on Securities 2019 (amended by Law on Amendments to 09 Law 2024).

- Apart from the circumstances stipulated in Clause 1, Article 31b of the Law on Securities 2019 (amended by Law on Amendments to 09 Law 2024), a private securities offering is canceled following a court ruling, arbitration, or directive from an authorized body per legal regulations.

- After a private placement, if shares or shares converted from convertible bonds or shares purchased from warrants have been listed or registered for trading, they cannot be canceled.

- Within 7 business days from the cancellation date of the private securities offering, the issuing organization must announce the cancellation according to the method stipulated in Clause 3, Article 25 of the Law on Securities 2019 and must retrieve the issued securities while reimbursing investors within 15 days from the cancellation date. Beyond this period, the issuing organization must compensate investors for damages per the terms agreed with investors.

Further details can be found in the Law on Amendments to 09 Law 2024, effective from January 1, 2025, except as provided in Clauses 2, 3, 4, and 5, Article 10 of Law on Amendments to 09 Law 2024.

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