11 Main contents of the model prospectus used in offering, issuance of securities in Vietnam

11 Main contents of the model prospectus used in offering, issuance of securities in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. Main contents of the model prospectus used in offering, issuance of securities in Vietnam

A model prospectus in Vietnam specified in Clause 1 of Article 3 of Circular 118/2020/TT-BTC shall, inter alia, contain the following information:

(1) Information about persons who bear primary responsibility for the prospectus;

(2) Information about risk factors;

(3) Information about the issuer or the public company whose shares are offered, including its establishment, organizational structure, relevant companies, and business operations;

(4) Information about founding shareholders, major shareholders, and owner of the company; company’s president, members of Board of Directors, members of Board of Members; Controllers; General Director (Director), Deputy General Directors (Deputy Directors) and Chief Accountant;

(5) Information about business performance, financial status and plans;

(6) Information about the offering or issuance, including characteristics of securities offered or issued; distribution method; distribution schedule; cases of cancellation of the offering;

(7) Information about purposes of the offering or issuance; plan for use of capital generated by the offering, except the initial public offering made to become a public company through change of ownership structure without increase in charter capital of the issuer, and the public offering of shareholders of the public company;

(8) Information about partners related to the offering or issuance, including counseling organization, underwriter, distribution agent, representative of bond holders, and audit organization;

(9) Other important information that might affect investors’ decisions;

(10) Signatures of the persons who bear primary responsibility for the prospectus as prescribed in Clause 3 Article 19 of the Law on Securities 2020;

(11) List of documents enclosed with the prospectus, including decisions issued by the General Meeting of Shareholders or Board of Directors or Board of Members or company’s owner related to the offering or issuance, financial statements as prescribed in Article 20 of the Law on Securities 2020, documents about the project using capital generated by the offering and other documents (if any).

(Clause 2, Article 3 of Circular 118/2020/TT-BTC)

2. Requirements for issuers when preparing the prospectus in Vietnam

According to Clause 3, Article 3 of Circular 118/2020/TT-BTC, when preparing the prospectus using the model prospectus specified in Clause 1 of Article 3 of Circular 118/2020/TT-BTC, the issuer must comply with the following provisions:

- The prospectus must contain clear, accurate, truthful and adequate information that might affect investors’ decisions. The language of the prospectus must be simple and understandable. The abbreviated or technical terms used in the prospectus must be clearly interpreted;

- Important and comparative information contained in the prospectus must be provided with their reference sources;

- The prospectus must have a clear format, and easily legible font and font size;

- The analysis of risk factors must include their impacts on business operations, financial status and business performance of the issuer; the offering or issuance; prices of securities; and the project using capital generated by the offering. Such risk factors must be classified and named in groups, and sorted by their negative effects in descending order;

- Information about business operations and financial status must clearly reflect business operations of the issuer or public company whose shares are offered within the latest 02 fiscal years and by the end of the latest quarter.

In case of a parent company, the information about business performance must include consolidated business performance and business performance of the parent company;

- Information about major shareholders, owner of the company, company’s president, members of Board of Directors, members of Board of Members, Controllers, General Director (Director), Deputy General Directors (Deputy Directors) and Chief Accountant must include information about their interests relevant to the issuer or shareholders of the public company that offers shares to the public;

- Purposes of the offering or issuance and plan for use of capital generated by the offering must be conformable with the plan approved by the General Meeting of Shareholders or Board of Directors or Board of Members or the company’s owner;

- If a prospectus is revised, revised contents and revision reasons must be indicated in the revised prospectus.

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