Organizational structure and management of a branch of a foreign securities company in Vietnam

Organizational structure and management of a branch of a foreign securities company in Vietnam (Internet image) 

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

1. Organizational structure and management of a branch of a foreign securities company in Vietnam 

Organizational structure and management of a branch of a foreign securities company in Vietnam (hereinafter referred to as “branch”) according to Article 13 of Circular 97/2020/TT-BTC is as follows:

- The parent company shall decide the organizational structure and management of its branch in conformity with regulations of the law of Vietnam on organizational structure, management and internal control of domestic securities companies.

- The employee in charge of compliance management of a branch must not a related person of the branch's Director, and must possess bachelor’s degree in finance, banking, law, accounting or auditing. 

The employee in charge of compliance management must have securities qualifications, including certificates of fundamentals of securities and securities market and certificates of laws in securities and securities market, or foreign securities practicing certificates and certificates of laws in securities and securities market.

- The branch must arrange its employees possessing securities practicing certificates to perform the following tasks:

+ Provide advice and explanation about contracts signed with clients;

+ Sign securities analysis outcomes or reports;

+ Provide recommendations about the purchase, sale and holding of securities.

2. Scope and contents of operations of a branch of a foreign securities company in Vietnam 

Scope and contents of operations of a branch of a foreign securities company in Vietnam according to Article 14 of Circular 97/2020/TT-BTC is as follows:

- Scope of operations

A branch shall be allowed to provide securities investment consultancy services only.

- Specific operations

A branch shall provide analysis outcomes and reports, and recommendations for clients with or without collecting fees in the following cases:

+ Provide reports on analysis of transactions on the securities market, and investment recommendations;

+ Provide reports on analysis of operations of public companies, listed companies and other enterprises, and investment recommendations;

+ Enter into securities investment consultancy service contracts with clients.

3. Rights of a branch of a foreign securities company in Vietnam 

According to Article 15 of Circular 97/2020/TT-BTC, a branch of a foreign securities company in Vietnam has the following rights:

- Collect consultancy service fees as agreed upon with clients and prescribed by laws.

- Open a foreign currency account or VND account converted from a foreign currency at a commercial bank that is licensed to provide foreign exchange services in Vietnam and only use this account for its operations. The opening, use and closure of an account by the branch shall comply with regulations of relevant laws.

- Recruit both Vietnamese and foreign employees to work at the branch in accordance with regulations of relevant laws.

- Have its own seal under the law of Vietnam and only use this seal on transaction documents made within the ambit of rights and functions of the branch.

- Exercise other rights as prescribed by relevant laws.

>> CLICK HERE TO READ THIS ARTICLE IN VIETNAMESE