Who has the right to decide private placement of bonds of joint stock company in Vietnam?

Who has the right to decide private placement of bonds of joint stock company in Vietnam? (Internet image)

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

1. Who has the right to decide private placement of bonds of joint stock company in Vietnam?

Pursuant to Article 130 of the Law on Enterprise 2020, regulations on deciding private placement of bonds are as follows:

- The company shall decide the private placement of bonds as follows:

+ The GMS shall decide the types and total value of bonds and time of offering of convertible bonds and warrant-linked bonds. A voting shall be carried out in accordance with Article 148 of this Law;

+ Unless otherwise prescribed by the company's charter and except the cases specified in Point a of this Clause, the Board of Directors is entitled to decide the types and total value of bonds and time of offering and shall submit a report to the nearest GMS. The report shall be enclosed with documents about the offering.

- The company shall register the change in charter capital within 10 days from the day on which the bonds are converted into shares.

2. What are the conditions for a joint stock company to conduct private placements of bonds in Vietnam?

According to Article 128 of the Law on Enterprise 2020, regulations on private placement of bonds are as follows:

- The joint stock company that is not a public company may make sell bonds using private placement in accordance with the Law on Enterprise 2020 and relevant laws. Private placement of bonds by public companies and other organizations, and public offering of bonds shall comply with securities laws.

- Private placement of bonds by a joint stock company that is not a public company means the offering of bonds without mass media to fewer than 100 investors, excluding professional securities investors, that satisfy the following conditions:

+ Strategic investors for privately placed convertible bonds and bonds attached to warrants;

+ Professional securities investors for privately placed convertible bonds, warrant-linked bonds and other kinds of privately placed bonds.

- A joint stock company that is not a public company must satisfy the following conditions to make private placement of bonds:

+ The company’s has fully paid the principal and interest of the bonds that are offered and due or fully paid due debts over the last 03 years before the offering (if any), except offering of bonds to creditors that are pre-selected finance organizations;

+ The company has the audited financial statement of the year preceding the year of offering;

+ The liquidity ratios and prudential ratios are maintained;

+ Other conditions prescribed by relevant laws.

3. What can be used to buy bonds of joint stock companies?

Pursuant to Article 131 of the Law on Enterprise 2020, regulations on purchase of shares and bonds of joint stock companies are as follows:

Shares and bonds of a joint stock company may be bought in VND, convertible foreign currencies, gold, land use right (LUR), intellectual property rights, technologies, technical secrets, other assets specified in the company's charter and shall be paid in a lump sum.

Thus, you can buy bonds of a joint stock company with:

- VND;

- Convertible foreign currencies

- Gold;

- Land use right (LUR)

- Intellectual property rights, technologies, technical secrets, other assets specified in the company's charter

Nguyen Ngoc Que Anh

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