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Investment Activities of Foreign Investors on Vietnam’s Stock Market

Investment Activities of Foreign Investors on Vietnam’s Stock Market

Securities investment activities of foreign investors on the Vietnamese stock market are regulated in Article 138 of Decree No. 155/2020/ND-CP dated December 31, 2020, of the Vietnamese Government and Circular No. 51/2021/TT-BTC dated June 30, 2021, of the Ministry of Finance of Vietnam, guiding the obligations of organizations and individuals in foreign investment activities on the Vietnamese stock market.

Investment activities of foreign investors on Vietnam’s stock market

Investment activities of foreign investors on Vietnam's stock market

1. Foreign investors make investments on the Vietnamese stock market in the following forms:

Directly invest and trade on the Vietnamese stock market by the law on securities and securities market; Foreign investors open 01 indirect investment capital account at 01 depository bank licensed to do foreign exchange business to conduct investment activities on the Vietnamese stock market.

Indirect investment in the form of entrusting capital to securities investment fund management companies, branches of foreign fund management companies in Vietnam. Securities investment fund management companies, branches of foreign fund management companies in Vietnam open indirect investment capital accounts to receive capital from foreign investors who do not have indirect investment capital accounts

3. Foreign investors are allowed to open securities trading accounts and make investments immediately after being issued securities trading codes in the form of an electronic confirmation.

4. Foreign investors may choose a transaction representative in Vietnam that fully meets the following conditions:

Not being in the case of serving a prison sentence or being banned from doing business by the court;

Possessing professional certificates in securities, including certificate of basic issues in securities and stock market, certificate of law on securities and securities market;

To be the sole trading representative in Vietnam of the foreign investor and authorized in writing by the foreign investor.

5. Foreign investors, trading representatives, securities companies, securities investment fund management companies, branches of securities companies, foreign fund management companies in Vietnam providing services to foreign investors must comply with legal regulations on foreign ownership ratio when participating in investment in Vietnam’s stock market.

6. Obligations in investment activities on Vietnam’s stock market

6. Obligations in investment activities on Vietnam's stock market

Foreign investors, trading representatives of foreign investors must ensure investment transactions on the Vietnamese stock market and transactions performed by related persons, groups of foreign investors; related external parties are not intended to create artificial supply and demand, manipulate securities prices and other prohibited trading acts as prescribed by law.

Foreign investors and foreign depository certificate issuers are obliged to declare, pay and finalize taxes, fees, charges, and service prices related to securities activities in Vietnam. by the laws of Vietnam.

Foreign investors and groups of foreign investors concerned shall perform the obligation to report ownership and disclose information on securities transactions by the law on information disclosure on the stock market by the law on information disclosure on the stock market. following principles:

 

  • Foreign investors implement or appoint 01 depository member or 01 securities company or 01 securities investment fund management company or its representative office (if any) or 01 organization or authorize 01 individual to perform the obligation to report ownership and disclose information by the law on information disclosure on the stock market.
  • The group of foreign investors concerned shall appoint 01 depository member or 01 securities company or 01 securities investment fund management company or its representative office (if any) or 01 other organization or authorize 01 individual to perform the obligation to report ownership and disclose information following the law on information disclosure on the stock market;
    • A notice of appointment or change of an organization or individual performing the obligation to report ownership and disclose information, made according to the form specified in Appendix I issued together with this Circular, must be sent to the Securities and Exchange Commission. The State, a subsidiary of the Stock Exchange of Vietnam, within 24 hours from the date of appointment or authorization takes effect, together with a valid copy of the License for Establishment and Operation or Certificate of Registration business or Funding Registration Certificate or equivalent document of the designated organization; or accompanied by a valid copy of the people’s identity card or citizen identification card or valid passport or other lawful personal identification of the authorized individual.
  • In case there is a change in the number of foreign investors in the relevant group of foreign investors but there is no change in the organization or individual performing the obligation to report on ownership and disclose information Organizations and individuals appointed or authorized to report ownership and disclose information are responsible for reporting to the State Securities Commission and a subsidiary of the Stock Exchange of Vietnam within 07 working days. work since the change. Reporting documents include:
    • An update on the list of relevant foreign investor groups using the form provided in Appendix II to this Circular;
    • A written appointment or authorization of the new foreign investor on the performance of the obligation to report ownership and disclose information according to the form prescribed in Appendix I issued together with this Circular (in case of supplementary information addition of new foreign investors to the relevant foreign investor group).
  • Foreign investors and groups of foreign investors concerned are responsible for providing sufficient information on their securities ownership status for the designated organization or authorized individual to report on their ownership. ownership and disclosure of information shall fulfill the obligation to report ownership and disclose information following the law;
  • Foreign investors and groups of foreign investors concerned shall perform the obligation to report on ownership concurrently with the obligation to disclose information. The obligation to report ownership and disclose information complies with the law on information disclosure on the stock market.

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