Chương VII Nghị định 155/2020/NĐ-CP: Quỹ đầu tư chứng khoán, công ty đầu tư chứng khoán

Chapter VII

SECURITIES INVESTMENT FUNDS, INVESTMENT COMPANIES

Article 217. Names of securities investment funds and investment companies

The Vietnamese name of a securities investment fund or investment company shall comply with enterprise laws and have at least the following two elements:

1. “Quỹ đầu tư” for closed-end funds, open-end funds, private funds; “ quỹ đầu tư bất động sản” for real estate investment funds; “ETF” for exchange traded funds; “investment JSC” for investment companies.

2. Proper name: suitable for the investment targets and strategies of the fund. For ETFs, the proper name must include the abbreviated name of the securities investment fund management company and the benchmark indexes.

Article 218. Changes subject to approval by SSC

The securities investment fund shall obtain SSC’s approval before making the following changes:

1. Increase, decrease in charter capital of the private fund; increase in charter capital of the closed-end fund or real estate investment fund.

2. Change in the fund’s operating period.

3. Change of the fund’s depository bank, supervisory bank.

4. Change of the name of the fund or securities investment fund management company.

Article 219. Conditions for operating as a public fund certificate distribution agent

1. An organization that has at least 01 business location for distribution of fund certificates. Fund certificates are only distributed at the registered locations.

2. Each location has at least 02 employees who have securities practicing certificates or foreign securities practicing certificates and the certificate of basic training in securities and securities market of Vietnam, or the following securities-related qualifications: certificate of basic training in securities and securities market laws, securities analysis and investment, securities brokerage and securities investment counseling.

3. The premises and equipment are adequate for fund certificate distribution.

4. There are professional processes for distribution of fund certificates and code of professional ethics applied to the agent’s employees.

Article 220. Documentation and procedures for issuance of the certificate of registration of public fund certificate distribution agent

1. An application for the certificate of registration of fund certificate distribution agent shall include:

a) The application form No. 88 in the Appendix hereof;

b) The authorization form No. 89 in the Appendix hereof;

c) The Certificate of Enterprise Registration, establishment and operation license (if any) of the applying organization and the distribution locations;

d) The description of facilities and personnel at distribution locations according to Form No. 90 and personal information sheets of the distribution agent’s employees according to Form No. 91 in the Appendix hereof; foreign securities practicing certificates of the employees (if any);

dd) The decision of the competent authority on promulgation of professional processes, including: information verification, identification of investors, distribution of fund certificates, regulations on prevention of late transactions; code of professional ethics for the distribution agent’s employees;

e) The written approval granted by a relevant authority for operation of the fund certificate distribution agent (if any).

2. When a securities investment fund management company distributes fund certificates, it shall have adequate personnel and professional processes for fund certificate distribution.

3. a) Within 10 days from the receipt of the satisfactory application, SSC shall issue the certificate of registration of fund certificate distribution agent. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

4. The Minister of Finance shall provide guidance on operation of fund certificate distribution agents.

Article 221. Revocation of the certificate of registration of fund certificate distribution agent

1. The certificate shall be revoked in the following cases:

a) Voluntary termination of fund certificate distribution;

b) The Certificate of Enterprise Registration, establishment and operation license is revoked;

c) The fulfillment of conditions for fund certificate distribution is not maintained or regulations on fund certificate distribution of the Ministry of Finance are violated during the agent’s operation.

2. An application for termination of fund certificate distribution shall contain:

a) The written request for permission for termination of fund certificate distribution;

b) The original copy of the certificate of registration of fund certificate distribution agent;

c) The report on termination of fund certificate distribution at all locations; records on finalization of fund certificate accounts of clients of the agent or records on transfer of clients to substitute agents (if any).

3. Within 10 days from the receipt of the satisfactory application, SSC shall issue the decision to revoke the certificate of registration of fund certificate distribution agent. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

Section 1. PRIVATE FUNDS

Article 222. Conditions for establishment of a private fund

1. The conditions specified in Clause 2 Article 113 of the Law on Securities are satisfied.

2. The securities investment fund management company has at least 02 executives who have fund management certificates; is not facing warning, put under control, special control or suspension; has implemented all decisions on administrative penalties for violations against securities laws.

Article 223. Application for registration of a private fund

1. The application form No. 92 in the Appendix hereof.

2. The fund's charter according to the model charter provided by the Ministry of Finance.

3. The asset depositing contract with the depository bank.

4. Capital contribution contracts with contributing members which specify the names of the fund, securities investment fund management company, depository bank, contributed capital; the decision of a competent authority on contribution of capital to the fund.

5. The list of professional investors that contribute capital according to Form No. 93 in the Appendix hereof; the appraisal report of the securities investment fund management company or authorized securities company on identification of professional investors.

6. The written confirmation of contributed capital of the fund issued by the depository bank.

7. The list and information disclosure sheets of the fund’s executives according to form No. 91 and 101 in the Appendix hereof.

Article 224. Conditions for increase, decrease in charter capital of a private fund

1. The fund’s charter includes regulations on increase, decrease in charter capital.

2. The Investor Assembly of the fund approves the increase/decrease in charter capital of the fund, the plan for increase/decrease in the charter capital, and the revised charter of the fund.

3. The fund is still conformable with Article 113 of the Law on Securities after increase/decrease.

4. In case of increase in charter capital, the securities investment fund management company must comply with Clause 2 Article 222 of this Decree. Capital shall be contributed in the form of money or securities that are listed/registered at Stock Exchanges. Capital contribution with securities shall ensure that:

a) The contributing investors are not restricted from transferring intended assets to the funds; the assets are not being pledged, deposited, put up as collateral, frozen or used in other collateral transactions as prescribed by civil laws;

b) The contributed assets are conformable with the fund’s charter, investment targets and investment policies; are not on the fund’s investment portfolio but are going to be liquidated or withdrawn; are not securities that are terminated or suspended from transaction, delisted, or securities of issuers that are undergoing liquidation, dissolution or bankruptcy;

c) Capital contribution with assets must be approved by all investors of the fund and is only completed after the lawful ownership of these assets has been transferred to the fund. The transfer of ownership shall be carried out in accordance with instructions of VSDCC;

d) The contributed assets shall be valuated in accordance with the fund's charter and relevant laws. Values of assets transferred to the fund shall be determined on the basis of their closing prices on the date of completion of ownership transfer at VSDCC.

5. In case of decrease in charter capital, assets distributed among investors are money or other assets. The securities investment fund management company, the depository bank shall distribute assets fairly according to the ratios of the investors’ contribution to the fund.

Article 225. Application for increase/decrease in charter capital of a private fund

1. The application form No. 94 in the Appendix hereof.

2. The minutes of meeting and resolution of the Investor Assembly on approval for the increase/decrease in charter capital of the fund and the revised charter of the fund.

3. The revised charter of the fund.

4. The revised depository contract (if any).

5. The list of professional investors that contribute capital before and after the increase/decrease according to Form No. 93 in the Appendix hereof; the appraisal report of the securities investment fund management company or authorized securities company on identification of professional investors that are new capital contributors (if any).

6. The depository bank’s written confirmation of additional capital and list of additional assets in case of increase in charter capital.

7. The depository bank’s written confirmation of distribution of assets among investors and the list of assets distributed among investors in case of increase in charter capital.

8. Capital contribution contracts with new contributing members (if any) enclosed with the decision of the competent authority of the organization on contribution of capital to the fund.

Article 226. Application for change in operating period of a private fund

1. Conditions for change in the fund’s operating period:

a) The reduction or extension of the operating period is approved by the Investor Assembly of the fund;

b) The latest net asset value of the fund is not smaller than 50 billion VND.

2. An application for change in operating period of a private fund shall contain:

a) The application form No. 94 in the Appendix hereof;

b) The minutes of meeting and resolution of the fund’ Investor Assembly on approval for reduction or extension of the fund’s operating period;

c) The list of professional investors of the fund according to form No. 93 in the Appendix hereof;

d) The detailed investment portfolios and report on the fund’s latest net asset value (confirmed by the depository bank);

dd) In case the fund’s operating period is extended, the contract with the depository bank for extension of depository service provision period.

3. The application shall be submitted to SSC at least 30 days before the expiration date of the fund’s operating period. Otherwise, the application will be rejected.

Article 227. Application for change of depository bank/supervisory bank

1. The application form No. 95 in the Appendix hereof and the written commitment of the depository bank/supervisory bank to fully transfer rights and obligations to the fund’s assets to the substitute bank (if any).

2. The minutes of meeting and resolution of the Investor Assembly on approval of the change of the depository bank/supervisory bank (if any); the plan for transfer of assets from the old depository bank/supervisory bank (if any) to the substitute depository bank/supervisory bank (if any) and the revised charter of the fund.

3. The depository contract with the substitute depository bank, supervision contract with the substitute supervisory bank (if any).

4. The revised charter, prospectus, summary prospectus of the fund (if any).

5. The plan for transfer of all assets, rights and obligations to the substitute depository bank or supervisory bank (if any).

Article 228. Application for change of the name of a fund or securities investment fund management company

1. The application form No. 94 in the Appendix hereof.

2. The minutes of meeting and resolution of the Investor Assembly on approval of the change; the plan for transfer of rights and obligations to the substitute securities investment fund management company and the revised charter of the fund.

3. The written commitment of the securities investment fund management company to transfer rights and obligations to the substitute company, the list and personal information sheets of the fund’s executives of the substitute company according to form No. 91 and 101 in the Appendix hereof in case of change of the securities investment fund management company.

4. The revised charter of the fund.

Article 229. Consolidation, acquisition of private funds

1. A private fund may be consolidated or merged with another private fund under the resolution of Investor Assemblies of the consolidating funds, or the acquired fund and acquiring fund. The private fund that is established after consolidation or merger shall satisfy the conditions specified in Clause 2 Article 113 of the Law on Securities.

2. The application for approval for consolidation/merger of funds shall include:

a) The application form;

b) The minutes of meeting and resolution of Investor Assemblies on approval for the consolidation/merger, the consolidation/merger contract and the charter of the consolidated/acquiring fund;

c) The consolidation/merger contract according to form No. 96 in the Appendix hereof;

d) The charter of the consolidated/acquiring fund.

3. In case the consolidation/merger of funds is combined offering of fund certificates, the funds shall comply with relevant regulations on offering.

4. The consolidated fund shall apply for revision of the certificate of fund registration. The acquiring fund shall apply for reissuance of the certificate of fund registration.

5. The application for reissuance/revision of the certificate of fund registration shall contain:

a) The application form No. 94 in the Appendix hereof;

b) The report on implementation of the consolidation/merger plan, results of transfer (if any), offering of fund certificates (if any);

c) The contract for depositing of assets of the consolidated/acquiring fund (if any);

d) The list of professional investors of the consolidated/acquiring fund according to form No. 93 in the Appendix hereof;

dd) The original copy of the certificates of fund registration of the consolidating/acquired funds;

e) The list of assets of the consolidated/acquiring fund (if any).

Article 230. Procedures for issuing, reissuing, revising the certificate of fund registration

1. a) Within 15 days from the receipt of the satisfactory application, SSC shall issue the certificate of fund registration. In case the application is rejected, SSC shall issue a written rejection and provide explanation. The fund’s capital shall only be disbursed after the certificate of fund registration is issued by SSC.

2. Within 10 days from the receipt of the satisfactory documents about the changes specified in Article 218 of this Decree, SSC shall revise the certificate of fund registration. In case the application is rejected, SSC shall issue a written rejection and provide explanation. The fund’s additional capital shall only be disbursed after the revised certificate of fund registration is issued by SSC.

3. Procedures for consolidation/merger of funds:

a) Within 30 days from the receipt of the satisfactory application for approval for consolidation/merger of funds, SSC shall issue an approval decision. In case the application is rejected, SSC shall issue a written rejection and provide explanation;

b) Within 05 working days from the day on which the consolidation/merger is completed, the securities investment fund management company shall submit the application for reissuance or revision of the certificate of fund registration. Within 30 days from receipt of the satisfactory application, SSC shall reissue or revise the certificate of fund registration. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

Article 231. Application for dissolution of a private fund

1. The application form No. 97 in the Appendix hereof.

2. The minutes of meeting and resolution of the Investor Assembly on approval for the dissolution of the fund and the dissolution plan.

3. The dissolution plan according to form No. 95 in the Appendix hereof.

4. The written commitment signed by the legal representative of the securities investment fund management company (if any), the depository bank, supervisory bank (if any) to complete procedures for liquidation of assets serving the dissolution of the fund.

Article 232. Procedures for dissolution of a private fund

1. c) Within 15 days from the day on which the Investor Assembly approves the dissolution of the fund, the securities investment fund management company or the depository bank, supervisory bank (if any) and the representative board of the fund (in case there is no securities investment fund management company) shall submit the application for dissolution to SSC.

2. Within 15 days from the receipt of the satisfactory application, SSC shall issue a document to approve the dissolution under the plan approved the Investor Assembly of the fund. In case the application is rejected, SSC shall issue a written response and provide explanation.

3. Within 05 working days from the day on which the dissolution is completed, the securities investment fund management company (or the depository bank, supervisory bank (if any) in case there is no securities investment fund management company) shall disclose information about the completion of liquidation, distribution and dissolution of the fund, and submit the following documents to SSC:

a) The report form No. 98 in the Appendix hereof;

b) The report on appraisal of liquidation result prepared by an audit organization appointed by the Investor Assembly or representative board of the fund (if any);

c) The original copy of the certificates of fund registration;

d) Documents of the depository bank, supervisory bank (if any) and securities investment fund management company specifying the money and assets distributed to each investor and confirmations of the investors that they have fully received the money and assets under the dissolution plan approved by the Investor Assembly or confirmation of VSDCC that securities have been distributed among investors as requested by the securities investment fund management company, depository bank, supervisory bank (if any) and investors; confirmation of the shareholder register management organization, the issuing organization and the enterprise receiving capital from the fund that ownership of shares/stakes has been transferred to each investor as requested by the securities investment fund management company.

4. Within 15 days from the receipt of adequate and satisfactory documents, SSC shall issue the decision to revoke the certificate of registration of fund.

Section 2. CLOSED-END FUNDS

Article 233. Public offering of closed-end fund certificates

1. Conditions for IPO of fund certificates:

a) The conditions specified in Clause 5 Article 15 of the Law on Securities are satisfied;

b) The securities investment fund management company has at least 02 executives who have fund management certificates; is not facing warning, put under control, special control or suspension; has implemented all decisions on administrative penalties for violations against securities laws.

2. Conditions offering fund certificates to increase capital of the fund:

a) The conditions specified in Clause 1, Clause 2 Article 112 of the Law on Securities are satisfied;

b) Regulations of Point b Clause 1 of this Article are complied with.

3. The plan for initial offering of fund certificates and offering of fund certificates for capital increase shall contain the mandatory information specified in form No. 99 in the Appendix hereof.

4. Within 30 days from the effective date of the certificate of fund registration or the revised certificate of fund registration, the securities investment fund management company shall list the fund certificates or additional fund certificates at the Stock Exchange as per regulations.

Article 234. Application for public offering of closed-end fund certificates

1. The application for IPO of fund certificates shall contain:

a) The application form No. 100 in the Appendix hereof;

b) The draft charter of the fund according to regulations of the Ministry of Finance;

c) The prospectus and summary prospectus according to regulations of the Ministry of Finance;

d) The supervision contract in principle between the supervisory bank and the securities investment fund management company;

dd) The contract in principle for distribution of fund certificates between the securities investment fund management company and distribution agents enclosed with the certificates of registration of fund certificate distribution agent, the report on assessment of facilities at distribution locations by the securities investment fund management company, the contracts in principle with relevant service providers (if any);

a) The list and information disclosure sheets of the fund’s executives according to form No. 91 and 101 in the Appendix hereof.

g) In case the fund does not hold the first Investor Assembly, the securities investment fund management company shall include documents about the investors’ opinions on members of the representative board of the fund, personal information sheets, judicial records and other contents;

h) the issuance underwriting agreement (if any), advertising documents, introduction of the fund (if any).

2. An application for offering fund certificates to increase capital shall contain:

a) The documents specified in Point a, Point b and Point c Clause 1 of this Article;

b) The resolution of the Investor Assembly on approval of the offering of call options for fund certificates to increase capital of the fund and the plan for offering of fund certificates;

c) The minutes of meeting and resolution of the representative board of the fund on approval for the application for offering, offering time, offer price, criteria for identification of eligible buyers in case the issued call options for the fund certificates are not completely distributed;

d) The latest annual financial statement according to Article 20 of the Law on Securities.

Article 235. Application for registration of a closed-end fund

1. The application form No. 92 in the Appendix hereof.

2. The offering result report according to form No. 102 in the Appendix hereof and the confirmation of the supervisory bank that the revenue from the offering has been frozen, the list of fund certificate buyers.

3. The document that contains investors’ responses to enquiries (if any).

Article 236. Application for revision of the certificate of closed-end fund registration due to capital increase

1. The application form No. 94 in the Appendix hereof.

2. a) The offering result report form No. 102 in the Appendix hereof.

3. The supervisory bank’s confirmation of the capital raised by the offering and the list of fund certificate buyers.

Article 237. Application for change of operating period, supervisory bank, name, management company of a closed-end fund

1. The documents specified in Article 226, Article 227 and Article 228 of this Decree.

2. In case the fund’s operating period is extended, the contract with the supervisory bank for extension of depository and supervision service provision period, detailed investment portfolios, and latest net asset value of the fund (confirmed by the supervisory bank).

Article 238. Consolidation, acquisition of closed-end funds

1. A closed-end fund may be consolidated or merged with another closed-end fund under a decision of its Investor Assemblies. The fund that is established after consolidation or merger shall satisfy the conditions specified in Clause 1 Article 108 of the Law on Securities.

2. The application for approval for fund consolidation/merger shall contain the documents specified in Clause 2 and Clause 3 Article 229 of this Decree.

3. The consolidated fund shall apply for revision of the certificate of fund registration. The acquiring fund shall apply for reissuance of the certificate of fund registration.

4. The application for reissuance/revision of the certificate of fund registration shall contain:

a) The conditions specified in Points a, b, dd, e Clause 5 Article 229 of this Decree are satisfied;

b) The prospectus, summary prospectus of the consolidated/acquiring fund;

c) The asset supervision contract between the supervisory bank and the consolidated/acquiring fund and reports of the supervisory banks on assessment of the consolidation/merger plan, including: rules for determination of debts, assets and net asset value on the consolidation/merger date; rules for conversion and determination of conversion ratio; the plan and rules for transfer of assets between the funds; quantity of fund certificates to be circulated of the consolidated/acquiring fund;

d) The written approvals of the Stock Exchange and VSDCC for delisting, deregistration, release of fund certificates of the consolidating/acquired funds.

Article 239. Procedures for issuing, reissuing, revising the certificate of closed-end fund registration

1. The fund management company shall submit the application for public offering of fund certificates to SSC. Within 30 days from the receipt of the satisfactory application, SSC shall issue the certificate of registration of public offering of fund. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

2. Within 10 days from the offering completion date, the fund management company shall submit the application for fund registration to SSC. Within 07 working days from the receipt of the satisfactory application, SSC shall issue the certificate of fund registration. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

3. Within 10 days from the completion date of the follow-on offering, the fund management company shall submit the application for revision of the certificate of fund registration to SSC. Within 07 working days from the receipt of the satisfactory application, SSC shall issue the revised certificate of fund registration. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

4. Procedures for making the changes specified in Article 218 of this Decree, consolidation and merger of closed-end funds shall comply with Clause 2 and Clause 3 Article 230 of this Decree.

Article 240. Dissolution of a closed-end fund

1. A closed-end fund will be dissolved in one of the following cases:

a) The cases specified in Clause 1 Article 104 of the Law on Securities;

b) The fund is delisted.

2. The application for dissolution shall include:

a) The documents specified in Article 231 of this Decree;

b) The delisting decision issued by the Stock Exchange (in case of delisting).

3. Procedures for dissolution shall comply with Article 232 of this Decree.

Section 3. Open-End Funds

Article 241. Conditions and documentation for IPO of open-end fund certificates

1. The conditions for IPO of open-end fund certificates are the same as those specified in Clause 1 Article 233 of this Decree.

2. The application for IPO of open-end fund certificates shall contain:

a) The documents specified in Clause 1 Article 234 of this Decree;

b) The contracts with fund administration service providers and transfer agents (if any).

Article 242. Application for fund registration, change of supervisory bank, name, management company of an open-end fund

1. An app for fund registration shall contain the documents specified in Article 235 of this Decree.

2. An application for change of supervisory bank, name, management company shall contain the relevant documents specified in Article 227 and Article 228 of this Decree.

Article 243. Consolidation, acquisition of open-end funds

1. An open-end fund may be consolidated or merged with another open-end fund under a decision of its Investor Assemblies. The fund that is established after consolidation or merger shall satisfy the conditions specified in Clause 1 Article 108 of the Law on Securities.

2. The application for approval for open-end fund consolidation/merger shall contain the documents specified in Article 238 of this Decree.

Article 244. Full division, partial division of an open-end fund

1. Conditions for full/partial division of an open-end fund:

a) The full/partial division is approved by the Investor Assembly of the fund;

b) The funds that are established after the full/partial division shall satisfy the conditions specified in Clause 1 Article 108 of the Law on Securities;

c) The funds that are established after the full/partial division shall be supervised by supervisory banks.

2. The application for approval for full/partial division of an open-end fund shall include:

a) The application form for approval for full/partial division of the open-end fund;

b) The minutes of meeting and resolution of Investor Assemblies on approval for the full/partial division and the charters of the funds established after division;

c) The full/partial division plan according to form No. 95 in the Appendix hereof;

d) The charters of the funds established after division.

3. The funds established after division shall apply for reissuance or revision or their certificates of fund registration.

4. The application for reissuance/revision of the certificate of fund registration prepared by a fund established after division shall contain:

a) The application form No. 94 in the Appendix hereof;

b) The report on implementation of the full/partial division plan;

c) The report of the supervisory bank on assessment of the full/partial division of investment portfolios, transfer of ownership and assets among the funds established after division, the list of assets of the funds established after division;

d) The supervision contracts between the fund management company and the supervisory banks for supervision of the funds established after division;

dd) The prospectuses and summary prospectuses of the funds established after division;

e) The original certificate of fund registration of the fully divided fund.

Article 245. Procedures for issuing, reissuing, revising the certificate of open-end fund registration

1. The procedures for registration of offering and establishment of an open-end fund shall comply with Clause 1 and Clause 2 Article 239 of this Decree.

2. Procedures for change of supervisory bank, name, management company, consolidation, merger of open-end funds shall comply with Clause 2 and Clause 3 Article 230 of this Decree.

3. Procedures for full/partial division of an open-end fund:

a) Within 30 days from the receipt of the satisfactory application for approval for full/partial division of the fund, SSC shall issue an approval decision. In case the application is rejected, SSC shall issue a written rejection and provide explanation;

b) Within 05 working days from the day on which the full/partial is completed, the fund management company shall submit the application for reissuance or revision of the certificate of fund registration. Within 30 days from receipt of the satisfactory application, SSC shall reissue or revise the certificate of fund registration. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

Article 246. Dissolution of open-end funds

Procedures for dissolution of open-end funds shall comply with Article 231 and Article 232 of this Decree.

Section 4. REAL ESTATE INVESTMENT FUNDS

Article 247. Real estate investment funds

1. A real estate investment fund shall be organized in the form of a closed-end fund or public investment company

2. In case the real estate investment fund is organized as a closed-end fund, the offering, establishment, capital increase and decrease, listing, change of operating period, name, fund management company, consolidation, merger, dissolution shall be carried out in accordance with Articles 233 to 240 of this Decree and regulations of this Section.

3. In case the real estate investment fund is organized as a public investment company, the offering, establishment, capital increase and decrease, listing, change of operating period, name, fund management company, consolidation, merger, dissolution shall be carried out in accordance with Articles 257 to 268 of this Decree and regulations of this Section.

Article 248. Conditions for public offering of real estate fund certificates

1. Investors are allowed to contribute capital in the form of real estate during the first offering and follow-on offering of the real estate investment fund. The contributed real estate shall satisfy the following conditions:

a) The conditions specified in the fund’s charter, investment targets and policies of the funds;

b) The real estate is lawfully owned by the investor, is not restricted from transferring; is not being pledged, deposited, put up as collateral, frozen or used in other collateral transactions as prescribed by civil laws;

c) The real estate is permitted for business operation according to regulations of law on real estate business;

d) The real estate is a finished construction work according to construction laws;

dd) In case the real estate is under construction, the real estate investment fund may only receive it as capital contribution if the following conditions are satisfied: there are contracts with prospective customers; the real estate is likely to be sold, used or leased out upon completion; the construction progress is on schedule on the contribution date; the total value of real estate projects in progress of the fund does not exceed 10% of the fund’s total assets; the real estate is not vacant land according to regulations of law on real estate business and the Land Law.

2. Conditions for IPO of fund certificates and follow-on offering of fund certificates by a real estate investment fund:

a) The conditions specified in Article 233 of this Decree are satisfied (if the real estate investment fund is organized as a closed-end fund) or Article 257 of this Decree (if the real estate investment fund is organized as a public investment company);

b) The fund management company has at least 02 employees who have valuators’ cards according to the Law on Prices.

Article 249. Application for public offering of real estate fund certificates

1. The application for IPO of real estate fund certificates shall contain:

a) The documents specified in Clause 1 Article 234 of this Decree are satisfied (if the real estate investment fund is organized as a closed-end fund) or Clause 1 Article 258 of this Decree (if the real estate investment fund is organized as a public investment company);

b) The list and information disclosure sheets of the fund’s valuators according to form No. 91 and 101 in the Appendix hereof and valuators’ cards;

c) The real estate valuation contract between the fund management company and the real estate valuation company according to the Law on Prices (if any);

d) The real estate management contract between the fund management company and the real estate management company (if any).

2. In case real estate is contributed as capital, the application for IPO of real estate fund certificates shall also include the following documents:

a) The list of investors who contribute real estate according to Form No. 103 in the Appendix hereof; the decision on contribution of assets to the real estate investment fund; the commitment to comply with limits on transfer of fund certificates of the competent authority of the contributing organization;

b) Documents about rights to ownership, rights to enjoyment of real estate of the contributing investors according to regulations of law on real estate business, housing and land;

c) The latest financial statement of the contributing organization according to Article 20 of the Law on Securities, or the report of the real estate management organization on the use of the contributed real estate in the latest year which is certified by an independent audit organization;

d) The real estate valuation certificates issued by 02 independent valuation enterprises;

dd) The questionnaire sent to investors that contribute real estate, the prices of contributed real estate.

3. An application for follow-on offering by the real estate investment fund shall contain the documents specified in Clause 2 Article 234 of this Decree are satisfied (if the real estate investment fund is organized as a closed-end fund) or Clause 2 Article 258 of this Decree (if the real estate investment fund is organized as a public investment company). In case there are investors that contribute real estate as capital, the following documents shall also be included:

a) The documents specified in Points a, b, c, d Clause 2 of this Article;

b) The minutes of meeting and resolution of the Investor Assembly, the representative board of the fund on approval for follow-on offering of fund certificates to increase capital of the fund by contributing real estate, including: the investors, contributed real estate, prices of contributed real estate;

c) The report on re-valuation of exiting real estate of the fund, report on net asset value confirmed by the supervisory bank on the date of submission of the application.

Section 5. EXCHANGE TRADED FUND (ETF)

Article 250. Benchmark indexes of ETFs

1. Benchmark indexes of an ETF shall satisfy the following conditions:

a) They are developed and managed by the Stock Exchange;

b) They are developed according to the component securities listed at the Stock Exchange;

c) There are specific and representative targets that reflect the characteristics of the market or the sector. The rules, management and maintenance of these indexes shall ensure that they reasonable reflect the overall fluctuations on the market or in the sector, fluctuations in prices of the component securities, changes in proportions of component securities and types of component securities;

d) The basket of component securities of each index shall be diverse and ensure that: there are at least 10 shares in the basket, the proportion of each share in the basket must not exceed 20% of the value of the index (for shares); there are at least 05 shares in the basket, the proportion of each share in the basket must not exceed 20% of the value of the index (for bonds), except government bonds, treasury bills, government-backed bonds and municipal bonds;

dd) Information about the benchmark indexes and their daily changes must be published daily on the website of the Stock Exchange and the media in accordance with regulations of law on disclosing information on the securities market.

2. The basket of component securities in swap transactions shall satisfy the following conditions:

a) The benchmark index is made up by at least 50% of its underlying securities;

b) The value of the component securities is not smaller than 95% of the value of the corresponding basket of the index.

Article 251. Conditions for becoming a founding member of a fund

1. Being a securities company is licensed for securities brokerage and proprietary trading, or depository bank.

2. In the last 12 years before the application for establishment of the ETF, the securities company is able to maintain a minimum liquidity ratio of 220% or a higher ratio imposed by the fund management company; the depository bank has a capital adequacy ratio that is conformable with banking laws.

3. The contract for establishment of an ETF has been concluded with the fund management company.

4. Other conditions (if any) in the contract are fulfilled.

Article 252. Conditions for IPO and listing of ETF certificates

1. Conditions for IPO of ETF certificates:

a) The conditions specified in Clause 1 Article 233 of this Decree are satisfied;

b) There are at least 02 founding members that satisfy the requirements specified in Article 251 of this Decree;

c) Each investor, funding member subscribes for at least 01 ETF creation unit; at least 10 ETF creation units must be subscribed, or a different number specified in the fund’s charter, as long as the charter capital of the fund is at least 50 billion VND.

2. The fund management company shall list the ETF certificates at the Stock Exchange within 30 days from the effective date of the certificate of ETF registration.

Article 253. Application for IPO of ETF certificates

1. The documents specified in Clause 1 Article 234 of this Decree.

2. The contract between the fund management company and the Stock Exchange for provision of benchmark indexes: the rules for development and management of indexes and documents describing the basket of their component securities, principles and methods for selection of securities in the basket, principles and methods for calculation of the indexes.

3. The fund establishment contracts between the fund management company and founding members enclosed with the establishment and operation license of the securities company or depository bank, the certificate of securities depository of the depository bank, the sheet of liquidity ratios and capital adequacy ratios of the securities company or the depository bank of the last 12 months before the application is submitted and other documents under the contract (if any).

Article 254. Application for establishment of an ETF

1. The capital contributed to establishment of an ETF by founding members and investors shall be component securities. Contribution of money is only permissible for payments of differences between the component securities in the basket and the issue price; payments for component securities the transfer of which by founding members and investors is restricted due to limited foreign ownership ratio; payment of dividends of the component securities.

2. All baskets of component securities of founding members and investors shall be frozen at VSDCC.

3. The application for establishment of an ETF shall contain:

a) The documents specified in Clause 1, Clause 3 Article 235 of this Decree;

b) The report on result of offering of fund certificates of the supervisory bank enclosed with the list of founding members and contributing investors according to form No. 102 in the Appendix hereof;

c) VSDCC’s confirmation of the frozen basket of component securities of each founding member and investor according to form No. 104 in the Appendix hereof.

Article 255. Procedures for issuing, reissuing, revising the certificate of ETF registration

1. The procedures for registration of offering and establishment of an ETF fund shall comply with Clause 1 and Clause 2 Article 239 of this Decree.

2. Documentation and procedures for change of supervisory bank, name, management company, consolidation, merger of ETF shall comply with Clause 2 Article 242, Article 243 and Clause 2 Article 245 of this Decree.

Article 256. Dissolution of an ETF

1. An ETF shall be dissolved in the following cases:

a) The cases specified in Clause 1 Article 104 of the Law on Securities;

b) The ETF is delisted, except voluntary delisting due to change in benchmark indexes.

2. Documentation and procedures for dissolution of ETFs shall comply with Article 246 of this Decree.

Section 6. INVESTMENT COMPANIES

Article 257. Conditions for initial offering and follow-on offering by public investment companies

1. Conditions for IPO of shares by a public investment company:

a) The total value of offered shares is at least 50 billion VND;

b) There is a plan for issuance and use of capital obtained from the offering;

c) The offering is supervised by a supervisory bank;

d) The publicly offered shares are listed at the Stock Exchange after the offering ends;

d) The securities investment fund management company has at least 02 executives of the investment company who have fund management certificates; is not facing warning, put under control, special control or suspension; has implemented all decisions on administrative penalties for violations against securities laws.

2. Conditions for follow-on offering by public investment companies:

a) The investment company’s charter has regulations on follow-on offering and there is a plan for follow-on offering which is approved by the GMS;

b) The company makes a profit in the year preceding the offering year and does not have accumulated loss when the offering is registered;

c) The securities investment fund management company fulfills the conditions specified in Point dd Clause 1 of this Article.

3. The plan for initial offering and follow-on offering of shares contains the mandatory information specified in form No. 99 in the Appendix hereof.

4. Within 30 days from the effective date of the establishment and operation license or the revised establishment and operation license of the public investment company, the securities investment fund management company shall list the shares of the public investment company at the Stock Exchange as per regulations.

Article 258. Documentation and procedures for initial offering and follow-on offering by public investment companies

1. The application for IPO of shares shall contain:

a) The application form No. 100 in the Appendix hereof;

b) The charter of the investment company according to regulations of the Ministry of Finance;

c) The prospectus and summary prospectus according to regulations of the Ministry of Finance;

d) The depository and supervision contract between the supervisory bank and the securities investment fund management company;

dd) The contract for distribution of shares between the securities investment fund management company and distribution agents enclosed with the certificates of registration of fund certificate distribution agent, the report on assessment of facilities at distribution locations by the securities investment fund management company, the contracts in principle with relevant service providers (if any);

e) The list of personnel and executives, personal information sheets according to Form No. 91 and Form No. 105 in the Appendix hereof enclosed with the judicial records of members of the Board of Directors, the Director/General Director that are issued within 06 months before the application is submitted;

g) In case the investment company does not plan to hold the first GMS, the securities investment fund management company shall include documents seeking opinions of investors about: the listing of shares at the Stock Exchange, composition of the Board of Directors, members of the Board of Directors and other issues;

h) The issuance underwriting agreement (if any), advertising documents, introduction of the fund (if any).

2. The application for follow-on offering by a public investment company shall contain:

a) The documents specified in Points a, b, c, h Clause 1 of this Article;

b) The GMS’s resolution to approve the follow-on offering, the plan for issuance and use of capital generated by the offering and the listing of shares at the Stock Exchange when the offering ends;

c) The resolution of the Board of Directors of the company on approval for the application for offering, issuance time, issue price, criteria for identification of eligible buyers in case the issued call options for the issued shares are not completely distributed;

d) The latest annual financial statement that is conformable with Article 20 of the Law on Securities and the company’s profit in which is a positive number without accumulated loss by the application date.

Article 259. Conditions for issuance of the establishment and operation license to a investment company

1. Capital:

a) Actual contributed charter capital shall be at least 50 billion. A public investment company shall authorize a securities investment fund management company to manage its capital. A private investment company may manage its own capital or authorize a securities investment fund management company to manage its capital;

b) All assets of the public investment company shall be deposited at the supervisory bank.

2. There are premises for securities investment operations. The public investment company or investment company may use the premises of the securities investment fund management company that is authorized to manage its capital as its headquarters.

3. Personnel:

a) The public investment company or investment company that authorizes a securities investment fund management company to manage its capital must not recruit personnel and Director/General Director, Deputy Director/Deputy General Director that are executives appointed by the securities investment fund management company.

b) A private investment company that manage its own capital shall have a Director/General Director who meets the requirements specified in Clause 5 Article 75 of the Law on Securities and at least 02 employees having the financial analysis certificate or fund management certificate.

4. Shareholders:

a) The public investment company shall have at least 100 shareholders that are not professional securities investors;

b) A private investment company may have up to 99 shareholders. Shareholders that are organizations shall contribute at least 03 billion VND. Shareholders that are individuals shall contribute at least 01 billion VND. In case of self-management, domestic shareholders shall be organizations that are licensed by securities, banking, insurance authorities or members of the Board of Directors, General Director/Director, Deputy Director/Deputy General Director of the company to be established.

5. At least two thirds of the members of the Board of Directors of the public investment company shall be independent from the securities investment fund management company, supervisory bank.

6. Conditions for contributing assets: shareholders may contribute securities that are being listed, registered, traded at Stock Exchanges in accordance with the charter of the private investment company, and:

a) The securities contributed shall be appropriate for the company’s investment targets and policies; not restricted from transfer, suspended or banned from transaction, or delisted; not being pledged, deposited, frozen or collateralized in other secured transactions as prescribed by law;

b) The contribution of securities must be approved by all shareholders and will only be considered completed after the lawful ownership of these securities has been transferred to the private investment company;

c) The prices of contributed securities shall be determined by the depository bank according to the closing price on the date of completion of ownership transfer at VSDCC and according to the charter of the private investment company.

Article 260. Application for issuance of the establishment and operation license to a public investment company

1. The application form No. 92 in the Appendix hereof.

2. The offering result report according to form No. 102 in the Appendix hereof and the confirmation of the supervisory bank that the revenue from the offering has been frozen and the quantity of shares sold.

3. The list of shareholders according to form No. 105 in the Appendix hereof.

4. The records on opinions of shareholders about designation of members of the Board of Directors and other issues, personal information sheets and judicial records of members of the Board of Directors (if any).

Article 261. Application for issuance of the establishment and operation license to a private investment company

1. The application form No. 92 in the Appendix hereof enclose with the document authorizing a securities investment fund management company or shareholder representative to complete company establishment procedures.

2. The draft charter of the company according to the model charter provided by the Ministry of Finance.

3. The asset depositing contract with the depository bank.

4. The agreement among the shareholders on establishment of the private investment company which specifies the company’s name, the securities investment fund management company (if any), the depository bank, supervisory bank (if any), contributing shareholders and amount of capital contributed by each shareholder.

5. The depository bank’s confirmation of contributed capital, contributed securities (if any), quantities and ticker symbols of securities contributed by each shareholder, date of recording of securities into the depository account of the investment company enclosed with the securities valuation record prepared by the depository bank.

6. The list of shareholders, intended personnel and personal information sheets according to form No. 91 and form No. 105 in the Appendix hereof; the Certificate of Enterprise Registration, decision of the competent authority on contribution of capital to establishment of the investment company of shareholders that are organizations; judicial records of members of the Board of Directors, the Director/General Director that are issued within the last 06 months before the application is submitted.

7. In case the investment company authorizes a securities investment fund management company to manage its capital, the following documents shall also be included: the investment management contract with the securities investment fund management company; the supervision contract with the supervisory bank.

8. In case the investment company manages its own capital, the application shall also contain the premises lease contract, documents about the right to ownership or enjoyment of the premises.

Article 262. Conditions for increase and decrease in charter capital of an investment company

1. The GMS has approved the capital decrease or follow-on offering; the plan for follow-on offering or capital decrease.

2. In case of decrease in charter capital, the company shall ensure that the charter capital after decrease and net asset value are not smaller than 50 billion VND.

3. In case of charter capital increase by follow-on offering of shares or scrip issue, the company shall have adequate sources of financing from share premium and undistributed post-tax profits according to the latest audited or examined financial statement.

4. In case of capital increase by offering or issuance, the company shall comply with regulations on public securities offering (for public investment companies), private placement (for private investment companies) and issuance to existing shareholders.

5. For private investment companies: There are not more than 99 shareholders. Shareholders that are organizations shall contribute at least 03 billion VND. Shareholders that are individuals shall contribute at least 01 billion VND.

Article 263. Application for adjustment of charter capital of an investment company

1. The application form No. 94 in the Appendix hereof.

2. The resolution of the GMS on approval for the increase/decrease in charter capital, the plan for capital increase/decrease and the revised charter of the company.

3. The list of shareholders after adjustment according to form No. 105 in the Appendix hereof.

4. In case of capital decrease, the following documents shall also be included: the report on decrease in charter capital enclosed with the written confirmation issued the depository bank, supervisory bank of the completion of payment to shareholders; quantity of shareholders, quantity of circulating shares after capital decrease.

5. In case of capital increase by offering or issuance, the following documents shall also be included: The follow-on offering result report according to form No. 102 in the Appendix hereof and a written confirmation that the increase in capital has been frozen at the supervisory bank; the list of new investors (if any);

6. The latest annual financial statement which has been audited in accordance with Article 20 of the Law on Securities and the latest financial statement before the application is submitted.

7. The prospectus and company’s charter (if revised).

Article 264. Changes subject to approval by SSC

1. The investment company shall obtain SSC’s approval before making the following changes:

a) Change of name, legal representative;

b) Change of securities investment fund management company, depository bank, supervisory bank;

c) Change of headquarters location for private investment companies managing their own capital;

d) Change in the operating period.

2. The application for approval for the changes specified in Clause 1 of this Article shall contain:

a) The application form No. 94 in the Appendix hereof;

b) The resolution of the GMS on approval for the changes specified in Clause 1 of this Article and the revised charter of the company;

c) The revised charter of the company;

d) In case of change of the legal representative: The personal information sheet according to Form No. 91 in the Appendix; the judicial record of the new legal representative which is issued within the last 06 months before the application is submitted;

dd) In case of change of the securities investment fund management company, depository bank, supervisory bank: The written commitment of the securities investment fund management company to transfer rights and obligations to the substitute company, depository bank, supervisory bank;

e) In case of extension of operating period: the contract with the depository bank, supervisory bank for extension of depository service provision period;

g) In case of relocation of headquarters: the premises lease contract, documents about the right to ownership or enjoyment of the premises.

Article 265. Conditions for consolidation/merger of investment companies

1. There is a plan, contract for consolidation/merger which is approved by the GMS of the participating companies.

2. The consolidated company or acquiring company satisfies the conditions specified in Article 259 of this Decree.

Article 266. Application for approval for consolidation/merger of investment companies

1. The application form No. 94 in the Appendix hereof.

2. The resolution of the GMS of relevant companies on approval for the consolidation/merger plan and contract.

3. The consolidation/merger plan according to form No. 95 in the Appendix hereof.

4. The consolidation/merger contract according to form No. 96 in the Appendix hereof.

5. The depository, supervision contract of the consolidated/acquiring company.

6. The charter of the consolidating /acquiring company.

7. The list of shareholders and personnel of the consolidating /acquiring company according to form No. 105 in the Appendix hereof.

8. The report of the supervisory bank and depository bank on the rules for determination of net asset value, shares swap ration, payment ratio (if any) and other relevant contents.

9. The list of creditors that demand repayment of loans and values thereof; the list of shareholders that demand repurchase of their shares, quantities and values thereof.

10. The written approvals of the Stock Exchange and VSDCC for delisting, deregistration, release of shares of the consolidating/acquired companies (if any).

11. Original establishment and operation licenses of the consolidating/acquired companies.

12. Other documents proving fulfillment of the conditions specified in Article 261 of this Decree.

Article 267. Procedures for issuance and revision of the establishment and operation license of an investment company

1. Procedures for establishment of a public investment company:

a) The securities investment fund management company shall send the application for public offering of shares by the investment company to SSC;

b) Within 30 days from the receipt of the satisfactory application, SSC shall issue the certificate of public offering of shares. In case the application is rejected, SSC shall issue a written rejection and provide explanation;

c) Within 10 days from the ending date of the offering, the securities investment fund management company shall submit a report on the offering result and the application for issuance of the establishment and operation license to the investment company to SSC.

2. In case of establishment of a private investment company, after completion of technical facilities, personnel and freezing of capital at the depository bank, the securities investment fund management company or the representative of shareholders shall submit the application for issuance of the establishment and operation license to the investment company to SSC.

3. Within 30 days from the receipt of the satisfactory application, SSC shall issue the establishment and operation license to the investment company. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

4. The securities investment fund management company shall complete the documentation for listing of shares of the public investment company on the Stock Exchange within 30 days from the effective date of the establishment and operation license of the public investment company.

5. Procedures for increasing/decreasing charter capital:

a) At least 30 days before the day on which the GMS is convene to approve the plan for follow-on offering, the investment company shall send the plan to SSC. Within 15 days from the receipt of the plan, SSC shall decide whether to issue a written approval or issue a written rejection and provide explanation;

b) The investment company shall follow procedures for public offering of shares (for public investment companies) or private placement (for private investment companies) in accordance with securities laws and enterprise laws;

c) Within 10 days from the ending date of the follow-on offering, the company shall submit the offering report and the application for adjustment of charter capital to SSC. Within 15 working days from the receipt of the satisfactory application, SSC shall issue the revised establishment and operation license. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

6. Procedures for making the changes specified in Clause 264 of this Article:

a) Within 05 working days from the day on which the GMS approves the changes, the investment company shall submit the application for approval for the changes to SSC;

b) Within 15 days from the receipt of the satisfactory application, SSC shall issue the revised establishment and operation license to the investment company. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

7. Procedures for consolidation/merger:

a) Within 30 days from the day on which the GMS of the last investment company approves the consolidation/merger, the investment company shall submit the application for approval for the consolidation/merger to SSC;

b) Within 30 days from the receipt of the satisfactory application, SSC shall issue a decision to approve the consolidation/merger. In case the application is rejected, SSC shall issue a written rejection and provide explanation;

c) Investment companies shall be consolidated/merged in accordance with the Law on Securities and the Law on Enterprises. In case the consolidation/merger is combined with private placement of shares or public offering of shares, the investment companies shall comply with relevant regulations on relevant regulations on offering;

d) Within 30 days from the date of consolidation/merger, the investment company shall submit a consolidation/merger result report enclosed with the supervisory bank’s confirmation of total assets, total debts, net asset value on the date of consolidation/merger, conversion ratio, cast payment ratio (if any);

dd) Within 10 days from the receipt of the satisfactory report, SSC shall issue the new or the revised establishment and operation license to the consolidated/acquiring investment company. In case the application is rejected, SSC shall issue a written rejection and provide explanation.

Article 268. Documentation and procedures for dissolution of an investment company

1. A investment company shall be dissolved in one of the cases specified in Clause 1 Article 104 and Clause 1 Article 114 of the Law on Securities.

2. Within 03 months before the dissolution date prescribed in Point a and Point b Clause 1 Article 104 of the Law on Securities or within 30 days from the date of occurrence of the event that causes the dissolution as according to in Points c, d, dd and e Clause 1 Article 104 of the Law on Securities, the Board of Directors of the investment company shall convene the GSM to approve the dissolution plan.

3. Within 15 working days from the day on which the GMS approves the dissolution plan, the Board of Directors of the investment company shall submit the application for dissolution to SSC. The application shall include:

a) The application form No. 97 in the Appendix hereof;

b) The minutes of meeting and resolution of the GMS on approval for the dissolution of the investment company and the dissolution plan;

c) The dissolution plan according to form No. 95 in the Appendix hereof;

d) The written commitment of the securities investment fund management company (if any), depository bank, supervisory bank (if any) to complete all procedures for liquidation of assets serving the dissolution of the investment company.

4. Within 15 days from the receipt of the satisfactory application, SSC shall issue a notice of receipt of the dissolution plan. In case of rejection, SSC shall issue a written response and provide explanation.

5. The investment company shall follow procedures for dissolution specified in the Law on Enterprises.

6. Within 05 working days from the day on which the dissolution is completed, the Board of Directors shall submit the following documents to SSC:

a) The dissolution result report according to Form No. 98 in the Appendix hereof; confirmation of the securities investment fund management company, depository bank, supervisory bank (if any), audit organization, Board of Directors of the investment company of liquidation of the company’s assets, distribution of the company’s assets among shareholders under the plan approved by the GMS; total revenue obtained from liquidation of assets; total debts payable, including financial obligations to the State and remaining assets to be distributed among shareholders; the list of creditors and paid debts, including tax debts;

b) The original establishment and operation license of the investment company;

c) The report on appraisal of liquidation result prepared by an audit organization appointed by the GMS, Board of Directors of the investment company (if any);

d) Documents of the depository bank, supervisory bank (if any) and securities investment fund management company specifying the money and assets distributed to each shareholder and confirmations of the shareholders that they have fully received the money and assets under the dissolution plan approved by the GMS or confirmation of VSDCC that securities have been distributed among shareholders as requested by the securities investment fund management company, depository bank, supervisory bank (if any) and investors; confirmation of the shareholder register management organization, the issuing organization and the enterprise receiving capital from the fund that ownership of shares/stakes has been transferred to each shareholder as requested by the securities investment fund management company.

7. Within 15 days from the receipt of adequate and satisfactory documents, SSC shall issue the decision to revoke the establishment and operation license of the investment company.