Chương 5 Nghị định 48/1998/NĐ-CP: Quỹ đầu tư chứng khoán và công ty quản lý quỹ

Chapter V

A SECURITIES INVESTMENT FUND AND A FUND MANAGEMENT COMPANY

Article 44.- Participating parties

1. Parties participating in the activities of a securities investment fund shall include a fund management company, a supervisory bank and investors.

2. The fund management company shall manage the securities investment fund.

3. The supervisory bank shall conduct the maintenance and custody of the assets of the securities investment fund and supervise the fund management company in protecting the benefits of investors.

4. Investors shall contribute capital to the securities investment fund and benefit from the investment by such securities investment fund.

Article 45.- The fund management company

1. Fund management companies must be granted operation licenses by the State Securities Commission.

2. To be granted an operation license, a fund management company must:

a) Be a joint stock company or a limited liability company established under the provisions of law and have a legal capital of VND 5 billion;

b) Have a contingent of professional personnel trained in the field of securities, have material and technical facilities to serve the fund management in accordance with regulations of the State Securities Commission;

c) Have managers to run the fund management company and the fund, who have been granted securities business practising licenses by the State Securities Commission.

3. A fund management company's dossier of application for an operation license shall comprise:

a) An application for license;

b) The permit for establishment of the company (if any);

c) The statute of the company;

d) Other documents prescribed by the State Securities Commission.

Article 46.- The procedures and time limit for granting operation licenses to fund management companies

1. Dossiers of application for operation licenses of fund management companies shall be submitted to the State Securities Commission. Within 90 days from the date of receipt of complete dossiers of application for operation licenses from fund management companies, the State Securities Commission shall either grant or refuse to grant licenses. In cases of refusal to grant licenses, the State Securities Commission shall have to clearly state the reasons therefor in writing.

Article 47.- The rights and obligations of the fund management companies

A fund management company shall have the following rights and obligations:

1. To apply for the establishment or dissolution of a securities investment fund;

2. To select and realize capital investment objectives of the securities investment fund;

3. To pay dividends and capital interests gained from assets of the securities investment fund to investors;

4. To manage one or several securities investment funds;

5. To provide securities investment consultancy after being granted license therefor by the State Securities Commission;

6. To conduct other operations in the interest of investors;

7. To be entitled to receive fees and bonuses in accordance with the fund's charter.

Article 48.- The restrictions on operation of a fund management company

1. A fund management company shall only be allowed to invest capital of a securities investment fund in securities or other assets in accordance with the fund's charter;

2. A fund management company shall not be allowed to use capital and assets of a securities investment fund for investment which exceeds 15% of the total value of the circulating securities of an issuing organization and not be allowed to use more than 10% of the total asset value of a securities investment fund to invest in the circulating securities of an issuing organization.

3. A fund management company shall not be allowed to use the capital and assets of all securities investment funds under its management for investment which exceeds 49% of the total value of circulating securities of an issuing organization.

4. A fund management company shall not be allowed to use capital and assets of a securities investment fund to lend or guarantee for any loan and not be allowed to borrow to finance the fund, except for short-term borrowings to cover necessary expenditures.

5. A fund management company shall have to abide by other restrictions imposed by law in order to ensure the benefits of investors and securities issuing organizations.

Article 49.- The granting and withdrawal of practitioner licenses

The granting and withdrawal of securities business practising licenses of managers of a fund management company and a securities investment fund shall comply with the provisions of Articles 40, 41, 42 and 43 of this Decree.

Article 50.- Dossiers of application for setting up of funds

In order to set up an investment fund and issue investment fund certificates, a fund management company shall have to submit to the State Securities Commission an application dossier comprising:

1. The application form;

2. The charter of the fund;

3. The contract for management and supervision of the fund;

4. The prospectus.

Article 51.- The procedures and time limit for granting licenses to set up funds

Dossiers of application for licenses to set up securities investment funds shall be submitted to the State Securities Commission. Within 45 days from the date of receipt of complete dossiers of application for licenses to set up securities investment funds, the State Securities Commission shall grant or refuse to grant licenses. In cases of refusal to grant licenses, the State Securities Commission shall have to clearly state the reasons therefor in writing.

Article 52.- The payable fees

A fund management company shall have to pay to the State Securities Commission the following fees:

1. The fee for granting an operation license to the fund management company, equal to 0.2% of its legal capital.

2. The fee for granting a license to set up a securities investment fund equal to 0.02% of the total value of the issued certificates, but not exceeding VND 50 million.

Article 53.- The issuance of investment fund certificates

The issuance of investment fund certificates shall comply with the provisions of Articles 12 and 13 of this Decree.

Article 54.- The suspension of issuance of investment fund certificates and withdrawal of licenses to set up funds

The suspension of issuance of investment fund certificates shall comply with provisions of Article 15 of this Decree. The withdrawal of licenses to set up securities investment funds shall comply with Point (a), Clause 1 and Clause 2 of Article 16 of this Decree

Article 55.- The conditions to be met by a supervisory bank

A supervisory bank must meet the following conditions:

1. Having been granted the establishment and operation license by the State Bank of Vietnam;

2. Having been granted the securities custody license by the State Securities Commission;

3. Being a bank independent from the concerned fund management company;

4. Not possessing any assets of the concerned securities investment fund.

Article 56.- The responsibilities of a supervisory bank

1. A supervisory bank shall have the following responsibilities:

a) To preserve assets of the concerned securities investment fund and separate the securities investment fund's assets from other assets.

b) To inspect and supervise investment decisions made by the fund management company and ensure their compliance with laws and the charter of the fund, to protect the interests of the investors.

Article 57.- The interests of investors

An investor shall benefit from investment operations of the securities investment fund but not directly exercise the rights over and perform the obligations toward assets included in the securities investment fund's portfolio.

Article 58.- The financial, accounting and reporting regimes

1. Fund management companies shall have to comply with the accounting and financial regimes prescribed by laws.

2. Fund management companies and supervisory banks shall have to abide by the reporting regime stipulated by the State Securities Commission.

Article 59.- The suspension of operation and withdrawal of operation licenses

1. A fund management company may be suspended from operation for a maximum period of 60 days in the following cases:

a) It has ceased its operation without any plausible reason(s) and written approval of the State Securities Commission;

b) It violates the stipulations in Articles 48 and 58 of this Decree.

c) It is no longer able to meet the conditions prescribed in Clause 2, Article 45 of this Decree.

2. A fund management company shall have its operation license withdrawn in the following cases:

a) It fails to mend its violation within the period of operation suspension;

b) It fails to commence its operation within 12 months from the date of being granted operation license;

c) It voluntarily terminates its operations or dissolves or goes bankrupt;

d) It violates stipulations in Articles 69, 70, 71, 72 and 73 of this Decree.

3. A supervisory bank which breaches commitments in the contract for fund management and supervision shall be dealt with in accordance with the provisions of Article 64 of this Decree.