Chương I Nghị định 86/2016/NĐ-CP: Những quy định chung

Chapter I

GENERAL PROVISIONS

Article 1. Scope and regulated entities

1. This Decree deals with requirements for investment and trading in securities that organizations or individuals must satisfy when conducting investment and trading in Vietnamese securities market.

2. This Decree applies to securities companies, fund management companies, investment companies, branches of foreign securities traders in Vietnam, depository members, trading members, paying bank(s), supervisory banks, Stock Exchange (SE), the Vietnam Securities Depository (VSD) and relevant agencies, organizations, and individuals on the Vietnamese securities market.

Article 2. Interpretation of terms

For the purposes of this Decree, these terms below shall be construed as follows:

1. Security company means an enterprise that is established and operates under law on securities to do business with one, some or all kinds of the following services: Securities brokerage, proprietary trading, securities underwriting, securities investment consultancy and financial services in accordance with the law on securities.

2. Fund management company means an enterprise that is established and operates under law on securities to do business with the following services: Management of securities investment fund, management of securities investment portfolio and securities investment consultancy.

3. Foreign securities traders includes securities companies and fund management companies established in foreign countries.

4. Branch of foreign securities company or fund management company in Vietnam is an unit which is affiliated to the foreign securities company or fund management company, has no legal status and is permitted to provide securities services in Vietnam.

5. Margin trading means practice of buying securities with money borrowed from a securities company, in which the purchased securities and other marginable securities of the customer then serve as collateral for the loan.

6. Day trading means practice of buying and selling the same security with the same volume, on the same account and within the same trading day.

7. Paying bank means a bank that provides payment process services for securities exchange on SE.

Article 3. General regulations on securities investment and trading

1. Any organizations or individuals, upon the establishment or during the investment and trading on the Vietnamese securities market, must conform and maintain requirements prescribed in this Decree and other requirements for investment and trading in securities (if any) prescribed in the Law on Securities and Decrees of the Government.

2. During the operation, if there is any changes to business service(s), name(s), business location(s), charter capital, legal representative(s) or head(s) of a securities trader, a branch of a securities trader, a branch of a foreign securities trader in Vietnam or restructuring of a securities trader, regulations on law on enterprises must be complied and such change or restructuring must be adopted by the General Meeting of Shareholders, Board of Directors, Member assembly or owner(s) of such entity in accordance with law on the Law on Securities and be registered with State Securities Commission (hereinafter referred to as SSC).

3. Procedures for investment and trading in securities on Vietnamese securities market applicable to domestic and foreign organizations or individuals shall be in accordance with law on securities.

Article 4. Requirements applied to foreign organizations holding 51% or more charter capital of securities traders in Vietnam

A foreign organization is permitted to hold 51% or more charter capital of securities traders in Vietnam when the following requirements are satisfied:

1. Regulations in Clause 6, 10 Article 71 of the Government's Decree No. 58/2012/ND-CP dated July 20th 2010 on guidelines for the Law on Securities and the Law on amendments to the Law on Securities (hereinafter referred to as the Decree No. 58/2012/ND-CP) and Clause 21, 24 Article 1 the Government's Decree No. 60/2015/ND-CP dated June 26, 2015 amendments to the Decree No. 58/2012/ND-CP (hereinafter referred to as the 60/2015/ND-CP).

2. The purchase of shares or stakes to hold 51% or more of charter capital of a securities trader in Vietnam is adopted by the General Meeting of Shareholders, the Board of members or owner(s) of the foreign organization.

3. The purchase of shares or stakes to hold 51% or more of charter capital of a securities trader in Vietnam by a foreign organization is adopted by the General Meeting of Shareholders, the Board of members or owner(s) of the securities trader in Vietnam, unless the foreign organization makes a tender offer as prescribed in law on securities.

4. Only owner’s equity and other legal sources of funds are used to buy shares or stakes and the foreign organization is not in the case of ownership restriction as prescribed in Point c Clause 7 and Point c Clause 8 of Article 71 of 58/2012/ND-CP.

5. The annual financial statement up to the latest submission of foreign organization (or the latest consolidated financial statement in case where the foreign organization is the parent company) is prepared and audited as prescribed in foreign law in conformity with international accounting and auditing standards.

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