Chương II Thông tư 228/2012/TT-BTC: Quỹ đầu tư bất động sản dưới hình thức quỹ đóng

Chapter II

REAL ESTATE INVESTMENT TRUSTS EXISTING IN A FORM OF CLOSED-END FUND

Section 1. OFFERING OF STOCK CERTIFICATES AND FUND ESTABLISHMENT

Article 3. General provisions regarding real estate investment trusts

1. Name of a trust must be subject to laws on enterprises, Vietnamese-writable and likely to contain numerals, symbols, pronounceable and must contain at least two factors as follows:

a) The phrase “real estate investment trust”;

b) Proper name.

2. State regulatory authorities and Vietnam's armed forces shall not be allowed to make equity investment in or purchase stock certificates of real estate investment trusts. Equity contributions to establishment and purchases of stock certificates of real estate investment trusts by credit institutions, insurance firms, securities trading organizations and single-member limited liability companies shall be subject to relevant specialized laws.

3. In cases where the charter of a real estate investment trust agrees that an investor may own more than 49% of its charter capital, the trust must register its stock code according to laws and shall be bound by laws on ownership restrictions as applied to foreign investors.

4. Public disclosure of activities of a real estate investment provided herein shall be made via means of mass communication below:

a) Website of the fund management company. Information to be made available to the public includes information about offering and additional issue of shares; other information, where necessary, may be publicized on both of the electronic information webpages administered by supervisory banks and distributing agencies;

b) Means of mass media run by the Securities Depository and Stock Exchanges;

c) Other mass media, subject to provisions of laws on release of information on the securities market.

5. The Charter of a real estate investment trust that is initially issued may be drawn up by its management company by using the form given in the Appendix No.05 hereto. It shall be considered that investors agree with such Charter by registering purchase of its stock certificates. In order to make any amendment or supplement to the Charter of the trust, the fund management company must collect opinions from investors in the general meeting. If allowed by the trust’s Charter, the fund management company shall be entitled to make amendment and revision to syntactic, grammatical or spelling errors contained in the trust's Charter to the extent of not causing any impact on contents of the Charter. In such case, it shall be unnecessary to collect investor’s opinions from the investors' general meeting. After the trust’s Charter is amended or supplemented, the fund management company must inform investors of such amendments or supplements.

6. The fund management company shall prepare and provide investors with the prospectus or the summary prospectus containing all information described in the form given in the Appendix No.06 and No.07 hereto. The prospectus or the summary prospectus may be updated whenever important information arises or may be updated periodically at the frequency rate specified in the trust’s Charter. The prospectus or the summary prospectus must be easy to understand, restrict use of professional terms and must be published on the electronic information webpage of the fund management company as well as be provided free for investors at their request.

7. The trust’s property shall be owned by investors making equity participations or holding stock certificates in the trust based on the percentage of contributed capital, but not possessed by the fund management company or supervisory bank. Fund management companies may use the trust’s property for the only purpose of settling the trust’s financial obligations, but shall not be allowed to use such property as payments or security for liabilities and other payment obligations of their own or other persons or entities in any form and circumstance.

Article 4. Registration of offering and additional issue of real estate investment trust’s stock certificates

1. The public offering and issue of stock certificates includes the initial public offering thereof for the purpose of pooling funds for establishment of a trust and the additional issue thereof for the purpose of increasing capital.

2. The initial public offering of stock certificates of a trust must be registered by its fund management company at the State Securities Commission and shall be subject to the following regulations:

a) Such offering shall be subject to provisions laid down in clause 3 of Article 12 in the Law on Securities;

b) The fund management company must have adequate capital and personnel serving the needs of administration of the real estate investment trust under laws on establishment, organization and operation of fund management companies; must not be put under the operational control, special administration, subject to decisions on temporary suspension, closure or must not be carrying out procedures for business merger, acquisition, dissolution or bankruptcy;

c) The fund management company must not be in the state of being subject to penalties for violations against regulations regarding the securities sector in which all required sanctions and remedial actions have not yet been fully carried out according to penalty decisions of competent state authorities.

3. The additional issue of stock certificates of a trust must be registered by its fund management company at the State Securities Commission and shall be subject to the following regulations:

a) Such issue must conform to requirements set out in clause 1 and 2 of Article 94 in the Law on Securities;

b) There must be a plan for issue of stock certificates and use of capital which is ratified in the latest investors' general meeting. The issue plan must be composed of the followings:

- Information about percentage of share purchase rights; principles and methods of determination of issue prices; degree of post-issue dilution of stock certificates; methods of determination of issue prices; percentage of successful issues or minimum proceeds from issues and actions that may be taken in case of failure to reach successful issue percentage or gain expected minimum proceeds; criteria for selection of selling investors and methods of determination of requirements for offer for sale in case of failure to distribute all of stock certificates expected to be additionally issued;

- Information about alternatives for use of capital; goals, plans and schedules of capital disbursement (if any); total investment value, information about real property proposed to receive investment (if any) according to provisions laid down in point b of clause 4 of Article 14 herein.

c) Stock certificates shall only be issued to existing investors in the trust through issue of rights to purchase stock certificates. Rights to purchase stock certificates may be transferred. In cases where existing investors give up their rights to purchase stock certificates, the trust’s fund management company can offer them for sale to other investors;

d) Issue documents, time and price levels, criteria for assessment of eligibility of target buyers and buyers eligible to receive offers for sale in case of failure to distribute all of rights to purchase of intended stock certificates shall be subject to approval of the trust’s representative board.

4. Application package for offer for sale of stock certificates of a real estate investment trust, including:

a) Application form for public offering of stock certificates prepared by using the form given in the Appendix No. 01 hereto;

b) Trust’s Charter;

c) Prospectus or summary prospectus;

d) Agreements in principle on deposit and monitoring of stocks with the supervisory bank; agreements in principle on appraisal of stocks signed with appraisal bodies (if any); agreements in principle on management of real estate signed with real estate management bodies (if any); agreements in principle on distribution of stock certificates entered into between the trust's fund management company and distributing agencies;

dd) List of operations staff working at the department of management of the real estate investment trust meeting regulations laid down in clause 2 of Article 3 herein, enclosing personal documents and the following documents:

- Legitimate copy of certificate of practice in fund management (if any) or other certificates prescribed by laws on establishment, organization and operation of the trust’s fund management company;

- Legitimate copy of valuer’s ID card, valid copy of real estate appraisal credentials prescribed by laws on real estate business, or any proof of pass in valuer’s tests in relevant subjects, including: (i) Price formation bases; (ii) Principles and methods of appraisal; (iii) Real estate appraisal; (iv) Corporate valuation, enclosing any document proving that the holder has acquired at least two (02) years of experience in real property valuation at real estate businesses, real estate service providers and appraisal enterprises;

e) Any firm commitment.

5. Application package for additional issue of stock certificates, including:

a) Documents referred to in point a, b and c of clause 4 of this Article, including the trust's Charter, which prescribe increase in the trust's capital stock;

b) Minutes and resolution of an investors’ general meeting that state approval of offer for sale of additional stocks for the purpose of raising the trust's capital, plans for issue of stocks and use of its share capital; minutes and resolution of the trust’s representative board that state approval of application documents for offer for sale of stocks and other matters specified in point d of clause 3 of this Article;

c) Financial statement of the year preceding the year of submission of application for additional issue of stock certificates which is audited by an approved auditing body and ensures that the trust’s profit earned within that year must be positive;

d) Report on results of valuation and revaluation, certificates of valuation of the trust’s existing real property or real property in which the trust intends to put their investments (if any), enclosing remarks of legal advisory bodies on the legal status concerning ownership of real property in which intended investments may be made and extent of regulatory compliance of real estate contracts to be effected; report on the trust’s net asset value endorsed by the supervisory bank that is made at the time of submission of application package.

6. Application package for the trust’s initial public offering or additional issue of stock certificates, as prescribed in clause 4 and 5 of this Article, may include one (01) original, enclosing electronic data files. The original set of application package shall be sent directly to the State Securities Commission or by post.

7. Fund management company shall have the burden of ensuring that information contained in an application package is correct, authentic, does not cause any misunderstanding, and it shows important matters that may influence an investor's decision. During the processing stage, the trust’s fund management company shall be charged with updating, modifying and revising the submitted application package in case of detecting any incorrect information, realizing any issue that arises or discovering any omission of material information required by regulations in force, or reckoning that it is necessary to give explanations about any issue that are likely to cause misinterpretation. All modifications or revisions must bear signatures of persons already signing their names in the submitted application package or persons holding the same office as the former's or legal representatives of the fund management company.

With respect to additional issue of stock certificates, any amendment, modification or revision must be publicly informed under the provisions of clause 4 of Article 3 herein.

8. During the period of processing and consideration of application package by the State Securities Commission, the fund management company and its related persons shall be obliged to use information given in the prospectus submitted to the State Securities Commission in an honest and correct manner in market surveys and, while doing so, must clarify that such information is unofficial. Such information must be provided via means of mass media.

9. Within thirty (30) days of receipt of the full and valid application package as prescribed in clause 4 and 5 of this Article, the State Securities Commission must issue the certificate of initial public offering of stocks or the certificate of additional issue of stocks. In case of rejection, the State Securities Commission shall be obliged to respond in writing with clear reasons for such rejection.

10. The certificate of initial public offering of stocks or the certificate of additional issue of stocks awarded by the State Securities Commission to the fund management company shall be treated as a written document confirming that the application package for offer for sale and issue of stocks has conformed to regulatory requirements and procedures.

Article 5. Offer for sale and distribution of stocks of a real estate investment trust

1. The public offering of stocks may take place only after obtaining the certificate of registration of offering of stocks from the State Securities Commission.

2. Within seven (07) days after the effective date of the certificate of registration of offering of stocks, the fund management company must publicize the notice of offer as provided in clause 4 of Article 3 herein and concurrently send it to the State Securities Commission. The notice of offer must contain all information required in the Appendix No. 02 hereto.

3. The fund management company, distributing agency and body underwriting issue of stocks (if any) must distribute stocks in a fair and public manner and must ensure that investors may register purchase of stocks within the duration of twenty (20) days; such duration must be specified in the notice of offer.

In case the number of stock certificates registered by potential holders exceeds the number of stock certificates offered for sale, the fund management company shall be obliged to distribute all of stock certificates obtaining permission for offer for sale to investors, depending on the ratio of purchase registration by each investor.

4. All of investor’s contributed capital must be frozen at a separate account opened at a supervisory bank and may only be released after the effective date of the trust’s establishment registration certificate. The supervisory bank shall be responsible for paying interest to the trust at the minimum rate equaling the floating interest rate which is applied during the capital freezing duration.

5. The fund management company shall be obliged to finish distributing stock certificates within ninety (90) days from the effective date of the certificate of registration for public offering of stocks. In case of failure to do so within such duration, the fund management company must request the State Securities Commission in writing for its decision on extension of the duration of distribution of stock certificates.

Within seven (07) days of receipt of the fund management company’s request, the State Securities Commission shall consider granting its decision on an extension of the duration of distribution of stock certificates which is, however, restricted to thirty (30) days. In case of rejection, the State Securities Commission shall be obliged to respond in writing with clear reasons for such rejection.

6. Within three (03) days after the date of completion of an offer or upon expiry of the certificate of registration of offering of stocks, the fund management company must inform the State Securities Commission and simultaneously make public disclosure of information as provided in clause 4 of Article 3 herein about the trust’s incompliance with establishment requirements in either following cases:

a) Fewer than 100 investors purchase stock certificates, excluding professional securities investors; or

b) Total value of share capital is less than fifty (50) billion Vietnamese dong or less than the required minimum value of share capital expected to be raised according to the trust’s Charter (if any).

7. In case of incompliance with trust establishment requirements specified in clause 6 of this Article, within the time limit of fifteen (15) days from the date of completion of an offer or upon expiry of the certificate of registration of offering of stocks, the fund management company must refund investors all of their contributed capital, including any interest amounts that may arise, and must be liable for costs incurred from such capital mobilization.

8. Suspension or cancellation of an offering shall be subject to provisions laid down in Article 22 and 23 in the Law on Securities.

9. With respect to additional issues of stock certificates for the purposes of capital increase, processes and procedures for issuing the notice of issue or distribution of rights to purchase stock certificates shall be subject to provisions laid down in clause 1, 2, 3, 4 and 5 of this Article and others of relevant laws on securities, applicable to listed organizations and other relevant corporate laws.

Article 6. Registration for establishment of real estate investment trusts, adjustment to certificates of registration of establishment of real estate investment trusts

1. Within ten (10) days after completion of offering of stocks or upon expiry of certificate of registration of offering of stocks, the fund management company must submit application package for registration of establishment of the trust to the State Securities Commission, including:

a) Application form for grant of the certificate of registration of establishment of the trust, which is completed by using the form given in the Appendix 04 hereto;

b) Report on results of an offering of stocks which is made under the provisions of the Appendix No. 03 hereto, enclosing a document stating the supervisory bank's confirmation of the amount of capital already raised in each offering and the number of investors making their equity participation.

2. In case of the additional issue of stock certificates for the purpose of raising capital, within five (05) days after end of each issue, the fund management company shall request the State Securities Commission to adjust the certificate of registration of establishment of the real estate investment trust. Application package for adjustment to the certificate of registration of establishment of the real estate investment trust must include documents referred to in clause 1 of this Article.

3. Application package for registration of establishment of the trust and adjustment to the certificate of registration of establishment of the real estate investment trust must be made into one (01) original set, enclosing an electronic data file. The original set of application package shall be sent directly to the State Securities Commission or by post.

4. Within ten (10) days of receipt of the adequate and valid set of application documents, the State Securities Commission shall issue the certificate of registration of establishment of the trust or the adjusted one. In case of rejection, the State Securities Commission shall be obliged to respond in writing with clear reasons for such rejection.

Article 7. Recognition of ownership of stock certificates

1. Within five (05) days from the effective date of the certificate of registration for establishment of the trust or of the adjusted one, the fund management company shall be responsible for recognizing an investor’s ownership of the number of stocks that that have already purchased and creating the register of investors, containing the following main information:

a) Name and address of the main office of the fund management company; name and address of the main office of the supervisory bank; the trust’s full name; the trust’s ticker symbol used on a stock market (if any);

b) Total authorized number of stock certificates; total stock certificates already sold and total share capital raised;

c) List and information about ownership of investors using the form specified in the Appendix No. 08 hereto;

d) Date of creation of the register of investors.

2. Information about investors in the register is a basis to authenticate that investor’s ownership of stock certificates.

3. Within ten (10) days after the effective date of the certificate of registration for establishment of the trust, the fund management company must finish registering and depositing stock certificates according to laws on securities registration and depositing.

4. Within forty five (45) days from the date on which the State Securities Commission gives its written recognition of the validity of the certificate of registration for establishment of the trust, the fund management company must file the followings to the State Securities Commission:

a) Meeting minutes or report on vote counting and resolution of the investors’ general meeting on the trust's representative board and members of the trust's representative board;

b) List and personal profiles of members of the representative board;

c) Contract with a supervisory bank, appraisal body or real estate management entity which has already been ratified and adopted.

Article 8. Listing of stock certificates of real estate investment trusts

1. Within thirty (30) days from the effective date of the certificate of registration for establishment of a trust or the adjusted one, the trust's fund management company must prepare a complete set of documents and list stocks on a stock exchange according to provisions of laws.

2. By registering purchase of the trust’s stocks, it shall be considered that they agree with listing of their stocks. If prescribed by the trust’s Charter and already announced in the prospectus, it shall be unnecessary to collect opinions from the investors’ general meeting on an additional issue of stocks, even including the additional listing of stocks carried out after implementation of business merger and acquisition procedures.

Section 2. INVESTMENTS OF REAL ESTATE INVESTMENT TRUSTS

Article 9. Investment portfolios and investments of real estate investment trusts

1. Investment portfolios of a real estate investment trust must correspond to investment goals and policies already prescribed in the trust’s Charter and announced in the trust’s prospectus. Each investment portfolio of the trust shall include the following assets invested in Vietnam:

a) Deposits made at commercial banks according to banking laws;

b) Money market instruments, including valuable papers and negotiable instruments stipulated in banking regulations;

c) Government bonds, Government-guaranteed bonds and municipal bonds;

d) Listed shares, registered stocks and bonds listed on Vietnamese stock exchanges;

dd) Unlisted shares, unregistered shares of listed companies; unlisted bonds of issuing organizations operating under domestic laws of Vietnam; shares of joint-stock companies or equity contributions to limited liability companies;

e) Securities and other assets prescribed according to laws and instructions given by the Ministry of Finance;

g) Real property meeting regulations laid down in clause 4 of this Article.

2. The trust’s fund management company may make deposits and invest in money market instruments specified in point a and b of clause 1 of this Article at commercial banks approved by the trust’s representative board.

3. The composition of investments in the trust’s portfolio must meet the following regulations:

a) Investing between at least sixty five percents (65%) and one hundred percents (100%) of net value of the trust’s assets in real property under the provisions of clause 4 of this Article;

b) Prohibiting investment of greater than thirty five percents (35%) of net value of the trust’s assets in those property referred to in point a, b, c, d, dd and e of clause 1 of this Article and ensuring investments are subject to the following restrictions:

- Prohibition against any investment of more than five percents (5%) of total value of the trust’s assets in securities of an issuing organization, except Government bonds;

- Prohibition against any investment in more than ten percents (10%) of total outstanding stocks, except Government bonds;

- Prohibition against any investment of more than ten percents (10%) of total value of the trust’s assets in issued stocks of companies having ownership relationships;

c) Total value of borrowed funds of the trust does not exceed five percents (5%) of net value of the trust’s assets at the investing time;

d) Prohibition against using the fund’s capital and assets for lending and loan guarantee purposes, except investment made in a form of deposit as provided in point a of clause 1 of this Article; prohibition against using the fund's assets to perform such transactions as margin trading (i.e. borrowing funds for purchase of securities) and short selling (i.e. lending securities for sale thereof);

dd) Prohibition against any investment in stocks of that trust, any investment in securities investment funds and securities investment companies established and operated in Vietnam;

e) If the trust is registered as a foreign investor according to clause 3 of Article 3 herein, during their investments, the trust must comply with relevant laws on restricted ownership interests of foreign investors.

4. A real estate investment trust shall be allowed to invest in real estate if it meets the following requirements:

a) Such real estate is the one obtaining marketing authorization under laws on real estate business. Real estate in which the trust invests must be located in Vietnam, may be used for rent or for the purpose of earning proceeds and must meet other regulations specified in the Decree No. 58/2012/ND-CP;

b) Real estate in which the trust invests must be a house or construction project which is completed under construction laws. With respect to real estate under construction, the trust may invest in such real estate if the following requirements are met:

- Such real estate is not an empty land lot where none of construction projects are developed according to laws on land and associated real property business;

- Such real estate is a construction project completed on schedule at the time of the trust’s making capital contribution;

- The trust has entered into real estate contracts with potential customers, making sure that the contractual real estate is able to be traded, used or leased immediately after completion;

- The aggregate value of an item under construction does not exceed 10% of total asset value;

5. Difference between proportions of investment components in the trust’s portfolio and restriction on investment proportions may be permissible according to provisions laid down in point a, b and c of clause 3 of this Article and due to the following causes:

a) Any fluctuation in market prices of assets listed in the trust’s investment portfolio occurs;

b) Allowable payments are made by the trust;

c) Merger, acquisition, purchase of the trust’s shares or public offer to purchase securities of issuing bodies takes place;

d) The trust has just been granted registration for its establishment or adjusted its capital or undergone corporate splitting, consolidation and acquisition for the maximum period of 6 months from the effective date of the certificate of registration for establishment of the trust or the adjusted one;

dd) The trust is going into liquidation.

6. Within one (01) year from the date on which such difference arises due to causes specified in point a, b and c of clause 5 of this Article, the trust's fund management company must adjust its portfolio, ensuring conformance to regulations laid down in clause 3 of this Article.

7. In cases where the difference arises owing to the fund management company's incompliance with investment restrictions prescribed in laws or the trust's Charter, the fund management company must immediately adapt the investment portfolio to conform to laws. The fund management company shall be liable to compensate for the trust's losses (if any) and incur any cost related to such adjustment to the trust’s investment portfolio as provided in this clause. Any profit earned must be recorded into the trust's bookkeeping accounts.

8. With five (05) days from the date of completion of adjustment to the portfolio, the fund management company must make relevant information known to the public as provided in clause 4 of Article 3 herein; simultaneously, must send the State Securities Commission a notice of any difference arising from the investment portfolio proportion, causes and time of occurrence or discovery of such difference or the trust's losses (if any) or any profit that may be earned for the trust, remedial actions, date and results of implementation of such actions. The notice must be certified by a supervisory bank.

9. When performing trades in assets on behalf of the trust, the fund management company must comply with the following regulations:

a) With respect to listed securities or those securities registered with stock exchanges, stock trades or transactions must be carried out through centralized transaction processing systems administered by Stock Exchanges;

b) As for assets which are not real property, listed securities or registered stocks, or in stock deals, the fund management company must obtain the written prior consent from the trust’s representative board for the following matters: the proposed price bracket within which transactions are performed, time of transaction, partners or persons ineligible to perform transactions and types of asset;

c) Any trade or transaction related to real estate must be performed in accordance with Article 14 herein.

Article 10. Net asset value

1. The fund management company shall be responsible for determining the trust’s net asset value and net asset value per a unit of stock certificate once a week by using the following calculation methods:

a) Net asset value is defined as the trust’s assets minus the trust’s liabilities. The trust’s assets are calculated at market prices or reasonable value thereof (used in case the market prices are unidentifiable). The trust’s liabilities are defined as debts or payment obligations accrued as at the date preceding the valuation date. The method of determination of market prices or reasonable value of assets in the trust’s portfolio, value of debts and payment obligations shall be subject to the principles referred to in the Appendix No. 15 hereto, and the trust’s internal rules and regulations set out in a valuation handbook. Each real property must be valued at least annually;

b) Net asset value per a unit of stock certificate equals the trust’s net asset value divided by total outstanding units of stock certificates.

2. The fund management company must compile a valuation handbook containing at least the followings:

a) Principles, criteria for selection and change of organizations providing price proposals and appraisal bodies. These principles must be clarified in the trust's Charter as well;

b) Principles and detailed procedures for implementation of valuation methods which ensure conformance to provisions of laws, the trust’s Charter, and are ratified at the investors’ general meeting. Principles and procedures for implementation of valuation methods must be transparent, rational and conformable to international conventions to ensure consistent application thereof under different market conditions.

3. The valuation handbook shall be subject to approval of the trust's representative board and be provided for the supervisory bank as a certification of calculation of the trust’s net asset value. The list of at least three (03) organizations providing price proposals that are not related persons of the fund management company and supervisory bank must be subject to approval of the representative board.

4. Net asset value and net asset value per a unit of stock certificate must be certified by the supervisory bank. The certification of value must be granted in writing or by access to data via the electronic information system of the supervisory bank that has already been approved by the fund management company.

5. On the following business day, after the supervisory bank has already certified, information about the trust’s net asset value or the net asset value per a unit of stock certificate must be publicized according to provisions laid down in clause 4 of Article 3 herein.

6. The fund management company may entrust the supervisory bank with determination of the trust’s net asset value and the trust’s net asset value per a unit of stock certificate. In this case, the fund management company and the supervisory bank must carry out the checking, review, inspection and oversight mechanism and procedures to ensure that such determination of net asset value is conformable to provisions of laws, and the net asset value is calculated accurately.

7. In case of incorrect valuation, within twenty four (24) hours from the time of discovery of such incorrectness, the supervisory bank or the fund management company (to the extent that the supervisory bank provides service of determination of net asset value) must inform and request the other to make timely adjustments.

8. Within five (05) days of discovery of incorrect valuation of net asset value, the fund management company or the supervisory bank must adjust and publicize information prescribed in clause 4 of Article 3 herein, and inform the State Securities Commission of incorrect valuation, including causes, time of occurrence of such incorrect valuation and corrective actions. Contents of the notice must be signed and certified by the fund management company and the supervisory bank.

Article 11. Distribution of the trust’s profits

1. A real estate investment fund must set aside at least 90% of its profits earned within a tax year to pay investors. The distribution method may be approved in the most recent investors' general meeting. After the trust's profits within a tax period or the trust’s accumulated profit is fully transmitted to any other fund as prescribed in the trust's Charter and fulfilling any tax or other financial obligation, the remaining amount thereof shall be paid to investors.

2. Distributed profits may be paid in cash or by giving additionally issued stock certificates. Within fifteen (15) days before income distribution, the fund management company must inform its investors. The notice of profit distribution must contain all information required in the Appendix No. 14 hereto.

3. The trust’s profit distribution must conform to the following principles:

a) Such distribution must be subject to regulations of the trust's Charter regarding profit distribution policies or other regulations set forth in the trust’s prospectus or summary prospectus;

b) Such distribution must be carried out after the trust fulfills its tax and other financial obligations as per law and fully transfer part of its profits to other funds (if any) under the provisions of the trust’s Charter;

c) After distribution, the trust must maintain adequate capital for payment on debts and other financial obligations due and ensure that its net asset value is not less than fifty (50) billion dong;

d) Rates of distributed profits must be subject to the decision of the investors’ general meeting or the trust’s representative board on condition that such rates are aligned with investment targets and conform to regulations on distribution of the trust's profits;

dd) In case where profits are distributed by giving stock certificates, the trust must provide adequate assets as reciprocal capital by setting aside its undistributed post-tax profits, based on its latest audited or reviewed financial statement.

Article 12. Operating expenses of real estate investment funds

Operating expenses of a real estate investment fund shall include the followings: Costs of management of the trust paid to the trust’s fund management company; costs of depositing of the trust’s assets, costs of supervision paid to the trust’s supervisory bank; costs incurred from maintenance, operation and exploitation of real estate which are paid to the trust’s real estate management bodies; auditing costs paid to auditing organizations; costs of valuation paid to valuing organizations; charges for legal advice, price proposal and other reasonable services, remuneration paid to the trust’s representative board; costs incurred from drafting, printing the prospectus, summary prospectus, financial statement and other documents, and sending them to investors; costs of public disclosure of the trust’s information; costs incurred from holding investors’ general meetings or meetings of the trust’s representative board; costs related to performing the trust’s asset transactions and other costs prescribed by laws.

Article 13. Management of real property listed in a trust's investment portfolio

1. Before making investment in a particular real property, the trust’s fund management company must plan the operation and use of that real property in the next five (05) years. This plan may be approved by the representative board.

Duration of retention of real estate listed in the trust’s investment portfolio shall be subject to point b of clause 1 of Article 91 in the Decree No. 58/2012/ND-CP.

2. The fund management company must run a department charged with managing the real estate investment trust that is staffed with professional and qualified personnel meeting the following requirements:

a) They must have full civil and legal capacity, and are not subject to any prison sentence or the court's prohibition from business practices;

b) They have not been subject to fines or other more severe penalties for their violations that may arise in the securities, banking and insurance sectors for two (02) recent years preceding the year of their appointments;

c) In order to manage the securities investment portfolio of each real estate investment trust, the fund management company must appoint at least two (02) officers holding fund management practicing certificates or other international credentials according to laws on establishment, organization and operation of the fund management company;

d) In order to manage the real estate investment portfolio of each real estate investment trust, the fund management company must appoint at least two (02) professional officers holding accredited valuer’s ID cards; or holding real estate valuation certificates prescribed in laws on real estate business; and having acquired at least two (02) years' experience in valuation of real estate at real estate business organizations, real estate service providers or valuing enterprises.

In cases where a manager of the trust, prescribed in point c, also meets standards specified in point d, that manager may be entitled to hold a part-time office as the manager of the trust's real estate investment portfolio.

3. The fund management company shall assume the following responsibilities:

a) Act on behalf of the trust to exercise rights to own and use, and fulfill obligations and responsibilities to the trust’s assets, in a voluntary and honest manner in the trust’s best interests;

b) Conduct regular inspection and oversight, and carry out all necessary activities, with a view to ensuring that project’s owners, sellers, lessees, hire-purchasers, real estate management organizations and other partners mentioned in economic agreements related to the trust’s real estate fulfill their obligations prescribed in laws on real estate business and other provisions of relevant laws;

c) Register rights to own and use the trust’s assets in a timely manner as provided in laws on real estate business. Ensure sufficient provision of real estate ownership certificates, certificates of rights to use land or legitimate documents proving rights to own and use real estate under laws with respect to existing real property; certificates of construction or documentation regarding projects and construction designs already approved with respect to real property under construction; construction designs, as-built dossiers and reports on commissioning and transfer of real estate with respect to real property belonging to projects not yet obtaining certificates of ownership rights or titles; project documentation, construction designs and progress of construction of residential homes or other structures already obtaining approval with respect to residential homes and other construction works formed in the future; and documents, records and other legitimate instruments prescribed in relevant laws;

d) In cases where the trust is the co-owner or co-user of a real property, the trust’s fund management company must ensure that the trust enjoys freedom of disposing of the trust’s asset portions at any time at the price that are not affected by any third party, and is vested with all of the following rights:

- Gain profits from operation and commercial use of real property as agreed upon in agreements on management of real estate according to the respective proportion of its contributed capital;

- Get involved in giving opinions and making the decision on important issues, including changes in business cooperation agreements, real estate management and operation agreements and other arrangements or economic agreements. In cases where the trust owns real property in an indirect manner or through ownership of shares or contributed capital of companies having rights to own real estate, the trust must be accorded all of rights granted to shareholders and capital contribution members, including freedom of disposition of assets (e.g. shares or contributed capital portions) of the trust;

dd) Sign real estate management agreements and other economic ones with respect to the trust’s assets as provided in laws on real estate business and other provisions of relevant laws. In case of signing new real estate management agreements or renewed ones, within fifteen (15) days from the signature date, the fund management company shall be responsible for sending them to the State Securities Commission.

e) Purchase all required insurance contracts for real property listed in the trust’s investment portfolio. Insurance agencies must be subject to approval from investors’ general meetings.

g) Enter into cooperation with the supervisory bank and ensure the supervisory bank keeps custody of all documents related to the trust’s real property, especially those documents certifying ownership rights under the provisions of point a of clause 2 of Article 32 herein.

4. The fund management company must authorize the real estate management body to keep custody, take care of, look after, repair, upgrade, operate and commercially use real property under terms and conditions of real estate management agreements. Criteria for selection of organizations providing the service of management of real estate and principles laid down in real estate management agreements must be subject to regulations of the trust's Charter. Bodies providing the service of management of real estate and real estate management agreements may be approved in an investors' general meeting.

5. Real estate management bodies shall assume the following responsibilities:

a) Carry out regular and ongoing oversight and management of business, operation and commercial use of real estate, ensure that real property is managed, operated and used in an effective and safe manner; ensure that service quality meets criteria and requirements of the trust's fund management company and other terms and conditions of real estate management agreements;

b) Comply with laws on real estate business and provisions of other laws during the period of management, operation and use of real property. Manage real property according to discreet, voluntary and honest principles, and in the trust’s best interests;

c) Any repair, maintenance, upgrade and expansion of operable and usable space, and any change in real estate structures shall be carried out only after receipt of consent from the fund management company or the trust’s representative board under terms and conditions of real estate management agreements.

d) Provide the fund management company with full and accurate information regarding business performance and prospect of variation in market segments of real property under their authority. Periodically, real estate management bodies shall be responsible for submitting performance assessment reports for compiling purposes and for proposing them to investors’ annual general meetings. Each report must contain all information required in the Appendix No. 26 hereto;

dd) Ensure security for all information related to real estate, business, use and operation of real estate under their delegated authority. Except competent regulatory authorities, real estate management bodies shall not be allowed to provide the abovementioned information for any person or entity, including other business departments of their own.

e) Real estate management bodies shall be responsible for compensating for any loss that the trust may suffer as the result of their negligent act performed during the stage of management of real estate, even including default, errors or frauds of their staff or third-party entities or persons providing services related to management of real estate, unless otherwise decided by investors’ general meeting.

Article 14. Real estate transactions of real estate investment trusts

1. Except transactions specified in clause 2 of this Article, a trust’s fund management company must ensure compliance with the following regulations:

a) The buying price of a real property does not exceed 110%, and the selling price of a real property is not lower than 90%, of the reference price determined by an appraisal body within the maximum duration of six (06) months ending on the effective date of a real estate transaction, unless otherwise decided by the investors’ general meeting. Where necessary, the investors’ general meeting or the trust’s representative board may request its fund management company and appraisal bodies to redetermine the reference price prior to the effective date of a real property transaction.

In cases where a real property is valued by multiple appraisal bodies, the reference price shall be defined as the mean value of prices determined by these entities.

b) The trust’s fund management company must conduct a poll to collect investors’ opinion in an investors’ general meeting in the following cases:

- The proposed buying price is higher than, or the selling price is lower than, those prices referred to in point a of this clause; or

- A real estate transaction has higher value than, or makes up 20% of total assets of the trust, after such transaction occurs; or results in total value of most recent transactions with the same partner within twelve (12) months which is greater than or equal to 20% of total asset value of the trust after such transaction occurs; or

- In other cases prescribed in the trust’s Charter.

c) The trust’s fund management company must consult with the representative board before performing a real estate transaction with regard to:

- A real estate transaction making up between 10% and 20% of total assets of the trust after such transaction occurs; or resulting in total value of most recent transactions with the same partner within twelve (12) months which equals between 10% and 20% of total asset value of the trust after such transaction occurs; or

- In other cases prescribed in the trust’s Charter.

2. The trust’s fund management company may perform real estate transactions between the trust and persons below if all requirements set out in clause 3 of this Article are met:

a) Staff of the trust’s fund management company; members of the trust's Governing Board, Board of Directors or Members' Board or Chair of the fund management company; major shareholders or members making equity participation making up more than 5% of the charter capital of the fund management company, authorized representatives of these persons; fund management companies; supervisory banks; major investors in the trust, authorized representatives of major investors (if any); members of the trust’s representative board;

b) Persons having rights and interests related to entities or individuals specified in point a of this clause;

c) Other real estate investment trusts, even including real estate securities companies put under the control of a fund management company;

d) In other cases prescribed in the trust’s Charter.

3. Requirements for carrying out a real estate transaction prescribed in clause 2 of this Article shall include the followings:

a) The trust’s Charter sets out regulations on permission to carry out a real estate transaction which are publicized in the trust's prospectus or summary prospectus;

b) The trading price meets regulations laid down in point a of clause 1 of this Article;

c) If a real estate transaction makes up more than 10% of total assets of the trust after such transaction occurs; or results in total value of most recent transactions with the same partner within twelve (12) months which equals more than 10% of total asset value of the trust after such transaction occurs, such transaction must be subject to approval from the investors’ general meeting. In such case, related investors shall not be allowed to exercise their voting rights in the investors’ general meeting and the decision on approval of such transaction is granted if the number of investors representing 65% of the remaining votes agrees;

d) Real estate must be valued by two appraisal bodies out of which an appraisal body is selected by the investors' general meeting and another one is designated by the supervisory bank. Valuation costs shall be recorded as expense entries of the trust;

dd) The appraisal body and the legal advisory organization must certify that terms and conditions of a proposed transaction agreement is corresponding to actual market conditions and such transaction is legal and conformable to provisions of relevant laws.

4. After completing transactions as provided in point b and c of clause 1 and 2 of this Article, details about these transactions must be publicized in the trust’s prospectus or provided for all investors in any form specified in the trust's Charter and prospectus. Information about transactions shall include the followings:

a) Adequate information about partners involved and relationship between these partners and the trust;

b) Comprehensive information about real property involved in transactions, including its type; location; information about planning in relation to real property; scale and dimension of the real property to be traded; characteristics, attributes and economic effectiveness assessed after commercial use/operation of the real property to be traded (usage ratio/accommodation capacity, etc.), quality of the real property to be traded; actual state of technical infrastructure, utilities and community amenities associated with the real property to be traded; legal status of the real property to be traded, including documents proving rights to own and use the real property to be traded, and other documents related to formation of the real property to be traded; history of ownership and use of the real property to be traded; restrictions on rights to own and use the real property to be traded (if any); trading prices of the real property to be traded; rights and interests of third-party persons involved and other relevant information;

c) The certificate of valuation of the real property to be traded shall include information regarding the valued real property; location and scale of the valued real property; properties and actual state of the valued real property; legal status of the valued real property; restrictions applied to the valued real property; methods of valuation of the real property; time of valuation of the real property; price of the real property and other relevant information;

d) Information about profits gained from commercial use of the real property before it is traded (enclosing evidencing documents) and expected profits after transaction;

dd) Other relevant information.

5. In all real estate transactions, the trust’s fund management company must actively and promptly inform and provide the trust’s supervisory bank and representative board with adequate documents and information about transactions (before and after they are performed) within the sufficient duration so that that bank and representative board exercise their rights to inspect and oversee the trust’s transactions according to laws, regulations laid down in the trust’s Charter, terms and conditions of the supervision agreement.

Article 15. Appraisal bodies

1. Investors’ general meeting shall decide to select at least one (01) appraisal body to render the service of valuation of the trust's real property within the service duration which is restricted to two (02) years. Upon expiry of such duration, the trust’s fund management company shall be responsible for selecting the substitute appraisal body and recommending it to the investors’ general meeting to seek its approval.

2. An appraisal body must meet the following criteria:

a) Such appraisal body must be a valuing enterprise complying with regulatory requirements for eligibility for provision of service at the time of conclusion of an agreement with the trust's fund management company in accordance with laws on valuation, or must be a prestigious real estate business having competence in valuing real estate in accordance with laws on real estate business;

b) Such appraisal body must not be a person related to the trust’s fund management company, supervisory bank or major investor of the trust; must not be a partner in property transactions with the trust; must not be a person related to a partner in trades in the real property that the former plans to value;

c) Such appraisal body must be staffed with at least three (03) qualified valuers holding valuer's ID cards that meet regulatory requirements for conformance to valuation regulations at the time of conclusion of a valuation service agreement; or holding real estate valuation certificates. These valuers must have at least five (05) years’ experience in providing real property valuation services;

d) Such appraisal body must be reputable, experienced, and professionally moral and meet other requirements specified in the trust’s Charter and other criteria of the fund management company.

3. The fund management company shall sign valuation agreements only with appraisal bodies already ratified and approved in the investors’ general meeting. Within fifteen (15) days from the signature date, the trust’s fund management company shall be responsible for sending them to the State Securities Commission. The maximum duration of a valuation agreement (even if it is extended) shall be two (02) consecutive years. Each valuation agreement may be ratified and approved, and must contain at least the followings:

a) Regulations regarding information sharing policies, which ensure that appraisal bodies receive all information necessary for their valuation activities;

b) Regulations regarding valuation costs that conform to the principles in which the amount of cost is not dependent on value of the asset to be valued;

c) Regulations regarding termination, discharge or extension of duration of agreements;

d) Regulations regarding authorization that conforms to the principles in which an appraisal body may authorize another appraisal body meeting regulations laid down in clause 2 of this Article to render valuation services. Such authorization must obtain the prior consent from the trust’s representative board.

4. Appraisal bodies and valuers must comply with the following regulations:

a) They shall not be allowed to appraise the real property in which they are partners or they are related persons to partners; shall not be allowed to provide valuation services for fund management companies in which they are shareholders or capital contributing members owning at least 5% of the charter capital; or in which their parents, spouses, children or siblings are members of governing boards, or chief accounts, members of boards of directors, members' boards or presidents. Appraisal bodies or valuers shall not be allowed to enter into trades in assets with the trust as this affects the arm’s length principle applied to the valuation process;

b) Appraisal bodies and valuers shall not be allowed to collude with fund management companies or partners in asset transactions of the trust, or give material benefits to or impose coercive acts or bribe fund management companies or transaction partners to falsify valuation results; shall not be allowed to suggest receiving or receive benefits existing in any form other than contractual service prices;

c) Store documents and records of valuation; provide documents and records of valuation as requested in writing by competent regulatory authorities;

d) Obtain permission only to provide real estate valuation services for a real estate investment trust or securities company for a time limit of two (02) consecutive years;

dd) Comply with all regulations on responsibilities and obligations prescribed in laws on valuation.

5. The trust’s valuation activities must conform to the following principles:

a) Each real property belonging to the trust’s portfolio must be valued periodically at least once a year and on any other date as requested by the trust's representative board and investors’ general meeting. On a three (03)-year basis, all of the trust's real estate investment portfolios must be revalued, unless otherwise decided in an investors' general meeting. All valuation or revaluation activities of the trust shall only be carried out by appraisal bodies approved in an investors’ general meeting;

b) In addition to valuation carried out in accordance with point a, the trust’s real property must be revalued before being traded or before the trust issues additional stocks for capital raising purposes. Revaluation of real property conforming to regulations laid down in this clause may be unnecessary in the event that the effective date of transaction does not exceed the time limit of six (06) months from the most recent valuation date;

c) Appraisal bodies shall only be allowed to determine the price at a specified place and time according to valuation standards and ensure such price is appropriate for particular purposes specified in valuation certificates;

d) Valuation bases are market value and reasonable value determined according to the principles conforming to laws on real estate business and laws on valuation. Real estate value must be determined by using at least two methods. Selection of the valuation method and results must be explained in detail. The valuation method must be selected according to the valuation handbook already approved in the investors' general meeting and the trust's representative board as provided in clause 2 of Article 10 herein, conventions and provisions of laws on real estate business and other laws on valuation.

Process and method of valuation of real property listed in the trust's portfolio shall contain information given in the Appendix No. 15 hereto;

dd) Data and information used in valuation activities must be updated in a sufficient, accurate and timely manner and must be adjusted in a logical and appropriate manner. Adjustment to data and information must be explained in full and detail;

e) Each real property must be appraised by an appraisal body only two consecutive times at maximum;

g) Periodically, real estate management bodies shall be responsible for preparing annual review reports on valuation of real property that has already been valued within the reporting year for submission to the fund management company before it compiles a general report and submit it to investors’ annual general meetings. The valuation activity report must contain all information as mentioned in the Appendix No. 16 hereto.

6. After managing to fulfill their assigned tasks, valuers of appraisal bodies who are directly entrusted with valuation of real property must make valuation result reports and bear legal liability for valuation results and their comments made in valuation result reports. Each valuation result report must conform to Vietnam's valuation standards and contain at least information given in the Appendix No. 17 hereto.

7. Valuation result reports on must be made in an arm’s length, unbiased and faithful manner with signatures of valuers who directly carry out valuation activities and General Directors or Directors of appraisal bodies or persons authorized in writing by General Directors or Directors of appraisal bodies. Valuation reports must be clear, avoid any misinterpretation and contain full and accurate information required.

8. Appraisal bodies must send a written notice of valuation results available in a form of valuation certificates to the trust’s fund management company.

9. Valuation certificates must be clear, accurate and sufficient, and must avoid any misinterpretation in order for investors to make their own decisions. Valuation certificates shall only be valid for assets valued at the predetermined valuation dates; shall have binding liabilities to appraisal bodies for valuation results and comments given in valuation certificates. Valuation certificates must contain at least the information required in the Appendix No. 18 hereto.

10. After a valuation date, if there are major changes affecting value of the valued asset, appraisal bodies and valuers shall be responsible for mentioning such changes in their valuation reports and certificates. Where necessary, the trust’s fund management company shall be obliged to issue another prospectus amending or replacing the previous valuation certificate.

Section 3. GENERAL MEETINGS OF INVESTORS AND REPRESENTATIVE BOARD

Article 16. Rights and obligations of investors and investors’ general meeting

1. Rights and obligations of investors in a real estate investment trust shall be implemented in accordance with the trust's Charter, provisions of laws on establishment and management of closed-end funds; regulations laid down in laws on securities and enterprises with regard to corporate governance, applicable to public companies.

2. Rights and obligations of investors in a real estate investment trust shall be implemented in accordance with the trust's Charter, provisions of laws on establishment and management of closed-end funds; regulations laid down in laws on securities and enterprises with regard to corporate governance, applicable to public companies.

Article 17. Trust’s representative board

1. The trust’s representative board representing investors is elected at investors’ general meetings or receives investors’ written opinions. The board may be composed of between three (03) and eleven (11) members with two-thirds (2/3) of its membership that is not persons related to the trust’s fund management company or supervisory bank. Each board’s member holds a vote.

2. The board must have at least an independent member qualified and experienced in the real estate and real property appraisal sector; another independent member having relevant qualifications and working experience in the securities investment analysis or asset management sector; and the last member having professional qualifications in laws.

3. Term of office, standards, membership, nomination, self-nomination, election and recruitment of additional members to the board; rights, responsibilities and obligations of the board's members shall be subject to regulations laid down in the trust's Charter, conformable to laws on establishment and management of closed-end funds; regulations laid down in laws on securities and enterprises with regard to corporate governance, applicable to public companies.

Section 4. TRUST RESTRUCTURING

Article 18. Amalgamation and merger of real estate investment trusts

1. A real estate investment trust is amalgamated or merged with another one according to the decision made by the investors' general meeting. At least thirty (30) days before an investors' general meeting, the trust's fund management company shall be obliged to provide investors with documents related to amalgamation and merger, including:

a) Amalgamation and merger plans attached to the report on analysis of amalgamation and merger that contains information specified in the Appendix No. 11 hereto;

b) Draft amalgamation and merger agreement containing terms and conditions regulated in the Appendix No. 12 hereto;

c) Annual financial statement already audited and quarterly financial statements of all of amalgamating or merging funds compiled till the most recent quarter;

d) Draft Charter, prospectus or summary prospectus of the amalgamated fund; the trust’s Charter, prospectus and summary prospectus of the merged fund.

2. Within ten (10) days from the date on which the investors’ general meeting makes its decision to approve amalgamation or merger, the trust's fund management company must inform such decision to creditors. Within thirty (30) days of receipt of such notice, creditors shall have the right to request the trust in writing to repay borrowed funds. If such written request is not sent to the trust’s fund management company within the above-stated time limit, creditors shall be considered not to request the amalgamating or merging fund to repay loans before amalgamation or merger. Contractual obligations to repay loans can be implemented by the amalgamated or merged fund.

3. In case where amalgamating or merging funds are managed by a fund management company, all of the legal advisory, administrative and other costs incurred from amalgamation or merger of funds shall not be recorded in the expense bookkeeping account of the trust, unless otherwise decided in investors' general meetings.

4. Fund management company and representative board shall assume the following responsibilities:

a) Provide information about amalgamation and merger processes in an adequate, timely, accurate and honest manner to investors;

b) Rights and obligations may be handled according to agreements between involved parties according to the voluntary principle and regulations laid down in laws;

c) Pay the trust’s debts to creditors at the request of creditors. Such debt payment must be finished by the amalgamation or merger date at the latest;

d) Before investors' general meeting is held to collect investors' opinions on amalgamation and merger, real property must be revaluated under laws on valuation.

Article 19. Processes and procedures for amalgamation and merger of real estate investment trusts

Processes, procedures and documentation requirements for amalgamation and merger of real estate investment trusts shall be conformable to regulations of laws on establishment and management of closed-end funds, including the written request for issuance or modification of certificate of registration for establishment of an amalgamated or merged real estate investment trust which is made using the form given in the Appendix No. 10 and No. 13 hereto.

Article 20. Extension of life spans of real estate investment funds

The life span of a trust shall be extended, subject to laws on establishment and management of closed-end funds and by using the request form for extension of the trust’s life span given in the Appendix No. 19 hereto.

Article 21. Closure of real estate investment trusts

1. Processes, procedures and documentation requirements for closure of a real estate investment trust shall be subject to laws on establishment and management of closed-end funds. Required documentation includes the written notice of closure and the report on closure of the trust prepared using the form given in the Appendix No. 19 and No. 20 herein.

2. In the course of closure of the trust, liquidation of the trust's assets must conform to regulations on trades in assets applied to real estate investment trusts as provided in clause 9 of Article 9 herein.