The State Securities Commission is seeking comments on the Draft amending and supplementing a number of articles of Circular No. 120/2020 dated December 31, 2020 of the Ministry of Finance regulating the trading of listed stocks, registration of trading and fund certificates, corporate bonds, and listed secured warrants on the securities trading system. The Circular will supplement regulations related to the deposit of 100% of the money of foreign institutional investors when purchasing securities.
Eliminate the 100% deposit requirement for foreign institutional investors when purchasing securities
Specifically, securities companies are allowed to receive securities purchase orders from foreign institutional investors when the customer's account does not have 100% of the order value. Securities companies will assess the customer's capacity to determine the margin level according to the agreement in the contract signed between the securities company and the customer.
In case the foreign investor lacks payment, the securities company will be responsible for paying the shortfall through the proprietary account, except for the case specified in the custodian bank where the foreign institutional investor opens an account. The securities company must ensure sufficient capital for payment, and in case of insolvency, it will be subject to penalties according to regulations.
Create conditions for foreign investors to buy securities
The securities company sells the securities as soon as they are in its own trading account. The difference arising from the handling of this case is made according to the agreement in the contract between the securities company and the customer.
The custodian bank where a foreign institutional investor opens a securities depository account is responsible for paying the shortfall in case of incorrect confirmation of the customer's deposit balance with the securities company, leading to a shortage of money to pay for securities transactions.
In case it is necessary to stabilize the market, the State Securities Commission has the right to temporarily suspend the 100% non-margin trading service of foreign institutional investors.
The removal of the requirement for 100% margin when buying securities for foreign institutional investors is considered one of the preparations to upgrade the Vietnamese stock market and attract foreign investment capital.
The draft also adds regulations that listed companies and large public companies must periodically disclose information in English from January 1, 2025; disclose extraordinary and on-demand information in English from January 1, 2026. Then, from January 1, 2027, other public companies must periodically disclose information in English; disclose extraordinary and on-demand information in English from January 1, 2028.
Source: https://thanhnien.vn/nha-dau-tu-ngoai-co-the-khong-can-ky-quy-khi-mua-chung-khoan-185240321091809584.htm
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