Types of Business Entities Engaged in Securities Activities under Vietnamese Law

I. Legal Regulations:

• Securities Law of 2006, amended in 2010

• Decree 58/2012/ND-CP providing detailed regulations and guidance on implementing some provisions of the Securities Law

  
  

II. Types of Companies Engaged in Securities Activities

Securities business refers to the activities of securities brokerage, proprietary trading, securities underwriting, securities investment consulting, securities custody, securities fund management, and securities portfolio management.

Individuals or organizations wishing to engage in businesses related to securities can choose between two types of companies: Securities Companies or Securities Investment Fund Management Companies. These companies may be organized as limited liability companies or joint-stock companies according to the provisions of the Enterprise Law.

The State Securities Commission issues licenses for the establishment and operation of securities companies and securities investment fund management companies. This license also serves as the Business Registration Certificate.

1. Securities Companies:

Securities companies may carry out one, several, or all of the following business activities:

• Securities Brokerage: Acting as an intermediary to buy and sell securities for clients.

• Proprietary Trading: When the securities company buys or sells securities for itself.

• Securities Underwriting: Committing to the issuing organization to carry out procedures before offering securities, purchasing part or all of the securities from the issuer to resell or buy the remaining unsold securities from the issuer, or assisting the issuer in distributing securities to the public.

• Securities Investment Consulting: Providing investors with analysis results, publishing analysis reports, and recommendations related to securities.

Note:

• Securities companies are only allowed to carry out securities underwriting activities if they are engaged in proprietary trading.

• In addition to the above-mentioned securities business activities, securities companies can also receive authorization to manage individual investors' securities trading accounts, provide financial consulting services, and other financial services in accordance with regulations from the Ministry of Finance.

2. Securities Investment Fund Management Companies:

Securities investment fund management companies can carry out the following business activities:

• Securities Investment Fund Management: Managing a fund formed from the contributions of investors with the goal of making a profit from investments in securities or other forms of investment assets, including real estate, where investors do not have daily control over the fund's investment decisions.

• Securities Portfolio Management: Managing the securities portfolio on behalf of individual investors, including buying, selling, and holding securities and other assets.

• Securities Investment Consulting: Providing investment advice on securities.

Note:

• The business activities specified in Clause 1 of this Article are granted under one license for the establishment and operation of a securities investment fund management company.

• In addition to the above business activities, securities investment fund management companies are allowed to mobilize and manage foreign investment funds that aim to invest in Vietnam.