Circular No. 74/2011/TT-BTC dated June 01, 2011 guiding on securities transaction
GENERAL PROVISIONS Article 1. Scope of governing
This Circular guides the security transaction activities of the listed company, transaction registration and public security investment capital at the Stock Exchange (SE).
Article 2. Interpretation of terms
In this Circular, the following terms are construed as follows: 1. Transaction member means the security company is approved to be transaction member by SE.
2. Transaction system means the computer system used for the security transaction activities at SE.
3. Order routing system means the system sending transaction orders of investors from transaction member to SE.
4. Price fluctuation means price fluctuations limit of securities stipulating
in the trading day which is calculated by percentage (%) compared with the reference price.
5. Reference price means price rate for use as a basis for calculating price
fluctuations of securities in the trading day.
6. Matching method means the transaction method implemented by the trading system based on matching the buy orders and sell orders of securities. Matching methods include periodical and continuous matching. 7. Agreement method means transaction method in which the transaction members agree with each other by themselves for transaction conditions and entered information into the system to record transaction results by transaction members.
8. Transaction to buy securities deposit (margin) means the customer’s transaction to buy securities using loans from Security Company and using other securities in their account and securities bought by loans for mortgage.
9. Internal information means the information relating to public companies or public funds that have not been announced yet, which if it is announced, it could seriously affect the stock prices of such public companies or public
10. Internal transactions mean the transactions using internal information
to buy or sell securities aiming to bring the benefits (getting fast profits or avoiding losses) for persons who made the transaction, those who know internal information or third party.
11. Transactions to manipulate the stock market mean one or more individuals or organizations performing or in collusion with each other to perform either directly or indirectly the placing orders, transactions or publish, distribute information to create supply, demand and liquidity, artificial price changes for one or more types of securities. Chapter II
Article 3. Security transaction organizations
1. SE organizes security transactions according to matching method and agreement method. The matching method on the transaction system is implemented in accordance with the principle of priority on price and time. 2. The SE organizes listing security transactions, transaction registration at SE through transaction system of SE, except for the following cases: a) The cases provided in point b clause 1 Article 4 of the Circular 43/2010/TT-BTC dated 25/3/2010 of the Minister of Finance amending and
supplementing the Regulation on securities registration, deposit, clearing and settlement promulgated together with the Minister of Finance's Decision No.87/2007/QD-BTC dated October 22,2007. b) Auction sale of state capital in the listed organizations, public companies;
c) The other assignments through the Securities Depository Center (DC) after being accepted by the State Securities Commission.
3. SE promulgates the Regulation guiding securities transactions after being accepted by the State Securities Commission. The Regulation of guiding securities transactions specified for: Transaction Time; transaction method; the way of determining the reference price, price fluctuation of securities;
types of transaction orders; the order correction, order cancellation and other related contents.
4. Hanoi SE listed by securities transaction organizations and securities of public companies not listed on the SE, except for cases prescribed in point a, b and c, Clause 2 of this Article.
5. The Security Depository Center grants securities code to the stocks to be transacted on in the SE.
Article 4. Suspension of securities transactions
1. SE suspends securities transaction activities all over the system in cases: a) Transaction system or orders routing system of SE gets troubles; b) When force majeure events take place affecting transaction activities of
the market like natural disaster, fire;
c) The State Securities Commission requires terminating the transactions to stabilize the market;
d) The cases that SE considers the necessary to protect benefits of investors after being accepted by the State Securities Commission. 2. Transactions suspension of each type of specific security is implemented according to the transaction Regulation of SE.
3. SE must report to the State Securities Commission right after the decision to suspend transaction stipulated in point a, b clause 1 and clause 2 of this Article.
Article 5. Price fluctuation
1. SE stipulates the price fluctuation after being accepted by the State Securities Commission;
2. In the necessary cases to ensure the market stability, the State Securities Commission decides to adjust the price fluctuation.
Article 6. Error correction after the transactions, transaction establishment and transaction cancellation
1. The Security Depository Center is responsible for promulgating the Process of guiding the error correction after the transactions for the stocks which are listed and registering transactions on SE after being accepted by the State Securities Commission.
2. SE is responsible for promulgating the provisions on establishing transactions and canceling securities transactions after being accepted by the State Securities Commission.
Article 7. Securities transactions of investors
Investors must open securities transactions accounts in the security
company to perform securities transactions on SE and takes responsibility to supply in full, exactly the information when opening the transaction accounts.
Investor is only permitted to open one transaction account in each securities
company, except for the following cases:
a) Deposit transaction accounts of investors;
b) Fund management companies must open a separate transaction account for itself and each securities investment fund managed by them at each security company where they open its account and must state clearly this issue in the account opening contract. Where the implementation of portfolio management, fund Management Company must open two (02) transactions accounts in the name of the fund management company in the securities companies on behalf of the trust investors, including one (01) account for the domestic trust investor and one for foreign trust investor. c) Foreign investors who are the foreign securities companies established under foreign law are opened separate securities transactions accounts in the securities company to manage securities owned by its own (business by itself) and accounts for customers (brokers) of foreign securities companies. d) Insurance companies with 100% of foreign capital operating in Vietnam when participating securities transactions must be open two (02) transactions accounts in the securities company: one (01) investment account from equity and under the adjustment on foreign owned ratio, one (01) investment account from the insurance fee collection and not subject to the adjustment on owned ratio of foreign investors.
3. The opening of the securities transaction accounts of persons who practice securities is done as prescribed in Clause 2 Article 81 of Securities Law.
4. Where investors opening securities transaction accounts in different securities companies, in the records of opening accounts in the new securities companies must record clearly the number of accounts opened and account codes in the former securities companies.
5. Foreign investors are only permitted to open transaction accounts after they registered and granted securities transaction code by the Security Depository Center.
6. The State Securities Commission guides principles to grant securities transaction account codes for investors. The securities companies where the investors open its accounts are responsible for keeping as archives
information of account owners, securities transaction information and other
relevant documents for at least 10 years since the date on which the transactions arise.
7. Investors must ensure deposit rate in cash or securities in the transaction. The State Securities Commission guides deposit rate in cash or securities after being approved by the Ministry of Finance.
8. The transfer of listed securities, transaction registration must be conducted via SE. The transfer cases mentioned in clause 2 Article 3 of this Circular is implemented through the Security Depository Center and must disclose information on SE.
9. Securities companies conduct the purchase of shares and odd-lots fund certificates of investors at the agreed price or organization trading odd-lots for clients under the guidance of the State Securities Commission (SSC). Article 8. Securities transactions in the transaction days: 1. Investors are entitled to make the opposite transaction (buy, sell) of the same securities in the transaction day, when meeting the following conditions:
a) Using an account opened in a securities company to make both buying and selling orders;
b) Only being bought (or sold) a type of security if the selling order (or buying order) of the same type of security which was previously made and
the transaction order must meet the demand on deposit rate as prescribed in clause 7, Article 7 of this Circular.
c) Securities Companies, depository bank take responsibility to check the validity of buying orders/selling orders of investors.
2. The investors are not permitted:
a) Performing transactions not leading to the change of ownership of securities;
b) At the same time placing selling and buying orders of the same type of security in each matching on the same account or different accounts that are
under the name of investors.
Article 9. Authorization transaction accounts
1. When opening securities transaction accounts, investors are entitled to authorize to transact in the following cases:
a) Authorizing to transact in writing to the Securities Company or securities depository bank to perform the transactions. When being authorized to transact, the securities company/depository bank who is on behalf of investors to perform the transactions must comply with the regulations on
transaction and payment of securities, obligations to disclose information and takes responsibility before the investors for the authorized contents; b) Authorizing to transact in writing to other Individuals to perform the transactions must ensure:
- With certification of local government or notarize public under the provisions of law;
- Authority contract must be stated clearly the scope of authority; - Authorized person is not entitled to perform the transactions with himself/herself or with third person who authorizes to such authorized person.
2. Staffs of securities companies are not entitled to receive the authority from investors.
3. Investor opening may securities transaction accounts must report on the obligations of majority shareholders on the total securities in the accounts
and disclose information in accordance with the law regulations. Article 10. Transaction of fund shares
1. Listed organizations, organizations of registering transactions repurchase, resale fund shares on the SE shall comply with the law regulations. The SE promulgates Regulations of specific guidance on fund share transactions after being approved by the SSC.
2. The case of selling fund shares, public companies must report to the SSC at least seven (07) days prior to the date of conducting transaction. 3. Listed organizations, organizations of registering transactions are entitled to repurchase odd-lot shares of investors as fund shares. Listed organizations, organizations of registering transactions repurchasing the odd-lot shares must ensure capital source to repurchase fund shares in accordance with the law regulations and not restricted the term to sell oddlot shares purchased as fund shares.
Article 11. Transaction of securities deposit
1. Securities companies are entitled to perform deposit transactions after they reported to the SSC.
2. Investors wishing to conduct deposit transactions must open deposit transaction accounts in the securities company where the investors opening the securities transaction accounts. In every securities company where investors open their transaction accounts, investors are only allowed to open one (01) deposit transaction account. The securities companies must manage separately the deposit transaction accounts of investors with other transaction accounts.
3. Securities which are permitted for deposit transitions as shares, investment fund certificates being listed on the SE meeting the requirements of securities are allowed to conduct deposit transitions under the provisions of the SSC. The securities companies are obliged to publicly announce the securities portfolio that the companies conducted deposit transactions.
4. The securities companies are obliged to report periodically or at request on deposit transaction activities with the SSC, the SE and the Security Depository Center (SDE).
5. In case of necessity, to ensure safety to the operations of the stock market, the SSC may require the securities companies to suspend the deposit transactions.
6. The SSC specified deposit transaction professional skill for securities companies.
Article 12. Cases of securities being managed
The SE specified the conditions, measures and time to apply the measures for securities traded on the SE which are subject to the cases of warning, control and transaction suspension and transaction termination after being approved by the SSC.
Article 13. Prohibited transactions
1. Prohibited transactions include: internal transactions, transactions manipulating market and the other prohibited transactions under the provisions of law;
2. The violations on securities transactions are handled under the law regulations.
Article 14. Regime of report and supervision
1. The SE, SDC implement the regime of report on securities transactions states with the SSC.
2. The SE, SDC are subject to the supervision of the SSC on the securities transactions.
IMPLEMENTATION ORGANIZATION Article 15. Implementation provisions
1. The SSC is responsible for issuing the regulations of specific guidance. The SEs, SDCs are responsible for issuing the Regulations of guidance, Process of professional skill and supervision of the compliance with transaction activities of members after being approved by the SSC.
2. This Circular takes effect on 01/08/2011.
3. The amendment, supplementation of this Circular is decided by the Minister of Finance.
FOR THE MINISTER DEPUTY MINISTER Tran Xuan Ha
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