1. Is it allowed to contribute capital in securities to a private securities investment company?
According to the provisions of Clause 6, Article 259 of Decree 155/2020/ND-CP, shareholders may contribute capital in securities listed or registered for trading on the Stock Exchange as stipulated in the Charter of the private securities investment company.
The contribution of capital in securities to a private securities investment company must ensure the following conditions:
– The securities intended for contribution must align with the company’s investment objectives and investment policies; not be restricted from transfer, suspended, temporarily halted from trading, or delisted; not be pledged, mortgaged, deposited, frozen, or used as collateral in other collateralized transactions as prescribed by law.
– The capital contribution in securities must be approved by all shareholders and shall only be considered complete after legal ownership of the contributed securities has been transferred to the private securities investment company.
– The value of the contributed securities shall be determined by the depository bank based on the closing price on the day the ownership transfer procedures are completed at the Vietnam Securities Depository and Clearing Corporation and in accordance with the Charter of the private securities investment company.
2. What is the maximum number of shareholders a private securities investment company can have?
The maximum number of shareholders of a private securities investment company is stipulated in Clause 4, Article 259 of Decree 155/2020/ND-CP as follows:
Article 259. Conditions for granting a license for establishment and operation of a securities investment company
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4. Conditions for shareholders include:
a) A public securities investment company must have a minimum of 100 shareholders who are not professional securities investors;
b) A private securities investment company must have a maximum of 99 shareholders. Among them, organizational shareholders must contribute a minimum of 03 billion VND, and individual shareholders must contribute a minimum of 01 billion VND. In cases of self-management, domestic shareholders must be organizations licensed by specialized agencies for securities, banking, or insurance, or members of the Board of Directors, General Director (Director), Deputy General Director (Deputy Director) of the prospective company.
Accordingly, a private securities investment company can have a maximum of 99 shareholders. Among them, organizational shareholders must contribute a minimum of 03 billion VND, and individual shareholders must contribute a minimum of 01 billion VND.
3. What does the application file for a License for establishment and operation of a private securities investment company include?
According to the provisions of Article 261 of Decree 155/2020/ND-CP, the application file for a License for establishment and operation of a private securities investment company includes the following documents:
(1) Registration form for establishment and operation according to Form No. 92 of the Appendix issued with this Decree, accompanied by a written authorization for the securities investment fund management company or shareholder representative to carry out the company establishment procedures.
(2) Company Charter according to the form prescribed by the Ministry of Finance.
(3) Asset depository contract with a depository bank.
(4) Minutes of agreement among shareholders on the establishment of a private securities investment company, clearly stating the company name, securities investment fund management company (if any), depository bank, supervisory bank (if any), contributing shareholders, and the capital contribution amount of each shareholder.
(5) Confirmation from the depository bank on the capital contribution scale, securities portfolio contributed (if any), clearly stating the quantity, security code of each shareholder contributing in securities, the date the securities portfolio is recorded in the securities investment company’s depository account, accompanied by a securities valuation report prepared by the depository bank.
(6) List of shareholders, prospective personnel, and individual information form according to Form No. 91, Form No. 105 of the Appendix issued with this Decree; Enterprise Registration Certificate, decision of the competent authority on capital contribution to establish a securities investment company for organizational shareholders; judicial record of members of the Board of Directors, General Director (Director) issued not more than 06 months prior to the date of submission.
(7) In cases where the securities investment company entrusts capital to a securities investment fund management company for management, additional documents: investment management contract signed with the securities investment fund management company; supervision contract signed with the supervisory bank.
(8) In cases where the securities investment company self-manages capital, additional documents: office lease contract, documents regarding ownership or right to use the office.
