Draft decree specifies a number of articles of the Securities Law: Towards cutting business conditions

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The workshop on July 16. Photo: T.L

It was stated at a consultation workshop on the draft decree detailing articles of the Securities Law held on July 16.

Reform and restructure the stock market

At the workshop, Bui Hoang Hai, Director of the Securities Public Offering Management Department under the State Securities Commission said the Securities Law No. 54/2019/QH14 was approved the XIV National Assembly at the 8th session on November 2019 and will take effect from January 1, 2021. In the Securities Law No. 54/2019/QH14, the Government is assigned to specify 29 articles and clauses. Therefore, the promulgation of the decree detailing articles of the Securities Law No. 54/2019/QH14 is necessary to implement the Securities Law.

“In the past 10 years, Vietnam's stock market has developed dramatically, gradually becoming an important medium and long-term capital mobilisation channel of the economy. The development of the stock market requires the adjustment of the legal basis system to supplement new regulations, amend regulations which are no longer consistent with market development, and strengthen integration of Vietnam’s stock market into regional and international capital markets,” Hai said.

According to a representative of the State Securities Commission, activities on the securities market are not only governed by the Securities Law but are also other relevant legal systems, especially the Law on Investment and the Law on Enterprises. Therefore, some provisions in current decrees guiding the implementation of the Law on Securities need to be amended to ensure consistency and compatibility with the amendment to the Law on Investment and the Law on Enterprises.

A representative of the State Securities Commission said the development of the decree regulating in detail the implementation of a number of articles of the Securities Law will ensure constitutionality, legality and consistency of legal documents in law system. At the same time comply with competency, form and procedures for developing and promulgating legal documents.

This decree will also contribute to simplifying administrative procedures, improving the business environment and enhancing national competitiveness. In addition, helping improve the legal basis for activities on the stock market; ensure legal rights and interests and fairness for organisations and individuals in the securities market; ensure the effectiveness of the state management for the stock market.

“The goal of this decree is to reduce business and investment conditions, simplify administrative procedures, improve business environment and step by step reform and modernize the structure of market securities, enhance transparency in the stock market according to international standards, creating a foundation for the integration process of Vietnam’s stock market with regional and world stock markets,” Hai said.

Consistent with market practices

At the workshop, Le Thi Hong Thai, VinaCapital Fund Management Joint Stock Company, said the draft decree inherited the current law and overcome obstacles of current provisions on business activities, issuance of securities and fund certificates.

Also, Thai said the draft decree updates and follows advanced management methods from the experience of countries in the region and the world, including taking full advantage of modern information technology to increase specialisation, transparency and confidence of investors and entities involved in the stock market and fund certificates. The scope of the draft decree also provides regulations on the operation of the Fund Management Company, which are consistent with market practice and are more specialised.

Hoang Hai Anh, Vice Chairwoman of the Association of Securities Business, said the decree regulates in detail the implementation of a number of articles of the Securities Law which is a super decree with many new provisions.

“I appreciate these new provisions, some of which are more difficult for management, but they will be an important milestone in the operation of the market. For example, regulations on allowing IPOs of limited liability companies, joint stock companies, etc. This is a move to encourage public and non-public companies to join the market and increase the transparency of the stock market,” Anh said.