You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

March 21, 2025

Vietnam’s Amended Securities Law: What You Need to Know

Subscribe to Updates

Vietnam’s Law on Securities of 2019 was one of several laws amended (“Amended Securities Law”) under the wide-ranging Law No. 56/2024/QH15 passed by the National Assembly on November 29, 2024. The amendments came into force on January 1, 2025, with certain provisions related to professional securities investors and the eligibility criteria for public companies becoming effective on January 1, 2026.

Below are some of the key points of the Amended Securities Law.

Changes to Professional Securities Investors

Professional securities investors (PSIs) are investors who have adequate financial capacity or securities qualifications and can participate in private placements and private funds, among other investment activities. Under the Amended Securities Law, foreign investors, including individuals and organizations, are now automatically classified as PSIs, without having to meet any requirements regarding financial capacity. This loosening of requirements is expected to attract more foreign investment.

However, from January 1, 2026, individual PSIs will only be able to purchase, trade, and transfer privately placed corporate bonds that: (i) have been given credit ratings and are secured by collateral, or (ii) have been given credit ratings and covered by payment guarantees from credit institutions. Meanwhile, institutional PSIs will not be bound by these restrictions relating to privately placed corporate bonds.

Protecting Shareholders in Private Securities Issuance

The Amended Securities Law introduces additional conditions for private issuance of shares, convertible bonds, and warrant-linked bonds by public companies, and revises the required contents in the issuance plans from “criteria and number of investors” to “number of shares, offering price, or principles for determining the offering price.” This change promotes shareholder supervision and protects minority shareholders from overly powerful boards of directors.

Expanded Powers of SSC

The Amended Securities Law grants the State Securities Commission (SSC) new powers to suspend and cancel private placements of securities and adds new circumstances for the SSC to cancel public offerings.

The SSC may suspend a registered private placement of securities for up to 60 days: (i) if the offering documents contain misleading information or omit material information that could impact investment decisions and cause damage to investors, or (ii) if the distribution of the securities does not comply with statutory requirements. The issuer must announce the suspension within 7 business days from the suspension and recall the issued securities upon the investor’s request as well as provide a refund to the investor within 15 days from the investor’s request. If deficiencies leading to the suspension are corrected, the SSC will issue a written notice of withdrawal of the suspension. As a result, such private placement will be allowed to proceed.

The SSC may cancel a registered private placement of securities if (i) the issuer fails to address deficiencies leading to the suspension within the suspension period; (ii) the offering documents or the distribution of the private placement of shares are found to have violated the law while the issued shares are not yet listed or registered for trading on the stock exchange; or (iii) the offering documents or the distribution of the securities upon completion of private placement are found to have breached the law. Cancellation of the private placement does not apply to offered shares, shares converted from convertible bonds, or shares purchased from warrants that have been listed or registered for trading on the stock exchange after the private placement.

Under the Amended Securities Law, the SSC may now cancel a public offering if the offering documents or the distribution of the public offering are found to have violated the law after the public offering, but before completion of procedures to be listed or registered for trading on the stock exchange.

Liability Framework for Public Companies, Shareholders, and Advisors

Previously, issuers, underwriters, auditors, and “certifying organizations” were liable for the legality, accuracy, and sufficiency of securities-related documents and reporting during public offerings or when registering securities for listing or trading. The Amended Securities Law extends this liability to private offerings of securities, public disclosures by public companies or their shareholders, and reporting of secondary trading of securities by investors. Further, advisors involved in these activities may be exposed to greater liability for their failure to adhere to professional standards.

This change pushes public companies, their shareholders, and advisors to be more accountable and enhance the transparency in the securities market. They must ensure that all documents and information related to public disclosures and securities trading do not have misleading information and comprehensively include all material facts that could influence decisions by investors, authorities, and other stakeholders.

Defining “Securities Market Manipulation”

The Amended Securities Law updates the acts of “securities market manipulation” as outlined in the 2015 Penal Code to align the definitions of securities market manipulation under securities law and criminal law, closing any gaps between the two. This change aims to imposes administrative liability for market manipulation that does not reach threshold for criminal liability.

Other Changes

The Amended Securities Law adds additional grounds for the cancellation of public company status, which include a public company (i) failing to publish its audited financial statements or annual shareholder meeting resolutions, for two consecutive years; (ii) failing to register its shares with the Vietnam Securities Depository and Clearing Corporation; or (iii) failing to register its shares for listing.

Privately issued corporate bonds offered before January 1, 2026, will adhere to the 2019 Securities and the 2020 Law on Enterprises until the principal and interest are fully paid. Privately issued corporate bonds disclosed to the stock exchange before January 1, 2026, but not yet distributed will follow the same laws until distribution is complete, after which they will comply with the Amended Securities Law.

A public company repurchasing shares from employees in accordance with an employee stock ownership program does not need to reduce charter capital, but only needs to report the total number of repurchased employee shares at the nearest annual general meeting of shareholders. Accordingly, the Amended Securities Law is implicitly reviving treasury shares as previously outlined in the expired 2006 Securities Law, allowing public companies to hold treasury shares after the effective date of the 2019 Securities Law for this limited case of repurchased employee shares. This amendment is paired with an exception to the 6-month blackout period for issuing new shares after a share repurchase for repurchase of shares from leaving employees according to the employee stock ownership program.

Outlook

The Amended Securities Law aims to significantly strengthen governance, increase robustness, and provide better protection for investors in Vietnam’s securities market. This initiative should help address evolving challenges, upgrade the local market, and ensure alignment with international practice.

Related Professionals

Practices

Banking and Finance

Capital Markets

Location

RELATED INSIGHTS​ 

May 16, 2023
On April 25, 2023, Myanmar’s Ministry of Planning and Finance issued a standard operating procedure (SOP) requiring entities and individuals remitting foreign currency equivalent to more than USD 10,000 out of Myanmar to clear their tax payments prior to the remittance. The SOP took effect on May 1, 2023. This is the latest development since Myanmar began imposing restrictions in April 2022 on the remittance of foreign currency out of the country, implemented by the Central Bank of Myanmar and the Foreign Currency Supervisory Committee. The SOP requires the remitters described above to obtain certain documents evidencing payment of all requisite taxes and duties, and to submit them to their licensed authorized dealer (AD) bank as part of the remittance process. The documents required as evidence differ depending on the purpose of the remittance. The SOP details three main categories, as summarized below. Payments for Interest, Royalties, Trademarks, Copyrights, or Services A remitter of foreign currency for payment of interest, royalties, trademarks, copyrights, or services, must first apply to the Internal Revenue Department (IRD) for evidence that all applicable withholding tax has been paid. In addition, if the country to which the payments are being remitted is party to an avoidance of double taxation agreement with Myanmar, evidence of the recipient’s tax residency must also be submitted to the AD bank. Payments for Goods A remitter of foreign currency to pay for goods must submit the necessary IRD forms along with evidence that corporate income tax and other applicable taxes have been paid. Evidence may include a tax clearance certificate for the fiscal year, the company name, the taxpayer name, and the taxpayer identification number (TIN). Salary Payments A person remitting, in foreign currency, salary earned in Myanmar must submit the required form showing that they paid income tax
Read More
April 21, 2023
In the context of low investor confidence in the bond market due to recent negative news and the difficulties in cash flow of bond issuers, especially those in the real estate and banking sectors, the government of Vietnam has taken action to address legal bottlenecks in order for the bond market to recover and develop sustainably. In contrast to the gentle hand offered to bond issuers shouldering the debts of corporate bonds, a more stringent approach is being applied to bond purchases by banks. This is being done to mitigate the negative impact of the bond market on Vietnam’s banking health. New Decree Loosens Requirements for Bond Issuers On March 5, 2023, the government promulgated Decree No. 08/2023/ND-CP (“Decree 08”), which took effect immediately, loosening requirements for bond issuers. The key changes under Decree 08 include the following: 1. Ability to negotiate repayment of bonds with in-kind payment: For corporate bonds in the domestic market, Decree 08 allows the bond issuer to negotiate with bondholders to make payment in assets other than cash if the bond issuer is unable to make full and timely payments of bond principal and coupon in VND according to the announced bond issuance plan. There are certain conditions which must be satisfied, such as bondholders’ consent, disclosure of the changes, and legal status of the assets used for payment (e.g., title, encumbrances, and material agreements involving the assets). 2. Ability to change terms and conditions of bonds: Previously, while, bond issuers were able to change the terms (such as extension of the term or use purpose of the bond proceeds) for corporate bonds issued after September 16, 2022, they were not allowed to do so for older corporate bonds. Now, Decree 08 allows the bond issuers to change the terms and conditions of the
Read More
March 20, 2023
Thailand has enacted new legislation to counter cybercrime and scams. The Royal Decree on Measures for Protection and Suppression of Technology Crimes B.E. 2566 (2023) (“Cybercrime Decree”) was published in the Government Gazette on March 16, 2023, and took effect the following day. The Cybercrime Decree provides a new legal tool to interrupt the money-laundering process and aims to crack down on cybercrime perpetrators and scammers by providing stronger legal measures applying to certain types of offenders that had not been sufficiently covered by existing laws. This new legislation grants victims the right to have commercial banks and online payment platforms freeze suspicious transactions and obligates these banks and platforms to comply with such requests. It further requires these banks and platforms—as well as other service providers—to share data for the prompt prevention and suppression of cybercrime. The key rights, duties, and offenses established by the Cybercrime Decree are detailed below. Freezing Transactions The Cybercrime Decree requires commercial banks and online payment platforms to temporarily freeze (for 72 hours) any related transactions of their account holders upon receipt of an alert from the account holder that he or she is the victim of cybercrime. Victims can report these illicit transactions by phone or electronic means. If by phone, the relevant bank or platform must document the call. The victim must file a police complaint about the illicit transaction within 72 hours of the freeze being made. A police inquiry officer will then notify the bank or platform about the complaint, and the transaction freeze must be maintained for seven days from the filing of the complaint with the police. The police will then determine whether it is necessary to keep the transaction frozen for longer than seven days. If the seven days lapse without a further order to freeze the
Read More
February 10, 2023
On January 16, 2023, Thailand’s Securities and Exchange Commission (SEC) prescribed a set of security measures that digital asset business operators must implement if they provide custody of digital assets for their customers. The new security measures are prescribed in two notifications from the SEC and its office on digital asset wallet management systems and cryptographic key management systems, with the aim of safeguarding digital assets in custody against loss, fraud, and cybertheft. The notifications took immediate effect. The new security measures and the management systems are summarized below. Policy and guidelines for managing systems related to digital asset custody Digital asset business operators must have a written risk management policy for all systems relating to digital asset custody, approved by their board of directors and made accessible to all employees. The policy must be reviewed or revised at least once annually, or promptly if any potential risks are identified. Specific procedures must be implemented, such as establishment of a compliance team and internal controls. Management of systems for digital asset wallets and cryptographic keys Digital asset business operators must have policies and procedures for managing all systems relating to digital asset custody. This includes properly designing, developing, and managing digital asset wallets in a safe and secure manner. The same requirement on policies and procedures applies to cryptographic key management as well. Management of incidents that may affect systems related to digital asset custody Digital asset business operators must have measures in place to manage incidents that may impact systems related to digital asset custody. The measures include designating a person responsible for incident management, testing and reviewing the incident management policy annually, reporting any incidents affecting digital asset custody to the designated responsible person and the SEC immediately, and conducting a digital forensic investigation with an independent
Read More