Is M&A Approval Required For A Foreign Investor Buying Secondary Shares In A Vietnamese Securities Company?
The Securities Law 2019 removes the requirement for an approval by the State Securities Commission (SSC) for transactions involving 10% or more of the Charter Capital of a securities company. Instead, only a private placement of shares by a securities company is subject to SSC’s approval. Accordingly, it is not clear if an M&A Approval is required if a foreign investor acquires secondary shares from existing shareholders in a Vietnamese securities company.
A foreign investor purchasing shares in a company doing businesses sectors which are subject to market access conditions applicable to foreign investors will have to obtain an M&A Approval under the Investment Law 2020 from the relevant Department of Planning and Investment (DPI). Businesses carried on by a securities company are conditional businesses. However, Article 4.3(e) of the Investment Law 2020 provides that if the provisions of the Investment Law 2020 and other laws promulgated before the 1 January 2021 differ on (i) investment processes or procedures, or (ii) investment guarantee, except that the authority, processes, procedures, investment conditions, securities and securities market activities will follow the Securities Law 2019.