Vietnam undertakes to the WTO that “after 5 years from the date of accession, securities service suppliers with 100% foreign-invested capital shall be permitted”. To implement this undertaking, Decree 58/2012 has expressly allowed:
- any foreign investor to acquire up to 49% interest in a domestic securities company; and
- foreign investors satisfying certain conditions (including coming from countries which have a cooperation agreement with the SSC) to acquire 100% interest in a domestic securities company.
Decree 58/2012 is silent on whether a foreign investor can acquire more than 49% but less than 100% interest in a domestic securities company. In a recent post on its website, the State Securities Commission has expressly confirmed that a foreign investor cannot acquire more than 49% but less than 100% interest in a domestic securities company.
On 28 December 2018, the State Bank of Vietnam (SBV) issued Circular 42 amending current foreign currency borrowing regulations (in Circular 24 of the SBV dated 8 December 2015, as amended from time to time (Circular 24/2015)) (Circular 42/2018). Circular 42/2018 will take effect from 1 January 2019.
Changes to permitted lending purpose
Vietnamese banks only lend in foreign currency for a few limited purposes. Circular 42/2018 has following changes to these purposes: