Foreign ownership in Vietnamese securities companies

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.

Vietnam Business Law Blog

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: