Quyết định 43/2000/QD-UBCK3

DECISION

AMENDING AND SUPPLEMENTING A NUMBER OF ARTICLES OF THE REGULATION ON SECURITIES CUSTODY, CLEARING AND REGISTRATION, PROMULGATED TOGETHER WITH DECISION No.05/1999/QD-UBCK3 OF MARCH 27, 1999 OF THE CHAIRMAN OF THE STATE SECURITIES COMMISSION

THE CHAIRMAN OF THE STATE SECURITIES COMMISSION

Pursuant to the Government’s Decree No.15/CP of March 2, 1993 on the tasks, powers and State management responsibilities of the ministries and ministerial-level agencies;
Pursuant to the Government’s Decree No.75/CP of November 28, 1996 on the establishment of the State Securities Commission;
Pursuant to the Government’s Decree No.48/1998/ND-CP of July 11, 1998 on securities and securities market;
Pursuant to the Prime Minister’s Decision No.127/1998/QD-TTg of July 11, 1998 on the establishment of the Securities Trading Center;
At the proposal of the Director of the Department for Securities Business Management,

DECIDES:

Article 1.- To amend and supplement a number of articles of the Regulation on securities custody, clearing and registration, promulgated together with Decision No.05/1999/QD-UBCK3 of March 27, 1999 of the Chairman of the State Securities Commission:

1.1. Clause 7, Article 2 is amended as follows:

7. Working days are weekdays from Monday through Friday, except for the public holidays defined in the Labor Code and days off by decisions of the Director of the Securities Trading Center in cases where the computer system is struck with incidents and force majeure circumstances.

1.2. Article 4 is amended as follows:

1. The securities firms, which have been granted securities business operation licenses by the State Securities Commission to conduct one or several securities business types specified at Points a, b, c and d, Clause 2, Article 29 of the Government’s Decree No.48/1998/ND-CP of July 11, 1998 on securities and securities market, shall naturally be granted securities custody licenses by the State Securities Commission.

2. Within 15 days after a securities firm files a complete dossier of application for securities custody license and pays the licensing fee as prescribed, the State Securities Commission shall grant the securities custody license to such securities firm.

3. The dossier mentioned in Clause 2 of this Article comprises:

a/ An application for securities custody license made according to the set form;

b/ A written exposition of material and technical bases in service of securities custody activities of the securities firm;

c/ The list of the securities firm’s operation personnel, who have already been granted securities custody practitioner licenses;

d/ The specimen of the securities firm’s seal, the sample signatures of the firm’s director and directorate members in charge of custody activities of the securities firm, and sample signatures of the authorized representatives and operation personnel.

1.3. Article 7 is amended as follows:

A foreign bank’s branch applying for a license for securities custody operation in Vietnam shall, besides documents specified in Clauses 1, 3, 4, 5, 6, 7, 8 and 9, Article 6 of this Regulation, have to submit the following documents:

1. The notarized copy of the current charter of the original bank;

2. The notarized copy of the operation license of the original bank and the establishment and operation license of the foreign bank’s branch;

3. The notarized copy of the original bank’s authorization letter permitting its branch to conduct the custody operation;

4. The financial reports for the latest two consecutive years and the report on custody operation of the original bank;

5. Other documents at the State Securities Commission’s requests.

1.4. Article 17 is amended and supplemented as follows:

1. The securities allowed to be put in custody or sub-custody at the Securities Trading Center include all types of shares, bonds, warrants of the right to buy shares, investment fund certificates and other types of securities qualified for listing at the Securities Trading Center.

2. The securities custody shall be effected only for securities which have completely going through the custody registration procedures.

1.5. Article 18 is added with Clauses 4 and 5 as follows:

4. Each client shall be allowed to open the custody account at the head office or a branch of a custody member.

5. Foreign investing organizations and/or individuals that wish to conduct activities of buying and/or selling securities at the Securities Trading Center shall have to file applications for granting of securities business registration code numbers through foreign custody members according to the Securities Trading Center’s regulations.

1.6. Article 19 is added with Clause 3 as follows:

3. Custody members shall have to notify clients of the date on which they are allowed to place trading orders for the deposited securities.

1.7. Clause 3, Article 20 is amended as follows:

3. Securities listed for trading at the Securities Trading Center must be gathered for custody thereat.

1.8. Article 23 is amended as follows:

Securities custody accounts specified in Clause 1, Article 22 of this Regulation shall include:

1. Trading securities accounts;

2. Trading cessation accounts;

3. Pledge accounts;

4. Accounts for clearing of already traded securities;

5. Other accounts.

1.9. To cancel Clause 2 of Article 24, and amend Clause 3 into new Clause 2 of Article 24 as follows:

2. In cases where securities custody at the Securities Trading Center is effected at variance with the provisions of Clause 1 of this Article, such securities custody shall be valid after the Securities Trading Center makes the credit entries of securities to the trading securities accounts of the custody members, opened at the Securities Trading Center.

1.10. Clause 4 and Clause 5 of Article 25 are amended as follows:

4. If the vouchers specified in Clause 1 of this Article and submitted by the custody members conform to the regulations, the Securities Trading Center shall account the volume of deposited securities into the trading securities accounts and issue securities deposit certificates to the concerned custody members.

5. After accounting the volume of deposited securities into the trading securities accounts, if the Securities Trading Center detects that such securities are no longer valid for circulation, not up to the standards, invalid or the signatures thereon are counterfeit or invalid ones, it shall cancel such securities deposit. The custody members that have deposited such securities shall be accountable for all losses caused by such securities’ depositing.

1.11. Article 26 is added with Clause 4 as follows:

4. The time limit for awaiting the securities withdrawal is 90 days from the date the Securities Trading Center receives the valid dossier of application for securities withdrawal. In cases where securities are still valid for less than 90 days, the custody members shall not be allowed to withdraw such securities’ certificates.

Pending the withdrawal, the Securities Trading Center shall suspend the account transfer or assignment of securities requested to be withdrawn. The Securities Trading Center shall continue undertaking to exercise rights arising over the securities awaiting the withdrawal. The exercise of rights over securities awaiting the withdrawal shall comply with provisions of the Regulation on securities custody, clearing and registration, promulgated together with Decision No.05/1999/QD-UBCK3 of March 27, 1999 of the Chairman of the State Securities Commission and the Securities Trading Center’s regulations.

1.12. Clause 1 of Article 28 is amended as follows:

1. In order to effect the account transfer of the already traded securities according to the clearing result, the Securities Trading Center shall open for each custody member an account for clearing of the already traded securities separately from the trading securities account of such custody member.

1.13. Point b and Point e, Clause 1 of Article 33 are amended as follows:

b/ The written pledge-pledge release request made according to the form set by Securities Trading Center.

e/ The request for account transfer of pledged securities into the pledge accounts.

1.14. Article 34 is amended as follows:

1. The securities pledge release shall be effected according to the following principles and procedures:

a/ The person who is in charge of the securities pledge release must be the securities pledgee;

b/ The pledged securities may be wholly or partly released in the form of account transfer;

c/ The pledgee shall have to send the securities pledge-pledge release request to the Securities Trading Center according to the latter’s regulations.

2. If the dossier submitted by the pledgee is accurate and complete, the Securities Trading Center shall effect the securities pledge release.

3. After the securities pledge release, the Securities Trading Center shall have to notify the pledgee and the pledgor in writing of the securities pledge release result.

1.15. Clause 1 of Article 37 is amended as follows:

1. The securities transaction clearing and settlement shall be conducted according to the time schedule set by the Securities Trading Center.

1.16. Clause 1 of Article 38 is amended as follows:

The securities transaction clearing and settlement shall be conducted on the following principles:

1. The clearing of round lot and block transactions shall be conducted by mode of multilateral clearing. The mode of bilateral clearing shall only be applied to certain cases and certain kinds of transactions according to the Securities Trading Center’s regulations;

The settlement of odd lot transactions shall be conducted directly between the custody members being securities firms and investors.

1.17. Clause 1 of Article 39 is amended as follows:

1. The members shall receive trading reports supplied by the Securities Trading Center.

1.18. Article 41 has its Clauses 1 and 2 amended and is added with Clauses 5, 6 and 7 as follows:

1. The settlement of securities transactions must accord with the volume of securities and money stated in the settlement vouchers according to the Securities Trading Center’s regulations.

2. The money payment must be effected in form of account transfer through the account system of the custody members and the Securities Trading Center, opened at a designated bank;

The designated bank is a big and prestigious commercial bank designated by the State Securities Commission on the basis of consulting the State Bank and such commercial bank to open settlement accounts for the Securities Trading Center and custody members in service of the settlement of securities transactions.

The bank designated for settlement shall be totally responsible to the State Securities Commission and the Securities Trading Center for the settlement of securities transactions already conducted at the Securities Trading Center.

5. The securities settlement shall be effected in form of account transfer through the account system of custody members and accounts for clearing of traded securities of the Securities Trading Center, opened at the Securities Trading Center.

6. The custody members shall have to ensure the full transfer of securities into their own accounts for clearing of traded securities at the Securities Trading Center within the prescribed time limit.

7. In case of temporary securities insolvency, custody members may supply securities as support to other custody members or receive securities support from other custody members when the Securities Trading Center’s consent is obtained. Those custody members that are temporarily insolvent for securities settlement shall have to bear all expenses and losses incurred and be sanctioned according to the regulations of the State Securities Commission and the Securities Trading Center.

1.19. Article 42 is amended as follows:

All securities must be concentratedly registered at the Securities Trading Center. The securities registration shall include:

1. Registering the newly issued securities;

2. Managing the securities owners registration book;

3. Managing the assigned securities registration book and the pledged securities registration book;

4. Drawing up the list of securities owners in preparation for the annual shareholders’ congresses;

5. Providing services of sending letters to invite shareholders and making minutes of the shareholders’ congresses;

6. Performing the activities related to the payment of dividends;

7. Performing the securities registration operations related to the increase of the issuing companies’ capital;

8. Supervising the participation proportions of the foreign party(ies);

9. Other activities specified by the Securities Trading Center.

1.20. Clause 1 of Article 46 is amended as follows:

1. An issuing organization shall have to notify the Securities Trading Center of the final registration day 15 working days as the latest before the final registration day. Upon receiving the issuing organization’s notice on the final registration day, the Securities Trading Center shall have to notify the custody members thereof 10 working days as the latest before the final registration day.

1.21. Clause 1 of Article 47 is amended as follows:

1. In cases where the list of securities owners submitted by the custody members does not contain adequate or accurate information as required in Clause 3, Article 46 of this Regulation, the Securities Trading Center shall accept only the list’s parts containing adequate and accurate information and return those with inadequate and inaccurate information to the custody members for appropriate supplement and correction. Custody members shall have to submit the supplemented and corrected list to the Securities Trading Center within 15 working days after the final registration day if such supplemented and corrected list is to be used at the shareholders’ regular congress, or within 4 working days after the final registration day if such supplemented and corrected list is to be used for other purposes by the issuing organization.

1.22. Clause 2 of Article 61 is amended as follows:

2. Within 5 working days after the settlement support fund’s money is used, the violating custody members are obliged to refund to the settlement support fund the full amount they have used, compensate for all losses caused by their settlement breaches together with the fine interest calculated from the date the settlement support fund’s money is used. The applicable fine interest shall be calculated on the delayed payment amount and the days of delayed payment. The fine interest rate shall be 1%/day for the first 5 days and 6%/day from the 6th day on. The fine interest shall be channeled into the settlement support fund.

Article 2.- To supersede the contract for opening account between a custody member being a bank and a client with a new form of contract provided for together with this Decision.

Article 3.- To cancel Appendices 13/LK, 14/LK, 15/LK, 16/LK, 17/LK, 18/LK and 19/LK. The relevant forms and tables shall be prescribed by the Securities Trading Center.

Article 4.- This Decision takes effect 15 days after its signing. The previous stipulations which are contrary to this Decision are now all annulled.

Article 5.- The director of the Office, the director of the Department for Securities Business Management and the heads of the units, of the State Securities Commission, the director of the Securities Trading Center, the custody members and the concerned parties shall have to implement this Decision.