Nghị định 108/2013/ND-CP

DECREE

PROVIDING FOR THE SANCTIONING OF ADMINISTRATIVE VIOLATIONS IN THE DOMAINS OF SECURITIES AND SECURITIES MARKET

Pursuant to the Law on organization of Government dated December 25, 2001;

Pursuant to the Law on sanctioning administrative violations dated June 20, 2012;

Pursuant to Law on securities dated June 29, 2006; and Law amending and supplementing a Number of Articles of Law on securities dated November 24, 2010;

Pursuant to the Law on enterprises dated November 29, 2005;

At the request of Minister of Finance;

Government promulgate the Decree providing for the sanctioning of administrative violations in the domains of securities and securities market,

Chapter 1.

GENERAL PROVISIONS

Article 1. Scope of regulation

This Decree provides for acts of administrative violations, sanctioning forms and levels, remedial measures; sanctioning competence and application of the additional sanction forms and remedial measures in the domains of securities and securities market.

Article 2. The subjects sanctioned administratively

Domestic and foreign individuals and organizations (hereinafter collectively referred to as individuals and organizations) committing violations of the law on securities and securities market shall be administratively sanctioned under this Decree.

Organizations sanctioned administratively, within 30 days after complying with decision on sanctioning administrative violations, must define individuals who mistake in causing administrative violations for defining legal liability and financial obligation of such persons as prescribed by law, concurrently inform State Securities Commission about defining individuals who mistake in causing administrative violations.  

Article 3. Forms of sanctioning administrative violations and remedial measures

1. The main sanctioning forms:

For each administrative violation in the domain of securities and securities market, the infringing individuals and organizations must suffer one of the following main sanctions:

a) Caution;

Caution shall be imposed for minor administrative violations or those committed for the first time or involving extenuating circumstances.

b) Fine;

The maximum fine level in the domain of securities and securities market, for the infringing organizations shall be VND 2,000,000,000 and for the infringing individuals shall be VND 1,000,000,000. 

The maximum fine level for organizations committing violation specified in Clause 3 Article 5 of this Decree shall be 5% of total amount mobilized illegally. The maximum fine level for organizations committing violation specified in Clause 5 Article 6 and Clause 2 Article 16 of this Decree shall be five times of the illegal revenue.

The fine levels specified in Chapter II of this Decree is applied to organizations; individuals committing a same violation shall be fined ½ the fine level applied to organizations. 

The fine level specified in Clause 2 and Clause 3 Article 11, Clause 3 Article 24 and Clause 1 Article 27 of this Decree shall be applied to sanction on individuals.

c) Deprivation of the right to use certificate of register for activities of representative offices, certificate of securities practice for a defined time of between over 03 months and 24 months.

2. The main sanctioning forms:

a) Suspension with a defined term for activities of listing securities, activities of registering for securities transaction; suspension with a defined term for a public bid; suspension with a defined term for activities of trading and supplying securities services; suspension with a defined term for activities of branches of foreign fund management companies in Vietnam; suspension with a defined term for activities of representative offices; suspension with a defined term for activities of securities depository or suspension with a defined term for other activities stated in the sanction decision;

b) Deprivation of the right to use certificate of register for activities of representative offices, certificate of securities practice for a defined time of between 01 month and 03 months;

c) Confiscation of exhibits of administrative violations and means used for committing administrative violations.

3. Remedial measures:

a) Forcible recall of securities conducted sale offer, issue and returning the amounts of securities purchase to investors; forcible recall of shares issued additionally;

b) Forcible return of securities, amount possessed by clients;

c) Forcible cancellation of information, correction of information;

d) Forcible remittance of illicit earnings from the commission of violations;

dd) Forcible public bid according to the registered plan;

e) Forcible further purchase of the remaining shares or closed fund certificates after conducting public bid;

g) Forcible abandon of the right to vote directly or through authorized representatives on the share quantity obtaining from violation;

h) Forcible transfer of securities in order to reduce the holding rate in accordance with regulations;

i) Forcible approval of General Meeting of Shareholders for change of purpose and plan on using capital obtaining from sale offer of securities;

k) Forcible depository, separate management of assets, capital and securities; 

l) Forcible provision of explanation, supply of information and figures involving audit activities.

Chapter 2

ADMINISTRATIVE VIOLATIONS, SANCTIONING FORMS AND REMEDIAL MEASURES

SECTION 1. VIOLATIONS OF THE REGULATIONS ON SALE OFFER OF INDIVIDUAL STOCKS IN VIETNAM OF PUBLIC COMPANY AND VIOLATIONS ON THE REGULATIONS ON ISSUING INDIVIDUAL STOCKS IN VIETNAM 

Article 4. Violations of the regulations on sale offer of individual stocks in Vietnam of public company and violations on the regulations on issuing individual stocks in Vietnam

1. A fine of between VND 50,000,000 and 70,000,000 for any of the following violations:

a) Failing to implement or implement improperly with regulations on notification of bond issue;

b) Conducting re-purchase of bonds before the prescribed time, bond swap upon not yet been accepted or conducting re-purchase of bonds before the prescribed time, bond swap inconsistently with the approved plan.

2. A fine of between VND 70,000,000 and 100,000,000 for any of the following violations:

a) Failing to amend and supplement dossier of registration for sale offer of individual stocks, dossier of issuing individual bonds when detecting that information is incorrect or important contents required by regulations to be included in these dossiers are omitted or when arising important information involving the dossier already filed;

b) Conducting sale offer of individual stocks inconsistently with the registered plan; issuing individual stocks inconsistently with the accepted plan; 

c) Certifying the transfer of stocks, bonds which are made sale offer, separate issues in restrained time for transfer, unless otherwise provided by law;

d) Change of purpose or plan to use capital gained from sale offer of individual stocks but failing to be approved by Shareholder’s General Assembly or failing to have authorization of Shareholder’s General Assembly. 

3. A fine of between VND 80,000,000 and 120,000,000 for any of the following violations:

a) Making, certifying the dossier of registration for sale offer of individual stocks, dossier of issuing individual bonds with untrue information or hiding truth, or seriously-misleading information;

b) Conducting sale offer of individual stocks, issue of individual bonds when not satisfying full conditions as prescribed by law;

c) Conducting sale offer of individual stocks without registration with State Securities Commission or not yet been informed by State Securities Commission to let organization register and announce on website about sale offer of individual stocks by the registering organization; conducting the issue of convertible bonds, bonds enclosed with the right certificate but failing to register with State Securities Commission;

d) Conducting the issue of individual bonds when the issuing plan has not yet been accepted by competent individuals or organizations.

4. Remedial measures:

a) Organizations committing violations specified in Clause 3 of this Article must revoke stocks, bonds which have been offered for sale, issued and must return amounts to investors which are used to buy stocks, bonds or advance security money (if any) added interest calculated according to the interest rate stated on bonds or interest of deposit with undefined term of bank where the infringing organizations open account to collect amounts for purchase of stocks, or advance security money at time when decision of applying this measure takes effect and within 15 days after receiving request of investors. Deadline for investors to send request will be 60 days after the effective day of decision on application of this measure;

b) Forcibly having the approval of the nearest Shareholder’s General Assembly for change of purpose or plan to use capital gained from sale offer of individual stocks for violation specified in point d Clause 2 of this Article;

c) Forcibly canceling information, correcting information for violations specified in point a Clause 3 of this Article.

SECTION 2. VIOLATIONS OF THE REGULATIONS ON PUBBLIC OFFERING OF SECURITIES IN VIETNAM

Article 5. Violations of the regulations on dossier of registration for public offering of securities in Vietnam

1. A fine of between VND 80,000,000 and 120.000.000 shall be imposed on act of failing to modify dossiers of registration for public offering of securities upon detecting inaccurate information or omitted important contents required by regulations to be included in these dossiers or when arising important information involving dossiers of registration for public offering of securities;

2. A fine of between VND 300.000,000 and 400.000,000 shall be imposed on act of certifying dossiers of registration for public offering of securities containing untrue information or hiding the truth or having been seriously falsified;

3. A fine equal to between 1% and 5% of the total raised-illegally money amount shall be imposed on organizations that make or certify dossiers for registration of public offering of securities containing forgeries under Clause 1, Article 121 of the Law on Securities.

4. Remedial measures:

a) Individuals and organizations committing violations specified in Clause 1 and Clause 2 of this Article must withdraw securities they have offered and refund to investors with securities purchase payments or deposits (if any) plus interests calculated at demand deposit interest rates applied by banks at which the infringing individuals and organizations open accounts for securities purchase payments or deposits at the time when decision on application of this measure takes effect, within 15 days after receiving requests of these investors.  Deadline for investors to send request will be 60 days after the effective day of decision on application of this measure;

b) Organizations committing violations specified in Clause 3 of this Article must withdraw securities they have offered and refund to investors with securities purchase payments or deposits (if any) plus interests calculated at demand deposit interest rates applied by banks at which the infringing organizations open the accounts for securities purchase payments or deposits, at the time when decision on application of this measure takes effect.  Deadline for withdrawing securities, returning the collected amounts to the investors will be 60 days after the effective day of decision on application of this measure;

c) Forcibly canceling information, correcting information for violations specified in Clause 2 and Clause 3 of this Article.

Article 6. Violations of the regulations on conducting public offer of securities in Vietnam

1. A fine of between VND 70,000,000 and 100,000,000 for any of the following violations:

a) Using information outside prospectuses or falsified information in comparison with information in prospectus to conduct a market survey before being permitted to conduct a public offering of securities; conducting a market survey in the mass media;

b) Failing to strictly comply with regulations on remittance of the amounts collected from the offering into a frozen account or failing to strictly comply with regulations on release of the amounts collected from the offering.

2. A fine of between VND 100,000,000 and 150.000.000 shall be imposed on failing to put securities made public offering into transaction on systematic market within 01 year from the day ending of the offering, unless of failing to be eligible for the listing of securities or registering securities transactions as prescribed by law.

3. A fine of between VND 150,000,000 and 200,000,000 for any of the following violations:

a) Offering of securities inconsistently with the plan already registered with State Securities Commission; conducting distribution of securities in contravention of  law;

c) Changing purpose or plan on using capital gained from sale offer without approval of Shareholder’s General Assembly or authorization of Shareholder’s General Assembly.

4. A fine of between VND 300,000,000 and 400,000,000 for any of the following violations:

b) Conducting a public offering of securities without fully satisfying the specified conditions;

b) Conducting a public offering of securities to found an enterprise, except cases permitted by law;

c) Conducting a public offering of securities without having registered it with the State Securities Commission.

5. A fine equal to between one to five times the illegal earning amounts shall be imposed on organizations conducting a public offering of securities when they have not yet had certificate of public offering of securities as prescribed in Clause 3 Article 121 of the Securities Law.

6. A fine of between VND 500,000,000 and 600.000.000 shall be imposed on foreign organizations conducting a public offering of securities in Vietnam which infringe the commitment of not remitting the mobilized capital to foreign countries or infringe commitment of not drawing the counterpart own capital in duration of projects granted permit.

7. Remedial measures:

a) Individuals and organizations infringing provisions in Clause 2, point a Clause 3, Clause 4, Clause 5 and Clause 6 of this Article must withdraw securities they have offered and refund to investors with securities purchase payments or deposits (if any) plus interests calculated at demand deposit interest rates applied by banks at which the infringing individuals and organizations open accounts for securities purchase payments or deposits at the time decision on application of this measure takes effect, within 15 days after receiving requests of these investors.  Deadline for investors to send request will be 60 days after the effective day of decision on application of this measure;

b) Forcibly having the approval of the nearest shareholder’s general assembly for change of purpose or plan to use capital gained from the offering for violation specified in point 1 Clause 3 of this Article.

SECTION 3. VIOLATIONS OF REGULATIONS ON ISSUING BONDS TO INTERNATIONAL MARKET, OFFERING OF SECURITIES IN FOREIGN COUNTRIES AND ISSUING NEW SECURITIES SERVING AS BASIS FOR OFFERING OF SECURITIES DEPOSITORY CERTIFICATES IN FOREIGN COUNTRIES, OR SUPPORTING FOR THE ISSUE OF SECURITIES DEPOSITORY CERTIFICATES IN FOREIGN COUNTRIES, ON BASIS OF STOCKS WHICH HAVE BEEN ISSUED IN VIETNAM

Article 7. Violations of regulations on issuing bonds to international market, offering of securities in foreign countries and issuing new securities serving as basis for offering of securities depository certificates in foreign countries, or supporting for the issue of securities depository certificates in foreign countries, on basis of stocks which have been issued in Vietnam

1. A fine of between VND 80,000,000 and 120,000,000 for failing to amend and supplement dossiers, documents on issuing bonds to international market, offering of securities in foreign countries and issuing new securities serving as basis for offering of securities depository certificates in foreign countries, or supporting for the issue of securities depository certificates in foreign countries, on basis of stocks which have been issued in Vietnam when detecting information is not exact or miss important content required by regulations to be included in these dossiers, documents, or when arising important information involving the submitted dossiers or documents.

2. A fine of between VND 300,000,000 and 400,000,000 for any of the following violations:

a) Conducting the issue of bonds to international market, offering of securities in foreign countries, the issue of new securities serving as basis for offering of securities depository certificates in foreign countries, or supporting for the issue of securities depository certificates in foreign countries, on basis of stocks which have been issued in Vietnam when not satisfying full conditions as prescribed by law;

b) Conducting the issue of bonds to international market, offering of securities in foreign countries, the issue of new securities serving as basis for offering of securities depository certificates in foreign countries, or supporting for the issue of securities depository certificates in foreign countries, on basis of stocks which have been issued in Vietnam when have not yet registered with competent state agencies or have not yet been appraised, approved or replied in writing by competent agencies or organizations.

3. A fine of between VND 400,000,000 and 500,000,000 for making, certifying on dossiers, documents on issuing bonds to international market, offering of securities in foreign countries and issuing new securities serving as basis for offering of securities depository certificates in foreign countries, or supporting for the issue of securities depository certificates in foreign countries, on basis of stocks which have been issued in Vietnam, which have false information or are hidden the truth, or falsified seriously.

4. Remedial measures:

Forcibly canceling information, correcting information for violations specified in Clause 3 of this Article.

SECTION 4. VIOLATIONS OF THE REGULATIONS ON THE ADDITIONAL ISSUE OF SHARES

Article 8. Violations of the regulations on the additional issue of shares

1. A fine of between VND 70,000,000 and 100,000,000 for any of the following violations:

a) Failing to amend and supplement dossiers, documents of the additional issue of shares when detecting that information is incorrect or miss important content which must be stated in dossiers, documents according to regulations or when arising important information involving the dossiers or documents already filed;

b) Conducting the additional issue of shares inconsistently with plan already reported or registered with State Securities Commission.

2. A fine of between VND 100,000,000 and 150,000,000 for any of the following violations:

a) Making, certifying the dossiers or documents in reports of the additional issue of shares with untrue information or hiding truth, or seriously-misleading information;

b) Conducting the additional issue of shares without reporting to the State Securities Commission or having reported but not yet had the written notice on receiving full reports on the additional issue of shares from the State Securities Commission;

c) Conducting the additional issue of shares without registration with the State Securities Commission or having registered but not yet been approved by the State Securities Commission;

d) Conducting the additional issue of shares when not satisfying full conditions as prescribed by law.

3. Remedial measures:

a) Forcibly canceling information, correcting information for violations specified in point a Clause 2 of this Article;

b) Forcible recall of shares issued additionally within 60 days from the effective day of decision on application of this measure, for violations specified in point b Clause 1 and Clause 2 of this Article.

SECTION 5. VIOLATIONS OF THE REGULATIONS ON OBLIGATIONS OF PUBLIC COMPANY

Article 9. Violations of regulations on dossiers for registration of public companies

1. A warning for submitting dossier for registration of public company one month behind the prescribed deadline.

2. A fine of between VND 5,000,000 and 10,000,000 for submitting dossier for registration of public company between over one month and 12 months behind the prescribed deadline.

3. A fine of between VND 30,000,000 and 50,000,000 for any of the following violations:

a) Failing to submit a registration dossier or submitting a registration dossier of public company over 12 months behind the prescribed deadline;

b) Declaring untruthful information about structure of shareholders, financial statements in the latest year, in registration dossier of public company.

Article 10. Violations of regulations on dossiers for registration of public companies

1. A warning for failing to notify or notify after the prescribed deadline to the State Securities Commission when no longer satisfy conditions of public company as prescribed in Article 25 of the securities Law.

2. A fine of between VND 30,000,000 and 50,000,000 for any of the following violations:

a) Failing to conduct securities registration or centralized depository at the Center of securities depository;

b) Infringing regulations on conducting rights, securities registration and depository at the Center of securities depository

Article 11. Violations of regulations on administration of the public companies

1. A warning for failing to formulate the internal regulations on administering company as prescribed by law.

2. A fine of between VND 30,000,000 and 50,000,000 shall be imposed on members of Board of Directors, members of Control Board, Directors or General Directors, Persons authorized for disclosure of information of public companies, who infringe regulations on providing information for shareholders and Control Board.

3. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on members of Board of Directors, members of Control Board, Directors or General Directors, and other managers of public companies, who fail to comply with full duties and obligations involving administration of their companies as prescribed by law; infringing regulations on prevention of conflicts on benefits and in trading with parties with rights and benefits related to their companies.

4. A fine of between VND 70,000,000 and 100,000,000 for infringing law on administering their companies, including the rights of shareholders, election, dismiss for members of Board of Directors, members of Control Board, summoning and organization of meetings, and approval for decisions of the Shareholder General Assembly, Board of Directors, or Control Board.

5. Remedial measures:

Forcible remittance of illicit earnings from the commission of violations specified in Clause 3 of this Article to their public companies.

SECTION 6. VIOLATIONS OF THE REGULATIONS ON REDEMPTION OF STOCKS OR SALE OF TREASURY STOCKS

Article 12. Violations of the regulations on redemption of stocks or sale of treasury stocks

1. A fine of between VND 30,000,000 and 50,000,000 for failing to comply with regulations on redemption sources and interval between the latest purchase of stocks and the latest sale of treasury stocks.

2. A fine of between VND 70,000,000 and 100,000,000 for any of the following violations:

a) Redeeming stocks or selling treasury stocks without reporting to the State Securities Commission as prescribed by law or having reported but not yet had the written notice of the State Securities Commission, on receiving full documents of reports thereon;

b) Redeeming stocks or selling treasury stocks when not satisfying full conditions as prescribed by law;

c) Redeeming stocks in cases in which redemption is banned by law;

d) Changing the intention or plan on redemption of stocks or sale of treasury stocks in contravention of law;

dd) Redeeming stocks or selling treasury stocks in contravention of plan already reported to the State Securities Commission, or disclosed information.

3. Remedial measures:

Forcible remittance of illicit earnings from the commission of violations specified in Clause 2 of this Article.

SECTION 7. VIOLATIONS OF THE REGULATIONS ON PUBLIC BIDS

Article 13. Violations of the regulations on public bids

1. A fine of between VND 100,000,000 and 150,000,000 for any of the following violations:

a) Directly or indirectly purchasing or pledging to purchase stocks, right to buy shares and convertible bonds of target companies or fund certificates of target investment funds, right to buy fund certificate of target investment funds currently bid for outside a bidding;

b) Selling or pledging to sell stocks, fund certificates they are bidding for public purchase;

c) Unfairly treating owners of the same type of stocks, right to buy shares and convertible bonds, or opened fund certificates currently bid;

d) Providing information only to a certain number of shareholders or investors, or providing information to different shareholders or investors at different extents and different points of time;

dd) Conducting the public bid inconsistently with the prescribed duration or duration already registered with the State Securities Commission;

e) Refusing to purchase stocks from any shareholders of target companies or fund certificates of investors of target investment funds during the public bid;

g) Purchasing stocks of target companies or fund certificates of target investment funds under terms different from those stated in the public bid registration;

h) Failing to conduct or conduct the further purchase of the remaining stocks or closed fund certificates after the public bid in contravention of  regulation on duration or conduct with conditions on prices and payment method which are not similar to those in public bid;

i) Failing to conduct reports, disclosure of information about public bid or conduct reports and disclosure of information about public bid in contravention of law.

2. A fine of between VND 100,000,000 and 150,000,000 shall be imposed on securities companies as public bid agent conducting one of the following violations:

a) Failing to guide individuals, organizations to conduct public bid in accordance with regulations, letting individuals, organizations to conduct public bid infringing provision in Clause 1 of this Article;

b) Failing to ensure that individuals and organizations conduct public bid have enough money to conduct public bid at the official time of public bid as registered.

3. A fine of between VND 200,000,000 and 300,000,000 for any of the following violations:

a) Failing to register public bid in accordance with law;

b) To conduct public bid while State Securities Commission has not yet issued a written approval for registering public bid;

c) To withdraw offer of public bid without acceptance of the State Securities Commission.

4. A fine of between VND 300,000,000 and 400,000,000 for misusing the obtained information of public bid to purchase or sale for themselves or provide information, entice, tempt other persons to purchase or sell securities before official time of public bid.

5. The additional sanctioning forms:

Suspension of public bid in 02 months for violation specified in points a, b, c and d Clause 1 of this Article.

6. Remedial measures:

a) Forcible public bid according to the registered plan for violation specified in points e, g Clause 1 and point c Clause 3 of this Article;

b) Forcible purchase of the remaining number of stocks or closed fund certificates public bid after conducting public bid for violation specified in point h Clause 1 of this Article;

c) Forcible abandonment of the right to vote directly or through authorized representatives on the share quantity obtaining from violations specified in points a, b Clause 3 of this Article and transfer of such share quantity so as to reduce the holding rate down less than 25% of the circulating stocks of a public company in a duration of 06 months maximally;

d) Forcible remittance of illicit earnings from the commission of violations specified in points a, b clause 3 and Clause 4 of this Article.

SECTION 8. VIOLATIONS OF REGULATIONS ON LISTING SECURITIES, REGISTER FOR SECURITIES TRADING OF THE LISTING ORGANIZATIONS AND ORGANIZATIONS REGISTERING FOR SECURITIES TRADING

Article 14. Violations of regulations on securities listing, register for securities trading

1. A fine of between VND 50,000,000 and 70.000.000 for failing to do procedures for changing registration for securities listing, registration for securities trading or conducting the securities listing, registration for securities trading under additional procedures improperly with deadline as prescribed by law.

2. A fine of between VND 80,000,000 and 120.000.000 shall be imposed on failing to modify, supplement dossiers of registration for securities listing or registration for securities trading upon detecting inaccurate information or omitted important contents required by regulations to be included in these dossiers or when arising important information involving the dossiers already filed.

3. A fine of between VND 300.000,000 and 400.000,000 shall be imposed on act of making, certifying dossiers of registration for securities listing or registration for securities trading containing untrue information or hiding the truth or having been seriously falsified;

4. A fine of between VND 1,800.000,000 and 2,000.000,000 shall be imposed on act of making, certifying the falsified dossiers for securities listing or registration for securities trading.

5. The additional sanctioning forms:

Suspension of activities of securities listing or registration for securities trading for duration of 01-03 months for violations specified in Clause 3 and Clause 4 of this Article.

6. Remedial measures:

a) Forcibly canceling information, correcting information for violations specified in Clause 3 and Clause 4 of this Article;

b) Forcible remittance of illicit earnings from the commission of violations specified in Clause 3 and Clause 4 of this Article.

Article 15. Violations of regulations on securities listing of the Vietnamese issuers at the foreign Stock Exchange

1. A fine of between VND 80,000,000 and 120.000.000 shall be imposed on failing to modify, supplement dossiers of registration for securities listing at foreign Stock Exchange upon detecting inaccurate information or omitted important contents required by regulations to be included in these dossiers or when arising important information involving the dossiers already filed.

2. A fine of between VND 100,000,000 and 150,000,000 shall be imposed on the securities issuing organizations which have just set up new facilities for public bid of securities depository certificates abroad without report to be sent to State Securities Commission, about registration for listing of depository certificates at the foreign Stock Exchange.

3. A fine of between VND 300,000,000 and 400,000,000 for any of the following violations:

a) Failing to submit dossiers of registering the securities listing at foreign Stock Exchange, to the State Securities Commission in accordance with law;

b) Conducting the securities listing at foreign Stock Exchange while they have not yet been accepted by the State Securities Commission.

4. A fine of between VND 400.000,000 and 500.000,000 shall be imposed on act of making, certifying dossiers of registration for securities listing at foreign Stock Exchange containing untrue information or hiding the truth or having been seriously falsified;

5. Remedial measures:

Forcibly canceling information, correcting information for violations specified in Clause 4 of this Article.

SECTION 9. VIOLATIONS OF THE REGULATIONS ON ORGANIZATION OF THE SECURITIES TRADING MARKET

Article 16. Violations of the regulations on organization of the securities trading market

1. A fine of between VND 1,800,000,000 and 2,000.000.000 shall be imposed on organizations conducting act of organization of the securities trading market in contravention of law in case there is no illegal revenue.

2. A fine equal to between one to five times the illegal earning amounts as prescribed in Clause 1 Article 124 of the securities Law shall be imposed on organizations conducting act of organization of the securities trading market in contravention of law in case of having illegal revenues but not less than the maximum fine specified in Clause 1 of this Article.

3. The additional sanctioning forms:

Suspension of business and provision of securities services for duration of 01-03 months for violations of regulations on organization of securities trading market.

4. Remedial measures:

Forcible remittance of illicit earnings from the commission of violations specified in Clause 2 of this Article.

Article 17. Violations of regulations on listing management of the Stock Exchange

1. A fine of between VND 200,000,000 and 300.000.000 shall be imposed on the Stock Exchange failing to timely handle cases which the listing organizations fail to maintain full conditions for listing in accordance with regulations.

2. A fine of between VND 300,000,000 and 400.000.000 shall be imposed on the Stock Exchange which accept or cancel the listing in contravention of regulations.

Article 18. Violations of regulations on member management of the Stock Exchange

1. A fine of between VND 200.000.000 and 300,000,000 shall be imposed on the Stock Exchange for failing to timely handle in case where trading members fail to maintain all the conditions on members or fail to strictly comply with regulations on member obligations of the Stock Exchange.

2. A fine of between VND 300,000,000 and 400,000,000 shall be imposed on a stock exchange for recognizing or denying the membership of a securities company in contravention of regulations.

Article 19. Violations of regulations on trading and supervision of the Stock Exchange

1. A fine of between VND 200,000,000 and 300,000,000 shall be imposed on the Stock Exchange conducting any of the following violations:

a) Organizing the trading of securities of a new type, changing or applying new trading methods, or commissioning a new trading system without approval of the State Securities Commission;

b) Failing to promptly handle violations of trading regulations or failing to comply with the prescribed process of supervising trading activities, thus letting violations occur.

2. A fine of between VND 300.000.000 and 400,000,000 shall be imposed on the Stock Exchange for failing to temporarily stopping, terminating or cancelling the securities trading under the trading regulations of the Stock Exchange in necessary cases for protecting investors.

SECTION 10. VIOLATIONS OF THE REGULATIONS ON SECURITIES BUSINESS AND SECURITIES PRACTICING

Article 20. Violations of regulations on permit for establishment and operation

1. A fine of between VND 5,000.000 and 10.000.000 shall be imposed on a securities company, fund management company or securities investment company; a Vietnam-based branch of a foreign securities company or fund management company which uses the name of the company, branch, representative office or transaction bureau; or renames of company, branch, representative office or transaction bureau in contravention of regulations.

2. A fine of between VND 10,000,000 and 30,000,000 shall be imposed on Vietnam-based branch of a foreign securities company or fund management company which fails to conduct procedures for adjusting permit of establishment and operation of branch in accordance with law.

3. A fine of between VND 50,000.000 and 70.000.000 shall be imposed on a securities company, fund management company or securities investment company; a Vietnam-based branch of a foreign securities company or fund management company which fails to revise, supplement dossier of requesting for grant, adjustment of permit of establishment and operation when detect incorrect information or omitted important content required by regulations to be included in dossier or when arising important information involving dossier already filed.

4. A fine of between VND 70,000.000 and 100.000.000 shall be imposed on a securities company, fund Management Company or securities investment company; a Vietnam-based branch of a foreign securities company or fund management company which conducts any of following violations:

a) Setting up or shutting down a branch, representative office or transaction bureau based in Vietnam or foreign country or investing abroad without approval of State Securities Commission;

b) Conducting its separation, splitting up, merger, consolidation or transformation or dissolving itself before schedule or suspends its operation without approval of the State Securities Commission, unless otherwise provided for by law.

5. A fine of between VND 100,000,000 and 150,000,000 for any of the following violations:

a) Erasing, modifying the permit;

b) Borrowing, hiring permit, receiving the permit transfer or lending, leasing, transferring its permit;

c) Conducting securities business or providing securities services at locations without approval of the State Securities Commission or changing location of head office, branch, representative office, transaction room without approval of the State Securities Commission;

d) Conducting securities business or providing securities services while failing to meet all conditions as prescribed by law.

6. A fine of between VND 200,000,000 and 300,000,000 for any of the following violations:

a) Conducting securities business or providing securities services without license or approval of the State Securities Commission, providing securities services, financial services without written opinion of the State Securities Commission or without guiding regulations of competent state agencies;

b) Operating not in compliance with its license.

7. A fine of between VND 200.000,000 and 300.000,000 shall be imposed on act of compiling or certifying a dossier of application for an establishment and operation license or its supplementation, which contains misleading information, hiding the truth or having been seriously falsified.

8. The additional sanctioning forms:

Suspension of activities of securities business, securities services for duration of 01-03 months for violations specified in points b, c, d Clause 5, Clause 6 and Clause 7 of this Article.

9. Remedial measures:

Forcible remittance of illicit earnings from the commission of violations specified in Clause 4, Clause 5 and Clause 6 of this Article.

Article 21. Violations of regulations on operation of securities companies

1. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on securities companies conducting any of the following violations:

a) Failing to promulgate sufficient internal processes, professional processes, internal control and risk governance processes, rules of professional ethic conforming with business operation of company; failing to comply with processes, rules of professional  ethic;

b) Failing to comply with the securities law, enterprise law and other law in administration and running of company;

c) Compiling or certifying a dossier of registration for providing service of online securities transaction containing the inaccuracy information or failing to modify, supplement when detecting incorrect information or omitted important contents required by regulations to be included in dossier;

d) Failing to collect, update sufficient information of customers, unless these customers fail to provide sufficient information; failing to supply sufficient and truthful information to its customers;

dd) Failing to separate working rooms, human, data system, report among professional division; failing to set up division for information and communication with customers and solving complaints of customers.

2. A fine of between VND 70,000,000 and 100,000,000 shall be imposed on securities companies conducting any of the following violations:

a) Failing to archive sufficient dossiers, documents, vouchers involving activities of company; the archived dossiers, documents and vouchers fail to record in detail and accurately its and its customers' transactions;

b) Opening accounts of securities transaction for customers, taking orders of customers and performing transaction orders of customers in contravention of law;

c) Violating regulations on liability of Securities Company in performing the professional operations of securities investment advisory, financial advisory; conducting banned acts in professional operations of securities investment advisory, financial advisory;

d) Accepting entrustment for managing accounts in securities transaction of investors being individuals in contravention of law;

dd) Failing to set up or maintain a system of internal audit, internal control and risk management in accordance with law; failing to supervise and prevent conflicts of interests within customers, or between the company, securities practitioners and customers in accordance with law;

e) Anticipating or guaranteeing its customers of a ratio of earnings or profits to their investments or securing its customers of no loss incurred, unless customers invest in securities with fixed earnings.

3. A fine of between VND 100,000,000 and 150,000,000 shall be imposed on Securities Company conducting any of the following violations:

a) Conducting act which makes its customers and investors misunderstanding about securities prices;

b) Agreeing or giving a specific interest or sharing profit or loss with customers to entice customers in participating in transaction;

c) Paying transaction with other person not being person named on transaction account without authorization in writing of person named on account;

d) Disclosing customer information, unless it is so provided for by law or requested by state management agencies; failing to supply or supplying insufficient and untruthful information of customers, improperly with deadline, at the request of State Securities Commission;

dd) Infringing provisions on operation of self-trading in securities; infringing the regulations on conditions, limitations of guarantee for securities issue; infringing the regulations on investment limitation of the securities company;

e) Conducting transactions which result a change in its share or contributed capital ownership in contravention of law; increasing or reducing its charter capital in contravention of law;

g) Infringing the regulations on securities escrow transaction;

h) Buying or letting its customers buy securities when these customers do not possess sufficient money as required by law, unless otherwise provided for by law.

4. A fine of between VND 150,000,000 and 200,000,000 shall be imposed on securities companies conducting any of the following violations:

a) Failing to set up a system of separate management for money of customers or failing to separately manage deposit for securities transaction of each customer or failing to separately manage money of customers from its own money; receiving and paying securities transaction money directly from its customers; accepting authorization of customers to conduct internal money transfer among accounts of customers;

b) Infringing the regulations on managing securities of customers;

c) Infringing the regulations on limitation of borrowing or limitation of loaning;

d) Using its capital or assets to provide loans in contravention of law.

5. The additional sanctioning forms:

Suspension of activities of securities business, securities services of securities company for duration of 01-03 months for violations specified in points c, dd, g Clause 3 and Clause 4 of this Article.

Article 22. Violations of regulations on operation of fund management companies, Vietnam-based branches of foreign fund management companies

1. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on fund management companies conducting any of the following violations:

a) Conducting violations specified in points a, b and d clause 1 Article 21 of this Decree;

b) Failing to sign contract in writing with customers when provide service for customers or contract have insufficient content as prescribed by law;

c) Failing to comply with its charter or investment portfolio management contracts;

d) Failing to separate head office, equipment, computer system, information technology infrastructure from other economic organizations; failing to separate the database among professional division with potential conflicts on benefits in company;

dd) Failing to supply timely, sufficient and honest information to depository bank, supervisory bank as prescribed by law.

2. A fine of between VND 70,000.000 and 100.000.000 shall be imposed on a fund management company or a Vietnam-based branch of a fund management company which conducts any of following violations:

a) Failing to set up a system of internal control, division of internal control, internal audit in accordance with regulations; failing to ensure personal structure at divisions of internal control, internal audit to meet conditions in accordance with regulations; failing to supervise and prevent conflicts of interests within customers, or between the company, securities practitioners and customers in accordance with law;

b) Violating regulations on liability of fund management company in performing the professional operations of securities investment advisory; conducting banned acts in professional operations of securities investment advisory;

c) Failing to comply with process of distributing transaction orders, distributing transaction assets upon conducting transactions for investment funds, securities investment companies, trusting investors and itself;

d) Acting as a buying or selling partner in a transaction in assets for trusted investment in contravention of law;

dd) Failing to keep the prescribed investment ratio or failing to readjust the investment portfolio under law;

e) Failing to conduct in accordance with regulations on authorized operation of fund Management Company;

g) Anticipating or guaranteeing its customers of a ratio of earnings or profits to their investments or securing its customers of no loss incurred; agreeing or giving a specific interest or sharing profit or loss with customers; deciding on investments on its customers' behalf, unless it is so provided by law.

3. A fine of between VND 100,000,000 and 150,000,000 shall be imposed on a fund management company conducting any of the following violations:

a) Conducting violations specified in points b, d and e clause 3 Article 21 of this Decree;

b) Failing to comply with the prescribed pricing process or wrongly pricing fund certificates, or wrongly valuating the net assets or investment portfolio of a fund, securities investment company, or trusting investor;

c) Infringing regulations on limitations on operation of fund management companies, their affiliated persons and staff; infringing regulations on limitations on operation of securities investment companies; infringing regulations on investment funds for real estate;

d) Failing to ensure that investment in assets of the entrusting customers being foreign individuals or organizations complies with law on foreign exchange management and ratio of ownership in Vietnamese enterprises.

4. A fine of between VND 150,000,000 and 200,000,000 shall be imposed on a fund management company conducting any of the following violations:

a) Shirking its legal obligations, limiting the scope of its compensation and financial liability, transferring risks from it to investors or unfairly forcing investors to pay compensations;

b) Using assets of an investment fund or securities investment company to invest in such investment fund or securities investment company or other investment funds or securities investment companies established and operating in Vietnam or to contribute capital to a joint venture or association or to make financial investments in itself and its affiliated persons;

c) Making financial investments, buying shares, contributed capital, bonds, participating in capital contribution to establish enterprises; holding shares in contravention of regulations;

d) Borrowing loans to finance operation of an investment fund, securities Investment Company in contravention of law;

dd) Using assets of an investment fund or securities investment company or trusted assets to pay debts, provide loans or guarantee any loan of the company, its affiliated persons or any partner;

e) Providing loans or consigning its capital to institutions or individuals in contravention of law;

g) Agreeing customers to borrow its securities or other assets; broking transaction between customers and the third party;

h) Failing to put into the depository and separately manage assets and capital of each entrusting investor, investment fund or securities investment company managed by it; failing to separate entrusted assets, assets of investment fund, securities Investment Company from its assets;

i) Using capital of entrusting customers for investment in contravention of law;

k) Acting in collusion with securities companies to conduct excessive transactions with securities in investment portfolio of a fund managed by a fund management company for Securities Company to earn benefit from brokerage charges.

5. A fine of between VND 150,000.000 and 200.000.000 shall be imposed on a Vietnam-based branch of a fund management company which conducts any of following violations:

a) Infringing regulations on raising and managing funds and assets in Vietnam;

b) Infringing the regulations on foreign exchange management, ratio of ownership in Vietnamese enterprises;

c) Using the entrusted assets in contravention of law;

d) Conducting sale offer, issue of securities to raise capital for itself in Vietnam;

dd) Remitting profits to foreign country in contravention of law;

e) Failing to put into the depository and separately manage assets and capital of each entrusting investor, investment fund or securities investment company managed by it; failing to separate entrusted assets, assets of investment fund, securities Investment Company from its assets;

6. The additional sanctioning forms:

a) Suspension of activities of securities business, securities services of fund management company for duration of 01-03 months for violations specified in points c Clause 3 and points dd, e, h, I Clause 4 of this Article;

b) Suspension of activities of Vietnam-based branch of foreign fund Management Company for duration of 01-03 months for violations specified in Clause 5 of this Article.

7. Remedial measures:

a) Forcible remittance of illicit earnings from the commission of violations specified in clause 2, Clause 3, Clause 4 and Clause 5 of this Article;

b) Forcibly putting into the depository and separately manage assets and capital of each entrusting investor, investment fund or securities investment company managed by company or branch; forcibly separately managing the entrusted assets, assets of investment fund, securities investment company from assets of company or branch within 06 months for violations specified in point h, Clause 4 and point e Clause 5 of this Article;

Article 23. Violations of regulations on operation of separate securities investment companies which self-manage capital

1. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on a separate securities investment company which self manages its capital conducting any of the following violations:

a) Failing to modify, supplement dossiers of registration for establishment of separate securities investment company self managing its capital, upon detecting inaccurate information or omitted important contents required by regulations to be included in these dossiers or when arising important information involving the dossiers already filed;

b) Failing to promulgate process of evaluating net assets of securities Investment Company or failing to valuate net assets or wrongly valuating the net assets of a securities investment company.

2. A fine of between VND 70,000,000 and 100,000,000 shall be imposed on a separate securities investment company which self manages its capital conducting any of the following violations:

a) Participating in elaboration, implementation and development of a project on real estate;

b) Infringing regulations on limited operation of securities investment companies;

c) Conducting transactions which result a change in its share or contributed capital ownership in contravention of law; increasing or reducing its charter capital in contravention of law.

3. A fine of between VND 200.000,000 and 300.000,000 shall be imposed on a separate securities investment company self manage its capital which makes, certifies dossiers of registration for establishment of a separate securities investment company self manage its capital containing untrue information or hiding the truth or having been seriously falsified.

4. Remedial measures:

Forcibly canceling information, correcting information for violations specified in Clause 3 of this Article.

Article 24. Violations of the regulations on representative offices of securities business institutions

1. A fine of between VND 10,000,000 and 30,000,000 shall be imposed on securities business organizations failing to conduct procedures for adjusting, amending and supplementing, re-granting certificate of operation registration, operation suspension of representative office in accordance with law. 

2. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on securities business organizations conducting any of the following violations:

a) Commencing the operation of a representative office without having fully satisfied prescribed conditions or failing to make operation registration under regulations, or operating without obtaining a representative office operation registration certificate;

b) Acting as representative for another organizations; transferring its representative office operation registration certificate to other individual or organization;

c) Erasing or modifying contents of the representative office operation registration certificate.

3. A fine of between VND 70,000,000 and 100,000,000 shall be imposed on head of representative office of securities business organization conducting activities of business in Vietnam or business in securities or management of capitals, assets for foreign investors or securities trading organizations in contravention of law.

4. Deprivation of the right to use representative office operation registration certificate for duration of 18-24 months shall be imposed on a securities trading organization conducting any of the following violations:

a) Making, certifying the dossiers requesting for grant of representative office operation registration certificate containing untrue information or seriously-misleading information;

b) Operating for improper purposes or at variance with the operation registration certificate.

5. The additional sanctioning forms:

a) Suspension of activities of representative offices for duration of 01-03 months for violations specified in points a and b, c Clause 2 of this Article;

b) Deprivation of the right to use certificate of representative offices operation registration for duration of 01-03 months for violations specified in Clause 3 of this Article.

6. Remedial measures:

Forcible remittance of illicit earnings from the commission of violations specified in Clause 2, Clause 3 and Clause 4 of this Article.

Article 25. Violations of regulations on establishment of member funds

1. A fine of between VND 50,000,000 and 70.000.000 shall be imposed on failing to modify, supplement dossiers of establishing member fund upon detecting inaccurate information or omitted important contents required by regulations to be included in these dossiers or when arising important information involving the dossiers already filed.

2. A fine of between VND 70,000,000 and 100,000,000 for any of the following violations:

a) Using the mass media to advertise, call for capital contribution or probe the market in the process of setting up a member fund;

b) Increasing or reducing its charter capital in contravention of law.

3. A fine of between VND 100,000,000 and 150,000,000 for any of the following violations:

a) Failing to report on the setting up of a member fund under regulations or setting up a member fund without satisfying prescribed requirements;

a) Failing to report or to promptly report on risks or fund asset losses.

4. A fine of between VND 200.000,000 and 300.000,000 shall be imposed on act of compiling or certifying a dossier of application for establishment of member fund, which contains untrue information, hides the truth or is seriously falsified.

5. Remedial measures:

Forcibly canceling information, correcting information for violations specified in Clause 4 of this Article.

Article 26. Violations of the regulations on managing securities practitioners and securities practice

1. A fine of between VND 30,000,000 and 50,000,000 for any of the following violations:

a) Failing to report or to promptly report on change of its securities practitioners;

b) Failing to employ sufficient securities practitioners for each business operation under regulations; employing persons possessing securities practice certificates to perform operations incompatible with their practice certificates in accordance with law.

2. A fine of between VND 50,000,000 and 70,000,000 for any of the following violations:

a) Employing persons possessing no securities practice certificate to perform operations which require securities practice certificates under law;

b) Failing to change or remove from professional positions for persons possessing securities practice certificates who have their practice certificates revoked;

c) Failing to report or to promptly report on practitioners detected to have committed violations specified in Clauses 3 and 4 of this Article.

3. Deprivation of the right to use securities practice certificates for duration of 06-12 months shall be imposed on a securities practitioner conducting any of the following violations, unless otherwise provided by law:

a) Concurrently working for another institution which has ownership relations with the Securities Company or fund management company at which he/she is working;

b) Concurrently working for another securities company or fund management company;

c) Concurrently acting as the director or director general of an institution making a public offering of securities or an issuing institution;

d) Concurrently opening a securities trading account at another securities company.

4. A fine of between VND 100,000,000 and 150,000,000 for any of the following violations:

a) Borrowing, renting securities practice certificate or lending, leasing securities practice certificate;

b) Erasing, modifying securities practice certificate.

5. A fine of between VND 150,000,000 and 200,000,000 for any of the following violations:

a) Changing the priority order of orders of customers; misusing the access with information of orders of customers which have not yet entered into the transaction system so as to make an order for himself/herself or another individual or organization on the basis of anticipating that information in the transaction orders of customers able to impact appreciably on price of securities, with the aim to earn benefit from change of securities prices;

b) Using name or account of a customer to register, make securities transactions;

c) Buying, selling securities on the entrusted transaction account in excess of the entrusted scope, value of entrusted assets and investment objective of the entrusting customers.

6. A fine of between VND 200,000,000 and 300,000,000 for any of the following violations:

a) Appropriating securities, money under the possession of customers or temporarily keeping securities, money under the possession of customers in form of depository under name of Securities Company;

b) Lending money, securities on accounts of customers;

c) Using securities of customers for pledge;

d) Using a customer's account or money or securities on such account without authorization of Securities Company according to written entrustment of this customer to Securities Company;

dd) Buying or letting its customers buy securities when these customers do not possess securities or letting its customers borrow securities, unless otherwise provided for by law.

7. The additional sanctioning forms:

a) Depriving the right to use of securities practice certificate for duration of 01-03 months for violations specified in point a Clause 4, Clause 5 and Clause 6 of this Article;

b) Suspension of activities of securities business, securities services of Securities Company, fund Management Company for duration of 01-03 months for violations specified in Clause 5 and Clause 6 of this Article.

8. Remedial measures:

Forcible recall of securities, money under the possession of customers within 60 days from the effective day of decision on application of this measure, for violations specified in points a, b, c and d Clause 6 of this Article.

Section 11. VIOLATIONS OF THE REGULATIONS ON SECURITIES TRANSACTION

Article 27. Violations on regulations on transactions of founding shareholders, internal shareholders, internal investors of public fund in closed form, major shareholders, investors holding 5% or more of fund certificates of a public fund in closed form, persons authorized to disclose information, and affiliated persons

1. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on members of Board of Directors, Directors or General Directors, Deputy Directors or Deputy General Directors, Chief accountant, persons in charge of finance or accounting and other managers in the management apparatus of public companies, who buy and sell or sell and buy securities of public companies not within the prescribed time limit.

2. A fine of between VND 50,000,000 and 70.000.000 for failing to report or reporting not within the prescribed time limit to the public company, fund management company, the State Securities Commission and the stock exchange when having changes of quantity of held shares or fund certificates in excess of 1% of shares or fund certificates.

3. A fine of between VND 70,000,000 and 100,000,000 for any of the following violations:

a) Failing to report or to report adequately and accurately or to report within the prescribed time limit before conducting a transaction; failing to report or to report within the prescribed time limit on transaction results or on the failure to conduct a transaction or to conduct all registered transactions;

b) Failing to conduct a transaction within the registered transaction time or conduct a securities transaction at variance with the registered content or in contravention with law.

4. A fine of between VND 100,000,000 and 150,000,000 for any of the following violations:

a) Failing to report or to report within the prescribed time limit about possession to public company, fund Management Company, the State Securities Commission and the Stock Exchange;

b) Reporting about possession with inadequate or inaccurate contents as prescribed by law;

c) Failing to report or report within the prescribed time limit to the public company, to the fund management company, the State Securities Commission and the stock exchange upon having the first change in the quantity of held stocks, resulting a major shareholder or investor owning 5% or more of fund certificate of a public fund in closed form is no longer;

d) Transferring shares, contributed capital in the time of limitation for transfer as prescribed by law.

5. Remedial measures:

Forcible remittance of illicit earnings from the commission of violations specified in Clause 1 of this Article to public companies.

Article 28. Violations of regulations on trading and holding securities of investors

1. A fine of between VND 50,000,000 and 70,000,000 for any of the following violations:

a) Breaching the prescribed stockholding rate applicable to foreign investors; violating the regulation on operation of foreign investors on the Vietnamese securities market;

b) Violating regulations on the rate of ownership of equity capital or contributed capital of securities companies and fund management companies;

c) Infringing the regulations on opening accounts for securities transaction, securities escrow transaction, accounts for authorized transactions;

d) Violating of the regulations on securities transaction in transaction day.

2. A fine of between VND 100,000,000 and 150,000,000 for conducting one or some transactions with the aim to hide the actual ownership on a securities for shirking obligation of information disclosure in accordance with regulations.

3. Remedial measures:

a) Forcible remittance of illicit earnings from the commission of violations specified in Clause 1 of this Article;

b) Forcible transfer of shares within 60 days so as to reduce ratio of stockholding in accordance with regulations, for violations specified in points a and b Clause 1 of this Article.

Article 29. Violations of the regulations on banned transactions

1. A fine of between VND 800,000,000 and 1,000,000,000 for conducting internal transaction.

2. A fine of between VND 1,200,000,000 and 1,400,000,000, for fraud or creating, disclosure of untrue information so as to entice, induce securities purchase and sale.

3. A fine of between VND 1,000,000,000 and 1,200,000,000 for conducting transactions manipulating securities market.

4. The additional sanctioning forms:

Suspension of securities business and service or deprivation of the right to use of securities practice certificate for duration of 01-03 months for violations specified in Clause 1, Clause 2 and Clause 3 of this Article.

5. Remedial measures:

a) Forcible remittance of illicit earnings from the commission of violations specified in Clause 1, clause 2, and Clause 3 of this Article;

b) Forcibly canceling information, correcting information for violations specified in Clause 2 of this Article.

SECTION 12. VIOLATIONS OF THE REGULATIONS ON SECURITIES REGISTRATION, DEPOSITORY, CLEARING AND PAYMENT, ON SUPERVISORY BANKS AND DEPOSITORY BANKS

Article 30. Violations of regulations on registration of depository operation

1. A fine of between VND 30,000,000 and 50,000,000 shall be imposed on a securities company or commercial bank which fails to carry out registration of a depository member or a depository member's branch and securities depository operation within the prescribed time limit.

2. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on a securities company or commercial bank which conducts securities depository operation without fully meeting the specified conditions or obtaining a securities depository operation registration certificate or an approval of the State Securities Commission.

3. A fine of between VND 100.000,000 and 120.000,000 shall be imposed on a securities company or commercial bank who makes dossier of registration for securities depository operation, branch operating depository containing untrue information or hiding the truth or being seriously falsified;

4. The additional sanctioning forms:

Suspension of securities depository operation for duration of 01-03 months for violations specified in Clause 3 of this Article.

5. Remedial measures:

a) Forcible remittance of illicit earnings from the commission of violations specified in Clause 2 of this Article;

b) Forcibly canceling information, correcting information for violations specified in Clause 3 of this Article.

Article 31. Violations of regulations on securities registration, depository, clearing and payment

1. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on Stock Depository Center, depository member, payment bank which conduct any of the following violations:

a) Organizing securities registration, depository, clearing and payment without satisfying specified conditions on physical and technical foundations for securities registration, depository, clearing and payment activities in accordance with law;

b) Failing to supply adequate, timely and accurate lists of owners and shareholders and relevant documents upon valid requests of public companies and in compliance with current regulations; failing to promptly and adequately notify benefits arising from deposited securities of customers.

2. A fine of between VND 70,000,000 and 10,000,000 shall be imposed on Stock Depository Center, depository member violating regulations on securities preservation and keeping or regulations on securities registration, depository, clearing and payment.    

3. A fine of between VND 100,000,000 and 150,000,000 shall be imposed on Stock Depository Center, depository member, and a fine of between VND 50,000,000 and 75,000,000 shall be imposed on staff of securities depository member, conducting any of the following violations:

a) Violating regulations on accounting on securities depository accounts, time limit for securities payment or ownership transfer;

b) Conducting a transaction in securities which have not been accounted by the Securities Depositary Center into a member's securities trading account, unless otherwise provided for by law;

c) Failing to protect the database and keep original documents on securities registration, depository, clearing and payment under regulations;

d) Infringing the regulations on confidentiality of information involving the securities ownership of customers;

dd) Failing to conduct depository and failing to manage securities deposited by customers at the Securities Depositary Center or a depository member separately from assets of the Center or depository member; failing to open a detailed securities depository account for each customer and to manage separately assets of each customer.

4. A fine of between VND 300,000,000 and 400,000,000 shall be imposed on Stock Depository Center conducting any of the following violations:

a) Accepting or canceling a depository membership in contravention of regulations;

b) Using securities of customers in interest of other institutions and individuals or for its own benefit.

5. A fine of between VND 400,000,000 and 500,000,000 shall be imposed on Stock Depository Center, depository member, and a fine of between VND 200,000,000 and 250,000,000 shall be imposed on staff of securities depository member, modifying, forging, or causing loss of vouchers during payment, transfer of securities ownership.

6. The additional sanctioning forms:

a) Suspension of securities depository operation for duration of 01-03 months shall be imposed on depository member violation regulations in points a, b, c, and d Clause 3 of this Article;

b) Suspension of activities of securities business, securities services for duration of 01-03 months for depository member violating regulations in point dd Clause 3, and Clause 5 of this Article;

c) Depriving the right to use of securities practice certificate for duration of 01-03 months for securities practitioners violating regulations in Clause 5 of this Article.

7. Remedial measures:

a) Forcibly managing the securities deposited by customers at the Securities Depositary Center or a depository member separately from assets of the Center or depository member; forcibly opening a detailed securities depository account for each customer and managing separately assets of each customer, for violations specified in point dd Clause 3 of this Article for a duration of 06 months from the effective day of decision on application of this measure;

b) Forcible remittance of illicit earnings from the commission of violations specified in Clause 3, Clause 4 and Clause 5 of this Article.

Article 32. Violations of regulations on responsibilities of Supervisory bank, depository bank

1. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on Supervisory bank, depository bank conducting any of the following violations:

a) Failing to properly and fully perform its obligations as prescribed in the supervision or depository contract, the fund charter and by law;

b) Failing to make and archive dossiers and documents under regulations; failing to record in an accurate and detailed manner transactions of a fund management company, investment fund, entrusting investor or securities investment company in accordance with law;

c) Failing to supply timely, sufficient and accurate information to fund Management Company, audit organization as prescribed by law;

d) Failing to ensure that division of providing services for valuating net assets employs staff possessing the audit or accounting practice certificates in accordance with law;

dd) Failing to formulate process of operation and risk control to ensure fulfilling obligations as prescribed by law.

2. A fine of between VND 70,000,000 and 100,000,000 shall be imposed on depository bank conducting any of the following violations:

a) Failing to conduct timely and accurate collection, payment, settlement and transfer of money and securities under regulations;

b) Paying for transactions not in accordance with the fund charter, entrustment contract and depository contract;

c) Failing to properly, adequately and promptly execute orders or other lawful instructions of the fund management company and supervisory bank and to exercise rights arising in exercising rights and performing obligations related to the ownership of assets of the investment fund, securities investment company or trusting investor;

d) Failing to adequately, accurately and promptly implement regulations on asset liquidation and plans on handling of remaining assets; failing to report to the State Securities Commission on necessary information relating to investment fund dissolution.

3. A fine of between VND 70,000,000 and 100,000,000 shall be imposed on supervisory bank, and a fine of between VND 35,000,000 and 50,000,000 shall be imposed on a member of the Board of Directors, a director or director general, a deputy director or deputy director general, or a professional staff of supervisory bank who commits any of the following violations:

a) Being an affiliated person or participating in the management and administration of a fund management company or having an ownership, capital contribution, share holding, borrowing or lending relation with a fund management company or securities investment company and vice versa;

b) Being a partner in asset transactions of an investment fund or securities investment company;

c) Failing to supervise operation or limit investment of an investment fund, securities Investment Company made by a fund management company;

d) Failing to report or to promptly report to the State Securities Commission on an error or a violation of a fund management company upon detecting it;

dd) Failing to promptly notify a functional state management agency of the fact that supervisory bank , member of Board of Directors, manager or professional staff is an affiliated person or has an ownership, capital contribution, share holding, borrowing or lending relation with a fund management company or securities investment company and vice versa;

e) Failing to separate the section providing the service of determining net asset values from the supervisory section and the section in charge of making, archiving and updating the investor register in terms of operation, information technology system and reporting system;

g) Failing to fully discharge the responsibility of a supervisory bank in reports on assets and operation of an investment fund made by a fund management company; certifying an inaccurate or erroneous asset report of a public fund or securities investment company or a report on determination of net asset values made by a fund management company or securities investment company.

4. A fine of between VND 100,000,000 and 150,000,000 shall be imposed on depository bank conducting any of the following violations:

a) Failing to put into the depository and separate assets of each investment fund or securities investment company, of each entrusting customers from assets of bank in accordance with law;

b) Using money and assets of investment fund, securities Investment Company, or entrusting investor for improper purpose, in contravention with fund’s charter, depository contract and law.

5. The additional sanctioning forms:

Suspension of securities depository operation for duration of 01-03 months for violations specified in Clause 4 of this Article.

6. Remedial measures:

a) Forcibly putting into the depository and separately managing assets of each investment fund or securities investment company, of each entrusting customer from assets of bank in accordance with law, for violations specified in point a Clause 4 of this Article within 06 months from the effective date of decision on application of this measure;

b) Forcible remittance of illicit earnings from the commission of violations specified in point b Clause 4 of this Article.

SECTION 13. VIOLATIONS OF THE REGULATIONS ON INFORMATION DISCLOSURE AND REPORTING

Article 33. Violations of the regulations on information disclosure

1. A warning for any of the following violations:

a) Failing to register the person authorized to disclose information; failing to notify or to notify within the prescribed lime limit the change of this person under regulations;

b) Failing to notify the State Securities Commission, the Stock Exchange about address of website and all changes involving this address in accordance with law.

2. A fine of between VND 10,000,000 and 30,000,000 for any of the following violations:

a) Failing to comply with full law on means and forms of information disclosure;

b) Failing to archive disclosed information under law.

3. A fine of between VND 50,000,000 and 70.000.000 for disclosing information not within the prescribed time limit, not adequate content in accordance with law or at the request of the State Securities Commission.

4. A fine of between VND 70,000,000 and 100,000,000 for any of the following violations:

a) Failing to build a website under law;

b) Failing to disclose information in accordance with law or at the request of the State Securities Commission;

c) Failing to certify or correct information or failing to do so within the prescribed time limit upon receiving information affecting securities prices or upon receiving a request of the State Securities Commission for information certification or correction;

d) Disclosing inaccurate information.

5. The additional sanctioning forms:

Suspension of activities of securities business, securities services of Securities Company, fund Management Company, for duration of 01-03 months for violations specified in Clause 4 of this Article.

6. Remedial measures:

Forcibly canceling information, or correcting information for violations specified in points c and d Clause 4 of this Article.

Article 34. Violations of the regulations on reporting

1. A fine of between VND 10,000,000 and 30,000,000 for failing to archive reported information under law.

2. A fine of between VND 50,000,000 and 70.000.000 for reporting not within the prescribed time limit, not adequate content in accordance with law or at the request of the State Securities Commission.

3. A fine of between VND 70,000,000 and 100,000,000 for any of the following violations:

a) Failing to report in accordance with law or at the request of the State Securities Commission;

b) Inaccurately reporting.

4. The additional sanctioning forms:

Suspension of activities of securities business, securities services of Securities Company, fund Management Company, for duration of 01-03 months, for violations specified in Clause 3 of this Article.

5. Remedial measures:

Forcibly correcting information for violations specified in point b Clause 3 of this Article.

SECTION 14. VIOLATIONS OF REGULATIONS ON AUDIT OF LARGE-SIZED PUBLIC COMPANIES, LISTING INSTITUTIONS, ORGANIZATIONS CONDUCTING PUBLIC BID OF SECURITIES, SECURITIES COMPANIES, INVESTMENT SECURITIES COMPANIES, FUNDS AND FUND MANAGEMENT COMPANIES

Article 35. Violations of regulations on audit of large-sized public companies, listing institutions, organizations conducting public bid of securities, securities companies, investment securities companies, funds and fund management companies

1. A fine of between VND 5,000,000 and 10.000.000 shall be imposed on an accepted audit institution which fails to report, to report within the prescribed time limit to the State Securities Commission upon changing its name, head office or practice field in accordance with regulations.

2. A fine of between VND 50,000,000 and 70,000,000 shall be imposed on an accepted audit institution and a fine of between VND 25,000,000 and 35,000,000 shall be imposed on an accepted practicing auditor upon conducting any of the following violations:

a) Failing to notify the audited unit upon detection of failure to comply with law and regulations concerning formulation, presentation of audited financial statements, or failure to request this unit to take measures to prevent or remedy its violation, or failure to record opinion on audit report or management letter in accordance with regulations on audit standard in case where this unit fails to repair, handle its violation;

b) Failing to notify or to promptly notify the audited unit, or a third party, or the State Securities Commission upon suspicion or detection of a material error or violation caused by the audited institution's failure to comply with law and regulations concerning audited financial statements;

c) Failing to provide for explanations, information, and data involving the audit operation, or failing to provide timey, adequate, accurate explanations, information, and data involving the audit operation at the request of the State Securities Commission.

3. A fine of between VND 70,000,000 and 100,000,000 shall be imposed on an accepted audit institution upon conducting any of the following violations:

a) Assigning partly or entirely audit affair of large-sized public company, listing institutions, organizations conducting pubic bid of securities, securities companies, securities investment companies, funds and fund management companies to a audit institution not been accepted for implementation, unless otherwise provided for by law;

b) Failing to report or to report within the prescribed time limit to the State Securities Commission upon changing list of the practice auditors and changes which result no-eligibility for approval for audit.

4. Remedial measures:

Forcible provision of explanations, information, data involving audit operation to the State Securities Commission, for violations specified in point c Clause 2 of this Article, within 03 days from the effective day of decision on application of this measure.

SECTION 15. VIOLATIONS OF REGULATIONS ON INSPECTION AND EXAMINATION OF COMPETENT STATE AGENCIES 

Article 36. Acts of obstructing inspection or examination

1. A fine of between VND 10,000,000 and 30,000,000 for any of the following violations:

a) Refusing to provide information, documents, and e-data; or supplying inadequate and untimely information, documents and e-data to an inspection or examination team or competent person;

b) Obstructing, causing difficulties for or shirking inspection or examination by competent persons;

c) Intentionally delaying or shirking the execution of or failing to execute administrative decisions of competent persons; failing to realize requests, abide by conclusions or execute decisions of an inspection or examination team.

2. A fine of between VND 30,000,000 and 40,000,000 for any of the following violations:

a) Hiding or modifying vouchers, documents, books and e-data or altering material evidence while under inspection or examination;

b) Removing, dispersing or otherwise arbitrarily changing the sealing condition of money, securities, books, dossiers and accounting documents or other sealed material evidence and means.

3. The additional sanctioning forms:

a) Suspension of securities business and service or deprivation of the right to use of securities practice certificate, for duration of 01-03 months, for violations specified in Clause 1 and Clause 2 of this Article;

b) Confiscation of vouchers, documents, books, and e-data for violations specified in point a Clause 2 of this Article.

Chapter 3.

SANCTIONING COMPETENCE, COMPETENCE TO MAKE MINUTES OF ADMINISTRATIVE VIOLATIONS AND APPLICATION OF ADDITIONAL SANCTIONING FORMS, REMEDIAL MEASURES

Article 37. Sanctioning competence of administrative violations

1. The Chief Inspector of State Securities Commission, head of specialized inspectorate teams of State Securities Commission have rights:

a) To impose a warning;

b) To impose fines of up to VND 100,000,000 on organizations and fines of up to VND 50,000,000 on individuals maximally;

c) Applying remedial measures as prescribed in clause 3 Article 3 of this Decree.

2. The Chairman of the State Securities Commission has rights:

a) To impose a warning;

b) To impose fines of up to VND 2,000,000,000 on organizations and fines of up to VND 1,000,000,000 on individuals maximally;

c) To impose fines of up to 5% of total amount raised illegally for violation specified in Clause 3 Article 5 and fines of up to 05 times illegal revenues for violation specified in Clause 5 Article 6 and Clause 2 Article 16 of this Decree;

a) Applying form of additional sanction and remedial measures as prescribed in Clause 2 and clause 3 Article 3 of this Decree.

Article 38. Competence of administrative violations

1. For positions mentioned in Article 37 of this Decree, upon detecting administrative violations in the domain of securities and securities market, they are entitled to make minutes of administrative violations in accordance with regulations.

2. Civil servants and public employee under State Securities Commission while doing their duty, detecting administrative violations in the domain of securities and securities market, must timely make minutes of administrative violations and send minutes to persons competent to sanction for carrying out sanction.

Article 39. Application of suspension with a defined duration of activities involving securities business and services

1. When applying the additional sanctioning form of suspension with a defined duration of activities involving securities business and service specified in Clause 3 Article 16, Clause 8 Article 20 and Clause 5 Article 21, point a Clause 3 Article 22, point b Clause 7 Article 26, Clause 4 Article 29, point b Clause 6 Article 31, Clause 5 Article 33, Clause 4 Article 34, point a Clause 3 Article 36 of this Decree, the Chairman of the State Securities Commission is entitled to issue decision on suspension with a defined duration for one or some or all professional operations involving securities business and service of the infringing organizations.    

2. In case of suspension with a defined duration for one or some professional operations involving securities business and service, the Chairman of the State Securities Commission must clearly state in the sanctioning decision on professional operations involving securities business and service which are suspended and duration of suspension.

3. When an infringing organization is suspended with a defined duration for activities of securities business and service, it must immediately suspend partly or entirely professional operations involving securities business and service or other activities as stated in the sanctioning decision.

Article 40. Application of suspension with a defined duration of activities involving securities listing, registration for securities transaction

1. Decision on application of suspension with a defined duration of activities involving securities listing, registration for securities transaction specified in Clause 5 Article 14 of this Decree must be concurrently sent to the Stock Exchange.

2. Suspension with a defined duration of activities involving securities listing, registration for securities transactions shall comply with regulation of the Stock Exchange.

Article 41. Application of suspension with a defined duration of securities depository operation

1. Decision on application of suspension with a defined duration of securities depository operation specified in Clause 4 Article 30, point a Clause 6 Article 31 and Clause 5 Article 32 of this Decree must be concurrently sent to the securities depository center.

2. Suspension with a defined duration of securities depository operation shall comply with regulation of the securities depository center.

Article 42. Application of remedial measures

1. Within 24 hours, after receiving decision on application of remedial measure which is forcible cancelation of information, correction of information, the infringing individual or organization must announce cancelation of information, correction of information on a central newspaper for 03 consecutive issues and on the company’s website. When the infringing individuals and organizations cancel information, correct information, they must concurrently report to the State Securities Commission, the Stock Exchange about the cancelled information and corrected information. 

2. The time limit for executing the measure of forcible remittance of illicit earnings from the commission of violations will be 60 days, from the effective date of decision on application of this measure. For benefits under the possession of individuals and organizations not submit into state budget, the infringing individuals and organizations shall be forced to repay to such individuals and organizations. 

3. The time limit for executing the remedial measures specified in Clause 3 Article 3 of this Decree will be 60 days, from the effective date of decision on application of remedial measures, except for cases specified in points a and b Clause 4 Article 4, points a and b Clause 4 Article 5, Clause 7 Article 6, point b Clause 3 Article 8, point c Clause 6 Article 13, point b Clause 7 Article 22, Clause 8 Article 26, point b Clause 3 Article 28, point a Clause 7 Article 31, point a Clause 6 Article 32, Clause 4 Article 35, Clause 1 and Clause 2 Article 42 of this Decree.

Chapter 4.

PROVISIONS OF IMPLEMENTATION

Article 43. Effect

This Decree takes effect on November 15, 2013 and replaces the Government’s Decree No. 85/2010/ND-CP dated August 02, 2010, on sanctioning of administrative violations in the domain of securities and securities market.

Article 44. Transitional provisions

1. For violations in the domain of securities and securities market happened before the effective date of Law on handling of administrative violations, this Decree, then detected or currently being considered and handled, provisions in the Government’s Decree No. 85/2010/ND-CP dated August 02, 2010, on sanctioning of administrative violations in the domain of securities and securities market are still applied for sanction, unless provisions on handling of administrative violations in this Decree are beneficial for infringing organizations and individuals, in this case, provisions of this Decree will be applied for sanction.

2. For decisions on handling of administrative violations already promulgated or executed before the effective date of Law on handling of administrative violations, this Decree, on which the sanctioned individuals and organizations complaint, the Ordinance on handling administrative violations and the Government’s Decree No. 85/2010/ND-CP dated August 02, 2010, on sanctioning of administrative violations in the domain of securities and securities market are applied for settlement.

Article 45. Responsibilities for implementation

1. The Minister of Finance shall guide, examine and supervise implementation of this Decree.

2. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, and chairpersons of provincial-level People's Committees shall implement this Decree.