Vietnam Legal Newsletter in July 2023 (Privately Placed Corporate Bond, Multi-Level Sales Management and Insurance)

Our Newsletter #12 would lead you on the following:

LEGAL UPDATE

I. Guidance on trading of privately placed corporate bonds in the domestic market

The Ministry of Finance’s Circular No. 30/2023/TT-BTC, which became effective on 01 July 2023, includes the following notable content:

1. Subject of application
      1. Enterprises issuing privately placed corporate bonds from the effective date of Decree No. 153/2020/ND-CP;
      2. Members of the Vietnam Exchange, depository members, or organizations directly opening accounts except for organizations directly opening accounts specified in Decree No. 155/2020/ND-CP;
      3. Vietnam Exchange, Hanoi Stock Exchange;
      4. Vietnam Securities Depository and Clearing Corporation;
      5. Payment banks;
      6. Privately placed corporate bond investors; and
      7. Other agencies, organizations and individuals engaged in the registration, depository of, exercise of rights, transfer of ownership rights to, trading of and payment for privately placed corporate bonds.
2. Registration and deregistration of trading of privately placed corporate bonds
      1. Dossiers, orders, and procedures for registration of bond trading in the privately placed corporate bond trading system shall comply with Decree No. 153/2020/ND-CP;
      2. An enterprise established after consolidation, merger, or change in its enterprise registration certificate must submit a dossier for change in information about bond trading registration organization to the Hanoi Stock Exchange within 10 days from the date of receiving the new enterprise registration certificate. Upon change in bond conditions and terms as specified in Decree No. 08/2023/ND-CP, bond-issuing corporations must update the changed information to the Hanoi Stock Exchange in accordance with the Vietnam Exchange’s Regulation on the trading of privately placed corporate bonds;
      3. The Hanoi Stock Exchange shall adjust the number of bonds registered for trading when bond-issuing corporations prematurely redeem, swap or convert privately placed corporate bonds partly or the bond-issuing corporations change the term of bonds but there arise some cases in which the bondholders do not accept the change in the term of bonds, resulting in the bond-issuing corporations having to make payment of bond principal and interest to bondholders under the announced issuance plan.
3. Trading of privately placed corporate bonds

The process of trading of privately placed corporate bonds includes the following main steps:

      1. An investor must open a trading account for a trading member to trade privately placed corporate bonds. Before purchasing the bonds, the investor must sign a written certification in accordance with the laws;
      2. If the investor has had a securities trading account opened in a trading member, the investor may use such securities trading account to conduct privately placed corporate bond trading. If the investor opens a privately placed corporate bond depository account at a depository bank and opens a privately placed corporate bond trading account at a securities company, the investor may place an order to purchase privately placed corporate bonds and the securities company may execute the order to purchase privately placed corporate bonds when the depository bank provides confirmation that the depository bank accepts the investor’s request for payment of privately placed corporate bonds.
      3. Trading members must uniformly apply and publicize the form of receiving and handling their clients’ transactions at their head offices, branches, and transaction bureaus. Clients must be notified of the trading results right after the transactions are performed according to the form agreed upon with the clients. Trading members must send monthly bond and money account statements or upon request by the clients.
      4. The execution of clients’ trading orders must take priority by trading members over the latter’s bond dealing orders with the best possible exercise price. The best possible exercise price is the price requested by the clients or the price that is better than the latter.
      5. After the trading of privately placed corporate bonds is established and completed, the Hanoi Stock Exchange shall be responsible for providing information about the trading results to the Vietnam Securities Depository and Clearing Corporation for the implementation of payment for privately placed corporate bonds.
II. Amendments on the management of multi-level marketing businesses

The Ministry of Industry and Trade issued Decision No. 1299/QD-BCT dated 31 May 2023 on the announcement of administrative procedures for amendments and supplements in the field of multi-level marketing businesses. Specifically, Decision No. 1299/QD-BCT stipulates the specific content of administrative procedures for multi-level marketing businesses such as: Issuance/Amendment/Re-issuance/Extension of multi-level marketing business registration certificates, notices of change in the list of goods traded by the multi-level method, etc.

The procedure for applying for a multi-level marketing business registration Certificate (“MMBRC”) is carried out as follows:

1. Step 1: Enterprises registering for a multi-level marketing business shall submit 01 set of dossiers as prescribed to the Office of the National Competition Commission – Ministry of Industry and Trade (“NCC”);

2. Step 2: Within 05 working days from the date of receipt of the application, the NCC will receive and check the sufficiency and validity of the dossier. If the dossier is incomplete or invalid, the NCC shall notify the enterprise to amend the dossier within 30 days. If the application dossier is sufficient and valid, the NCC will conduct an appraisal;

3. Step 3: After receiving a complete and valid application, the NCC will notify the enterprise to pay the appraisal fee. The NCC shall evaluate the dossier within 20 working days from the date of receipt of the appraisal fee.

4. Step 4: If the application dossier meets the requirements, the NCC shall issue an MMBRC.

5. Step 5: Within 10 working days from the date of issuance of the MMBRC, the NCC is responsible for publishing it on the NCC’s website, notifying the bank where the enterprise deposits, and providing a copy of the multi-level marketing business registration certificate and copies of documents as prescribed to the departments of Industry and Trade nationwide.

III. Amendments on the process of collecting social insurance, health insurance, unemployment insurance, occupational accident insurance, and occupational disease

The Vietnam Social Insurance Agency issued Decision No. 948/QD-BHXH dated 05 June 2023 becoming effective from 01 April 2023. It amends the types of papers used as a basis for the issuance, recording and adjustment of social insurance books as follows:

1. Adding the period of payment of social insurance but not having to pay social insurance

1.1  If granting and recording the confirmation of the time of payment of social insurance premiums to employees who have worked before 1995 (excluding those who have been disciplined to quit their job or voluntarily quit their job, or those who have been sentenced to imprisonment before 01 January 1995), the dossier should include:

      1. Original resume and additional resume (if any) of the employee, the decision on admission, the labor contract, and other relevant documents such as the decision to raise the salary level, the decision on rotation or the decision on relocation work, decision on major demobilization, majors, salary termination papers, etc;
      2. For those who left to wait for work from November 1987 to before 01 January 1995: in addition to the above documents, add the Decision on leave and the list of the unit or documents identifying the employees named in the booklist of the unit until 31 December 1994.

1.2  In cases dealing with the issuance and confirmation of the time of payment of social insurance premiums for cadres, civil servants, public employees, army men and people’s police officers on the payrolls of State agencies, socio-political organizations and enterprises, State enterprises, armed forces units that have legally exited abroad, returned home but failed to arrive on time, or returned home on time but the former units failed to arrange jobs and self-employed workers are sent to work cooperatively after returning home, to continue to participate in compulsory social insurance contributions (excluding cases of legal violations abroad, deported back home, or disciplined and forced to return home or prison sanctioned before 01 January 1995):

      1. Attach dossiers of employees working abroad for a definite time under the Agreements of the Government and of the person serving as captain, interpreter or regional official paid by the foreign country;
      2. Attach documents of the person going to work abroad in the form of direct cooperation between ministries, branches and People’s Committees of provinces and cities with foreign economic organizations;
      3. Attach documents of the person going to study or practice abroad;
      4. Attach documents of the person working as an expert under the Agreement of the Government.

1.3  Record the confirmation of the time of payment of social insurance premiums for cadres who have worked in communes, wards and townships, including other positions according to regulations on solving problems in terms of regimes and policies applicable to commune-level officials:

      1. Original profile and curriculum vitae of the individual;
      2. Relevant documents proving the working time in the commune, ward or township (booklist, the decision on assignment, the decision on living allowance, etc).
2. Adjustment to doing heavy, hazardous, dangerous or particularly heavy, hazardous or dangerous jobs

The dossier includes one of the following documents: Decision on the assignment of job positions and salary; labor contract, work contract and other documents related to the adjustment.

3. Change of workplace

Decision (written) proving the place of work.

4. Adjustment of the first name, last name, middle name; adjustment of date of birth; gender, ethnicity; nationality

ID card/passport issued by a competent authority in accordance with regulations.

If you are a party member, you must provide your party member’s resume (original profile) when you were admitted to the Party.

The above is not official advice from BLawyers Vietnam’s lawyers. If you have any questions or suggestions about the above, please contact us at consult@blawyersvn.com. BLawyers Vietnam would love to hear from you.

Date: 25 July 2023

Writer: BLawyers Vietnam

Legal News and Update Team

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