Vietnam State Securities Commission details draft reforms to simplify securities rules, enable a sandbox and broaden fund activities

The Vietnam State Securities Commission has published details of draft Securities Law amendments that would simplify licensing and offering requirements, establish a securities sandbox and expand the framework for digital services and investment funds. The draft would amend 44 articles and add one. It develops policy areas discussed during the June consultation and July review at the Ho Chi Minh Stock Exchange, including administrative simplification, new products and controlled testing. The proposed simplification would remove selected licensing conditions for securities companies, fund managers and foreign branches, alongside certain custody registration requirements for banks. Requirements covered elsewhere in law or suitable for subsequent checks would give way to greater supervision during operations. Issuers would no longer need to include a report on proceeds from their most recent offering in applications for additional public share offerings. Offering notices would move from print publication requirements to publication on specified websites and at least one electronic newspaper. Digital provisions would expressly accommodate customer contracts concluded under electronic transactions law. The sandbox would permit supervised, limited testing of technologies, products, services and business models not covered by, or differing from, existing rules, subject to eligibility criteria and certification. Fund reforms would allow exchange traded funds to accept other assets specified by the government and exempt securities in their reference indices from the relevant 10% investment limit, while retaining other limits. Foreign bank branches licensed for securities custody could provide supervisory bank services to public funds. Securities companies and fund managers would need at least one legal representative meeting the corresponding chief executive standards, with transitional protection for existing arrangements. Certificate holders would face revocation for three consecutive years without required annual training or qualifying employment, subject to specified exceptions. The draft would also remove the statutory requirement for a parent exchange and subsidiaries, leaving the organizational model for a later decision. It proposes general commencement on March 1, 2027, with the sandbox provisions taking effect one year later. The prime minister would issue an exchange reorganization decision within one year of general commencement, while existing exchanges would continue operating until that decision takes effect.