Circular No. 10/2017/TT-BTC amends and supplements certain provisions of Circular No. 234/2012/TT-BTC dated December 28, 2012, issued by the Minister of Finance, guiding the management of transactions of government bonds, government-guaranteed bonds, and local government bonds.

CIRCULAR

Amending and supplementing certain articles of Circular No. 234/2012/TT-BTC dated February 28, 2012, issued by the Minister of Finance guiding the management of transactions of government-guaranteed bonds and local government bondsdated July 20, 2012, of the Government detailing and guiding the implementation of certain provisions of the Securities Law and the Law amending and supplementing certain provisions of the Securities Law;

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Pursuant to the Securities Law dated June 29, 2006;

Pursuant to the Law Amending and Supplementing Certain Provisions of the Securities Law dated November 24, 2010;

Decree No. the Law Amending and Supplementing Certain Provisions of the Securities Law; Decree No. 01/2011/NĐ-CP

Decree No. 91/2018/NĐ-CP June 26, 2018 of the Government on the issuance and management of government guarantees; the Law Amending and Supplementing Certain Provisions of the Securities Law; Decree No. 01/2011/NĐ-CP

Decree No. dated January 5, 2011, of the Government on the issuance of government bonds, government-guaranteed bonds, and local government bonds; Circular No. 234/2012/TT-BTC

Decree No. 215/2013/NĐ-CP dated December 23, 2013 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

At the proposal of the Chairman of the State Securities Commission;

The Minister of Finance issues this Circular amending and supplementing certain Articles of Circular No. of the Minister of Finance dated December 28, 2012, guiding the management of transactions of government bonds, government-guaranteed bonds, and local government bonds. Amending and supplementing certain articles of Circular No. 234/2012/TT-BTC dated December 28, 2012, of the Minister of Finance guiding the management of transactions of government bonds, government-guaranteed bonds, and local government bonds as follows:

Article 1. 1. Supplement Clause 9 of Article 2 as follows:

9. Equivalent government bonds that can be transferred

"are listed government bonds traded on the Hanoi Stock Exchange and may be used to settle transactions in lieu of original government bonds when there are insufficient original government bonds for settlement. The transferable equivalent bonds shall be based on agreements between the parties involved in the transaction. The Hanoi Stock Exchange will specify the detailed mechanism for using equivalent bonds that can be transferred in government bond transactions." Article 3. Classification of members

2. Amend Article 3 as follows:

"1. The government bond trading market at the Hanoi Stock Exchange has two types of members: ordinary trading members and special trading members.

2. The State Treasury participates in the government bond trading market in accordance with the provisions of Decree No. 24/2016/NĐ-CP dated April 5, 2016, of the Government stipulating the state treasury management system.

a) The State Treasury may conduct purchase transactions in repurchase transactions of government bonds on the government bond trading system at the Hanoi Stock Exchange with a maximum transaction period not exceeding three months and must pay the transaction service fee as prescribed by law. The State Treasury may use the trading system and services provided by the Hanoi Stock Exchange and the Vietnam Securities Depository.

b) The State Treasury is exempt from complying with the provisions regarding member standards, member registration, member obligations, and member reporting systems stipulated in Articles 4, 5, 6, and 9 of this Circular."

3. Amend Clause 2 of Article 7 as follows:

"2. A member's membership status shall be terminated if they fall under any of the following circumstances:

a) No longer meeting the member standards set forth in Article 4 of this Circular;

b) Seriously violating or committing systemic violations of regulations concerning government bond trading members at the Hanoi Stock Exchange;

c) Dissolution, bankruptcy, suspension of operations, revocation of establishment and operation licenses, or termination of existence after mergers (merged company), consolidations (consolidated company), divisions (divided company); or formation after consolidation (consolidating company), spin-offs (spun-off company) but failing to meet one of the conditions stipulated in Article 4 of this Circular;

d) The Hanoi Stock Exchange will specify the detailed rules and procedures for terminating member status after obtaining approval from the Securities Commission."

4. Amend Clause 2 of Article 9 as follows:

"2. Reporting format:

Members report to the Hanoi Stock Exchange through electronic data via the reporting and information disclosure system of the Hanoi Stock Exchange. In necessary cases, the Hanoi Stock Exchange has the right to request members to submit reports in writing."

Members shall report to the Hanoi Stock Exchange via electronic data through the Hanoi Stock Exchange's reporting and information disclosure system. In case of necessity, the Hanoi Stock Exchange has the right to require members to submit reports in writing.

5. Amend Article 11 as follows:

"Article 11. Types of Government Bonds for Listing

1. Government bonds;

2. Government-guaranteed bonds;

3. Local government bonds."

6. Amend Clause 2 and Clause 3 of Article 12 as follows:

"2. The listing process for treasury bills shall be carried out in accordance with Article 38 of Circular No. 111/2015/TT-BTC dated July 28, 2015, issued by the Minister of Finance guiding the issuance of Government Bonds in the domestic market.

3. The listing process for treasury bills shall be carried out in accordance with Article 18 of Joint Circular No. 92/2016/TTLT-BTC-NHNN dated June 27, 2016, issued by the Minister of Finance and the Governor of the State Bank of Vietnam guiding the issuance of treasury bills through the State Bank of Vietnam."

7. Amend Article 13 as follows:

"Article 13. Listing for Government-Guaranteed Bonds

1. The registration dossier for listing of corporate bonds guaranteed by the Government includes:

a) A request for listing of bonds according to Form 03a (if it is the first auction), according to Form 03b (if it is a supplementary auction), or according to Form 03c (if it is issued in another form);

b) A certificate from the Vietnam Securities Depository confirming that the bonds of that organization have been registered and centrally deposited;

c) A written approval from the Prime Minister regarding the issuance guarantee and the guarantee limit;

d) A written notification from the Ministry of Finance regarding the maximum permissible issuance limit of guaranteed bonds.

2. Bonds of policy banks guaranteed by the Government shall be listed on the Hanoi Stock Exchange when there is a written request from the issuer according to Form 03a (if it is the first auction), according to Form 03b (if it is a supplementary auction), or according to Form 03c (if it is issued in another form) and a registration notice of bonds from the Vietnam Securities Depository.

3. The listing process for Government-guaranteed bonds shall be carried out in accordance with Article 13 of Circular No. 99/2015/TT-BTC dated June 29, 2015, issued by the Minister of Finance guiding the issuance of Government-guaranteed bonds.”

8. Amend Clause 2 of Article 15 as follows:

"2. Transactions of Government Bonds at the Hanoi Stock Exchange shall be conducted through members; settlement shall be made through the Vietnam Securities Depository and payment banks.

a) The sale of Government Bonds can only be executed when the seller ensures that they have sufficient Government Bonds available for transfer on the settlement date as stipulated by the Vietnam Securities Depository. The amount of Government Bonds for transfer includes those already held in the seller's securities account on the trading day, and those received before or on the settlement date from previous purchase transactions or borrowing transactions.

Borrowing of Government Bonds shall be conducted according to the agreement of the parties and through the trading system at the Hanoi Stock Exchange or the lending and borrowing system at the Vietnam Securities Depository, and must comply with the following principles:

- Only trading members who are tender participants may borrow Government Bonds for sale under the rules of the Hanoi Stock Exchange;

- The borrowing period shall not exceed 180 days and shall not exceed the remaining time until maturity of the Government Bonds;

- The loan must be repaid with the borrowed Government Bonds; if there are insufficient borrowed Government Bonds, they can be repaid with equivalent Government Bonds that can be transferred;

- The parties involved must negotiate and bear responsibility for the contents related to the volume of borrowing, collateral, repayment, security, interest rate, and other terms. The parties must ensure that these agreements comply fully with applicable laws for all parties involved in the transaction. The Hanoi Stock Exchange and the Vietnam Securities Depository shall issue detailed regulations governing the borrowing of Government Bonds for sale.

b) Investors may conclude two ordinary buy-sell transactions simultaneously with the same counterparty (sell/buy-back transaction, hereinafter referred to as combined sale and repurchase transaction), including one sale transaction of Government Bonds (the first ordinary transaction) combined with a subsequent repurchase transaction of the same Government Bonds at a predetermined future date. In this case, the seller in the first ordinary transaction is the buyer in the second transaction; the price, quantity, and execution time of the second transaction must be determined beforehand at the time of concluding both transactions.

The Hanoi Stock Exchange shall issue detailed regulations governing combined sale and repurchase transactions.

c) For members of the Vietnam Securities Depository who are not trading members of Government Bonds and clients opening securities accounts for Government Bonds at depositary members, trading orders shall be placed through a securities company that is a regular trading member, and the transaction settlement shall be handled by a member of the Vietnam Securities Depository."

9. Amend Clause 1 of Article 24 as follows:

"1. Ordinary agreement is a transaction where the parties negotiate the terms of the transaction among themselves in the form of exchanging messages on the trading system or through other communication means, and report the results into the trading system to establish the transaction. The transaction result must be reported and entered into the trading system on the same working day after the parties have agreed on the transaction. Information reporting shall be carried out in accordance with the guidelines of the Hanoi Stock Exchange, including: the time of concluding the transaction; the time of signing the contract and the time of executing the transaction, and other relevant information."

10. Amend Clause 1 of Article 27 as follows:

"1. Ordinary agreement is a transaction where the parties negotiate the terms of the transaction among themselves in the form of exchanging messages on the trading system or through other communication means, and report the results into the trading system to establish the transaction. The transaction result must be reported and entered into the trading system on the same working day after the parties have agreed on the transaction. Information reporting shall be carried out in accordance with the guidelines of the Hanoi Stock Exchange, including: the time of concluding the transaction; the time of signing the contract and the time of executing the transaction, and other relevant information."

11. Amend Article 37 as follows:

"Article 37. Disclosure of information by ordinary trading members. Ordinary trading members shall fulfill their obligation to disclose information in accordance with Circular No. 155/2015/TT-BTC dated October 6, 2015, issued by the Minister of Finance guiding the disclosure of information on the securities market."

12. Replace Appendix No. 01/TTTP and Appendix No. 02/TTTP promulgated together with Circular No. 234/2012/TT-BTC of the Minister of Finance dated December 28, 2012, guiding the management of government bond transactions, government-guaranteed bonds, and local government bonds, with Appendix No. 01 and Appendix No. 02 promulgated together with this Circular.

Article 2. Implementation clause

1. This Circular takes effect from September 1, 2017. In cases where the legal documents referred to for application under this Circular are amended, supplemented, or replaced by new documents, implementation shall be carried out in accordance with the provisions of the amended, supplemented, or replacing documents.

2. The State Securities Commission, Hanoi Stock Exchange, Vietnam Securities Depository, and entities participating in government bond transactions shall be responsible for implementing this Circular.

3. The Hanoi Stock Exchange and Vietnam Securities Depository shall be responsible for completing the system and technological infrastructure and issuing operational regulations to guide the transactions specified in this Circular.