Circular No. 59/2004/TT-BTC guiding the listing of shares and bonds on the centralized securities market

CIRCULAR

Guidelines for Listing Shares and Bonds on Concentrated Securities Markets

_____________________________

Implementing Decree No. 144/2003/NĐ-CP dated November 28, 2003 of the Government on Securities and Securities Markets (referred to as Decree 144), the Ministry of Finance issues guidelines for listing shares and bonds on concentrated securities markets as follows:

This technical regulation sets out technical requirements, testing methods, sampling procedures; management requirements; responsibilities of organizations and individuals producing, trading, and importing cigarettes.

1. These Circulars regulate the issuance of permits for listing shares and corporate bonds on concentrated securities markets within the territory of the Socialist Republic of Vietnam. The registration of government bonds and local government bonds shall be carried out by the Stock Exchange Center based on the application of the issuing organization.

2. Listing at the Stock Exchange shall be conducted separately for each type of issued shares and bonds; each type may include a freely tradable portion and a restricted tradable portion according to legal provisions or the issuing organization's regulations.

II. SPECIFIC PROVISIONS

1. Conditions for Listing Shares and Bonds

1.1. Conditions for Listing Shares:

1.1.1. Being a joint-stock company with a minimum paid-in charter capital of VND 5 billion at the time of applying for listing, calculated based on book value;

1.1.2. Having sound financial conditions, including no overdue debts exceeding one year; fulfilling all financial obligations to the State and employees within the company. For credit institutions and non-bank financial organizations, financial conditions are evaluated according to the specialized management agency's regulations;

1.1.3. Achieving positive net income after tax for two consecutive years immediately preceding the year of application for listing, without accumulated losses up to the date of application for listing;

1.1.4. For enterprises that have successfully converted into joint-stock companies, the two-year period of profitability immediately preceding the year of application for listing includes the period before conversion;

1.1.5. For state-owned enterprises undergoing shareholding reform and listing directly on the securities market within one year after conversion, the business operations of the year immediately preceding the year of application must be profitable;

1.1.6. Shareholders who are members of the Board of Directors, General Director's Office, and Supervisory Board of the company must commit to holding at least 50% of their shares for three years from the listing date, excluding state-owned shares held by these individuals. This provision does not apply to companies listed under previous regulations;

1.1.7. At least 20% of the company's share capital must be held by at least 50 shareholders outside the issuing organization. For companies with a share capital of VND 100 billion or more, this ratio must be at least 15% of the share capital.

1.2. Conditions for Listing Bonds:

1.2.1. Being a joint-stock company, limited liability company, or state-owned enterprise with a minimum paid-in charter capital of VND 10 billion at the time of applying for listing, calculated based on book value;

1.2.2. Having profitable business operations for two consecutive years immediately preceding the year of application for listing. For enterprises converting to joint-stock company operations, the period includes the period before conversion;

1.2.3. Having sound financial conditions, including no overdue debts exceeding one year; fulfilling all financial obligations to the State. For credit institutions and non-bank financial organizations, financial conditions are evaluated according to the specialized management agency's regulations;

1.2.4. Having at least 50 bondholders.

2. Application Documents for Listing Permit

2.1. Application documents for listing shares include:

2.1.1. An application form for listing permit prepared according to Model Form No. 01 attached to this Circular;

2.1.2. Decision of the Shareholders' Meeting approving the listing of shares;

2.1.3. A shareholder register of the entity applying for listing prepared within one month prior to the submission of the listing application;

2.1.4. A certified copy of the Business Registration Certificate, including any certificates of business change registration;

2.1.5. The Company Charter containing contents consistent with legal provisions;

2.1.6. An information memorandum prepared according to Model Form No. 02 attached to this Circular and must meet the following requirements:

- Containing all necessary information, being truthful and clear to enable investors and securities companies to accurately assess the financial situation, business operations, and prospects of the entity applying for listing;

- Financial data in the Information Memorandum must correspond with the audited financial statements in the listing application documents;

- Signed by the Chairman of the Board of Directors, Head of the Supervisory Board, Director (General Director), and Chief Accountant of the entity applying for listing. In case of proxy signing, a power of attorney is required;

2.1.7. A list and brief curriculum vitae of Board of Directors, General Director's Office, and Supervisory Board members prepared according to Model Form No. 03 attached to this Circular;

2.1.8. Commitment of Board of Directors, General Director's Office, and Supervisory Board members to hold at least 50% of their shares for three years from the listing date, excluding state-owned shares held by these individuals;

2.1.9. Two consecutive annual financial reports immediately preceding the year of application for listing must meet the following requirements:

- Comply with the current accounting regulations of the State;

- Annual financial reports must be confirmed by an independent auditing organization; audit opinions on financial reports must express full acceptance or acceptance with exceptions. If the audit opinion is acceptance with exceptions, then the exception items cannot exceed 10% of the equity of the entity applying for listing;

- If the period from the end of the fiscal year of the most recent financial report to the date of submitting the listing application to the State Securities Commission exceeds 90 days, the entity applying for listing must prepare supplementary financial reports up to the latest month or quarter;

- If there are unusual changes after the end of the fiscal year of the most recent financial report, the entity applying for listing must prepare supplementary financial reports up to the latest month or quarter;

- The financial report, if it is a copy, must ensure its validity in accordance with the provisions of the law.

2.1.10. The consultancy contract for preparing the application documents for listing between the securities company providing consultancy services and the organization applying for listing.

2.2. The application documents for obtaining permission to list bonds include:

2.2.1. The documents prescribed in Points 2.1.1, 2.1.4, 2.1.5, 2.1.6, 2.1.9, and 2.1.10 above;

2.2.2. The decision approving the listing of bonds by the Board of Directors or the Shareholders' Meeting in the case of listing convertible bonds (for joint-stock companies), by the Board of Members (for limited liability companies with two or more members), or by the Capital Owner (for a single-member limited liability company) or by the competent authority (for state-owned enterprises);

2.2.3. A register of bondholders maintained by the organization applying for listing within one month prior to the submission of the listing application;

2.2.4. Commitment to fulfill the obligations of the organization applying for listing towards investors, including payment terms, debt-to-equity ratio, conversion conditions (in the case of listing convertible bonds), and other conditions;

2.2.5. Approval letter for guaranteeing payment or a valuation document of collateral assets accompanied by valid documentation proving lawful ownership and insurance contracts (if any) for such assets in the case of listing guaranteed bonds.

2.3. For organizations applying for listing within one year after issuing to the public according to the provisions of Decree 144, the application documents for obtaining permission to list shares include the documents prescribed in Points 2.1.1, 2.1.2, 2.1.3, and 2.1.8 above, and the application documents for listing bonds include the documents prescribed in Points 2.1.1, 2.2.2, and 2.2.3 above, provided that there have been no changes in other documents since the submission of the registration application for issuance.

2.4. For organizations already listing shares or bonds on the Securities Trading Center, the application documents for obtaining permission to list bonds include the documents prescribed in Points 2.1.1, 2.2.2, and 2.2.3 above; for organizations already listing bonds on the Securities Trading Center, wishing to list shares after meeting the conditions stipulated in Decree 144, the application documents for obtaining permission to list shares include the documents prescribed in Points 2.1.1, 2.1.2, 2.1.3, 2.1.6, 2.1.8, 2.1.9, and 2.1.10 above.

2.5. State-owned enterprises, foreign-invested enterprises, and limited liability companies implementing the transition to operate under the form of a joint-stock company combined with listing may submit an application for listing shares concurrently with the process of shareholding reform. The application documents for listing as prescribed in Point 2.1 above, wherein:

- The documents prescribed in Point 2.1.2 are replaced by the decision of the competent authority for state-owned enterprises to issue shares for listing, or by the decisions of the Board of Directors or the Board of Members for foreign-invested enterprises and limited liability companies;

- The documents prescribed in Point 2.1.9 for state-owned enterprises undergoing shareholding reform may be replaced by the decision of the competent authority determining the enterprise's value (if the process of determining the enterprise's value involves the participation of an auditing organization); for other types of enterprises combining the transition to operate under the form of a joint-stock company with listing, at least the financial report of the immediately preceding year must be confirmed by an approved auditing organization;

- The documents prescribed in Point 2.1.10 will be exempted for enterprises that have already engaged consultancy organizations during the implementation of the transition;

- The documents prescribed in Points 2.1.3, 2.1.4, 2.1.5, 2.1.7, and 2.1.8 may be submitted after the completion of the transition to operate under the form of a joint-stock company;

2.6. For organizations whose shares or bonds were delisted according to Articles 1 and 3, Clause 29 of Decree 144, wishing to relist according to Article 30 of Decree 144 within six months after being delisted, the relisting application documents are exempt from the documents prescribed in Point 2.1.10, while the relisting application documents for shares are exempt from the documents prescribed in Points 2.1.4, 2.1.5, 2.1.7, and 2.1.8, and the relisting application documents for bonds are exempt from the documents prescribed in Points 2.1.4, 2.1.5, 2.1.7, 2.2.4, and 2.2.5, provided that these documents have not changed since the date of delisting.

2.7. The application documents for obtaining permission to list shall be prepared in two sets (one original set and one certified true copy) and submitted to the State Securities Commission. Amendments and supplements to the application documents can be made when the organization applying for listing deems it necessary to make such amendments or upon request by the State Securities Commission. Any amended or supplemented documents must bear the signatures of those who signed the original application documents submitted to the State Securities Commission or of individuals holding the same positions as those mentioned above. In cases where the State Securities Commission requests such amendments or supplements, the organization applying for listing must comply with the procedures and deadlines specified by the State Securities Commission.

3. Changes in Listing

3.1. In the event that a listed organization has been approved by the State Securities Commission to register additional share issuance, within ten working days after the end of the additional issuance period, the listed organization shall proceed with supplementary listing procedures for the additional shares in accordance with the regulations of the Securities Trading Center.

3.2. A listed organization wishing to split or consolidate shares shall report to the State Securities Commission on matters related to the splitting or consolidation of shares before carrying out such actions. Based on the approval of the re-listing registration by the State Securities Commission, the listed organization shall proceed with the re-listing procedures in accordance with the regulations of the Securities Trading Center within five working days after completing the splitting or consolidation.

3.3. A listed organization that carries out a split or merger but does not change the listed entity must register for re-listing with the State Securities Commission.

4. Approval or Denial of Permission to List

4.1. Within forty-five days from the date of receiving complete valid files, the State Securities Commission shall consider granting or refusing to grant the listing permit. In case of refusal to grant the permit, the State Securities Commission shall issue a document explaining the reasons.

4.2. For organizations applying for listing as prescribed in Points 2.3 and 2.4 above, the State Securities Commission shall consider granting or refusing to grant the permit within fifteen days after receiving complete files.

4.3. In case of need to amend or supplement the application file for listing, within fifteen days from the date of receiving the application file for listing, the State Securities Commission shall issue a document requesting the organization applying for listing to amend the application file for listing; the deadline for receiving the file shall be calculated from the date the State Securities Commission receives the amended and supplemented version.

4.4. The organization applying for listing must pay the full fee for issuing the listing permit as stipulated by law before receiving the listing permit.

5. Revocation of listing and relisting

5.1. In cases of revoking listing pursuant to Clause 3, Article 29 of Decree 144, the listed organization must submit a request to revoke listing to the State Securities Commission, accompanied by the Decision approving the revocation of stock or convertible bond listing of the Shareholders' Meeting or the Decision approving the revocation of bond listing of the Board of Directors (for joint-stock companies), the Decision approving the revocation of bond listing of the Board of Members (for limited liability companies with two or more members), the Decision of the Capital Owner (for limited liability companies with one member), and the approval document of the competent authority (for state-owned enterprises). The Decision of the Shareholders' Meeting on the revocation of stock listing must be approved by at least 65% of the total votes of all attending shareholders. The listed organization must fulfill all obligations as prescribed by law before proceeding with the revocation of listing procedures with the Stock Exchange Center.

5.2. Cases of revoking stock or bond listing include:

5.2.1. Securities no longer meeting the listing conditions within the prescribed period:

5.2.1.1. The listed organization ceases or is stopped from conducting main production and business activities for one year or more, or has had its business registration certificate or operating license revoked in the specialized field;

5.2.1.2. The audit opinion on the financial statements of the listed organization for two consecutive years expresses non-acceptance or refusal to express an opinion;

5.2.1.3. Shares have no trading activity at the Stock Exchange Center for one year;

5.2.1.4. Production and business results show negative figures for three consecutive years and the cumulative loss exceeds the equity in the most recent financial report;

5.2.1.5. The number of share holders outside the issuer decreases to less than fifty people over twelve consecutive months.

5.2.2. The listed organization terminates its existence due to merger, consolidation, division, dissolution, or bankruptcy.

5.2.3. The listed organization submits a request to revoke listing and is approved by the State Securities Commission.

5.2.4. Other cases including:

5.2.4.1. The organization applying for listing does not proceed with listing procedures at the Stock Exchange Center within a maximum period of three months from the date of issuance of the listing permit;

5.2.4.2. The listed organization intentionally or frequently violates information disclosure regulations;

5.2.4.3. The listed organization fails to submit annual financial reports for two consecutive years;

5.2.4.4. The remaining payment period of listed bonds is less than two months; or listed bonds are fully repurchased by the issuer before maturity;

5.2.4.5. The State Securities Commission deems it necessary to revoke listing to protect investors' rights and interests.

5.3. Stocks and bonds that meet the conditions prescribed in Articles 20 and 21 of Decree 144 upon being delisted may be considered for relisting according to the procedures prescribed in Points 2 and 4 above.

6. Reporting and Information Disclosure System

The reporting and information disclosure of listed organizations shall be carried out in accordance with Chapter VI of Decree 144 and the Circular guiding the information disclosure system issued by the Ministry of Finance.

III. IMPLEMENTATION

1. This Circular takes effect fifteen days after its publication in the Official Gazette.

The Ministers, Heads of ministerial-level agencies, Heads of agencies under the Government, Chairmen of Provincial People's Committees under the Central Government, Chairmen of the Board of Directors, General Managers (Directors) of listed organizations, Securities Companies, and Heads of related units are responsible for implementing this Circular.

2. During implementation, if there are difficulties, relevant organizations and individuals are requested to reflect them to the Ministry of Finance for research, guidance, and resolution./.