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:: Question :: My company has been dealt with breach by the State Securities Commission (SSC) due to its breach of the regulation on tender offer of securities. The SSC requested the Board of Management to convene the extraordinary meeting of the GMS to inform shareholders of such breach and, concurrently, to inform shareholders of returning the money paid by them for buying securities if they request. After that, base on the request of the SSC, the Board of Management approved this decision and inform the GMS. However, at the extraordinary GMS, a member of the Board of Management supposes that the GMS has to approve this decision, instead of just informing like that. Is the opinion of the member of the Board of Management right or wrong?
Answer:
According to the Article 13 of the 2006 Law on Securities, registration of a tender offer of shares or bonds is a required obligation of the issuing organization. Accordingly, before implementation of the tender offer of securities, public companies have to submit the application file for registration of a tender offerof securities to the SSC. Within a time limit of thirty (30) days from the date of receipt of a valid application file, the SSC shall consider and issue a certificate of acceptance [of registration] of the tender offer of securities to the issuing organization.
Your company is a public company. Therefore, it must comply with the procedure stipulated in Article 13 of the Law on Securities of 2006. Accordingly, it appears that your company breached such regulation, therefore, it was dealt with breach by the SSC.
For the meeting of the GMS, Clause 3 Article 97 of the 2005 Law on Enterprises stipulates that the Board of Management must convene an extraordinary meeting of the GMS in the following cases:
a) The Board of Management considers it necessary to do so in the interests of the company;
b) The number of the remaining members of the Board of Management is less than the number of members required by law;
c) Upon request by a shareholder or a group of shareholders as stipulated in clause 2 of article 79 of this Law;
d) Upon demand by the Inspection Committee;
e) In other cases stipulated by law and the Charter of the company.
Currently, there are no specific regulation of laws providing that the SSC has the right to request the public company to convene an extraordinary meeting of GMS. In principle, except the Charter of your company has the regulations on the other cases the Board of Management must convene an extraordinary meeting of GMS, your company does not need convene an extraordinary meeting of the GMS.
However, your company is required to comply with regulations on corporate information disclosure as stipulated in the Law on Securities.
According to item a Clause 4 Article 101 of the Law on Securities, a public company must disclose information upon request of the SSC on the occurrence of the events: There is information relating to the public company that seriously affects the lawful interests of investors.
According to Clause 4 Article 100 of the Law on Securities, information shall be disclosed by way of the mass media, by publications of organizations and companies, and on the information network of the Stock Exchange or Securities Trading Centre, but not by way of an extraordinary meeting of GMS.
orther:
- » Question :: I am a member of the Supervisory Commission (the Commission) of a public company which is unlisted and termed from 2007 to 2010. Until now, my term is still valid. In 2009, I was [not] invited to attend any meeting of the company’s Commission. Recently, I also did not attend the Commission’s meeting to produce the Commission’s Report for submission to the General Shareholder’s Meeting (the Meeting) year 2010 on April 9. I was informed that this Commission’s Report was built by the Commissions’ Director (the another member of the Commission also did not attend). I would like to ask you whether the operation of the Commission like that is legal or not? Is the Report mentioned above legal? What should I do to comply with the rights, duties and obligations of a Commission’s member? (01/06/2010)
- » Question :: I am a president of the Management Board (“the Board”) of a public company. As per regulations, the term of the Board, Supervisory Commission (“the Commission”) is five (5) years. Therefore, the first term of the Board, Commission is due on November 2010. However, in order to facilitate the voting of the Board, the Commission in the second term, the Board would like to submit the General Shareholder’s Meeting (“the Meeting”) with the latest on April 19, 2010 for renewal of the first term of the Board, the Commission until April 2011. So, the question is that is the renewal true or not? If the shareholders are not taken opinions directly at the Meeting, can the Board collect opinions indirectly from shareholders in writing? If the Meeting does not pass the renewal, how can the voting of the Board, the Commission be taken in compliance with laws? (31/05/2010)
- » Question :: Our company registers shares at the Securities Depository Central (SDC), but cannot deposit, of which my 10.000 shares. So, can I transfer directly 2.000 shares to my brother and compliment 2.000 shares to my wife? (03/05/2010)
- » Question :: We are a unlisted public company which issued convertible bond (two years term) nearly two years ago. In the coming time, the company will register to list shares in the Ho Chi Minh City Stock Exchange (HOSE). In order to shorten time, will the company be able to conduct this procedure along with converting bonds to shares? (28/04/2010)
- » Question :: In 2009, the price of listed shares of many companies increased continuously. Therefore, such companies were required to provide explanation for such increase. There are many companies used the same explaining contents for different explanation. Please kindly provide the regulations on content of the explanation on increase of price of shares? (21/03/2010)