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question and answer
:: Question :: When shareholding companies proposes to issue more shares to increase their Charter Capital, pursuant to laws and regulations of Vietnam, which percentage between the capital proposed to be issued and the current Charter capital? Is there any limitation on the capital proposed to be increased within a year?
Answer:
In principle, in respect of both listed companies and un-listed companies, there are two major kinds of share offering namely public offering and private offering. There is no specific regulation on percentage between the capital proposed to be issued and the current Charter capital as well as the limitation on the capital proposed to be increased within a year.
In order to conduct public share offering, the company must satisfy conditions stipulated in Article 12.1 of the Law on Securities 2006.
Currently, there is no specific regulation on distance between the two tranches of public shares offering to increase Charter Capital.
In order to conduct private share offering, the company must satisfy conditions stipulated in Article 8 of Decree No. 1/2010 of the Government on Private Share Offering dated January 4, 2010. .
In respect of distance between the two tranches of private shares offering to increase Charter Capital, pursuant to Article 8.5 of Decree No. 1/2010, private shares offering tranches must be conducted at least six months part. If company breaches this regulation, the offering shall be deemed invalid and the increase of Charter Capital shall not be approved by the competent authority.
Especially, breach of regulation on dossier, conditions and conducting of the private shares offering shall be subjected to a fine from 30 million Vietnam dong to 100 million Vietnam dong.
However, Decree No. 1/2010 took effect from February 25, 2010. Therefore, before the effective date of this Decree, there was no specific regulation on private shares offering. The private shares offering must be conducted pursuant to the 2005 Law on Enterprises and the 2006 Law on Securities.
orther:
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- » Question :: Shares of my Company are listed on the HOSE. The enterprise intended to increase its charter capital under the form of issuing additional shares to offer investors in 2009. Nevertheless, when the enterprise registered the dossier to increase its charter capital with the competent Planning and Investment Department, this competent authority did not accept the vote counting minutes, which collects the shareholders’ written opinion. As a result, the Planning and Investment Department requested the enterprise to supply the copy of the Minutes of the General Meeting of Shareholders of the Company. Please kindly advise how the law regulates this case? (04/03/2010)
- » Question :: We are a bank accepted by the State Securities Commission (SSC) to issue share to public to increase the charter capital. Under the applicable regulations, the invested capital by the Investors to purchase shares of an enterprise must deposit in an escrow bank account at a commercial bank (CB). Please kindly advise whether we are permitted to open such bank account at our bank or not? (24/01/2010)
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- » Question :: I am a foreign individual shareholder who owns a large amount of shares in several enterprises in Vietnam. Because I am not available to attend the General Meeting of Shareholders (GMS), I would like to authorize such right to my authorized representative who is Vietnamese. Please kindly advise the regulations on this procedure? (21/12/2009)