Vietnam - HOSE’s capital requirement lifted to 120 billion dong

Enterprises having demand to list on the Hochiminh Stock Exchange (HOSE) are required to have minimum charter capital of 120 billion dong from September 15, instead of the current 80 billion dong.

Under Government Decree 58/2012/ND-CP, enterprises must have at least two year operating as joint stock companies by the time they ask HOSE for permission to list. Besides, they must have a return on equity (ROE) ratio of at least 5% in the latest year and have been profitable in the two preceding years. Overdue debts over one year and accumulated debts are disqualifiers for listing.

In addition, at least 20% of shares with voting rights in a company must be held by at least 300 shareholders who are not majority shareholders, except for State-owned enterprises transformed into joint-stock firms given the Government’s direction.

Meanwhile, the minimum chartered capital of listed firms on the Hanoi Stock Exchange will be 30 billion dong. Qualified enterprises on this exchange are joint stock companies having been active for one year while at least 15% of shares with voting rights must be held by 100 shareholders.

However, unqualified firms having listed before September 15 are allowed to continue listing. They will not transfer to the other bourse given the new listing regulations.

The decree also requires ineligible enterprises on the two exchanges and unlisted public companies offering shares to the public to trade on the UPCoM, the market for unlisted public companies, within one year from the offering day.

Besides, a voluntary delisting of enterprises will need approval from 50% of shareholders who are not majority shareholders instead of 65% as before. However, enterprises are not allowed to delist within two years from the date of bourse debut.

Foreign institutions are permitted to own 100% of securities firms or establish a new company but they have to follow rules on capital of securities enterprises.

Saigon Times

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