15.08.2020, 10:42

Many changes in derivative securities trading conditions


Many changes in derivative securities trading conditions

Securities companies and fund management companies wishing to consult on derivative securities must have capital of VND 250 billion or more. The new draft adds the conditions that enterprises must have professional processes, internal control processes, and risk management processes in accordance with the law in order to trade in derivative securities.

The Ministry of Finance is drafting a Decree guiding the Securities Law on derivative securities and the derivative securities market with many changes compared to the present.

The new draft specifies that securities companies and securities investment fund management companies are only allowed to trade derivative securities when they are fully licensed in securities brokerage and securities dealing operations.

The conditions on charter capital and equity for derivative securities activities remained at VND 800 billion for brokerage and VND 600 billion for proprietary trading. However, the new draft specifies that securities companies wishing to advise on derivative securities investment must have charter capital, equity capital of 250 billion VND or more. Current regulations only need equity capital, charter capital is not lower than legal capital.

The new draft adds the conditions that enterprises must have professional processes, internal control processes, and risk management processes in accordance with law.

In addition, the director (general director), deputy director (deputy general director) in charge of operations and at least 3 employees instead of 5 employees according to the current regulations for each derivative securities business is expected to register to have securities practicing certificate and certificate of expertise in derivative securities and derivative securities market. The draft adds the condition that professional staff in the derivative securities business department cannot concurrently work in other professional departments of the company.

Another change is that securities companies and fund management companies do not have accumulated losses according to the audited financial statements of the most recent fiscal year and the latest semi-annual financial statements (if any) have been ransack. The current regulation is that there is no loss in the last 2 years.

Finally, the time limit for processing is shortened from 15 days to 10 working days from the date of receipt of a complete and valid dossier as prescribed, the State Securities Commission issues the Certificate of Business Qualification derivative securities trading. In case of refusal, the State Securities Commission must reply in writing, clearly stating the reason.

Source: ndh.vn