Decree No. 01/2014/ND-CP dated January 3, 2014 of the Government on foreign investors’ share purchase from Vietnamese credit institutions
Pursuant to the December 25, 2001 Law on Organization of the Government;
Pursuant to the June 16, 2010 Law on the State Bank of Vietnam;
Pursuant to the June 16, 2010 Law on Credit Institutions;
Pursuant to the November 29, 2005 Law on Enterprises;
Pursuant to the June 29, 2006 Law on Securities and the November 24, 2010 Law amending and supplementing a number of articles of the securities Law;
At the proposal of the Governor of the State Bank of Vietnam;
The Government promulgates Decree on foreign investors' share purchase from Vietnamese credit institutions,
Article 1. Scope of regulation
This Decree provides for conditions of and procedures for share purchase, total of maximum shareholding level for foreign investors, the maximum shareholding percentage for a foreign investor in a Vietnamese credit institution; conditions for a Vietnamese credit institution to sell shares to foreign investors.
Article 2. Subjects of application
1. Joint-stock credit institutions and credit institutions transforming the legal form into joint-stock credit institutions (Abbreviated to as Vietnamese credit institutions).
2. Foreign investors.
3. Other organizations and individuals involving foreign investors' purchase of shares of Vietnamese credit institutions.
Article 3. Interpretation of terms
In this Decree, the following terms are construed as follows:
1. Joint stock credit institutions mean credit institutions which are established and organized under form of joint stock companies, including: Joint stock commercial banks, Joint stock financial companies, Joint stock finance-leasing companies.
2. Credit institutions transforming the legal form into joint stock credit institutions mean credit institutions which are performing transformation of legal form from credit institutions operating in form of limited liability companies into credit institutions operating in form of joint stock companies.
3. Foreign investors include foreign organizations and individuals.
4. Foreign organizations include:
a) Organizations which are set up and operate under foreign law and branches of these organizations in foreign countries or/and in Vietnam.
b) Organizations, closed funds, member funds, companies of securities investment which are set up and operate in Vietnam with rate of contributed capital amount of foreign parties more than 49%.
5. Foreign individuals are persons who do not bear Vietnamese nationality.
6. Foreign strategic investor means a foreign organization which has financial capacity and has a written commitment of competent person to bind its long-term benefit with Vietnamese credit institutions and support Vietnamese credit institutions in transferring modern technologies; developing banking products and services, raising the administration and financial capacity.
7. Shareholding includes direct and indirect shareholding.
Article 4. Currency used in share purchase and sale transactions
Currency used in foreign investors’ share purchase and sale transactions in Vietnamese banks is Vietnam dong.
Article 5. Participation in administration at Vietnamese credit institutions
1. The participation and appointment of representative for contributed capital amount to participate in a Vietnamese credit institution shall comply with provisions of Law on Credit Institutions and relevant Laws.
2. Foreign investors are only allowed to participate or appoint representative for the contributed capital amount to participate in Managing Board at a Vietnamese credit institution, except for the following cases:
a) Foreign investors participate or appoint representative for the contributed capital amount to participate in Managing Board of other credit institution being subsidiary company of Vietnamese credit institution of which foreign investors participated or appointed representative for the contributed capital amounts to participate in Managing Board.
b) Foreign investors participate or appoint representative for the contributed capital amount to participate in Managing Board at a weak joint-stock credit institution in order to restructure it under the plan already been accepted by the State Bank of Vietnam.