| THE GOVERNMENT ------- | SOCIALIST REPUBLIC OF VIET NAM Independence - Freedom - Happiness ---------- |
| No. 52/2006/ND-CP | Hanoi, May 19, 2006 |
DECREE
ON ISSUANCE OF ENTERPRISE BONDS
THE GOVERNMENT
Pursuant to the December 25, 2001 Law on Organization of the Government;
Pursuant to the November 29, 2005 Enterprise Law;
Pursuant to the November 29, 2005 Investment Law;
Pursuant to the December 12, 1997 Law on Credit Institutions and the June 15, 2004 Law Amending and Supplementing a Number of Articles of the Law on Credit Institutions,
At the proposal of the Minister of Finance,
DECREES:
Chapter I
GENERAL PROVISIONS
Article 1.- Scope of regulation
1. This Decree provides for separate issuance of bonds by enterprises of different types, including joint-stock companies, state companies in the course of transformation into limited liability companies or joint-stock companies under the provisions of the Enterprise Law, and foreign-invested enterprises in the territory of the Socialist Republic of Vietnam.
2. Issuance of bonds to raise capital for addition to own capital of state-owned credit institutions shall comply with the provisions of Clause 3 of Article 19, Clause 3 of Article 46, and Clause 1 of Article 47 of this Decree.
3. Issuance of government-underwritten enterprise bonds and public offering of bonds shall not be governed by this Decree.
Article 2.- Interpretation of terms
In this Decree, the following terms are construed as follows:
1. Enterprise bond (hereinafter referred to as bonds for short) means a type of debit securities issued by enterprises acknowledging their obligation to pay both bond principals and interests to bondholders.
2. Convertible bond means a type of bond convertible into ordinary share of the same issuing organization under the conditions set in the issuance plan.
3. Inconvertible bond means a type of bond that is not convertible into share.
4. Secured bond means a type of bond for which the payment of its principal and interest is wholly or partly secured upon its maturity with assets of the issuing organization or of a third party or is underwritten by a financial or credit institution.
5. Unsecured bond means a type of bond for which the payment of its principal and interest is not wholly or partly secured upon its maturity with assets of the issuing organization or of a third party or is underwritten by a financial or credit institution.
6. Bond issuance means the initial sale of bonds to buyers.
7. Separate issuance of bonds means cases of bond issuance other than public offering in accordance with the provisions of law on securities and security market.
8. Issuing organization means an enterprise issuing bonds under the provisions of this Decree.
9. Issuance underwriting means the commitment made by an issuance underwriting organization to an issuing organization to carrying out procedures before issuing bonds or distributing bonds to investors, accepting to buy up bonds for resale or to buy up undistributed quantities of bonds.
10. Issuance agency means the sale of bonds to investors by organizations under the mandate of an issuing organization.
11. Payment agency means the payment of principals and interests of bonds upon maturity by organizations under the mandate of an issuing organization.
12. Bond bidding means the selection of bidding organizations and individuals that meet the requirements set by an issuing organization.
13. Bidding based on interest rate competition means a bidding whereby bidding organizations and individuals offer their interest rate bids to the issuing organization or a mandated organization for selecting the winning interest rate.
14. Bidding not based on interest rate competition means a bidding whereby bidding organizations and individuals, rather than offering interest rate bids, register to buy bonds with the winning interest rate determined on the basis of the results of bidding based on interest rate competition.
15. Right certificate means a type of security issued together with bonds, acknowledging bondholders' right to buy a certain quantity of ordinary shares under given conditions.
16. Bond-into-share conversion ratio means the ratio for determining the quantity of ordinary shares to be received by a bondholder when converting a bond into shares.
17. Bond conversion period means the duration from the time an issuing organization starts the conversion of bonds till the time it finishes the conversion.
18. Bond pledge means the hand-over of bonds by a bondholder to another organization or individual for custody to secure the fulfillment of civil obligations.
19. Credit rating organization means a legal person with the function to assess the degree of credit of enterprises and the capability of issuing organizations to pay bond principals and interests throughout the term of bonds.
20. Bond custody means the deposit of bonds by a bondholder at an organization licensed to keep and preserve bonds for this organization to perform the rights over such bonds for the bondholder.
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