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Rules govern listing of shares after IPO
The Government issued Decree No 58/2012/ND-CP on July 20 to implement portions of the Law on Securities relating to private placement and public offerings of securities. The new decree repeals Decree No 14/2007/ND-CP as amended by Decree No 84/2010/ND-CP and Decree No 01/2010/ND-CP.
Decree No 01 previously required one year before securities acquired under private placement could be transferred. Decree 58 scraps these requirements for an unlisted company and retains them for public companies.
Decree No 58 also updates provisions governing public offerings, adding the additional condition for initial public offers (IPOs) by infrastructure or hi-tech enterprises that the board of management must undertake to list sold shares on the securities market within one year from the date in which the enterprise was established.
The decree further provides stricter conditions for bond issues denominated in Vietnamese dong by international financial organisations in Viet Nam. The maximum term of such bonds is set at 10 years. The capital raised from issue cannot exceed 30 per cent of the total project cost, and the issuing organisation must undertake to bring list the bonds on the market within one year of their initial public offer.
The decree also imposes additional burdens on foreign issuers who seek to make an IPO in Viet Nam. Issuers must have been profitable for the preceding two years. Proceeds from the IPO cannot exceed 30 per cent of total project capital. For an offer of convertible shares, there must be an undertaking by general shareholders meeting or board of management that such securities will be listed on the securities market within one year from the IPO.
Decree No 58 takes effect on September 15.
Certain commercial contractors to be subject to tax
The Ministry of Finance issued Circular No 60/2012/TT-BTC on April 12 governing the tax liability of foreign organisations or individuals doing business or having incomes in Viet Nam. Under the circular, foreign organisations or individuals selling goods in Viet Nam under the specified commercial terms must pay the foreign contractor tax. The tax also applies to foreign organisations and individuals providing goods in Viet Nam through on-the-spot import or export. The circular, which took effect on May 27, also changes the tax rates applicable to some business lines of business. It replaces Circular No 134/2008/TT-BTC of December 2008.
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