The State Securities Commission of Vietnam (SSC) will randomly check supervised subjectsviadetecting suspicious transactions. This is the content in adraft circular guiding securities trading supervision on the stock market, which wasconsulted on by the Ministry of Finance.

The Ministry of Finance is consulting on a draft circular guiding
securities trading supervision on the stock market.

Many subjects supervising stock market

According to the draft circular, supervising subjects include: SSC; Vietnam Stock Exchange; Subsidiaries of the Vietnam Stock Exchange including Hanoi Stock Exchange and HCM City Stock Exchange; the Vietnam Securities Depository and Clearing Corporation (VSDCC); and the VSDCC’s subsidiaries performing the securities clearing and settlement functions.

In addition, there are also securities trading members of subsidiaries, except for special trading members, which are commercial banks on the derivative stock market and the Government bond market.

The draft circular stipulates that on the basis of reports by trading members, the Vietnam Stock Exchange and its subsidiary companies, the VSDCC and itssubsidiaries, monitoring results at the SSC and other information sources, the SSC will clarify signs of violations of the law on securities and stock market of suspicious transactions to prevent and handle promptly according to regulations.

The SSC also supervises activities of the Vietnam Stock Exchange and its subsidiaries in organising and supervising securities transactions in each market area assigned to manage and operate.

At the same time, supervise the VSDCC’s operation and subsidiaries in managing and monitoring the rate of using collateral/deposit required by each investor’s account for the derivative stock market, clearing members for the underlying market.

Along with that, work with the Vietnam Stock Exchange and its subsidiaries, trading members, the VSDCC and itssubsidiaries to analyse and clarify transactions that can affect the stock market to ensure the legitimate rights and interests of investors and the stability of the market.

In addition, supervising the provision of services related to securities trading by other subjects in accordance with regulations.

Other supervising subjects are also assigned appropriate monitoring tasks.

Supervision based on many information sources

The draft circular stated securities trading supervision is conducted based on several information sources.

The first is the supervision report, the report serving supervision of Vietnam Stock Exchange and its subsidiaries, trading members, VSDCC and itssubsidiaries and members.

The second is the report of the listed organisation/registered-to-trade organisation. The third is the report and information reflected by organisations and individuals participating in securities trading on the stock market.

Notably, there are information sources on the mass media, rumours related to stock trading. According to the Ministry of Finance, rumoursareinformation that is true or not true, with no basis to verify at the time of broadcasting the information relating to listed organisation/registered-to-trade organisation, and organisation participating in securities trading onthe stock market.

The SSC will conduct random checks for supervised subjects viadetecting suspicious transactions as reported by the Vietnam Stock Exchange and its subsidiaries, trading members,the VSDCC and itssubsidiaries and members, and organisations and individuals participating in trading and providing securities trading services onthe stock market.

The draft circular stated organisations and individuals participating in securities trading, providing securities trading services must provide information and explain at the request of the SSC, the Vietnam Stock Exchange and its subsidiaries, the VSDCC and itssubsidiaries, and authorities in accordance with the law.

Commercial banks providing services of opening investment accounts for investors willbe responsible for providing information on customers’ account balances at the request of the SSC and competent authorities.

The Custodian Bank is responsible for providing data relating to the investment fund’s securities investment and trading activities at the request of the SSC and competent authorities.

If organisations and individuals participating in securities trading or providing securities trading services do not coordinate toprovideinformation, they shall be handled according to the provisions of the Law on Securities and Stock market and other current regulations.