According to current regulations, a depository member must open a securities depository account at the Vietnam Securities Depository and Clearing Corporation to carry out transactions with the member's securities.
According to the provisions of Article 14, Circular No. 119/2020/TT-BTC dated December 31, 2020, of the Ministry of Finance regulating the activities of registration, custody, clearing, and settlement of securities transactions, each depository member may only open 01 securities depository account at Vietnam Securities Depository and Clearing Corporation and may not open securities depository accounts at other depository members, except for the following cases: :
First, a depository member opens a securities depository account at a fund founder to conduct transactions related to the exchange-traded fund.
Second, a depository member being a securities company that has terminated its membership at the Stock Exchange of Vietnam is permitted to open a securities depository account at other depository members to handle the remaining securities in the proprietary trading account.
Third, a depository member who is not a clearing member shall open a securities depository account at a clearing member to serve the purpose of managing clearing margin assets and make payment for securities transactions for depository members.
Fourth, a depository member who is a securities company issuing covered warrants shall open one more securities depository account at the Vietnam Securities Depository and Clearing Corporation for hedging activities for covered warrants.
Fifth, a depository member who is a market maker opens an additional securities depository account at the Vietnam Securities Depository and Clearing Corporation to carry out market-making activities.
For the opening of securities depository accounts for investors and issuer of overseas depository certificates, as prescribed in Article 14, Circular No. 119/2020/TT-BTC, at each depository member, investors may only open 01 securities depository account. Foreign investors shall open securities depository accounts by relevant laws. Organizations issuing overseas depository certificates may open securities depository accounts after being granted securities trading codes.
Each securities investment fund, securities investment company is only allowed to open 01 securities depository account at 01 depository bank or custodian bank only following relevant laws.
The fund management company must open a separate securities depository account for the company and each securities investment fund managed by the company. In the case of portfolio management, at each custody bank, the fund management company may open 02 securities depository accounts in the name of the fund management company on behalf of the entrusted investor (01 securities depository account for domestic entrusted clients and 01 securities depository account for foreign entrusted investors). Meanwhile, branches of foreign fund management companies in Vietnam can open 02 securities depository accounts in depository members, including 01 securities depository account for themselves and 01 securities depository account to manage the portfolio for foreign investors.
A foreign securities company is allowed to open 02 separate securities depository accounts at a depository member, of which 01 securities depository account is for himself and 01 securities depository account is for the company's customers.
Insurance enterprises may open 02 securities depository accounts to manage separate investments from equity sources and insurance premium sources when making investments in the stock market. In case the insurance enterprise has a foreign investor holding more than 50% of the charter capital, securities deposited on the securities depository account from equity sources are governed by the law on foreign ownership on the stock market.
Foreign investment funds and foreign investment organizations are managed by many fund management companies, investment organizations belonging to foreign governments, or investment and financial institutions belonging to international financial institutions that Vietnam is not authorized to operate. Being a member is allowed to open multiple securities depository accounts on the principle that for each issued securities trading code, one can open one security depository account at a depository bank.
Where the depository bank where the investor opens a securities depository account is not a clearing member, Investors must open a securities depository account at a clearing member for managing clearing margin assets and making payment for securities transactions.
It should be noted that direct account opening organizations are allowed to open securities depository accounts at Vietnam Securities Depository and Clearing Corporation.
Collected from source
PV.