New admin offence ruling

Decree 108 adds "forfeiture of using rights of the certificates of registration of operation applicable to representative office, securities business practising certificates from over 03 months to 24 months" to the main forms of penalties.— VNS Photo Nguyen Manh Ha

(VNS) — Decree No 108/2013/ND-CP ("Decree 108") has just been issued on September 23 and replaces Decree 85/2010/ND-CP on penalties for administrative offences in securities and securities market sector ("Decree 85"). In comparison with Decree 85, Decree 108 includes some major changes as follows:

The rate of fine stipulated in Decree 108 is also changed: (i) the maximum rate of fine is specified; accordingly, it shall be VND2 billion and VND1 billion, applicable to an organisation and individual that commits an administrative offence, respectively; (ii) along with the maximum rate of fine, Decree 108 also provides the rates of fine on the basis of percentage and multiple of the unlawful incomes.

For instance, the formation, verification of an application file for registration of a public offer of securities having fabrication shall be fined from 1 per cent to 5 per cent of the unlawful mobilised amount of money; the organisation that conducts a public offer of securities without the certificate of acceptance of the public offer of securities shall be fined the amount of money that is from 01 to 05 time (s) as much as the unlawful income. Pursuant to Decree 108, some new administrative offences are also supplemented; for example, breaches of provisions on private placement of shares within the territory of Viet Nam by public company and breaches of provisions on issuing private bonds in Viet Nam; breaches of provisions on bonds issuance in the international market, offers of securities in foreign countries and new placement of securities to offer securities depository certificates in foreign countries or to support the issuance of securities depository certificates in foreign countries on the basis of the issued shares in Viet Nam.

According to Decree 108, the position of Head of specialised inspection group of State Securities Commission has the same authority to impose penalties for administrative offences as the Chief of the Inspectorate of the State Securities Commission.

Besides, the maximum fine that the competent persons can impose is also remarkably increased: the Chief of the Inspectorate of the State Securities Commission can impose a fine up to VND100 million in the case of an organisation instead of VND70 million as previously stipulated; the Chairman of the State Securities Commission shall have the right to impose a fine up to VND2 billion with respect to an organisation, and VND1 billion with respect to an individual.— BIZCONSULT