Adjustment of License for Establishment and Operation of Securities and Fund Management Companies

The Adjustment of License for Establishment and Operation of Securities and Fund Management Companies is a mandatory requirement when an enterprise changes its licensed operational content. The current securities legal system strictly regulates conditions, dossiers, and procedures to ensure the transparency and safety of the financial market. This article analyzes the legal regulations related to this issue in detail.

Cases requiring amendment of the Establishment and Operation License of a securities company or securities investment fund management company.

According to Clause 4, Article 186 of Decree 155/2020/ND-CP, securities companies and securities investment fund management companies must request the competent authority to adjust their Establishment and Operation License in the following cases:

• Adding or withdrawing securities business operations.
• Changing the company name.
• Changing the head office location.
• Changing charter capital.
• Changing the Legal Representative.
• Re-issuing (exchanging) the Establishment and Operation License according to legal regulations.

>>> See more at: Withdrawal of Securities Business Operations by Securities Companies

The competent authority regulates the establishment and operation licenses of securities companies and securities investment fund management companies.

Based on Article 70 of the Law on Securities 2019, the State Securities Commission (SSC) is the sole authority competent to grant, re-grant, adjust, and revoke the Establishment and Operation License.

• Role: The SSC supervises compliance from the dossier reception stage. It has the right to conduct physical inspections of facilities, personnel, and IT systems before issuing a decision, especially for changes in head office location or the addition of high-risk operations (proprietary trading, brokerage).
• Effect: Decisions by the SSC have the highest legal validity regarding the entity’s legal status and scope of operation.

The competent authority regulates the establishment and operation of securities companies and securities investment fund management companies.

Application for amendment of the License for establishment and operation of a securities company or securities investment fund management company.

The dossier varies depending on the specific content of the adjustment:

1. Adding Securities Business Operations: (Ref: Article 179, Decree 155/2020/ND-CP)

• Request Form (Form No. 69).
• Decision of the General Meeting of Shareholders (GMS)/Board of Members (BOM)/Owner.
• List of personnel for the new operation (Form No. 66).
• Description of facilities (Form No. 65) and internal control/risk management processes.

2. Withdrawing Securities Business Operations: (Ref: Article 180, Decree 155/2020/ND-CP)

• Request Form (Form No. 69).
• Decision of the GMS/BOM/Owner.
• Report on contract settlement with clients (Form No. 70).
• Report on proprietary trading account settlement (if withdrawing proprietary trading).
• Decision terminating membership at the Stock Exchange and VSDC (if withdrawing brokerage).

3. Changing Name, Head Office, Charter Capital: (Ref: Article 181, Decree 155/2020/ND-CP)

• Request Form (Form No. 69).
• Decision of the GMS/BOM/Owner.
• For Head Office: Lease contract/ownership proof; description of facilities (Form No. 65).
• For Capital Increase: Bank confirmation of blocked capital OR audit confirmation OR audited financial statements after the increase.
• For Capital Decrease: Audited report on owner’s equity after decrease.

4. Changing Legal Representative: (Ref: Clause 2, Article 182, Decree 155/2020/ND-CP)

• Request Form (Form No. 69).
• Same Title: Decision appointing/dismissing the Chairman/CEO; Personal information (Form No. 67); Judicial record (within 6 months).
• Change of Title: Decision of GMS/BOM/Owner approving the title change; Amended Charter; documents as above.

Procedure for amending the Establishment and Operation License

According to Article 186 of Decree 155/2020/ND-CP, the process is as follows:

Step 1: Submission The company submits a complete dossier corresponding to the specific adjustment content to the State Securities Commission (SSC).

Step 2: Physical Inspection (if applicable) Mandatory for changes affecting operational conditions (e.g., location change, adding proprietary trading/brokerage). The SSC inspects facilities and IT infrastructure at the headquarters.

Step 3: Appraisal The SSC reviews the dossier’s validity and legal compliance, including inspection results.

Step 4: Decision Within 07 working days from receiving a valid dossier and inspection results (if any), the SSC issues the Adjusted License.

• Note: If brokerage is withdrawn, the SSC simultaneously revokes the Certificate of Depository Activity and Clearing/Settlement eligibility (if any).
• Refusal: A written reply stating the reason is provided.

>>> See more at: Licensing for Foreign Securities Branches and Representative Offices

Long Phan Consulting provides consulting services for procedures to amend the establishment and operation license of securities companies and securities investment fund management companies.

Long Phan Consulting Company provides comprehensive solutions to ensure effective and accurate procedures:

• Consulting & Review: Assessing legal status; advising on capital structure, personnel, and facilities to meet SSC standards; reviewing internal documents (Minutes, Resolutions, Charter).
• Drafting: Preparing dossiers according to regulations; coordinating with auditors/banks for financial reports and capital blocking confirmation; preparing personnel profiles.
• Representation: Submitting dossiers and monitoring progress at the SSC; participating in physical facility inspections; receiving the result and advising on post-adjustment information disclosure.

Frequently Asked Questions about amending the Establishment and Operation License of Securities Companies and Securities Investment Fund Management Companies

Below are some frequently asked questions regarding the procedure for requesting amendments to the establishment and operation license of securities companies and securities investment fund management companies. Please refer to them:

Does capital increase from equity need bank confirmation?

No. Bank confirmation or audit confirmation of additional capital is not required if the capital increase is funded from owner’s equity. (Legal Basis: Clause 4, Article 181, Decree 155/2020/ND-CP).

When is a physical inspection required?

It is mandatory for: Changing head office location; Adding proprietary trading; Adding securities brokerage. (Legal Basis: Clause 1, Article 186, Decree 155/2020/ND-CP).

Can a securities company have multiple Legal Representatives?

Yes. As per the Charter. If multiple, the Chairman and CEO are naturally Legal Representatives. (Legal Basis: Clause 1, Article 182, Decree 155/2020/ND-CP).

What is required when withdrawing brokerage?

A Decision terminating membership at the Stock Exchange and VSDC (Vietnam Securities Depository and Clearing Corporation) is mandatory in the dossier. (Legal Basis: Clause 5, Article 180, Decree 155/2020/ND-CP).

Does changing a non-Legal Rep CEO require license adjustment?

No. License adjustment applies only if the “Legal Representative” recorded on the License changes. If the new CEO is not a Legal Rep, the company only reports the personnel change via information disclosure. (Legal Basis: Clause 4, Article 186 and Article 182, Decree 155/2020/ND-CP).

Conclusion

For in-depth legal support regarding the Adjustment of License for Establishment and Operation of Securities and Fund Management Companies, please contact Long Phan Consulting Company. Our team is committed to providing optimal solutions, ensuring compliance, and saving time. Call Hotline 1900636389 for immediate advice.