What are the general regulations on securities investment funds and securities investment companies?

Based on Article 3 Circular 98/2020/TT-BTC stipulates general regulations on securities investment funds and securities investment companies as follows:

- Securities investment funds and securities investment companies (except for cases where individual securities investment companies manage their own capital) must be managed by the fund management company and the activities of the securities investment fund. , a securities investment company made through a fund management company.

- Assets of member funds and individual securities investment companies must be deposited at 01 depository bank. Assets of public funds and public securities investment companies must be deposited at a custodian bank. Capital and asset management activities of public funds and public securities investment companies must be supervised by a custodian bank.

- Assets of securities investment funds and securities investment companies are owned by investors and shareholders in proportion to the capital contribution ratio, and are not assets of the fund management company or supervisory bank. supervisor or depository bank.

- The fund management company is only allowed to use the assets of the securities investment fund or securities investment company to pay the payment obligations of the fund or securities investment company, and cannot be used for payment. or guarantee payment of financial obligations of the fund management company, custodian bank, depository bank or any other organization or individual in any form and under all circumstances.

- State agencies and units of the Vietnamese people's armed forces are not allowed to contribute capital to establish securities investment funds or securities investment companies; Buy fund certificates and shares of securities investment companies.

- Credit institutions, insurance enterprises, securities companies, fund management companies, state-owned enterprises contribute capital to establish funds, securities investment companies; Purchasing fund certificates and shares of securities investment companies shall comply with the provisions of specialized laws.

What types of assets are securities investment funds allowed to invest in?

Pursuant to Clause 2, Article 5 Circular 98/2020/TT-BTC stipulated as follows:

Portfolio and investment activities of the fund

1. The fund's investment portfolio must be consistent with the investment objectives and policies specified in the Fund Charter and announced in the Prospectus.

2. The Fund is allowed to invest in the following asset types:

a) Deposits in commercial banks according to the provisions of banking law;

b) Money market instruments include valuable papers and transferable instruments according to the provisions of law;

c) Government debt instruments, Government-guaranteed bonds, local government bonds;

d) Listed stocks, stocks registered for trading, bonds listed on the Stock Exchange, public fund certificates;

d) Unlisted bonds of issuing organizations operating under Vietnamese law; shares of joint stock companies, capital contributions in limited liability companies;

e) Rights arising attached to securities that the fund is holding;

g) Other securities and assets as prescribed by law.

3. The fund management company is only allowed to deposit money and invest in money market instruments specified in Points a and b, Clause 2 of this Article from credit institutions that have been approved by the Fund Representative Board.

4. Member funds are allowed to contribute capital to establish joint stock companies and limited liability companies according to the provisions of law on enterprises. In case the Fund Charter stipulates and is approved in writing by the General Meeting of Investors, member funds may invest in real estate that meets the conditions for putting it into business according to the law on real estate business. .

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Thus, according to the above regulations, securities investment funds are allowed to invest in the following types of assets:

- Deposits to commercial banks in accordance with banking laws.

- Money market instruments include valuable papers and transfer instruments according to the provisions of law.

- Government debt instruments, Government-guaranteed bonds, local government bonds.

- Listed stocks, stocks registered for trading, bonds listed on the Stock Exchange, public fund certificates.

- Unlisted bonds of issuing organizations operating under Vietnamese law; shares of joint stock companies, capital contributions in limited liability companies.

- Rights arising are attached to the securities that the fund is holding.

- Other securities and assets as prescribed by law.

What are the expenses of a stock investment fund?

Based on Article 8Circular 98/2020/TT-BTC Regulations on expenses of securities investment funds are the following:

- Fund management fees paid to the fund management company.

- Fund asset depository fees and supervision fees (if any) paid to the depository bank or custodian bank.

- Audit fees paid to the audit organization.

- Price appraisal costs paid to price appraisal businesses (if any); costs of legal consulting services, quotation services and other reasonable services, remuneration paid to the Fund Representative Board.

- Costs of drafting, printing, and sending prospectus, summary prospectus, financial reports and other documents to capital contributing members; Fund information disclosure costs; Expenses for organizing meetings of the General Meeting of Investors and Fund Representative Board.

- Expenses related to carrying out asset transactions of the fund and other expenses as prescribed by law.

- Costs related to switching depository banks, custodian banks (if any) or other service providers.