Foreign investors must not have sufficient funds when placing order for securities purchase

In particulars, Clause 1, Article 1 of the Circular No. 68/2024/TT-BTC supplement Article 9a Foreign institutional investors’ transaction of stock purchase exempted from sufficient fund requirement when placing an order specified in the Circular No. 120/2020/TT-BTC.

Accordingly, this transaction is specified as follows:

- Securities companies shall conduct evaluation of foreign institutional investors’ payment risks to determine the required funds when placing order for stock purchase.

- In case where foreign institutional investors fail to make full payment for purchasing stocks, the obligation of settlement of unfully-paid transactions shall be transferred to securities companies where foreign institutional investors placed their orders by using proprietary trading accounts.

Within that: Depository banks where the foreign institutional investors open their securities depository accounts shall make settlement for unfully-paid transactions and arising expenses (if any) in the event of incorrect confirmation of the deposit balance of foreign institutional investors with the securities companies, leading to insufficient funds to pay for the stock purchase transaction.

- Securities companies may transfer their ownership outside the securities trading system or sale the number of stocks already transferred to their proprietary trading accounts, by using the put-through trading method, in the securities trading system to foreign individual organizations who fail to make full payment for stock purchase transactions

Anh the time is no later than the trading date immediately preceding the date on which stocks are accounted into securities companies’ proprietary trading accounts, without exceeding the maximum limit on the foreign investor’s holding rate for such stocks as prescribed by law.