The Securities Market Supervision Board aims to monitor all market fluctuations to keep the securities market purring along while controlling acts of manipulation.
The State Securities Commission (SSC) has submitted the Government a project to establish a Securities Market Supervision Board, which will closely work with the securities trading centres to set up a uniform continuous supervision system.
Supervisory results from the board will provide an important foundation for inspectors to handle violations of the securities market. SCC Vice Chairman Nguyen Doan Hung talks about this issue.
How have the securities market’s activities been supervised?
The supervision process occurs on three different levels: Firstly supervising areas related to the SSC, secondly supervising the market’s operations at the stock exchanges and securities trading centres and thirdly, supervising securities companies and funds. The SSC currently focuses on monitoring securities companies, fund management companies and organisations licensed by the SCC.
The SSC is managing the issuance of securities by public companies, which has been approved by the SSC.
What is the most important task of the Securities Market Supervision Board and how will it impact on the securities market?
The board will monitor all fluctuations on the market to ensure its table operation. However, there is a difference between inspection and supervision. Inspection is conducted by a functional board. For instance, securities and fund management companies are under the supervision of the business management board. When signs of violation are detected among these companies, they will be reported to the securities inspection board to consider and deal with under punitive laws. However, supervision and analysis of transactions on the securities market in Vietnam remains weak while many other countries can use a standard information and technology (IT) supervision system to find out violations of transaction regulations. We are trying our best to build a modern IT system to raise the SSC’s supervisory efficiency.
How about the exercise of supervision at the stock exchanges and securities trading centres in Hanoi and Ho Chi Minh City?
Securities companies are members of the stock exchanges and securities trading centres. The stock exchanges and securities centres have specific regulations to supervise transactions made by their members. If any unusual transaction is discovered, all members of securities companies will be notified. If it is a serious violation, the case will be moved to the SSC for consideration. In addition, the securities custodies also supervise securities trading activities.
People say that the SSC has not controlled the influx of foreign investment in the securities market. What is your idea opinion?
Regarding the management of foreign currencies, the Government has assigned the State Bank of Vietnam (SBV) and the SBV’s Department of Foreign Currency Management in particularly to supervise the flows of direct and indirect foreign investment into Vietnam and out of the country.
The SBV has strict supervision regulations. For example, investors must open an account at the SBV so that the bank can monitor the account and regulate the country’s monetary policy and State budget balance.
For the SSC, the commission is interested in foreign investment funds, as they can be set up quickly with a large capitalisation. Under the law on securities and new regulations, the SSC will be in charge of supervising the funds. The regulation stipulates that foreign investment funds must report to the SSC on the establishment of the fund, the origin, the capital source of the fund and investment plans in Vietnam. We hope that the law and new regulations will help monitor the effectiveness of direct and indirect foreign investments in Vietnam.
source: VNE
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