The Ministry of Finance plans to keep stricter control over the selling of shares to strategic shareholders as it is drafting a document amending several provisions in Circular No 18 on the buying and selling of shares, and the issuance of additional shares by public companies.
If companies sell shares at preferential prices to strategic partners, it is necessary to define who will be listed as ‘strategic shareholders’ after considering the criteria as follows: suppliers of materials for production; big partners who consume products of the companies; partners that have experience in the operation fields of the issuing companies; partners that can help the companies to expand markets and develop production and business; and partners that can give advice in corporate governance and set up strategies.
The management boards of the companies issuing securities must publish the lists of strategic shareholders and the volume of shares to be sold to them and make them public for the review of shareholders. The lists also must be submitted to the State Securities Commission (SSC).
Besides the sale of shares to strategic shareholders, the draft also sets regulations on issuing shares to companies’ labourers under specific programmes, under which the issuance programmes must be approved by shareholders.
The total shares issued under the specific programmes must not be higher than 5% of the total existing shares of the companies. The price of shares to be sold to labourers must not be lower than 40% of the market price at the time of issuance and the price at which shares were sold to existing shareholders.
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