Securities Issuance by Enterprises: Who May Issue and How

Short answer: Only a joint-stock company may issue securities (shares, bonds, warrants, etc.); a limited liability company may not issue shares. A non-public joint-stock company may only make private placements; public companies and public offerings are subject to the management and supervision of the State Securities Commission. This article summarizes the basic legal issues of securities issuance under the Securities Law 2019 and the Law on Enterprises 2020.

Legal basis

• The Securities Law 2019 (54/2019/QH14);
• The Law on Enterprises 2020 (as amended and supplemented by Law No. 76/2025/QH15, effective from 01/07/2025);
• Decree 155/2020/ND-CP detailing the implementation of certain articles of the Securities Law.

Which enterprises may issue securities?

• Joint-stock company: may issue shares (ordinary shares, preference shares), bonds, warrants, and other securities as prescribed;
• LLC: may not issue shares; may only issue private corporate bonds under the regulations on corporate bond issuance;
• Private enterprises, partnerships, household businesses: may not issue securities.

Forms of securities offerings

1. Private placement of securities

• Applies to joint-stock companies that are not public companies;
• Target investors: fewer than 100 investors (excluding professional securities investors), or the offering is made only to professional securities investors;
• No registration with the State Securities Commission is required, but the conditions and procedures under the Securities Law and reporting obligations must be complied with.

2. Public offering of securities

• Only a public company (or an enterprise registering to become a public company) may make a public offering of securities;
• Must register with the State Securities Commission and may only offer after being granted the Offering Registration Certificate;
• Conditions: paid-up charter capital, profitable business operations (except special cases), issuance and capital use plans approved by the General Meeting of Shareholders, an approved auditing organization, etc.

Conditions for becoming a public company

Under the Securities Law 2019, a joint-stock company becomes a public company when it meets one of the conditions: paid-up charter capital of VND 30 billion or more with at least 10% of voting shares held by at least 100 non-major investors; or having successfully made a public offering of shares. A public company must register with the State Securities Commission and comply with information disclosure obligations.

Public offering (IPO) procedure — overview

1. The General Meeting of Shareholders approves the issuance plan and the capital use plan;
2. Prepare the offering registration dossier (prospectus, audited financial statements, etc.);
3. Submit the dossier and obtain the Offering Registration Certificate from the State Securities Commission;
4. Distribute the securities within the statutory time limit;
5. Report the offering results; register for depository and listing/trading registration.

Information disclosure obligations

Public companies and public securities issuers must disclose information periodically (financial statements, annual reports) and extraordinarily (changes of key personnel, major transactions, disputes, etc.) under the Securities Law. Violations of disclosure obligations are subject to administrative penalties and the offering may be canceled in case of fraud.

Frequently asked questions

Can an LLC issue shares?

No. An LLC may not issue shares; to raise capital through share issuance, it must convert into a joint-stock company.

Must a small joint-stock company register with the SSC when raising capital?

If it only makes a private placement (fewer than 100 non-professional investors), no offering registration with the SSC is required, but private placement conditions and reporting obligations must still be complied with.

Is issuing “internal shares” to employees lawful?

Share issuance under an employee stock option program (ESOP) of a public company must comply with securities offering regulations; non-public companies follow private placement regulations and the company charter.

Notes on applying current laws

This article is for general enterprise–securities knowledge and is presented for reference, helping readers understand the legal issue at a general level. Securities law has many detailed technical conditions and is frequently supplemented by guidance. For an assessment of a specific capital-raising plan, please contact an ANT Legal lawyer at 0966.475.966 for verification and advice before proceeding.

Common risks to watch out for

• Assuming an LLC may issue shares — a misconception.
• Raising capital from the public without being a public company and without registering the offering.
• Failing to fulfill information disclosure obligations after becoming a public company.

How ANT Legal can help

ANT Legal advises on capital-raising plans (private placements, IPOs), conditions for becoming a public company, drafts dossiers, and coordinates procedures with the State Securities Commission. For quick advice, please contact our lawyers at 0966.475.966.

Related articles

• Procedure for Increasing Charter Capital of a Joint-Stock Company
• How to Change Founding Shareholders of a Joint-Stock Company
• Converting a Joint-Stock Company into a Multi-Member LLC
• What Is a Legal Entity? Legal Personality of Enterprises
• Rights and Obligations of Enterprises