Report on the repurchase of shares of public companies according to legal regulations

1. What is a stock?

According to Clause 2, Article 4 of the Securities Law 2019, the words are explained as follows:

“Article 4. Interpretation of terms[…]2. Stocks are a type of security that confirms the legal rights and interests of the owner of a portion of the equity capital of the issuing organization issued.[…]”

Accordingly, a stock is a type of security that confirms the owner’s legal rights and interests over a portion of the issuing organization’s share capital.

2. What content does a report on repurchasing shares of a public company include?

According to Article 37 of the Securities Law 2019, which regulates the Report on repurchasing shares, disclosing information and implementing stock repurchases as follows:

– Public companies as prescribed in Clause 1, Article 36 of this Law, before repurchasing their own shares, must submit reporting documents. to the State Securities Commission including:

+ Report on the repurchase of shares;

+ Decision of the General Meeting of Shareholders approving the repurchase of shares, repurchase plan;

+ Document confirming the appointment of the securities company to conduct transactions, except in cases where the securities company is a member of the Vietnam Stock Exchange repurchasing shares own;

+ Decision of the Board of Directors approving the plan to repurchase shares;

+ Most recent audited financial statements;

+ Documents proving that the company has enough resources to repurchase shares;

+ Documents proving that it meets the conditions to repurchase its own shares according to provisions of law in the case of public companies belonging to conditional business and investment industries.

– Report on stock repurchase includes the following contents:

+ Purpose of repurchase;

+ Total number of shares registered to repurchase;

+ Capital source for purchase re;

+ Transaction method;

+ Expected implementation time;

+ Principles for determining price (price range).

– Within 07 working days from the date of receiving complete and valid stock repurchase report documents specified in Clause 1 of this Article, the State Securities Commission shall send a written notification to the public company about receiving complete stock repurchase report documents; In case the documents are not complete and valid, the State Securities Commission shall send a document to the public company clearly stating the content and request for amendments and supplements. The time limit for amending and supplementing reporting documents is not included in the time limit specified in this Clause. In case of refusal, the State Securities Commission must respond in writing and clearly state the reason.

– Within 07 working days from the date of notification by the State Securities Commission, the public company must disclose information on the company’s electronic information page, the information disclosure means of the State Securities Commission, and the Vietnam Stock Exchange with the contents as prescribed in Clause 2 of this Article. Public companies are allowed to repurchase shares after 07 working days from the date of information announcement.

– Within 10 days from the date of completion of the share repurchase transaction, the public company must send a report on transaction results to the State Securities Commission and disclose the information to the public. In case the public company does not carry out the entire number of shares expected to be traded, the public company must report and announce the reason for not completing the transaction.

– The public company must complete the repurchase of shares according to the time stated in the information disclosure but no more than 30 days from the date of commencement of the transaction.

– Within 06 months from the date of completion of the purchase public companies are not allowed to offer shares to increase charter capital, except in the case of converting bonds into shares as committed when making a convertible bond offering.

Accordingly, the report on the repurchase of shares includes the following contents:

+ Purpose of repurchase;

+ Total number of shares registered to buy again;

+ Capital source for acquisition;

+ Transaction method;

+ Estimated time of implementation;

+ Principles for determining price (price range).

3. How long does a public company have to finish repurchasing shares?

According to Clause 6, Article 37 of the Securities Law 2019, it is stipulated as follows:

“Article 37. Report on stock repurchase, information disclosure and implementation of stock repurchase[…]6. Public companies must finish repurchasing shares according to the time stated in the information disclosure but no more than 30 days from the date of commencement of transaction. transaction.[…]”

Accordingly, the public company must finish repurchasing shares according to the time stated in the information disclosure but no more than 30 days from the date the transaction begins.