HCMC – Vietnam will introduce the KRX stock trading system in the second quarter of this year, according to the State Securities Commission (SSC).
SSC will unveil the system’s features in April, with the rollout expected in May or June. Developed with South Korea’s KRX, the system is part of Vietnam’s efforts to upgrade from a frontier to an emerging market. It aims to modernize market operations and attract foreign investment, reported the Government news website (baochinhphu.vn).
SSC is adjusting regulations to facilitate market upgrades. Under Circular No. 68/2024/TT-BTC, foreign investment organizations that do not repurchase shares must disclose non-settled transactions. SSC has proposed modifying the rule to require disclosure at the organizational level instead of individual representatives. Securities firms must also standardize procedures for handling non-settled transactions.
The KRX system will address foreign ownership limits. Currently, if a securities firm covers a foreign investor’s shortfall in a share repurchase transaction, the shares are recorded in the firm’s proprietary account, affecting foreign ownership limits. The new system will allow the retention of foreign room until the T+3 settlement period, enabling uninterrupted transactions.
SSC is also promoting electronic communication between securities firms and custodian banks to streamline transaction processing. This system is expected to be operational by March after testing with market participants.
The KRX system will improve market efficiency and integrate new trading features. Vietnam’s stock exchanges and the Vietnam Securities Depository and Clearing Corporation (VSDC) will release details before the launch.
SSC is considering omnibus accounts, which would allow fund management firms to trade for multiple investment funds simultaneously. To implement this, SSC plans to revise Circular No. 120/2020/TT-BTC before August.
A policy dialogue group will be established in March to address market concerns. SSC is also streamlining procedures for opening foreign indirect investment capital accounts. The State Bank of Vietnam is drafting regulations to replace Circular No. 05/2014/TT-NHNN, with completion expected by March.
