The working group also proposed that securities companies, fund management companies, public companies and investment funds founded in Vietnam be regarded as domestic investors, regardless of the foreign ownership at these companies.

The working group called for the amended draft Law on Securities to be made public early for comments because this is a specialised law and revision would take time.

At a dialogue between the working group and the State Securities Committee (SSC) early this month, Nguyen Quang Viet, Director of SSC’s Legal Department, said the new law aimed to create favourable conditions for businesses and investors and there was a high possibility that it would eliminate limits on foreign ownership at public companies and fund management companies.

Viet also said the draft law would be announced in March 2018 at the earliest. Compiling a new securities law to replace the Law on Securities 2006, which proved to be outdated amidst the rapid development of the capital market in Vietnam, was identified as a major task for the Ministry of Finance in 2017.

Decree 58/2012/ND-CP and Decree No 60/2015/ND-CP were issued to amend several points of the Law on Securities 2006. Accordingly, foreign ownership at public companies was capped at 49 percent. According to Scriven, Decree 90/2011/ND-CP should also be revised to allow enterprises to issue bonds efficiently.

At December 13’s conference where amendments to the decree were discussed, Dang Van Thanh, Chairman of the Vietnam Association of Financial Investors, said the corporate bond market had not received adequate attention.

Thanh said that in Vietnam, few individual investors participated in this market and companies generally did not regard bond issuance as a major channel for raising capital in comparison with banking credit. “The corporate bond market still has significant room for growth,” Thanh said. The capital market, including bonds and stocks, developed rapidly in recent years and became an important capital raising channel for the economy.

The total capitalisation of the stock and bond market is now equivalent to more than 100 percent of the country’s gross domestic product, compared to outstanding loans, which are now worth about 130 percent of GDP. The scale of the securities market tripled in the past decade from 22 percent of GDP in 2006 to 63 percent of GDP currently.