Securities watchdog plans legal overhaul to boost foreign investor access

Securities watchdog plans legal overhaul to boost foreign investor access

One of the regulator's key priorities will be the development and implementation of a central counterparty clearing (CCP) mechanism, which is expected to become operational in the first quarter of 2027.

An investor watches the market's movements on his computers. — Photo vietnamplus.vn

Việt Nam's securities regulator is preparing a new round of legal reforms aimed at improving the investment environment and strengthening the attractiveness of the country's capital market to international investors, as authorities continue efforts to modernise market infrastructure and advance market-upgrade objectives.

Speaking at a seminar held in Singapore on June 2, Chairwoman of the State Securities Commission (SSC) Vũ Thị Chân Phương highlighted the rapid development of Việt Nam's stock market and outlined key priorities for future reforms.

According to Phương, the country's stock market capitalisation had reached approximately US$410 billion by mid-May, while average daily trading value on the Hochiminh Stock Exchange (HoSE) stood at around $1.2 billion per session.

The market has also recorded a number of initial public offerings (IPOs) accompanied by stock exchange listings. At the same time, an increasing number of foreign-invested enterprises have been exploring opportunities to list on the stock market, reflecting growing interest in the market from international businesses.

Phương said Việt Nam has implemented a series of important reforms in recent years to improve market accessibility for foreign investors.

Among the most notable measures is the introduction of a non-prefunding mechanism that allows foreign institutional investors to place trades without depositing funds before submitting orders. Authorities have also streamlined administrative procedures relating to the opening of indirect investment accounts and securities trading accounts, making it easier for international capital to participate in the domestic market.

She noted that the stock market's new information technology system, which entered operation in May 2025, has enhanced operational capacity and supported the market's development needs.

Phương added that regulators have continued to focus on improving corporate governance standards, strengthening information transparency, developing intermediary institutions and expanding the range of investment products available to market participants.

Several major initiatives are currently being implemented, including Việt Nam's stock market upgrade roadmap, a development strategy for the fund management industry and investor education programmes aimed at improving financial literacy and market participation.

An investor watches the market's movements on his computers. — Photo vietnamplus.vn

Looking ahead, Phương said the regulator would continue refining the legal framework, increasing market openness in line with international practices, developing modern financial products and services, and promoting the growth of institutional investors while improving the quality of participation among retail investors.

The SSC also plans to maintain regular dialogue mechanisms with the international investment community through advisory groups, allowing regulators to promptly address difficulties and concerns raised by foreign investors.

For now, one of the regulator's key priorities will be the development and implementation of a central counterparty clearing (CCP) mechanism, which is expected to become operational in the first quarter of 2027.

The SSC is also preparing proposals to amend the Securities Law and related regulations as part of broader efforts to improve the investment environment. In parallel, regulators are studying solutions related to foreign ownership limits and measures designed to strengthen market supervision and transparency.

At the event, participants acknowledged progress made in improving market transparency, operational efficiency and accessibility for foreign investors. 

Discussions also focused on the timeline for market upgrading, the implementation of new mechanisms such as the CCP framework and omnibus trading accounts (OTA), as well as measures to develop the corporate bond market, expand hedging instruments and increase the scale of the foreign exchange market.

Many investors noted that Việt Nam possesses a number of advantages in attracting long-term capital flows, citing the country’s positive economic growth outlook, its increasingly important role within global supply chains and the Government's commitment to pursuing structural reforms aimed at building a modern, transparent and internationally integrated capital market.

SSC Vice Chairman Bùi Hoàng Hải said Việt Nam has been working to align market mechanisms and infrastructure with international standards.

Hải said that authorities have advanced several initiatives, including the introduction of omnibus trading accounts, the planned CCP mechanism and connectivity systems linking securities companies with custodian banks to facilitate transaction processing and improve convenience for foreign investors.

He added that Việt Nam would continue promoting equitisation and State divestment programmes, developing the fund management industry, diversifying investment products and expanding the supply of high-quality listed securities.

These measures are being implemented within the framework of Việt Nam's stock market development strategy through 2030, which aims to build a modern, transparent and efficient capital market capable of meeting the economy's evolving financing needs. 

Bizhub