Circular No. 134/2017/TT-BTC dated December 19, 2017 of the Ministry of Finance on guiding e-transactions in the securities market

CIRCULAR

Guiding e-transactions in the securities market^[1]

Pursuant to the June 29, 2006 Law on Securities;

Pursuant to the November 24, 2010 Law Amending and Supplementing a Number of Articles of the Law on Securities;

Pursuant to the November 29, 2005 Law on E-Transactions;

Pursuant to the June 29, 2006 Law on Information Technology;

Pursuant to the November 19, 2015 Law on Cyber-information Security;

Pursuant to the Government’s Decree No. 58/2012/ND-CP of July 20, 2012, detailing and guiding the implementation of a number of articles of the Law on Securities and the Law Amending and Supplementing a Number of Articles of the Law on Securities;

Pursuant to the Government’s Decree No. 60/2015/ND-CP of June 26, 2015, amending and supplementing a number of articles of Decree No. 58/2012/ND-CP of July 20,  2012, detailing and guiding the implementation of a number of articles of the Law on Securities and the Law Amending and Supplementing a Number of Articles of the Law on Securities;

Pursuant to the Government’s Decree No. 42/2015/ND-CP of May 5, 2015, on derivatives and derivatives market;

Pursuant to the Government’s Decree No. 27/2007/ND-CP of February 23, 2007, on e-transactions in financial activities;

Pursuant to the Government’s Decree No. 156/2016/ND-CP of November 21, 2016, amending and supplementing a number of articles of Decree No. 27/2007/ND-CP of February 23, 2007, on e-transactions in financial activities;

Pursuant to the Government’s Decree No. 87/2017/ND-CP of July 26, 2017, defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

At the proposal of the Chairperson of the State Securities Commission;

The Minister of Finance promulgates the Circular guiding e-transactions in the securities market.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation

This Circular guides online securities trading, exchange of e-information on the securities market, and other activities relating to e-transactions in the securities market. 

Article 2. Subjects of application

Subject to this Circular include:

1. The State Securities Commission, Stock Exchanges, and Vietnam Securities Depository.

2. Organizations and individuals participating in transactions and conducting activities in the securities market by electronic means, including:

a/ Issuing organizations, listing organizations, organizations registering for trading, and public companies;

b/ Securities companies, fund management companies, and securities investment companies;

c/ Vietnam-based representative offices and branches of foreign securities companies and fund management companies;

d/ Commercial banks, branches of foreign banks being members of the bond market or derivatives market, supervisory banks, depository members, clearing members and fund certificate distribution agents;

dd/ Investors;

e/ Other organizations and individuals participating in transactions and conducting activities in the securities market by electronic means.

Article 3. Interpretation of terms

In this Circular, the terms below are construed as follows:

1. Online securities trading means securities transactions conducted via the information technology system and the Internet, telecommunications or other open networks, including: securities transactions between investors and online securities trading service providers; securities transactions between trading members and the Stock Exchange; securities-related transactions between depository members, clearing members and the Vietnam Securities Depository.

2. Online securities trading system means a system for managing and conducting online securities transactions, including: hardware equipment and devices, software, database, telecommunications, the Internet and computer networks.

3. E-document in the securities sector means a data message about e-transactions in the securities market which is created, sent, received and stored by electronic means.

4. E-order means a data message recording the information included in an order placed at a certain time by an investor via the online securities trading system which is accessible only to such investor through access and order-placing confirmation.

5. Two-factor authentication means a method of authentication requiring two factors to verify an identity. Two-factor authentication is based on information which the user knows such as PIN and password, together with information the user obtains via his/her smartcard, token device or cell phone or his/her biometrics for verifying his/her identity.

6. Cyberinformation security means the protection of cyberinformation and cyberinformation systems from illegal access, use, disclosure, interruption, modification or sabotage in order to ensure the integrity, confidentiality and usability of information.

7. Physical address of order-placing device (also called as media access control - MAC address) means the only code assigned by the manufacturer to identify the device upon placing or aborting an order in the online securities trading system.

8. Telephone number for order placement means a telephone number registered by an investor with an online securities trading service provider to place securities orders. 

9. Online securities trading service means a service provided by online securities trading service providers to investors to open accounts, place orders or set requirements on securities transactions or receive trading results via the Internet or telephone.

10. Online securities trading service provider means a securities company, fund management company or fund certificate distribution agent that provides online securities trading services.

11. Depository member means a securities company or commercial bank operating in Vietnam and granted by the State Securities Commission a securities depository operation registration certificate and admitted by the Vietnam Securities Depository as one of its depository members.

12. Clearing member means a securities company, commercial bank or foreign bank branch licensed to conduct clearing and payment for derivatives transactions.

13. Serious incident means a technical breakdown occurring in the online securities trading system and leading to the cessation or suspension of the system.

Article 4. Principles of conducting e-transactions in the securities market

E-transactions in the securities market must adhere to the principle of accuracy, fairness, publicity, transparency, safety and efficiency and compliance with the Law on E-Transactions and Law on Cyberinformation Security and guiding documents, and other relevant regulations.

Chapter II

ONLINE SECURITIES TRADING ACTIVITIES

Section 1

REQUIREMENTS ON SERVICES, TECHNICAL INFRASTRCTURE, CONFIDENTIAL SECURITY AND DATA STORAGE

Article 5. Requirements on services

1. The Stock Exchanges and the Vietnam Securities Depository shall:

a/ Elaborate and issue regulations on connection of the online securities trading system, processes of incident response, system backup and risk control in online securities trading activities in compliance with the Law on E-Transactions and Law on Cyberinformation Security and guiding documents, and this Circular;

b/ Ensure the provision of online securities trading services in a public, fair, transparent, safe and efficient manner to all members using the same type of service.

2. Securities companies providing online securities trading services shall:

a/ Provide online securities trading services directly to investors;

b/ Build a website with the domain name already registered on the Internet to provide online securities trading services. Programs and applications used for conducting online securities transactions shall be uploaded to or integrated in such website;

c/ Issue processes of providing online securities trading services, including process of daily operation, monitoring and administration; process of registration and cancellation of use of online securities trading services; process of incident response; process of system and data backup; process of risk control in the provision of online securities trading services to investors, and other processes in compliance with the Law on E-Transactions and Law on Cyberinformation Security and guiding documents, and this Circular, clearly stating the responsibility of process participants;

d/ Deploy employees who possess a degree or certificate of training in information technology for software administration, system administration and information security to manage and supervise activities of the online securities trading system, ensuring they are conducted in a continuous and uninterrupted manner;

dd/ Express the provision and use of online securities trading services to/by investors in contracts or terms and clauses of contracts on opening of securities trading accounts, specifically providing the online securities trading method, risks which might occur when conducting online securities transactions as prescribed in Clause 1, Article 15 of this Circular, responsibility of parties to pay compensation upon occurrence of a risk and other responsibilities related online securities transactions;

e/ Record information about trading requests of investors in the online securities trading system. Such information shall be stored for reference according to time, log-in session, transaction results and balance on accounts of investors before and after transactions;

g/ Notify results of execution of trading orders to investors right after such orders are matched in the online securities trading system.

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