Process for foreign investor purchasing Government Bonds

There are no regulatory restrictions on offshore holdings in the bond market.

Special requirements

Foreign investors must apply for a Securities Trading Code from the Vietnam Securities Depository. The following documents are required for the application for a Securities Trading Code:

·        Registration form for Securities Trading Code

·         Notarised certificate of incorporation or business/investment licence or other legal evidence of incorporation

·         Notarised power of attorney to a local custodian, supported by the notarised company’s authorised signature list if a company seal is not available

·         Other documents (for hedge funds) or as deemed necessary by the Vietnam Securities Depository

Below is the trade and settlement flowchart for non-resident investors investing in Government Bond and Treasury Bill

Taxation

Non –residents don’t have to pay corporate income tax of 20%.

There are 2 kind of tax that impose on non –residents: 5% on coupon income and 0.1% tax on total proceeds from sale