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Banking & Finance

Foreign ownership limits finally lifted

Released at: 13:46, 27/06/2015

Foreign ownership limits finally lifted

PM signs off on new decree allowing listed enterprises to set their own foreign ownership limits.

by Doanh Doanh

The Prime Minister has ratified Decree No. 60/2015, replacing Decree No. 58, which includes a long-awaited regulation on removing limits on foreign ownership in listed companies.

Minister of Finance Dinh Tien Dung announced the news at a ministry meeting held on June 26 reviewing results in the first half of the year and plans for the second half.

The new decree will not only have a major positive impact on the development of Vietnam’s securities market but also accelerate the equitization process, which the government is determined to step up as quickly as possible, according to Minister Dung.

Current regulations cap foreign stakes in public companies at 49 per cent. Under the new decree this can be increased, with enterprises permitted to propose their own limits. The limit on foreign stakes in banks, however, will be retained at the existing 30 per cent.

Full details of the regulation will be disclosed soon.

According to Mr. Andy Ho, Chief Investment Officer at VinaCapital and Managing Director of its Vietnam Opportunity Fund, the new Decree is an exciting development and of great importance, as it will open Vietnam up to the world and make the market more competitive, accessible, and investor-friendly. “The market will also benefit from a re-rating and a larger allocation by global fund managers,” he said.

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