VietnamÆs regulator overloaded

The State Securities Commission (SSC) in Vietnam has a supervisory department thatÆs ôoverloadedö with work and unable to fully monitor all the activities in the local stock market for now, says SSC deputy director Nguyen Than Long.

ôThere are some limitations at present,ö says Long. ôPreviously, we were only in charge of listed companies. Now, we are also in charge of public companies, numbering in the thousands.ö

There are around 200 stocks listed in Vietnam and around 4,000 joint stock companies.

Under the Law on Securities, which was enforced in January this year, joint stock companies with over VND10 billion ($633,000) in charter capital and more than 100 shareholders must register with the commission to be a public company or face fines.

However, only around 700 joint stock companies have registered to be public companies and accept SSC regulations.

Both listed and public companies are required to release their financial results, among other things. The financial reports must be audited within 10 days after being completed and must be published

Since the Law on Securities is relatively new, the SSC itself has to learn how to interpret all the provisions, Long says.

ôWe need to sort out what is legal and what is illegal. This will require time,ö he says. ôWe are improving our organisational structure to ensure enforcement. We need other guidelines and enforcement mechanisms.ö

Long noted that punishments for violation regulations is ônot severe enough because they only consider administrative violations and not criminal activities.ö

Long made the comments at the recent Funds World Vietnam 2007 conference in Ho Chi Minh City, which had 160 fund managers, investors, and investment professionals in attendance.