This   Decree   provides   detailed   regulations   for   implementation   of   the Commercial   Law regarding establishment of a Commodity Exchange and activities of trading goods on a Commodity Exchange.

The decree covers:

• Chapter 1: Applicable entities and rights of Vietnamese businesses to trade on offshore Commodity Exchanges
• Chapter 2: Commodity Exchange: Legal status, conditions, applications, evaluation, contents of licence, operations, powers, responsibilities and foreign investors
• Chapter 3: Members of a Commodity Exchange: Approval of members, broker status, rights and obligations of members, trading members, rights, obligations and termination of trading members
• Chapter 4: Clearing / Settlement Centre and Goods Forwarding Centre: Rights and obligations of the clearing / settlement centre and of the goods forwarding centre
• Chapter 5: Trading Goods on a Commodity Exchange
• Chapter 6: Entrusting Trading on a Commodity Exchange
• Chapter 7: Dealing with Breaches, Resolution of Complaints and Denunciations
• Chapter 7: Dispute Resolution

The Ministry of Industry and Trade shall issue a decision on the issuance, re-issuance, amendment or addition to a licence for establishment of a Commodity Exchange (“CE”) and shall approve its Operational Charter.

A commodity exchange can be established where:

(i) there is legal capital of 150 Billion Dong or more, and

(ii) information technology systems are established that meet the requirements on technological and technical solutions for goods purchase and sale through a Commodity Exchange:

Requirements include a stable server system with one on-demand backup server; a server system to ensure data backup of business applications, transaction data, and ensure the recovery of data information in the event of a problem;

Application software must comply with requirements on intellectual property rights; software systems must have a log function to track all transactions of goods, payment, delivery, and maintained for a minimum of 5 years.

Chapter 2, Article 15 sets out the Powers of a CE:

1) To select goods on the list referred to in Article 32 of this Decree and to organize trading of such goods on a CE,

2) To organize, operate and administer activities of trading goods on the CE,

3) To grant or revoke membership status in accordance with provisions in its Operational Charter,

4) To request trading members to pay their member status security deposits and trading deposits, to collect membership fees, trading fees, service charges for supply of information and other service fees, and

5)  To promulgate rules, to inspect and supervise trading, to administer risk management, as well as other administration functions.

Chapter 2, Article 16a set out that foreign investors are also entitled to

(i) contribute capital to establish a CE in Vietnam and to purchase capital contribution portions and shareholding in a Vietnamese CE at a ratio not to exceed forty-nine per cent (49%) of the charter capital, and

(ii) to trade on a CE as clients or members with an unlimited ratio of ownership of charter capital.