Circular 03: Removing more bottlenecks in the process of upgrading the market

This is one of the key points that facilitates foreign organizations when opening a money account. Previously, foreign organizations had to spend several weeks, even several months to complete the consular legalization procedure for foreign-issued documents before being able to open an account in Vietnam. This not only prolongs the time but also causes many investors to miss out on investment opportunities.

This is the content of Circular 03 issued by the State Bank, regulating the opening and use of VND accounts to conduct foreign indirect investment in Vietnam.

The Circular officially takes effect from June 16, 2025 and replaces Circular No. 05/2014/TT-NHNN, contributing to removing another bottleneck in the roadmap to upgrade Vietnam's stock market.

Thus, another bottleneck in the process of upgrading Vietnam's stock market has been removed.

Previously, Circular 68/2024/TT-BTC was officially applied from November 2, 2024, allowing foreign institutional investors to purchase shares without requiring sufficient funds (Non Pre-funding solution - NPS), and the roadmap for information disclosure in English was also fully regulated.

This Circular allows foreign institutional investors to buy shares without having to have enough money when placing orders, and at the same time establishes a roadmap for information disclosure in Vietnamese in parallel with English. The new regulations in Circular 68 are assessed to be highly feasible, in line with international practices, and positively recognized by market rating organizations.

According to many assessments, the Vietnamese stock market may be approved for upgrading by FTSE Russell in September 2025 and MSCI may consider adding it to the watch list in June 2025. The MSCI reclassification will take longer because it depends on reaching a sustainable and comprehensive solution regarding foreign ownership limits in the stock market.

Along with that, from May 5, 2025, the KRX system will officially operate, contributing to supporting the development of more complex financial products and diversified order types. It is also an important factor contributing to bringing Vietnam closer to the goal of upgrading from frontier to emerging in 2025.

According to BSC Research, foreign investors will conduct net buying activities 2-4 months before FTSE announces its approval for upgrading (T0) as well as the time to start the transition process (T1). For MSCI, foreign investors act 4-5 months earlier due to the scale of reference funds according to the index set and the level of influence of MSCI is larger than FTSE Russell.

Source: https://baodautu.vn/thong-tu-03-go-them-nut-that-trong-tien-trinh-nang-hang-thi-truong-d285956.html