Vietnam should reduce the certification needed to become a licensed broker and simplify procedures to establish stock investment funds to increase the number of portfolio investors, finance investors have proposed.
The State Securities Commission conducts training courses on various aspects of the stock market including legal issues, analysis, and fund and asset management that aspiring brokers need to complete and obtain certification in.
Most of these certificates should not be mandatory except the one that ensures the person’s knowledge of the latest legal issues relating to the market, the Vietnam Association of Financial Investors (VAFI) said in a note to the Ministry of Finance and the State Securities Commission on December 10.
The association said the certificates have not proved effective “as a tool for the government to manage stock trading.” The complicated process involved in obtaining them actually hindered the business, it said.
The Dau Tu Chung Khoan (Stock Investment) newspaper cited an unnamed official with a brokerage as saying the government has so far required employees at securities companies to hold many training certificates in order to be granted the license to become a broker.
The official said any college graduate should be given a business certificate after they finish a basic course on the stock market and its operations including the Vietnam Securities Law.
Other training certificates should not be deemed compulsory but only considered to evaluate the employee in case the latter happens to possess them, the official said.
Nguyen Quang Bao, Deputy General Director of the Ho Chi Minh City-based Viet Capital Securities Co. (VCSC), was quoted by Dau Tu Chung Khoan as saying the time taken to issue a certificate should be reduced.
VAFI also suggested that the process of establishing stock investment and asset management funds should be reformed. It said the current procedures are “the most difficult and complicated in the world.”
In many cases, a business will lose its chance to mobilize funds while waiting for the permit because its members, especially foreign investors, would be discouraged. The procedures so far have not proven effective in assessing the quality of the fund, the VAFI said in the note.
The association said a fund should be allowed to mobilize money from among its members and then register itself with the State Securities Commission instead of the other way round.
Procedures to set up investment funds should be as simple as those to set up any other company, it said.
The VAFI also called for administrative reforms at stock investment firms, and the elimination of barriers and inequalities between finance investment organizations toward attracting strategic investors.
Nguyen Hoang Hai, General Secretary of VAFI, said the government should also issue regulations for retirement and charity funds to operate on the stock market as well.