Marketing Equity-linked Notes in Vietnam

Originally published in the Journal of International Banking Law and Regulation

The securities business is in its early stages in Vietnam. Not many products are available to investors. The Law on Securities largely recognizes only more traditional products: stocks, bonds and investment fund units. The legal framework for securities that are held indirectly through securities intermediaries is inadequate. While almost no securities derivatives have been issued in Vietnam, a number of offshore brokers are looking for a structure that will permit them to offer more sophisticated products to Vietnamese investors.

This article briefly examines the legal framework that governs the offer and trading of a particular type of securities derivative. We refer to notes linked to equities that are traded on the Vietnamese securities market. We will further discuss how an offshore broker can issue these products to Vietnamese investors.