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ARTICLE · 01 OCTOBER 2024

New Regulations On The Offshore-Issued Bonus Share Plan

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On 8 June 2024, the State Bank of Vietnam ("SBV") released Circular No. 23/2024/TT-NHNN ("Circular 23") amending a number of provisions of Circular No. 10/2016/TT-NHNN regarding governance on the employee stock ownership...

VietnamFinance and Banking
Thang Nguyen
Thang Nguyen
Nguyet Le
Nguyet Le
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On 8 June 2024, the State Bank of Vietnam ("SBV") released Circular No. 23/2024/TT-NHNN ("Circular 23") amending a number of provisions of Circular No. 10/2016/TT-NHNN regarding governance on the employee stock ownership plans ("ESOP") issued oversea. Circular 23 is effective from 12 August 2024.

This legal update will present to you an overview of the key provisions and amendments prescribed by Circular 23.

1. SBV registration requirement is removed

Prior to Circular 23, the foreign entity to issue foreign ESOP rights to Vietnamese employees shall comply with the required hurdles, including registration of the ESOP scheme with the SBV. The process was complicated, expensive and not practical in approach. As a result, we often saw a combination of alternative (less favourable) bonus arrangements offered to Vietnamese employees, or non-registration of foreign ESOPs, leaving employees to deal with implications and risks themselves for their foreign entitlement/

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