Vietnam set to roll out new regulations for VC funds independent from securities law

VC word cloud. Credit:Barrie Entrepreneur Connect

Vietnam is working on a separate set of regulations, independent of the existing securities law, to govern venture capital investment activity in the country. The move is seen to enable a diverse set of investors to participate in startup funding in the country.

The state, which is working on the decree on venture capital fund establishment in the country, is expected to introduce the regulation by the end of the year.

The new move is a departure from its earlier stance when the state was exploring the idea of setting up of such funds under the purview of the  current securities law.

“Regulations on the establishment of securities investment funds are very tight. (…) These regulations do not encourage private investors to contribute capital to set up venture funds,” said a government document.

Therefore, the local technology ministry has proposed the formation of fund management companies, which will operate venture capital funds, as well as startup investment firms.

Each fund is set to have no more than 30 limited partners (LPs). These investors will be not be limited in transferring their capital within the funds.

“The availability of such a dedicated set of regulations will not only boost the fundraising capacity but also protect investors’ interest through tax incentives and a detailed operation guideline,” the document added.

Investors into Vietnamese startups will enjoy income tax reduction or exemption although details of the same have not been made available.

The government is also seeking advice on adding convertible loan to diversify the tools for funding startups.

“Banks and securities investment funds are not targeting funding for startups due to the risk and small scale of the business,” said the government document. “Meanwhile, a lot of local individual and institutional investors are interested in startups but dithered about how to jointly invest.”

Also read:

Vietnam to launch venture capital regulation in 2017

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.