With just one month remaining before FTSE Russell announces the results of its annual market classification review, the Ministry of Finance has released a major update on Vietnam’s efforts to upgrade its stock market status. Recent regulatory changes have received strong recognition from international organizations.

According to the Ministry of Finance, global index provider FTSE Russell has positively assessed Vietnam’s recent financial reforms, particularly the issuance of Circular 68 and Circular 18, which removed the requirement for pre-funding transactions - bringing Vietnam in line with global standards.

In addition, international observers welcomed the rollout of the KRX technology platform and the introduction of new circulars governing registration, depository, clearing, and settlement. Vietnam has also established a legal framework to support new trading mechanisms.

In August, the Ministry continued pursuing key reforms to meet FTSE’s upgrade criteria and to facilitate greater foreign investor participation. It submitted a draft amendment to Decree 155 to the government, which includes a provision requiring public companies to announce their foreign ownership limits within 12 months of the new decree taking effect.

Furthermore, the Ministry is collaborating with other ministries to revise the Law on Investment and related guidelines to increase foreign ownership caps in sectors unrelated to national security and defense. This would allow for expanded foreign holdings in public companies.

Meanwhile, the State Bank of Vietnam is revising Circular 17 to ease regulations for foreign investors. Key updates under consideration include:

Allowing financial institutions to open, close, and operate payment accounts under power of attorney
Removing consular legalization requirements for account opening
Waiving biometric verification for e-account opening and fund withdrawal
Enabling the use of SWIFT systems
Reducing documentation and signature requirements

FTSE Russell’s 2025 market classification results are expected to be announced on October 7.

In addition to market reform updates, the Ministry of Finance also shared progress on plans to establish international financial centers (IFCs) in Ho Chi Minh City and Da Nang. Two draft decrees are in development, covering investment incentives, tax policies, insurance, securities, and capital markets related to IFCs.

These draft decrees have been circulated among relevant ministries, local governments, and stakeholder organizations for feedback. The Ministry of Finance has submitted the proposals to the Ministry of Justice for evaluation and is finalizing them before submission to the central government.

PV