On March 5, 2023, the Government has just issued Decree No. 08/2023/ND-CP amending, supplementing and suspending the effect of a number of articles in the previous Decrees regulating private placement and trading of privately placed corporate bonds in domestic market and offering of corporate bonds in international market.
A new highlight in Decree 08/2023/ND-CP is the regulation allowing bond issuers to extend the term by 2 years. As follows:
Point b, Clause 3, Article 3 of Decree No. 65/2022/ND-CP dated September 16, 2022 amending and supplementing a number of articles of Decree No. 153/2020/ND-CP stipulating that enterprises must not change maturity of the issued bonds. The above regulation has been amended by Decree 08/2023/ND-CP in the direction of allowing bond issuers to extend the term of bonds by up to 2 years. In case the bondholder does not agree to this change, the enterprise “must have the responsibility to negotiate to ensure the interests of investors”. If the negotiation process still does not reach the expected results, the enterprise must fulfill its obligations to the bondholders according to the announced bond issuance plan.
With domestically offered bonds, if the enterprise cannot fully and timely pay the principal and interest in VND according to the previously announced plan, it can negotiate with the bondholder to pay with other assets. This should ensure the principle that the bondholder approves and the business must disclose unusual information, responsible for the legal status of the assets used for payment.
In addition, in Article 3 of Decree 08/2023/ND-CP, the following provisions of Decree No. 65/2022/ND-CP shall be suspended until December 31, 2023, including:
- Regulations on determining the status of professional securities investors as individuals at Point d Clause 1 Article 8 of Decree 153/2020/ND-CP are amended in Clause 6, Article 1 of Decree 65/2022/ND-CP.
- Regulations on bond distribution time of each issuance are in Clause 7, Clause 8, Article 1 of Decree 65/2022/ND-CP.
- Regulations on credit rating results for bond issuers at Point e, Clause 2, Article 12 of Decree 153/2020/ND-CP as amended in Clause 9 Article 1 of Decree 65/2022/ND-CP.
Decree 08/2023/ND-CP takes effect from March 5, 2023.