List of Vietnam Law
Decision No. 242/QD-TTg dated February, 28, 2019 of the Prime Minister approving the scheme for “Restructuring securities and insurance markets by 2020 and vision to 2025”
Date: 2/28/2019
PRIME MINISTER
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SOCIALIST REPUBLIC OF VIETNAM
Independence – Freedom - Happiness --------------- |
No. 242/QD-TTg
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Hanoi, February, 28, 2019
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PRIME MINISTER
(Signed and sealed) Nguyen Xuan Phuc |
(Enclosed with the Decision No. 242/QD-TTg dated February 28, 2019 of the Prime Minister)
(Enclosed with the Decision No. 242/QD-TTg dated February 28, 2019 of the Prime Minister)
No.
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Contents
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Unit in charge
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Cooperation unit
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Implementation period
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2018
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2019
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2020
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2025
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A. FOR SECURITIES SECTOR
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I. DEVELOPMENT OF THE LEGAL FRAMEWORK
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1
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Develop the amended Law on Securities and submit it to the National Assembly for approval in 2019
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Ministry of Finance
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Ministry of Justice, Ministry of Planning and Investment, State Bank
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2
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Develop the legal framework to carry out effective implementation of the "Road map for developing the Vietnamese bond market from 2017 to 2020, and vision to 2030.” Such road map is approved by the Prime Minister in the Decision No. 1191/QD-TTg dated August 14, 2017.
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Ministry of Finance
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State Bank, Ministry of Planning and Investment, Ministry of Justice
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3
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Develop and issue the guidelines for digitalization of main assets in the securities market; issue guidelines for standardization of activities for opening online accounts and establishing eKYC, online-trading, AI asset management and robo-advisory, and digitalizing main assets in the securities market with Fintech.
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Ministry of Finance
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4
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Develop and amend the documented guidelines for financial safety index and methods for handling securities trading organizations that do not meet such index.
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Ministry of Finance
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5
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Provide legal framework for crowdfunding.
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Ministry of Finance
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6
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Review and amend the Regulation on classification of securities trading organizations, in order to carry out early classification and give early warning.
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The State Securities Commission
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7
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Amend the Regulation on guiding the establishment and operation of the risk management system of securities trading organizations.
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The State Securities Commission
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II. RESTRUCTURING COMMODITY BUSINESS IN THE SECURITIES MARKET
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1
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Promote the equitization plan and the state capital withdrawal plan from 2017 to 2020 according to the portfolio approved by the Prime Minister; carry out inspection and timely handle enterprises that do not comply with the regulations on listing/registration for transactions after equitization.
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Ministry of Finance
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Related ministries and sectors
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2
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Commercial banks shall list their shares and register to have their shares traded until the end of 2020. 100% of commercial banks perform the above-mentioned activities in the official market.
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Ministry of Finance
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State Bank
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3
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Issue the road map for selling derivative products from the simple to the complex: in 2019, develop covered warrants and futures contracts based on the new index and the Government bond futures contract; step by step sell the products specified in the futures contracts and the option contracts based on odd lots or round lots whenever possible.
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Ministry of Finance
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4
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Develop VN30 Securities Index Principles in compliance with international treaties; develop more index numbers to use them as the basic assets for the derivative securities market.
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State Securities Commission
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Departments of Stock Exchange
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5
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Diversify the bond products to satisfy the demands of the investors; establish the standard yield curve in the financial market; inspect the ability to issue new bonds based on a suitable road map; bonds with floating rates, bonds of which the principles and interests are traded separately, or bonds attached to inflation index; restructure the list of Government bond debts through swap pay and buyback.
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Ministry of Finance
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6
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Issue green bonds to mobilize funds for serving the green economic development and sustainable development and attracting foreign investors.
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Ministry of Finance
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7
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Simplify requirements for application documents and procedures for issuance of corporate bonds to the public and issuance of separate bonds, in order to enable enterprises to raise capital through the issuance of corporate bonds.
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State Securities Commission
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8
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Develop different types of investment funds, in order to diversify the fund products for the investors.
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State Securities Commission
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9
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Strengthen inspection and supervision for the capital raising activities and utilization of the raised capital in the securities market; timely detect and handle the cases where the virtual capital is increased and the capital is used for the wrong purposes.
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State Securities Commission
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10
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Classify the listed shares, improve listing conditions and conditions for maintaining the listed shares of each classification table; establish additional criteria for the company management, proportions of transferable shares and return on capital.
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Ministry of Finance
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11
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Set additional requirements for capital scale, quantity of shareholders, percentage of shares owned by minority shareholders in the public companies.
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Ministry of Finance
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12
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Strengthen the inspection of financial reporting quality and the audit activities of auditing units and auditors; closely cooperate with the Association of Practicing Auditors in providing trainings and evaluating the financial reporting quality, supervision and handling of violations of auditing units and practicing auditors.
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State Securities Commission
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Association of Practicing Auditors
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13
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Develop and implement the scheme for applying international accounting standards; encourage listing enterprises with large scale to publish the financial reports based on international financial reporting standards (IFRS);
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Ministry of Finance
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14
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Strengthen the management training of the company and the dissemination of information about such management and the annual program for ranking the management of listing companies; improve the role and responsibility of the Department of Stock Exchange in supervising the implementation of regulations on disclosure of information about the company's management.
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State Securities Commission
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Department of Stock Exchange
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15
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Encourage credit rating organizations with good reputation to establish enterprises with good reputation in Vietnam, work towards having enterprises with good reputation (as required) issuing and listing bonds to the public.
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Ministry of Finance
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III. RESTRUCTURE INVESTOR MECHANISM IN THE SECURITIES MARKET
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1
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Issue the norms and standards for professional investors, in order to classify investors and move towards restructuring the products and the market based on the classified groups of investors.
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Ministry of Finance
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2
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Promote the activities for providing trainings and knowledge and disseminating information to raise the society awareness of securities and securities market.
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State Securities Commission
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3
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Enable small investors and foreign investors to get access to the market by giving the securities companies the permission to form e-contract and establish electronic Know Your Customer (eKYC).
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State Securities Commission
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4
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Permit credit institutions to partially use the compulsory reserves which are government-issued bonds; develop the policy regulations on the portion of government-issued bonds held by credit institutions.
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Ministry of Finance
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State Bank of Vietnam, Ministry of Labor, Invalids and Social Affairs
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5
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Develop and promulgate the incentive policies to promote the development of voluntary pension scheme (pension insurance products and pension funds)
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Ministry of Finance
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Ministry of Labor, Invalids and Social Affairs
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6
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Develop the legal framework for foreign ownership ratios at enterprises, moving towards spreading foreign ownership in the fields of which the shares are not held by the state as regulated by laws and according to the international treaties.
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Ministry of Planning and Investment
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Ministry of Finance and related ministries and sectors
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IV. RESTRUCTURING THE SYSTEM OF INTERMEDIARY ORGANIZATIONS
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1
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Request all securities companies and investment management companies to develop the restructuring plan.
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State Securities Commission
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2
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Evaluate and classify account receivables and financial assets of securities companies and fund management companies.
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State Securities Commission
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3
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Develop the risk evaluation and classification system and send early notification to securities companies and fund management companies. Classify these companies for management and supervision.
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State Securities Commission
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4
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Strengthen inspection and supervision of the unofficial funding activities pertaining to securities trading in the market. Strictly impose penalties to the securities companies that violate the regulations on margin trading and participate in supporting the unofficial funding activities that pertain to securities trading.
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State Securities Commission
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5
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Implement the restructuring methods for the group of companies with safe operation, group of companies with normal operation, group of companies with poor performance and group of companies that no longer be able to restore their capability.
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State Securities Commission
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V. RESTRUCTURING THE ORGANIZATION OF SECURITIES MARKET
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1
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Establish the Department of Stock Exchange of Vietnam based on the model and road map which have been approved by the Prime Minister and specified in the Decision No. 32/QD-TTg dated January 07, 2019; divide the market based on the scale, operation quality and liquidity without disordering the organization but maintaining a consecutive operation and market stability.
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Ministry of Finance
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2
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Develop and bring the new information technology system into a synchronized operation at two Departments of Stock Exchange and Vietnam Securities Depository in 2019, in order to modernize the technology infrastructure to serve the trading management and supervision and make clearing payments for the whole market.
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State Securities Commission
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3
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Develop the central counterparty at Vietnam Securities Depository according to the international treaties: study the Scheme for connecting the clearing house system and securities settlement system with the inter-bank payment system, in order to make clearing payments for other securities trading; provide collateral management services and carry out secured transaction activities at Vietnam Securities Depository.
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Ministry of Finance
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4
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Change the operation model of the custodian banks in compliance with the international treaties: consider permitting the commercial banks to provide clearing services in the derivative securities market.
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State Securities Commission
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5
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Study the possibility to apply block chain in some segments of the market or in some stages of the trading and payment process, in order to improve efficiency, transparency and integrity of the data of investors.
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State Securities Commission
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Department of Stock Exchange, Vietnam Securities Depository
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6
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Implement new regulations in the securities market, especially the regulations that are suitable to the needs of professional investors.
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State Securities Commission
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Departments of Stock Exchange
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7
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Carry out trading activities within the day to satisfy the requirements of the market.
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State Securities Commission
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Departments of Stock Exchange
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8
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Widen the daily permitted trading band, based on the characteristics of each classification table of listed shares; apply the circuit breaker measure in case there are fluctuations in the market and extend the transaction period for some special transactions.
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State Securities Commission
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Departments of Stock Exchange
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9
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Develop the securities lending and borrowing model in compliance with the financial capability and the risk management ability of the securities trading organizations.
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State Securities Commission
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Departments of Stock Exchange
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10
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Improve the market organization model and the bond trading system in compliance with the transaction agreement, in order to timely make an accurate report and develop the standard yield curve in the market.
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Ministry of Finance
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11
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Issue additional bonds, swap and buy-back bonds to establish the standard bonds and thus improve liquidity, stabilize the market, minimize risks to the government bond portfolio.
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Ministry of Finance
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12
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Hire market makers and provide them with full benefits and obligations to carry out their duties in the primary and secondary markets according to the international treaties.
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Ministry of Finance
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13
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Build a central information center to issue corporate bonds at the Department of Stock Exchange and provide information to the investors and enterprises when they participate in raising the capital through issuance of bonds.
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State Securities Commission
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Departments of Stock Exchange
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VI. STREGHTHEN THE ABILITY TO CARRY OUT SUPERVISION MANAGEMENT AND IMPROVE ENFORCEMENT
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1
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Establish the Securities Market Management Team.
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Ministry of Finance
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Ministry of Justice, State Bank of Vietnam, Ministry of Planning and Investment, and National Financial Supervisory Commission
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2
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Step by step change the management and supervision model of the State Securities Commission from compliance monitoring model to management and supervision model which is risk-based, in order to optimize the resources and improve the management and supervision efficiency.
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State Securities Commission
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3
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Develop the securities market supervision system on the basis of clearly determining the responsibilities, and developing securities trading organizations to become a supervision unit at first level in the market.
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State Securities Commission
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4
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Strengthen application of information technology in managing and monitoring the securities market, especially the supervision activities carried out for the public companies and trading supervision in the market.
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State Securities Commission
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5
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Strengthen the regular exchange of information and cooperation between the securities market management agency and the monetary market management agency. Such cooperation is carried out to manage and supervise the cash flow between the securities market and the monetary market, as well as supervising the foreign investment capital; mobilizing capital through issuance of cybercash and crypto-assets.
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State Securities Commission
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6
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Develop the cooperation mechanism between the State Securities Commission and the Department of Stock Exchange. Such cooperation is carried out to supervise, detect and handle the violations related to controlling, spying and fraudulent behaviors and violations against the obligation to announce information; cooperation between the State Securities Commission and presiding agencies in the fight against criminals in the securities field, especially 04 securities crimes specified in the Criminal Code.
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State Securities Commission
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Departments of Stock Exchange
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7
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Fulfill the international commitments on cooperation in the exchange of information and the cross-border investigation between securities market surveillance authorities.
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State Securities Commission
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8
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Effectively fulfill the commitments on international economic integration in the securities field, and carry out the cooperation programs with international organizations and partners, especially securities services specified in FTAs to which Vietnam is a signatory.
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State Securities Commission
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9
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Strengthen the cooperation with international economic organizations and foreign securities management agencies in the provision of supports and trainings for public officials of the State Securities Commission.
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State Securities Commission
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VII. RAISING THE RANK OF THE MARKET
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1
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Ensure equal rights for foreign investors to get access to information by developing and regularly updating the English websites of the State Securities Commission and Departments of Stock Exchange; encouraging public companies to announce information in English.
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State Securities Commission
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Departments of Stock Exchange, public companies
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2
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Continue to reduce and simplify the administrative procedures for issuance of trading codes and registration procedures for sale of open-end fund certificates; provide guidelines for electronic voting and online meeting.
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State Securities Commission
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Vietnam Securities Depository, Departments of Stock Exchange
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3
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Amend the regulations on opening and use of indirect investment account, in order to continue to enable foreign investors and foreign investment funds to open and use payment accounts.
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Ministry of Finance
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State Bank of Vietnam
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4
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Hold regular dialogues between the management agency and the index providers, in order to develop methods and policies which are suitable to the conditions of Vietnam.
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State Securities Commission
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5
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Promote the activities for disseminating information about the Vietnamese securities market to foreign countries.
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Ministry of Finance
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VIII. ENHANCING THE ROLES OF PROFESSIONAL ASSOCIATIONS IN DEVELOPING THE SECURITIES MARKET
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1
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Periodically exchange information and consult professional associations about the mechanism, polices and methods for developing the securities market.
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State Securities Commission
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Related associations
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2
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Review and develop training programs for securities practitioners in harmony with the general standards of ASEAN; regularly update knowledge for securities practitioners; cooperate with the Broker Association to strengthen management and supervision of securities practitioners.
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State Securities Commission
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Securities trading association
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3
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Cooperate with professional associations to promulgate professional and ethical standards and carry out supervision for the implementation of these standards, in order to improve the professional quality and ethics of organizations and individuals participating in the securities market.
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State Securities Commission
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Departments of Stock Exchange, and related associations
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4
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Develop the set of company management principles which apply to listing companies in the securities market.
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State Securities Commission
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Departments of Stock Exchange, and related associations
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5
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Strengthen the cooperation with professional associations in disseminating information and providing professional trainings and legal knowledge about securities and securities market for the public.
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State Securities Commission
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Securities trading association
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6
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Develop plans and step by step transfer the activities for administering and issuing certificates of securities business practice for professional associations. Such transfer is done on the basis of satisfying the ability requirements of each of these associations.
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State Securities Commission
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Securities trading association
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B. FOR INSURANCE SECTOR
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GENERAL METHODS FOR THE INSURANCE MARKET
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I. DEVELOPING THE LEGAL FRAMEWORK
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1
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Develop the amended Law on Insurance Business and documented guidelines for risk management and how to satisfy the international integration requirements, as well as strengthening the initiation ability and self-responsibility of insurance companies in business and while making capital contribution and managing risks and personnel. Also, develop the regulations on insurance contracts; develop the state management method towards simplifying administrative procedures, strengthening post-inspection through inspection, boosting connectivity with international management, integration and cooperation agencies.
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Ministry of Finance
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Ministry of Justice, Insurance Association of Vietnam
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II. IMPROVING INFORMATION TRANSPARENCY
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1
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Request the insurance enterprises to timely disclose full, comprehensive and related information, in order to help the insurance buyers and related organizations to clearly understand the organization structure, business activities, business results and financial status of these enterprises.
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Ministry of Finance
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Insurance Association of Vietnam
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III. DEVELOPING AND PROFESSIONALIZING THE INSURANCE DISTRIBUTION CHANNELS
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1
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Develop diversified channels in order to promote the development of insurance business activities towards professionalism and catch up with the development of 4.0 technology revolution, provide the best service to insurance buyers and enable customers to get insurance access easily and in the most professional way.
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Ministry of Finance
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Ministry of Justice
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2
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Carry out management under principles for the insurance backup service providers by regulating the operation requirements and standards for such providers in compliance with each type of service (counseling service, risk management service; actuary service, compensation management service, loss assessment service, etc.).
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Ministry of Finance
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Ministry of Justice, Insurance Association of Vietnam
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IV. IMPROVE THE EFFECTIVENESS OF STATE MANAGEMENT AND THE EFFICIENCY OF INPSECTION, SUPERVISION AND ADMINISTRATIVE PENALTY ACTIVITIES.
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1
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Step by step change the management and supervision model of the Insurance Supervisory Agency from compliance monitoring model to management and supervision model which is risk-based and suitable to the capital model.
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Ministry of Finance
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Ministry of Justice, Insurance Association of Vietnam
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2
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Improve the role and responsibilities of the Ministry of Finance in managing and supervising inspection, supervision and penalty activities of the insurance companies and insurance brokerage enterprises.
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Ministry of Finance
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Ministerial inspectors
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3
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Continue to simplify the administrative procedures and enable and give business opportunities for insurance enterprises.
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Ministry of Finance
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Ministry of Justice
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V. DEVELOPING AND IMPROVING THE PERSONNEL QUALITY
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1
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Improve the personnel quality of the insurance market; Study and apply potential framework which is suitable to the actual conditions and the development of the market; strengthen the training for officials of the insurance market.
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Ministry of Finance
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Insurance Association of Vietnam
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2
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Issue the regulations on standardization of personnel quality through a professional certificate system which is suitable to the potential framework.
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Ministry of Finance
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Insurance Association of Vietnam
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3
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Study the model for establishment of Insurance Development Institute. Such establishment is carried out to socialize the Insurance Research and Training Center (without establishing a new Center).
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Ministry of Finance
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Insurance Association of Vietnam
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VI. ENHANCING THE ROLES OF PROFESSIONAL ASSOCIATIONS IN DEVELOPING THE SECURITIES MARKET
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1
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Strengthen the roles of professional associations as the centers of the whole market for collecting the opinions, feedbacks and suggestions of members of such associations on mechanism, policies and methods for developing the securities market and connecting with related agencies to effectively implement the policies.
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Ministry of Finance
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Insurance Association of Vietnam
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VII. STRENGTHEN THE CONNECTION BETWEEN THE SOCIAL HEALTH INSURANCE WITH COMMERCIAL HEALTH INSURANCE.
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1
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Develop and suggest the plan for sharing information and strengthening the interconnection between social health insurance and commercial health insurance as specified in the Resolution No. 20-NQ/TW dated October 25, 2017 of the Party Central Committee, encouraging the development of the insurance products that are in high demand by the society, and ensuring efficiency and bringing the maximum benefits to the insurance users.
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Ministry of Finance
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Ministry of Health, Social Insurance
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VIII. PROMOTING DISSEMINATION OF INSURANCE INFORMATION
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1
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Disseminate information about the role, meaning and necessity of insurance, as well as the law on insurance business to agencies, sectors, organizations, individuals and the citizens.
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Ministry of Finance
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Insurance Association of Vietnam
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IX. ESTABLISHING INFORMATION TECHNOLOGY SYSTEM AND TECHNICAL INFRASTRUCTURE; DEVELOPING DATABASE FOR THE INSURANCE MARKET
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1
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Carry out the project on data information system in the insurance sector, in order to serve the management and supervision activities
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Ministry of Finance
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Insurance Association of Vietnam
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METHODS FOR NON-LIFE INSURANCE SECTOR
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ENHANCING THE COMPETITION ABILITY AND OPERATION EFFICIENCY OF NON-LIFE INSURANCE ENTERPRISES TO ENSURE SYSTEM SAFETY
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|||||||
1
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Develop the risk control system at the insurance companies
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Ministry of Finance
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Insurance Association of Vietnam
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2
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Issue legal documents as guidelines for the risk management framework. Such documents shall specify the responsibilities of the companies in taking the initiative to apply the risk prevention, control and reduction methods.
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Ministry of Finance
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Ministry of Justice
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II. STRENGTHENING THE ABILITY TO COMPLY WITH THE REGULATIONS OF NON-LIFE INSURANCE COMPANIES
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1
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Inspect, supervise and strictly handle violations against the law.
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Ministry of Finance
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III. STRENGTHENING BUSINESS COOPERATION BETWEEN NON-LIFE INSURANCE COMPANIES
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|||||||
1
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Create a general database to develop the net fee schedule of some insurance products
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Ministry of Finance
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METHODS FOR LIFE INSURANCE SECTOR
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1
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Encourage the development of new and diversified products. Have mechanism and policies for encouraging the development of products which carry community meaning and social security meaning, such as micro-insurance, health insurance and pension insurance.
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Ministry of Finance
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Ministry of Justice
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2
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Diversify methods and develop insurance products in compliance with the business trend which is associated with 4.0 technology revolution.
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Ministry of Finance
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Ministry of Justice
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