Ministry of Finance Announces Pilot Period for Short Selling and Day Trading
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Perfecting Legal and Technical Frameworks for Market Upgrade
The Ministry of Finance has officially issued Decision No. 3761/QĐ-BTC dated November 6, 2025, regarding the implementation plan for Decision No. 2014/QĐ-TTg, which approves the project to upgrade Vietnam’s stock market. This marks the next step in concretizing the government’s directives, aiming to elevate Vietnam to an emerging market status by international standards during the 2025-2030 period.
The plan’s focus is on accelerating the completion of legal mechanisms and market infrastructure, with the State Securities Commission (SSC) serving as the focal point for monitoring, urging, and synthesizing implementation progress.
The SSC is tasked with closely coordinating with units under the Ministry, stock exchanges, and the Vietnam Securities Depository and Clearing Corporation (VSDC) to promptly address challenges and investor recommendations, particularly those from foreign investors.
The plan also outlines a series of short-term tasks to meet international upgrade criteria, including gradually eliminating the requirement for advance payment for securities purchases during the pre-Central Counterparty (CCP) mechanism phase. This involves refining non-collateralized trading mechanisms for foreign investors and enhancing transparency regarding foreign ownership ratios to ensure equal access.
Additionally, the plan mandates upgrading the information system between custodian banks and securities companies to support investor trading activities (STP), implementing the Omnibus Trading Account (OTA) mechanism in line with international practices, and strengthening IT infrastructure to handle increasing trading volumes.
The SSC will collaborate with the State Bank of Vietnam to review and propose amendments to regulations related to banking services for foreign investors, addressing discrepancies in custody, settlement, and transaction utilities. These factors directly impact the upgrade assessments by organizations like FTSE Russell and MSCI.
Comprehensive Upgrade for Sustainable Capital Market Development
To ensure the upgrade goals extend beyond technical criteria, the plan sets forth long-term tasks with a broader scope, encompassing market structure, legal frameworks, and supervisory capabilities.
Initially, the Ministry of Finance has tasked the Foreign Investment Agency with reviewing the list of restricted industries for foreign access, studying the expansion or removal of unnecessary foreign ownership limits, in line with improving the investment environment. This is a critical barrier in the upgrade assessment.
Regarding infrastructure, VSDC will establish a subsidiary to implement the CCP mechanism—a key condition for applying T+0 or T+2 non-collateralized settlement, bringing the market closer to emerging market standards.
The plan also emphasizes the controlled implementation of securities lending and borrowing mechanisms and short selling, alongside modernizing trading systems through new technologies.
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Short selling is the practice of selling securities that the seller does not own at the time of the transaction. In short selling, investors borrow securities from a broker’s account and sell them, anticipating a price drop. Later, they repurchase the securities at a lower price to profit. Essentially, short selling involves borrowing shares to sell at a high price, then buying them back at a lower price to make a profit. |
From 2026 to 2030 and beyond, the Vietnam Stock Exchange (VNX) will continue to modernize trading and settlement systems, enhance system capacity to handle large trading volumes, and gradually integrate new technologies into market operations.
Additionally, there is a mandate to review and amend legal provisions related to financial supervision and security to ensure system safety, enhance transparency through audit quality control, adopt IFRS for listed companies, and elevate corporate governance standards in line with OECD practices. The Accounting and Auditing Supervisory Department will lead this task, with coordination from the SSC, VNX, subsidiaries, and the Vietnam Association of Certified Public Accountants.
The plan also emphasizes expanding the product base by developing new derivatives, green bonds, depository certificates, and benchmark indices, while diversifying investors by encouraging individual participation through investment funds and implementing the Investor Restructuring Project.
Beyond intra-sector efforts, the Ministry of Finance stresses inter-sector collaboration with the State Bank of Vietnam and the Ministry of Public Security to monitor capital flows, ensure financial security, and maintain macroeconomic stability. This is a cornerstone for sustaining market robustness during the upgrade phase.
The decision also outlines funding sources for implementation, including the state budget, socialized resources, and other lawful sources.
– 21:15 11/11/2025
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