Decision No. 155/2004/QD-TTg dated August 24, 2004 of the Prime Minister promulgating the classification criteria and list of to be classified state companies and independent cost-accounting member companies of state corporations

DECISION

PROMULGATING THE CLASSIFICATION CRITERIA AND LIST OF TO BE-CLASSIFIED STATE COMPANIES AND INDEPENDENT COST-ACCOUNTING MEMBER COMPANIES OF STATE CORPORATIONS

THE PRIME MINISTER

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the November 26, 2003 Law on State Enterprises;

In order to materialize the Resolution of the 9th Plenum and to step up the materialization of the Resolution of the 3rd Plenum of the Party Central Committee, IXth Congress, on the further restructuring, renewal, development and raising of the efficiency of State enterprises;

At the proposal of the Minister of Planning and Investment,

DECIDES:

Article 1.- To issue together with this Decision the classification criteria and list of to be-classified State companies and independent cost-accounting member companies of State corporations.

Article 2.- Subject to the application of this Decision are independent State companies, independent cost-accounting member companies of State corporations and existing State corporations.

Article 3.- This Decision replaces Decision No. 58/2002/QD-TTg of April 26, 2002 of the Prime Minister and takes effect 15 days after its publication in the Official Gazette.

The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, the presidents of the provincial/municipal People’s Committees, and the Managing Boards of Corporations 91 shall, basing themselves on this Decision, have to continue classifying and restructuring State companies and independent cost-accounting members companies of State corporations under their management and report thereon to the Prime Minister in October 2004.

The Ministry of Planning and Investment shall coordinate with the Steering Committee for Enterprise Renewal and Development in monitoring, guiding and urging the ministries, branches, localities and Corporations 91 to implement this Decision and regularly sum up and report the situation to the Prime Minister.

CLASSIFICATION CRITERIA AND LIST OF TO BE-CLASSIFIED STATE COMPANIES AND INDEPENDENT COST-ACCOUNTING MEMBER COMPANIES OF STATE CORPORATIONS

(Issued together with the Prime Minister’s Decision No. 155/2004/QD-TTg of August 24, 2004)

A. INDEPENDENT STATE COMPANIES AND INDEPENDENT COST-ACCOUNTING MEMBER COMPANIES OF STATE CORPORATIONS (hereinafter called companies for short)

I. The State shall own 100% of capital of companies operating in the following branches and domains:

1. Companies operating in some important domains:

- Production and supply of explosive materials;

- Production and supply of toxic chemicals;

- Production and supply of radioactive substances;

- National electricity transmission system;

- National and international communication axis networks;

- Production of cigarettes;

- Flight control;

- Maritime security;

- Production and repair of weapons, ammunition and equipment exclusively used for national defense and security; equipment, facilities, technical documents and provision of information confidentiality services with cipher techniques;

- Companies assigned to perform special defense and security tasks and companies located in important strategic areas where economy and defense are combined under the Prime Minister’s decisions;

- Printing of banknotes and valuable certificates; production of coins;

- Construction lottery;

- Publishers;

- Production of scientific films, newsreels, documentary films and films for children;

- Measurement and cartography;

- Management and maintenance of the national railway systems, airports and seaports of large scale and important position under the Prime Minister’s decision;

- Management and exploitation of head-water water works and large-scale water works;

- Planting and protection of head-water forests, protective forests and special-use forests;

- Water drainage in large urban centers;

- Public lighting;

- Some other important domains as decided by the Prime Minister.

2. Companies ensuring the essential demands for developing production and improving the material and spiritual life of ethnic minority people in mountainous, deep-lying and remote areas.

3. Companies meeting the following conditions: having the State capital of VND 30 billion or more; having the three preceding years’ average level of State budget remittance of VND 3 billion or more; taking the lead in applying spearhead technologies and high technologies; contributing an important part to stabilizing marco-economy; and operating in the following branches and domains:

- Petroleum processing;

- Exploitation of ores containing radioactive substances;

- Building and repair of air transport means;

- Printing of political books and newspapers;

- Wholesale of preventive and curative medicines, pharmaceutical chemicals;

- Wholesale of food;

- Gasoline and oil wholesale;

- Air and railway transport.

II. Companies which diversify their ownership in forms of equitization, assignment to labor collectives, or sale

1. Companies where the State holds more than 50% of the total shares upon their equitization.

a/ Companies which have the State capital of VND 20 billion or more; have the three preceding years’ average level of State budget remittance of VND 2 billion or more; and operate in branches and domains specified at Point 3, Section I above or the following branches and domains:

- Electricity production;

- Exploitation of important minerals: coal, bauxite, copper ore, iron ore, tin ore, gold, gemstones;

- Manufacture of mechanical-engineering products: electric equipment and materials; machines exclusively used for industries; machinery and equipment in service of agriculture, forestry and fisheries; building and repair of sea and railway transport means;

- Supply of telecommunication infrastructure;

- Production of ferrous metals (pig iron, steel) with a capacity of over 100,000 tons/year;

- Production of high-quality cement by modern technologies, with designed capacity of over 1.5 million tons/year;

- Production of chemical fertilizers and plant protection drugs;

- Production of a number of consumer goods and foodstuffs: kitchen salt; milk; beer with a capacity of over 50 million liters/year; alcohol and liquor with a capacity of over 10 million liters/year;

- Exploitation, filtering and supply of clean water in urban centers;

- Sea transport;

- Trading in currencies and insurance.

b/ Other companies:

- Production of plant varieties, animal breeds and frozen sperm;

- Off-shore fishing services;

- Management and maintenance of important road and waterway systems;

- Management and exploitation of water works;

- Labor cooperation services;

- Dealing in fair and exhibition floor-space.

2. For those companies not defined at Point 1 of this Section, when they are equitized, the competent State agencies shall base themselves on each specific case to decide whether the State shall hold shares with a small percentage or shall not hold shares.

3. For those companies, which cannot be equitized, their ownership shall be converted in form of assignment of companies to labor collectives or sale of companies according to the Government’s regulations.

III. Modes of handling companies not defined in Section I above, which have suffered prolonged losses and cannot convert their ownership

1. Those companies, which have conducted business without efficiency, suffered losses for two consecutive years but not to the extent of being dissolved or declared bankrupt, shall be merged or consolidated.

2. Those companies, which have suffered losses in their business activities for three consecutive years and have the accumulated loss amount equal to 3/4 or larger of the State capital at the companies, but do not yet fall into insolvency, and which, though having applied the reorganizing measures, cannot overcome the situation, shall be dissolved.

3. Those companies, which have suffered losses in their business activities for two consecutive years and cannot repay their due debts, shall be declared bankrupt.

B. STATE CORPORATIONS

1. Corporations with their establishment and investment being decided by the State must fully meet the following conditions:

a/ Being engaged in the following branches and domains: oil and gas exploitation and processing as well as gasoline and oil wholesale; electricity production and supply; exploitation, processing and supply of coal and important minerals; metallurgy; mechanical-engineering; cement production; post, telecommunications, electronics, aviation; maritime; railway; chemicals and chemical fertilizers; production of a number of important consumer goods and foodstuffs (textiles, paper, salt, coffee, rubber, wood processing, liquor, beer, cigarettes); curative medicines, pharmaceutical chemicals; construction; food wholesale; banking; insurance.

b/ Having the State capital of VND 500 billion or more; for specific branches under the Prime Minister’s decisions, the State capital amount may be smaller but not less than VND 100 billion.

c/ Having the three preceding years’ average level of State budget remittance of VND 50 billion or more; for specific branches under the Prime Minister’s decisions, it may be smaller but not less than VND 20 billion.

d/ Having advanced technological and managerial levels, high-quality products, high efficiency in production and business activities, and having capability to compete with others on domestic and international markets.

2. Those State Corporations, which do not fully meet the above-mentioned four conditions, shall be restructured along the direction of merger, consolidation or dissolution after restructuring their member companies.