Decree No. 10/2019/ND-CP the exercise of rights and responsibilities of the state owner’s representatives

DECREE

On the exercise of rights and performance of responsibilities of the state owner’s representatives^[1]

Pursuant to the June 19, 2015 Law on Organization of the Government;

Pursuant to the November 26, 2014 Law on Management and Use of State Capital Invested in Production and Business at Enterprises;

Pursuant to the November 26, 2014 Law on Enterprises;

At the proposal of the Minister of Planning and Investment;

The Government promulgates the Decree on the exercise of rights and performance of responsibilities of the state owner’s representatives.

Chapter I

GENERAL PROVISIONS

Article 1.Scope of regulation

This Decree prescribes the exercise of rights and performance of responsibilities of the state owner’s representatives under the Law on Management and Use of the State Capital Invested in Production and Business at Enterprises.

Article 2.Subjects of application

1. State owner’s representatives at enterprises where the State holds 100% charter capital and state capital portions at joint-stock companies or limited liability companies with two or more members.

2. Enterprises with 100% charter capital held by the State.

3. Other agencies, organizations and individuals involved in the investment, management and use of state capital at enterprises.

Article 3.State owner’s representatives

1. The Government shall uniformly exercise rights and perform responsibilities of the state owner’s representatives in the investment of state capital in enterprises and the management of state capital at enterprises in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and other relevant laws.

2. The Prime Minister shall exercise rights and perform responsibilities of the state owner’s representatives in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and other relevant laws.

3. The owner’s representative agencies shall exercise rights and perform responsibilities of the state owner’s representatives at enterprises established under their decisions or assigned to them for management and exercise rights and perform responsibilities of the state owner’s representatives with regard to state capital portions invested in joint-stock companies or limited liability companies with two or more members in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and other relevant laws.

4. The owner’s representatives shall directly exercise rights and perform responsibilities of the state owner’s representatives at enterprises in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and other relevant laws.

Article 4.Owner’s representative agencies

1. The Committee for Management of State Capital at Enterprises shall act as the owner’s representative agency of enterprises with 100% charter capital held by the State and state capital portions invested in enterprises under the Government’s regulations.

2. Ministries, ministerial-level agencies and government-attached agencies (below collectively referred to as ministries), and People’s Committees of provinces and centrally run cities (below collectively referred to as provincial-level People’s Committees) shall act as the owner’s representative agencies of:

a/ Enterprises with 100% charter capital held by the State and state capital portions invested in enterprises established under decisions of ministries or provincial-level People’s Committees or assigned to them for management and not subject to transfer to the Committee for Management of State Capital at Enterprises and the State Capital Investment Corporation as prescribed by law;

b/ Enterprises with 100% charter capital held by the State and state capital portions invested in enterprises which are subject to transfer to the Committee for Management of State Capital at Enterprises and the State Capital Investment Corporation pending the transfer.

3. The State Capital Investment Corporation shall exercise rights of the state owner’s representatives at enterprises that are transferred from ministries or provincial-level People’s Committees in accordance with law.

Chapter II

ORGANIZATION OF THE EXERCISE OF RIGHTS AND PERFORMANCE OF RESPONSIBILITIES OF THE STATE OWNER’S REPRESENTATIVES

Section 1

EXERCISE OF RIGHTS AND PERFORMANCE OF RESPONSIBILITIES OF THE GOVERNMENT OR PRIME MINISTER

Article 5.Exercise of rights and performance of responsibilities of the Government

The exercise of rights and performance of responsibilities of the Government under the Law on Management and Use of State Capital Invested in Production and Business at Enterprises are prescribed as follows:

1. The Committee for Management of State Capital at Enterprises shall request competent state agencies to submit to the Government the promulgation or revision of charters of enterprises with 100% charter capital held by the State established under the Prime Minister’s decisions and with the Committee assigned by the Prime Minister to act as the owner’s representative under the Government’s regulations; or the promulgation or revision of the financial management regulations of Vietnam Oil and Gas Group and Vietnam Electricity.

2. The Ministry of National Defense shall propose the Government to promulgate or revise the charter and salary management mechanism of the parent company - Viettel Military Industry and Telecoms Group.

3. The Ministry of Finance shall:

a/ Propose the Government to promulgate regulations on transformation of enterprises with 100% charter capital held by the State into joint-stock companies; regulations on financial management applicable to enterprises with 100% charter capital held by the State; regulations on criteria for evaluation of operation and production and business efficiency of enterprises with 100% charter capital held by the State; and regulations on supervision and examination of the investment, management and use of state capital at enterprises;

b/ Make reports on investment, management and use of state capital at enterprises nationwide and submit them to the Government for consideration and reporting to the National Assembly at its year-end sessions as assigned by the Government.

4. The Ministry of Home Affairs shall propose the Government to promulgate regulations on recruitment, appointment, re-appointment, removal from office, commendation or disciplining of managers and supervisors at enterprises with 100% charter capital held by the State and representatives of state capital portions.

5. The Ministry of Labor, Invalids and Social Affairs shall propose the Government to promulgate regulations on regimes of wages, remunerations, bonuses and other benefits of managers and supervisors at enterprises with 100% charter capital held by the State and representatives of state capital portions; regulations on recruitment, salaries, bonuses and other benefits of employees at enterprises with 100% charter capital held by the State in accordance with the labor law.

6. The Ministry of Planning and Investment shall propose the Government to promulgate regulations on disclosure of information on operation of enterprises with 100% charter capital held by the State; regulations on operation of supervisors at enterprises with 100% charter capital held by the State; and regulations on establishment, consolidation, merger, separation, dissolution or total sale of enterprises and transformation of enterprises with 100% charter capital held by the State into limited liability companies with two or more members.

Article 6.Exercise of rights and performance of responsibilities of the Prime Minister

The Prime Minister shall exercise rights and perform responsibilities of the state owner’s representatives in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises as follows:

1. To invest state capital for establishment of enterprises with 100% charter capital held by the State according to competence, specifically as follows:

a/ An owner’s representative agency shall make and submit to the Prime Minister a dossier of request for the establishment of an enterprise, which must comprise a scheme on enterprise establishment as prescribed by the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and other documents prescribed by law.

b/ The Prime Minister shall issue a decision on establishment of an enterprise after obtaining the appraisal opinions of the Ministry of Planning and Investment and opinions of the Ministry of Finance, Ministry of Home Affairs, Ministry of Justice, Ministry of Labor, Invalids and Social Affairs, and related line ministries, for a scheme on establishment of an enterprise submitted by the owner’s representative agency.

c/ The Prime Minister shall appoint the chairperson of the Members’ Council based on the proposal of the owner’s representative agency and the appraisal of the Ministry of Home Affairs.

2. To decide on the following matters for enterprises with 100% charter capital held by the State which are established under the Prime Minister’s decisions:

a/ To decide on the restructuring, ownership transformation and reorganization of enterprises at the proposal of the owner’s representative agencies and opinions of the Ministry of Planning and Investment, Ministry of Finance, Ministry of Home Affairs, Ministry of Justice, Ministry of Labor, Invalids and Social Affairs, and related line ministries.

b/ To decide on charter capital upon the establishment of enterprises prescribed in Clause 1 of this Article; to decide to approve adjustment of charter capital of enterprises during their operation based on the proposal of the owner’s representative agencies and the written approval of the Ministry of Finance according to the Government’s regulations on investment of state capital in enterprises and the management and use of capital and assets at enterprises.

c/ To approve 5-year production and business strategies and plans and development investment plans of enterprises based on the proposal of the owner’s representative agencies, opinions of the Ministry of Finance and related line ministries, and appraisal of the Ministry of Planning and Investment.

d/ To decide on the planning, appointment, re-appointment, approval of resignation, removal from office, transfer, rotation, commendation, disciplining, dismissal, or retirement of chairpersons of Members’ Councils, based on the proposal of the owner’s representative agencies and appraisal of the Ministry of Home Affairs. The Prime Minister shall appoint chairpersons of Members’ Councils after reaching agreement with the Government’s Party Caucus Commission according to charters of enterprises.

The Committee for Management of State Capital at Enterprises shall assume the prime responsibility for, and coordinate with the Ministry of Home Affairs in, proposing the Prime Minister to appoint the Director General of the State Capital Investment Corporation after reaching agreement with the Government’s Party Caucus Commission.

dd/ To decide on the appointment, re-appointment, removal from office, resignation, transfer, rotation, commendation, disciplining, or retirement of the Chairperson of the parent company - Viettel Military Industry and Telecoms Group based on the proposal of the Ministry of National Defense and opinions of the Ministry of Home Affairs. The Prime Minister shall appoint the Chairperson of the parent company - Viettel Military Industry and Telecoms Group after reaching agreement with the Government’s Party Caucus Commission.

3. To approve the general scheme on restructuring and renewal of enterprises established under decisions of the owner’s representative agencies or assigned to them for management, based on the proposal of the owner’s representative agencies and opinions of the Ministry of Finance, Ministry of Planning and Investment, Ministry of Home Affairs, Ministry of Labor, Invalids and Social Affairs, Ministry of Justice, and related line ministries.

The competence to decide on restructuring of credit institutions placed under special control must comply with the Law on Credit Institutions.

4. To decide on the policy on transfer of state capital at enterprises among the owner’s representative agencies, between owner’s representative agencies and enterprises having the function of state capital investment and trading under regulations on transfer of the right to represent owners of state capital at enterprises in accordance with law.

5. To exercise other rights and perform other responsibilities of the state owner’s representatives in accordance with law, the Government’s assignment and this Decree.

Section 2

EXERCISE OF RIGHTS AND PERFORMANCE OF RESPONSIBILITIES OF THE OWNER’S REPRESENTATIVE AGENCIES

Article 7.Rights and responsibilities of the owner’s representative agencies regarding the establishment of enterprises with 100% charter capital held by the State

1. Based on the state capital investment scope and conditions on establishment of enterprises with 100% charter capital held by the State as prescribed by the law on management and use of state capital invested in production and business at enterprises, an owner’s representative agency shall make and submit to the Prime Minister a dossier of request for establishment of an enterprise, which must comprise a scheme on establishment of an enterprise prescribed by the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and other documents prescribed by law.

2. After the Prime Minister approves the scheme, the owner’s representative agency shall exercise the following rights and perform the following responsibilities:

a/ To decide on the establishment of the enterprise, except cases which fall within the Prime Minister’s competence.

b/ To propose the same-level finance agency to appraise the dossier of request for capital investment and to allocate capital for the enterprise.

c/ To promulgate the charter, and appoint the chairperson and members of the Members’ Council or company president, except cases which fall within the competence of the Government or Prime Minister.

3. The order and procedures for the exercise of rights and performance of responsibilities defined in Clauses 1 and 2 of this Article must comply with the Government’s regulations on investment of state capital in enterprises, management and use of capital and assets at enterprises, and establishment of enterprises with 100% charter capital held by the State.

Article 8.Rights and responsibilities of the owner’s representative agencies regarding reorganization, ownership transformation, dissolution, bankruptcy or transfer of enterprises with 100% charter capital held by the State

1. An owner’s representative agency shall coordinate with related agencies in formulating and submitting to the Prime Minister for approval a general scheme on restructuring and renewal of enterprises established under its decision or assigned to it for management in accordance with the law on management and use of state capital invested in production and business at enterprises, and criteria for classification of state enterprises and enterprises with state capital as decided by the Prime Minister in each period.

2. The scheme prescribed in Clause 1 of this Article must state the form of restructuring, renewal, reorganization, ownership transformation or dissolution applicable to each of enterprises established under decision of the owner’s representative agency or assigned to it for management and implementation schedule.

3. Division, separation, consolidation or merger of enterprises under the Prime Minister-approved master scheme on restructuring and renewal of enterprises:

a/ The owner’s representative agencies shall issue decisions on division, separation, consolidation or merger of enterprises, except the cases prescribed at Points b, c and d, Clause 3 of this Article.

b/ For cases of merger of enterprises under different owner’s representative agencies, the owner’s representative agency of the merging enterprise shall issue a decision on merger of enterprises after obtaining the written agreement of the owner’s representative agency of the merged enterprise.

c/ The competence to decide the consolidation of enterprises under different owner’s representative agencies must comply with the Government’s guiding regulations.

d/ The owner’s representative agencies shall submit to the Prime Minister for decision the division, separation, consolidation or merger of enterprises established under the Prime Minister’s decisions.

dd/ The conditions, dossiers, order and procedures for division, separation, consolidation or merger of enterprises must comply with the law on enterprises and the Government’s guiding regulations.

4. Transformation of enterprises with 100% charter capital held by the State into joint-stock companies:

The order, procedures and competence to decide on transformation of enterprises into joint-stock companies must comply with the Government’s regulations on transformation of state enterprises and single-member limited liability companies with 100% charter capital invested by the State into joint-stock companies.

5. Transformation of enterprises into limited liability companies with two or more members:

Based on the conditions, mode, order and procedures for transformation of enterprises into limited liability companies with two or more members prescribed in the Law on Enterprises, Law on Management and Use of State Capital Invested in Production and Business at Enterprises and the Government’s guiding regulations, the owner’s representative agencies shall exercise the following rights and perform the following responsibilities:

a/ To propose the Prime Minister to decide on the transformation of enterprises established under the Prime Minister’s decisions.

b/ To decide on the transformation of enterprises, except the cases prescribed at Point a of this Clause.

c/ To decide on the selection of valuation consultancy or auction organizations; to approve enterprise valuation results.

d/ To approve enterprise transformation plans or submit to the Prime Minister for approval plans on transformation of enterprises established under the Prime Minister’s decisions.

dd/ To coordinate with related agencies in approving financial finalization, finalization of expenses for enterprise transformation, finalization of funds in support of redundant employees, and finalization of proceeds from enterprise transformation.

e/ To appoint representatives of state capital portions at enterprises after the transformation; to settle problems, complaints and denunciations related to enterprise transformation according to their competence and current law.

g/ To guide, examine and supervise the process of enterprise transformation in accordance with law.

6. Sale of enterprises:

a/ The owner’s representative agencies shall decide to approve enterprise sale plans and prices, except the case prescribed at Point b of this Clause.

b/ The owner’s representative agencies shall submit to the Prime Minister for approval plans on sale and sale prices of enterprises established under the Prime Minister’s decisions.

c/ The owner’s representative agencies or authorized persons shall sign contracts on enterprise sale with enterprise purchasers under the approved sale plans and prices mentioned at Points a and b of this Clause.

d/ The conditions, order and procedures for sale of enterprises must comply with the Government’s guiding regulations on sale of enterprises with 100% charter capital held by the State.

7. Dissolution of enterprises:

a/ The owner’s representative agencies shall decide on the dissolution of enterprises at the proposal of persons competent to propose enterprise dissolution under law, except the case prescribed at Point b of this Clause.

b/ The owner’s representative agencies shall propose the Prime Minister to decide on the dissolution of enterprises established under the Prime Minister’s decisions.

c/ Enterprises subject to dissolution shall be determined under the Prime Minister-approved general scheme on restructuring and renewal of enterprises. In case the dissolution of state enterprises is not yet stated in the general scheme on restructuring and renewal of state enterprises, the agencies deciding on the establishment of state enterprises shall report such to the Prime Minister for consideration and decision.

d/ The conditions, order and procedures for dissolution of enterprises must comply with law.

8. Bankruptcy of enterprises:

The owner’s representative agencies shall carry out procedures to file requests for bankruptcy of enterprises in accordance with law.

9. Transfer of owner representation rights:

The owner’s representative agencies shall transfer state capital at enterprises to other owner’s representative agencies under the Government’s regulations.

10. If the provisions of this Article are different from the provisions of the banking law regarding the reorganization, ownership transformation, dissolution, bankruptcy or transfer of enterprises with 100% charter capital held by the State which are credit institutions, the latter shall prevail.

Article 9.Rights and responsibilities of the owner’s representative agencies regarding charters, strategies and plans of enterprises with 100% charter capital held by the State

1. The owner’s representative agencies shall promulgate charters or revised charters of enterprises at the proposal of Members’ Councils or company presidents, except cases falling within the Government’s competence.

2. The owner’s representative agencies shall approve 5-year plans (including 5-year production and business strategies and plans and development investment plans) and annual production and business plans of enterprises for Members’ Councils or company presidents to decide, except cases falling within the Prime Minister’s competence.

3. A decision approving a plan specified in Clause 2 of this Article must have the following principal contents:

a/ The plan’s targets and tasks;

b/ Targets on turnover, profit, budget remittance and other targets;

c/ Plan implementation solutions;

d/ Assignment of tasks of implementation organization, supervision and assessment of results of plan implementation.

dd/ Other contents.

4. Supervision and examination of the implementation of approved plans:

a/ The owner’s representative agencies shall supervise and examine the implementation of the plans prescribed in Clause 2 of this Article and assess the implementation results.

b/ The owner’s representative agencies shall guide and urge enterprises to make and send mid-term and term-end reports on the implementation of plans to serve the supervision and examination. Such a report must have the following principal contents:

- Implementation of assigned plan objectives, tasks and targets;

- Implementation of solutions set forth in the plan;

- Limitations and causes of non-performance or poor performance of the plan (if any).

- Subsequent solutions to achieve the plan’s objectives in the subsequent period.

c/ The order and time limits for submission of reports must comply with the Government’s regulations on regimes of supervision and examination of the implementation of strategies, plans, objectives and assigned tasks of state enterprises.

Article 10.Rights and responsibilities of the owner’s representative agencies regarding management of personnel of enterprises with 100% charter capital held by the State

1. For enterprise managers:

a/ To decide on the planning, appointment, re-appointment, resignation, removal from office, transfer, rotation, commendation, disciplining, dismissal, or retirement of chairpersons and members of Members’ Councils or company presidents in accordance with law, except cases falling within the Prime Minister’s competence.

b/ To approve the appointment, re-appointment, removal from office, commendation or disciplining of directors general or directors of enterprises for Members’ Councils or company presidents to decide.

The owner’s representative agencies shall assume the prime responsibility for, and coordinate with the Ministry of Home Affairs in, consulting the Government’s Party Caucus Commission before issuing the written approval for Members’ Councils of enterprises established under the Prime Minister’s decisions to appoint directors general according to charters of enterprises.

c/ To exercise rights and perform responsibilities regarding salaries, remunerations, bonuses and other benefits of enterprise managers under the Government’s regulations on salaries, remunerations and bonuses of managers of single-member limited liability companies with 100% charter capital held by the State.

d/ The decision on appointment, re-appointment,  removal from office, approval of resignation, removal from position, transfer, rotation, rank bestowment or promotion, salary and salary-allowance grading and raising, commendation, disciplining, or retirement of directors general, directors and holders of other managerial titles of enterprises under the Ministry of Public Security or Ministry of National Defense must comply with the regulations on personnel work in the army and public security forces, provisions of law, and charters of enterprises.

2. For supervisors:

a/ To decide on the planning, appointment, re-appointment, resignation, removal from office, transfer, rotation, commendation, disciplining, dismissal, or retirement of supervisors in accordance with law.

b/ To form a Supervisory Board with up to 5 supervisors at the parent company of a state economic group.

c/ To form a Supervisory Board with 3 supervisors at the parent company of a state corporation.

d/ To appoint one supervisor or form a Supervisory Board with 3 supervisors at other state enterprises, depending on capital amounts, business lines and geographical areas of state enterprises established under their decisions or assigned to them for management.

dd/ The owner’s representative agencies shall select and appoint cadres or civil servants under their management to be supervisors and arrange appropriate jobs for them upon their retirement from supervisors.

Article 11.Exercise of rights and performance of responsibilities regarding financial and investment activities of enterprises with 100% charter capital held by the State

The owner’s representative agencies shall:

1. Promulgate financial regulations of enterprises in accordance with the Government’s regulations on investment of state capital in enterprises and management and use of capital and assets at enterprises, except cases falling within the Government’s competence.

2. Approve charter capital of enterprises (including the adjustment of charter capital in the operation process), except cases falling within the Prime Minister’s competence; appraise dossiers and plans on addition of charter capital of enterprises; coordinate with same-level finance agencies in additionally allocating charter capital for enterprises under regulations as suitable to each funding source used for charter capital addition.

The dossiers, schemes, order and procedures for capital allocation must comply with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and the Government’s guiding regulations.

3. Consider and approve at the request of Members’ Councils or company presidents:

a/ A scheme on capital mobilization for each project expected to raise capital at a level higher than that prescribed at Point a, Clause 3, Article 23 of the Law on Management and Use of State Capital Invested in Production and Business at Enterprises.

b/ A scheme on mobilization of capital from foreign organizations and individuals.

For foreign loans which enterprises borrow and pay by themselves, except foreign loans taken in the form of goods import on delayed payment, the owner’s representative agencies shall approve the policy on foreign loan borrowing of enterprises and request the Ministry of Finance to appraise and approve it. For the Government-guaranteed loans, the law on public debt management and other relevant laws shall apply.

c/ Investment, construction or fixed asset purchase and sale projects of enterprises with a value higher than that prescribed at Point a, Clause 1, Article 24 of the Law on Management and Use of State Capital Invested in Production and Business at Enterprises.

d/ Projects on investment outside enterprises with a value higher than that prescribed at Point a, Clause 4, Article 28 of the Law on Management and Use of State Capital Invested in Production and Business at Enterprises.

The capital mobilization by enterprises with 100% charter capital held by the State which are credit institutions must comply with the banking law and other relevant laws.

The order and procedures for formulating, appraising and approving the projects and plans specified in Clause 2 of this Article must comply with relevant laws.

4. Decide to let Members’ Councils or company presidents sign contracts on rent, lease, pledge or mortgage of assets of enterprises with a value higher than the level decentralized for Members’ Councils or company presidents under the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and the Government’s guiding regulations.

5. Approve schemes on liquidation or sale of fixed assets with a value higher than the level decentralized for Members’ Councils or company presidents in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and the Government’s guiding regulations.

6. Decide on the policy on offshore investment, except cases falling within the competence of the National Assembly or Prime Minister, under the law on management and use of state capital invested in production and business at enterprises, law on investment, law on foreign exchange management, and other relevant laws.

7. Decide on the policy on contribution of capital, increase or decrease of contributed capital, transfer of capital invested by enterprises in joint-stock companies or limited liability companies with two or more members.

8. Decide on the policy on takeover of joint-stock companies or limited liability companies with two or more members as subsidiaries or associated companies of enterprises.

9. Approve annual financial statements, and plans on profit distribution and setting aside of funds of enterprises.

10. Coordinate with same-level finance agencies in the investment of state capital in enterprises after such investment is approved by a competent authority; decide on the transfer of capital invested by enterprises in joint-stock companies or limited liability companies with two or more members in case the transfer value is lower than the book value after clearing the provisions for investment capital loss.

11. Approve the policy on the establishment, reorganization or dissolution of branches, representative offices or dependent cost-accounting units of enterprises in accordance with law for Members’ Councils or company presidents to decide.

The establishment of branches and representatives offices of enterprises with 100% charter capital held by the State which are credit institutions must comply with the banking law.

Report the policy on the establishment, reorganization or dissolution of branches, representative offices or dependent cost-accounting units of enterprises established under the Prime Minister’s decisions to the Prime Minister for consideration and approval and for Members’ Councils or company presidents to decide.

Article 12.Exercise of rights and performance of responsibilities regarding supervision, examination and assessment of operation of enterprises with 100% charter capital held by the State

1. The owner’s representative agencies shall organize the supervision and examination of capital management, use, preservation and development, implementation of development investment strategies and plans, labor recruitment, and implementation of salary and bonus regimes of enterprises; give opinions on the supervision, examination and inspection by other competent agencies or organizations of the investment, management and use of state capital at enterprises under the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and the Government’s guiding regulations.

2. The owner’s representative agencies shall assess operation results and efficiency of production and business activities of enterprises; assess task accomplishment in management and administration work by enterprise managers and supervisors under the law on management and use of state capital invested in production and business at enterprises and the Government’s guiding regulations.

3. The competence, order and procedures for inspection of operation of enterprises with 100% charter capital held by the State must comply with the law on inspection and other relevant laws.

Article 13.Exercise of rights and performance of responsibilities regarding state capital portions invested in joint-stock companies or limited liabilities companies with two or more members

The owner’s representative agencies shall:

1. Exercise rights and perform responsibilities of representatives of owners of state capital invested in joint-stock companies or limited liability companies with two or more members through representatives of state capital portions.

2. Appoint, remove from office, relieve from duty, commend, discipline, decide on salaries, responsibility-based allowances, bonuses and other benefits of, representatives of state capital portions under the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and the Government’s regulations on representatives of state capital portions holding managerial titles at enterprises with over 50% charter capital held by the State, regulations on labor, salaries, remunerations and bonuses for companies with dominant shares and contributed capital of the State, and relevant laws.

3. Coordinate with same-level finance agencies in the additional investment of the State’s contributed capital in joint-stock companies or limited liability companies with two or more members after such additional investment is decided by a competent authority. The dossiers, order and procedures for additional investment of state capital in enterprises must comply with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and the Government’s regulations.

Work out a roadmap for, and decide on the plan on and organize the implementation of, the transfer of state capital at joint-stock companies or limited liability companies with two or more members according to the list of enterprises with transferred state capital which is decided by the Prime Minister in each period.

In case the transfer of state capital at enterprises is not yet stated in the Prime Minister-decided list of enterprises with transferred state capital, the owner’s representative agencies shall report thereon to the Prime Minister for decision before formulating a plan on and organizing the transfer of state capital at such enterprises.

The dossiers, order and procedures for transfer of state capital at enterprises must comply with the law on investment of state capital in enterprises and management and use of capital and assets at enterprises.

4. Supervise the recovery of investment capital and collection of profits and dividends from joint-stock companies or limited liability companies with two or more members in accordance with law.

5. Request representatives of state capital portions at enterprises with at least 36% charter capital held by the State to report to, and consult, the owner’s representative agencies before giving opinions, voting or making decisions at the General Meeting of Shareholders or meetings of Boards of Directors or Members’ Councils in accordance with law and charters of enterprises regarding:

a/ Objectives, tasks and business lines; reorganization, dissolution or request for bankruptcy of enterprises;

b/ Charters and revision of charters of enterprises;

c/ Increase or decrease of charter capital; capital mobilization time and mode; types of shares and total volume of shares of each type entitled to offering; redemption of over 10% of the total shares of each type sold;

d/ Nomination for election, recommendation on removal from office, relief from duty, commendation, or handling of violations of members of Boards of Directors, chairpersons of Boards of Directors, chairpersons of Members’ Councils, and members of Supervisory Boards. Nomination for appointment, recommendation on removal from office, or signing or termination of contracts with directors general (directors) of enterprises. Remuneration, salaries, bonuses and other benefits of members of Boards of Directors, members of Members’ Councils, members of Supervisory Boards, and directors general (directors) of enterprises; number of members of the Board of Directors, members of the Supervisory Board, and deputy directors general (deputy directors) of enterprises;

dd/ Production and business strategies and plans and development investment plans;

e/ Policies on contribution, holding, increase and decrease of capital of enterprises at subsidiaries; establishment, reorganization or dissolution of branches or representative offices; takeover of enterprises volunteering to become subsidiaries or associated companies;

g/ Policies on asset purchase and sale and borrowing or lending contracts with a value at least equal to 50% of charter capital of enterprises or another smaller percentage as prescribed in the charter of enterprises; and the policy on borrowing of foreign loans by enterprises;

h/ Financial statements, profit distribution, setting aside and use of funds, and annual dividends;

i/ Recruitment regime; remuneration, salary and bonus regimes of enterprises;

k/ Other matters as prescribed by the working regulations of representatives of state capital portions which are promulgated by the owner’s representative agencies and not contrary to Article 48 of the Law on Management and Use of State Capital Invested in Production and Business at Enterprises and relevant laws.

6. Prescribe in the working regulations of representatives of state capital portions the matters on which these representatives must report to or consult the owner’s representative agencies before giving opinions, voting, or making decisions at enterprises with under 36% charter capital held by the State (if any) not in contravention of Article 48 of the Law on Management and Use of State Capital Invested in Production and Business at Enterprises, charters of enterprises, and relevant laws.

7. Promptly give opinions on matters on which representatives must report and seek consultation.

8. Supervise and evaluate representatives of state capital portions according to the competence, order and procedures prescribed in the law on management and use of state capital invested in production and business at enterprises and the Government’s regulations on supervision of state capital investment in enterprises, financial supervision, assessment of operation efficiency, and disclosure of financial information of enterprises with 100% charter capital held by the State and enterprises with state capital.

9. Take responsibility for the use efficiency, preservation and development of state capital assigned to them for management.

10. Organize the exercise of other rights and performance of other responsibilities in accordance with the Law on Enterprises, Law on Management and Use of State Capital Invested in Production and Business at Enterprises, charters of enterprises, and relevant laws.

Section 3

OWNER’S DIRECT REPRESENTATIVES

Article 14.Rights and responsibilities of owner’s direct representatives at enterprises with 100% charter capital held by the State which are established under the Prime Minister’s decisions

Members’ Councils of parent companies of state economic groups, the State Capital Investment Corporation and enterprises established with state capital under the Prime Minister’s decisions in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises shall:

1. Formulate and report to the owner’s representative agencies for the latter to submit to the Prime Minister for approval 5-year production and business strategies and plans and development investment plans of enterprises.

2. Make decisions on annual production and business plans and development investment plans of enterprises and send them to the owner’s representative agencies, the Ministry of Planning and Investment and Ministry of Finance for summarization and supervision.

3. Propose competent authorities to decide on the planning, appointment, re-appointment, removal from office, transfer, rotation, approval of resignation, commendation, disciplining, or evaluation of chairpersons and members of Members’ Councils, and to approve annual remuneration funds and salaries of enterprise managers in accordance with law.

4. Decide on the planning, appointment, evaluation, re-appointment, resignation, removal from office, transfer, rotation, commendation, disciplining, dismissal, or retirement of directors general of enterprises after obtaining the approval of the owner’s representative agencies.

5. Propose the owner’s representative agencies to submit to competent authorities the adjustment of charter capital; revision of charters; reorganization, ownership transformation, dissolution, or request for bankruptcy of enterprises. Decide on the establishment, reorganization or dissolution of attached units after obtaining appraisal of the owner’s representative agencies and approval of the Prime Minister.

6. Propose the owner’s representative agencies to consider and submit to the Prime Minister for decision the policy to establish subsidiaries with 100% capital of enterprises. Decide on the establishment of such subsidiaries after the Prime Minister approves the policy.

7. Propose the owner’s representative agencies to consider and decide on the policy on capital contribution or establishment of new enterprises at home and abroad in the form of limited liability companies with two or more members, joint-stock companies or foreign-invested companies, or takeover of enterprises willing to become subsidiaries or associated companies. Decide on investment after the owner’s representative agencies decide on the policy.

8. Propose the owner’s representative agencies to consider and decide on the policy on making additional investment or making no additional investment in subsidiaries or associated companies; decide on investment after the owner’s representative agencies decide on the investment policy.

Propose the owner’s representative agencies to consider and submit to the Prime Minister for decision the policy on making additional investment or making no additional investment in subsidiaries or associated companies in cases falling within the Prime Minister’s competence as prescribed by law; decide on investment after the Prime Minister decides on the investment policy.

9. Decide on additional investment in subsidiaries or associated companies, and contribute capital to business cooperation contracts after the owner’s representative agencies decide on the investment policy with regard to investment amounts with a value exceeding the equivalent value of group-B projects as classified under the Law on Public Investment.

10. Propose the owner’s representative agencies to approve annual financial statements of enterprises (including financial statements of parent companies and consolidated financial statements), profit distribution, and setting aside and use of funds.

11. Take the initiative in deciding and bear responsibility for decision on matters falling within the competence of Members’ Councils of enterprises with 100% charter capital held by the State in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises, Law on Enterprises, other relevant laws, and charters of enterprises.

Article 15.Rights and responsibilities of the owner’s direct representatives at enterprises with 100% charter capital held by the State which the owner’s representative agencies decide to establish or are assigned to act as the owner’s representatives

Members’ Councils or company presidents of enterprises with 100% charter capital held by the State other than those defined in Article 14 of this Decree shall:

1. Propose the owner’s representative agencies:

a/ To decide on the reorganization, ownership transformation, dissolution or bankruptcy of enterprises;

b/ To promulgate or revise charters; to decide on or adjust charter capital;

c/ To approve 5-year development investment strategies and plans and annual production and business plans of enterprises;

d/ To decide on the appointment, re-appointment, removal from office, commendation, disciplining, salaries, remunerations, bonuses and other benefits of chairpersons and members of Members’ Council or company presidents;

dd/ To approve the appointment, re-appointment, removal from office, commendation, or disciplining of directors general or directors of enterprises;

e/ To approve capital mobilization plans, investment, construction or fixed asset purchase and sale projects, projects on investment outside enterprises, or offshore investment projects of enterprises with a value exceeding the level decentralized for Members’ Councils or company presidents as prescribed by law;

g/ To allocate capital for investment of state capital in enterprises after obtaining approval of competent authorities; to decide on the transfer of capital invested by enterprises in joint-stock companies or limited liability companies with two or more members if the transfer value is lower than the book value after clearing the provisions for investment capital loss;

h/ To decide on the policy on capital contribution, increase or decrease of contributed capital, or transfer of capital invested by enterprises in joint-stock companies or limited liability companies with two or more members; to decide on the policy to take over joint-stock companies or limited liability companies with two or more members as subsidiaries or associated companies of enterprises;

i/ To approve financial statements, and plans on profit distribution and setting aside of annual funds of enterprises.

2. To take the initiative in deciding and bear responsibility for decision on matters falling within the competence of Members’ Councils or company presidents of enterprises with 100% charter capital held by the State in accordance with the Law on Management and Use of State Capital Invested in Production and Business at Enterprises, Law on Enterprises, other relevant laws, and charters of enterprises.

Chapter III

IMPLEMENTATION PROVISIONS

Article 16.Effect

1. This Decree takes effect on March 15, 2019.

2. This Decree replaces the Government’s Decree No. 99/2012/ND-CP of November 15, 2012, on task assignment and decentralization of the exercise of rights and performance of responsibilities and obligations of the state owner with regard to enterprises with 100% charter capital held by the State and state capital invested in enterprises.

Article 17.Organization of implementation

1. The owner’s representative agencies shall formulate and implement their internal regulations on exercise of rights and performance of responsibilities with regard to enterprises with 100% charter capital held by the State and state capital at enterprises established under their decisions or assigned to them for management.

2. In case of receipt of the transfer of the right to represent owners of state capital at enterprises, the owner’s representative agencies shall assume prime responsibility for, and coordinate with related agencies in, organizing the arrangement, renewal, reorganization, ownership transformation, or restructuring of state capital at enterprises according to the schemes and plans approved by competent authorities before the time of transfer.

3. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees, Members’ Councils or company presidents of enterprises with 100% charter capital held by the State, and representatives of state capital portions shall implement this Decree.-

On behalf of the Government
Prime Minister
NGUYEN XUAN PHUC