THE NATIONAL ASSEMBLY | | THE SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom - Happiness |
No. 68/2025/QH15 | | |
LAW
On Management and Investment of State Capital in Enterprises[1]
Pursuant to the Constitution of the Socialist Republic of Vietnam;
The National Assembly promulgates the Law on Management and Investment of State Capital in Enterprises.
Chapter I
GENERAL PROVISIONS
Article 1. Scope of regulation
This Law provides the investment of state capital in enterprises and the management of state capital in enterprises.
Article 2. Subjects of application
1. The Government; the Prime Minister; and the owner’s representative agencies.
2. The owner’s direct representatives; and representatives of the State’s capital contributions.
3. State enterprises as defined in the Law on Enterprises; and credit institutions in which the State holds over 50 percent of charter capital as defined in the Law on Credit Institutions, except policy banks.
4. Other agencies, organizations and individuals related to the management and investment of state capital in enterprises.
Article 3. Interpretation of terms
In this Law, the terms below are construed as follows:
1. The owner’s representative agencies means agencies and organizations assigned by the Government to exercise the rights and perform the responsibilities of the state owner’s representatives with respect to the State’s capital contributions in enterprises, including:
a/ Ministries, ministerial-level agencies, government-attached agencies, and organizations assigned by the Government to exercise the rights and perform the responsibilities of the state owner’s representatives;
b/ Provincial-level People’s Committees assigned by the Government to exercise the rights and perform the responsibilities of the state owner’s representatives.
2. Investment of state capital in enterprises means the State’s use of its capital and assets to invest in enterprises.
3. The owner’s direct representative means an individual who is appointed by a competent state agency to the Members’ Council or as the Company President to exercise the rights and perform the responsibilities of the state owner’s representative in an enterprise in which the State holds 100% of charter capital.
4. Representative of the State’s capital contribution means an individual who is authorized in writing by the owner’s representative agency to exercise the rights and perform the responsibilities of the state owner’s representative with respect to the State’s capital contribution to a joint stock company or a limited liability company with two or more members.
5. Representative of capital contribution of an enterprise means an individual who is authorized in writing by an enterprise to exercise the rights and perform the responsibilities of the enterprise with respect to its capital contribution to a joint stock company or a limited liability company.
6. State capital in an enterprise means the value of the State’s capital contribution that is determined based on the ratio of shareholding or capital contribution held by the State to the total equity of the enterprise.
7. Capital of an enterprise includes equity of the enterprise and capital mobilized by the enterprise.
Article 4. Application of the Law on Management and Investment of State Capital in Enterprises
1. The management and investment of state capital in enterprises must comply with the Law on Management and Investment of State Capital in Enterprises; matters not regulated by the Law on Management and Investment of State Capital in Enterprises must comply with the Law on Enterprises and other relevant laws.
2. In case another law or resolution of the National Assembly that is promulgated after the effective date of the Law on Management and Investment of State Capital in Enterprises has specific provisions on the management and investment of state capital in enterprises, it is required to specify what provisions of the Law on Management and Investment of State Capital in Enterprises shall apply or not apply and what provisions of such another law or resolution shall apply.
Article 5. Principles of management and investment of state capital in enterprises
1. Compliance with the law on management and investment of state capital in enterprises, the law on enterprises and other relevant laws, and treaties to which the Socialist Republic of Vietnam is a contracting party.
2. The owner’s representative agencies and state management agencies may not directly interfere in production, business and investment activities of enterprises or in management and administration activities of the owner’s direct representatives and other managerial title holders as provided in the company charter.
3. The management of state capital in enterprises shall be performed through the owner’s direct representatives or representatives of the State’s capital contributions, ensuring that enterprises conduct production and business activities under the market mechanism, are equally treated, and cooperate and compete in accordance with law.
4. The owner’s representative agencies, the owner’s direct representatives and representatives of the State’s capital contributions shall manage, monitor and supervise state capital in enterprises, ensuring efficiency, preservation and development of state capital in enterprises in accordance with this Law; and prevent and combat thinned-out use, waste or loss of capital and assets of the State and enterprises.
5. Improving the effectiveness and efficiency of state management, supervision, examination and inspection by competent state agencies, and accountability.
Article 6. The state owner’s representatives
1. The Government shall uniformly exercise the rights and perform the responsibilities of the state owner’s representative in investing state capital in enterprises and managing state capital in enterprises.
2. The Prime Minister and the owner’s representative agencies shall exercise the rights and perform the responsibilities of the state owner’s representative with respect to enterprises with the State’s capital contributions in accordance with this Law and other relevant laws.
3. The owner’s direct representatives and representatives of the State’s capital contributions shall exercise the rights and perform the responsibilities of the state owner’s representatives in enterprises in accordance with Articles 36 and 39 of this Law and relevant regulations.
Article 7. Contents of state management of the management and investment of state capital in enterprises
1. Promulgating, and organizing the implementation of, legal documents on the management and investment of state capital in enterprises.
2. Uniformly managing and monitoring the investment of state capital in enterprises; supervising, examining and inspecting the implementation of the State’s policies and laws on the management and investment of state capital in enterprises; settling complaints and denunciations, carrying out commendation and disciplining, and handling violations in accordance with law.
3. Establishing, operating and managing the information system on the management and investment of state capital in enterprises.
Article 8. Information system on the management and investment of state capital in enterprises
1. The information system on the management and investment of state capital in enterprises shall be uniformly established and operated nationwide to serve the management, reporting, supervision, examination and inspection of the management and investment of state capital in enterprises.
2. The information system on the management and investment of state capital in enterprises must ensure its compatibility and capacity of uninterrupted and safe information integration and sharing between state agencies and enterprises.
3. The Government shall detail this Article.
Article 9. Prohibited acts in the management and investment of state capital in enterprises
1. Investing state capital in enterprises beyond the law-specified scope, subjects and competence.
2. Interfering in production and business activities of enterprises beyond assigned functions, tasks and powers.
3. Improperly exercising the rights and performing the responsibilities of the state owner’s representatives in the management and investment of state capital in enterprises.
4. Supervising, examining and inspecting the management and investment of state capital in enterprises beyond assigned functions, tasks, powers and responsibilities.
5. Intentionally making untruthful or inaccurate reports.
6. Providing or using information of enterprises or the state owner’s representatives in contravention of law.
Chapter II
INVESTMENT OF STATE CAPITAL IN ENTERPRISES
Article 10. Forms of investment of state capital in enterprises
1. Investment of state capital to establish enterprises in which the State holds 100% of charter capital.
2. Investment of state capital to increase charter capital for enterprises in which the State holds 100% of charter capital.
3. Investment of state capital to add capital in joint stock companies or limited liability companies with two or more members with the State’s capital contributions.
4. Investment of state capital to contribute capital to the establishment of joint stock companies or limited liability companies with two or more members.
5. Investment of state capital to contribute capital to, or purchase shares or capital contributions of, enterprises not yet invested with state capital.
Article 11. Funding sources and assets for investment of state capital in enterprises
1. The state budget.
2. Public assets.
3. Development investment funds; charter capital addition reserve funds; after-tax profits retained for charter capital increase; stock dividends; and share capital surpluses.
4. Other lawful funding sources as specified by the Government.
Article 12. Investment of state capital to establish enterprises in which the State holds 100% of charter capital
1. Investment of state capital to establish enterprises in which the State holds 100% of charter capital applies to:
a/ Enterprises providing essential public products and services for the society;
b/ Enterprises directly serving national defense and security;
c/ Enterprises operating in areas that are strategically important in terms of national defense and security;
d/ Enterprises operating in the fields of natural monopoly;
dd/ Enterprises engaged in scientific and technological development, innovation and digital transformation;
e/ Enterprises applying high technologies or making large-scale investments that create a driving force for rapid development of other sectors and fields and the economy;
g/ Enterprises engaged in the construction of strategically or nationally important infrastructure facilities;
h/ Enterprises operating in key or essential fields of the economy as specified by the Government.
2. The Government shall detail this Article.
Article 13. Investment of state capital to increase charter capital for enterprises in which the State holds 100% of charter capital
1. Investment for charter capital increase applies to the enterprises specified in Clause 1, Article 12 of this Law and falling into one of the following cases:
a/ Enterprises operating efficiently and in need of charter capital increase for production and business activities;
b/ Enterprises directly serving national defense and security; enterprises engaged in scientific and technological development, innovation and digital transformation; or enterprises operating in the fields of natural monopoly, and falling into other cases in need of capital addition as specified by the Government.
2. Enterprises in other necessary cases not specified in Clause 1 of this Article are entitled to investment for charter capital increase from the sources specified in Clauses 2, 3 and 4, Article 11 of this Law under the Government’s regulations.
3. The Government shall detail this Article.
Article 14. Investment of state capital to add capital in joint stock companies or limited liability companies with two or more members with the State’s capital contributions
1. Investment of state capital to add capital in joint stock companies or limited liability companies with two or more members with the State’s capital contributions which fall into one of the following cases:
a/ Providing essential public products and services for the society;
b/ Being in need of being maintained for performance of national defense and security tasks;
c/ Being engaged in scientific and technological development, innovation and digital transformation;
d/ Other cases that aim to ensure the State’s ownership ratio as specified by the Government.
2. The Government shall detail this Article.
Article 15. Investment of state capital to contribute capital to the establishment of joint stock companies or limited liability companies with two or more members; or to contribute capital to or purchase shares or capital contributions in enterprises not yet invested with state capital
1. Investment of state capital to contribute capital to the establishment of joint stock companies or limited liability companies with two or more members; or to contribute capital to or purchase shares or capital contributions in enterprises not yet invested with state capital shall be made to perform one of the following tasks:
a/ Restructuring the economy;
b/ Performing national defense and security tasks;
c/ Providing essential public products and services for the society;
d/ Carrying out scientific and technological development, innovation and digital transformation.
2. Investment of state capital under Points a, c, and d, Clause 1 of this Article must conform to socio-economic development strategies and plans in each period.
3. The Government shall detail this Article.
Article 16. Competence concerning investment of state capital in enterprises
1. The National Assembly shall decide on policy on investment of state capital in enterprises from the state budget with a value equivalent to that of national important projects in accordance with the law on public investment.
The Government shall define the competence to decide on investment of state capital in enterprises in the case specified in this Clause.
2. The Government shall define the competence to decide on investment policy and the competence to decide on investment of state capital in enterprises from the state budget not falling into the case specified in Clause 1 of this Article, and from the sources specified in Clauses 2, 3 and 4, Article 11 of this Law.
Article 17. Order and procedures for investment of state capital in enterprises
1. A dossier to be submitted by the Government to the National Assembly for making decision on policy on investment of state capital in an enterprise in the cases specified in Clause 1, Article 16 of this Law must comprise:
a/ The Government’s proposal;
b/ The enterprise establishment scheme, the plan on investment for charter capital increase, the plan on addition of the State’s capital contribution in a joint stock company or a limited liability company with two or more members, or the plan on contribution of capital or purchase of shares or capital contributions in an enterprise not yet invested with state capital;
c/ Opinions of related agencies and responses thereto (if any).
2. The National Assembly’s agency in charge of dossier examination shall examine the dossier specified in Clause 1 of this Article. The examination covers:
a/ Satisfaction of the criterion on capital size equivalent to that of national important projects; and scope of investment of state capital in the enterprise as specified in Article 12, 13, 14 or 15 of this Law;
b/ Capital demand; and capital use plan;
c/ Evaluation of socio-economic efficiency; and urgency or assurance of national defense and security (if any).
3. The Government and related agencies, organizations and individuals shall provide adequate information and documents serving the examination of the dossier; and respond to matters related to the dossier when so requested by the National Assembly’s agency in charge of examination.
4. The National Assembly shall consider and decide on policy on investment of state capital in enterprises, covering the contents specified in Clause 2 of this Article.
5. The Government shall provide the order and procedures for investment of state capital in enterprises.
Chapter III
MANAGEMENT OF STATE CAPITAL IN ENTERPRISES
Section 1
MANAGEMENT OF STATE CAPITAL IN ENTERPRISES IN WHICH THE STATE HOLDS 100% OF CHARTER CAPITAL
Article 18. Development strategy and annual business plans of an enterprise
1. The Members’ Council or the Company President shall decide on the promulgation and adjustment of the enterprise’s development strategy and annual business plans based on the socio-economic development plan and basic tasks and targets assigned by the state owner’s representative.
2. The Government shall detail this Article.
Article 19. Principles of capital mobilization and loan provision
1. Enterprises may decide on capital mobilization in adherence to the self-borrowing and self-repayment principle in accordance with law. Capital mobilization plans must ensure solvency of enterprises.
2. An enterprise may decide to provide guarantees for companies in which it holds over 50% of charter capital for the latter to borrow loans from credit institutions, ensuring that the total value of guarantee amounts does not exceed the value of actually contributed capital of the enterprise at the time of guarantee provision.
3. An enterprise may decide to provide loans to companies in which it holds over 50% of charter capital, ensuring that the total value of loans for each company does not exceed the value of actually contributed capital of the enterprise at the time of loan provision. In case the total value of loans for each company exceeds the level specified in this Clause, the enterprise shall report thereon to the owner’s representative agency for consideration and approval.
4. The Members’ Council or the Company President and the person approving the capital mobilization or loan provision plan shall take responsibility for their decisions, organize the implementation thereof, and carry out inspection and supervision to ensure that mobilized capital or loan is used for proper purposes and efficiently, and that debts are collected and paid within the agreed time limit.
5. In case an enterprise’s capital mobilization results in the fact that total liabilities, including guarantee amounts for the guaranteed companies as specified in Clause 2 of this Article, exceed 3 times the enterprise’s equity stated in its latest quarterly or annual financial statement prior to the time of capital mobilization, the enterprise shall report thereon to the owner’s representative agency after approving the capital mobilization plan for supervision under regulations.
6. Credit institutions shall mobilize capital and provide loans and guarantees in accordance with the law on credit institutions.
7. The Government shall detail this Article.
Article 20. Investment activities of enterprises
1. Enterprises’ investment activities shall be carried out in the forms of investment specified in the law on investment and other relevant laws, and through securities purchase as specified in the law on securities.
2. Competence to decide on investment:
a/ For investment projects wholly or partly funded by public investment capital, the competence to decide on investment policy or decide on investment, and the order and procedures for investment must comply with the law on public investment;
b/ For investment projects subject to investment policy approval in accordance with the law on investment and other relevant laws, the Members’ Council or the Company President shall decide on investment in the projects after investment policy approval procedures are completed; the order and procedures for investment must comply with the law on investment and other relevant laws;
c/ For investment projects subject to investment policy approval in accordance with the law on investment but not required to undergo investment policy approval procedures in accordance with other relevant laws, the competence, order and procedures for investment must comply with other relevant laws and the Government’s regulations.
3. Except the cases specified in Clause 2 of this Article, the competence to decide on investment is as follows:
a/ The Members’ Council or the Company President shall decide on investment for each investment project or investment item with a value not exceeding 50% of equity or not exceeding 50% of the owner’s investment capital in case equity is lower than the owner’s investment capital, which, however, must not exceed the specific cap set by the Government. Equity and owner’s investment capital referred to at this Point shall be determined based on the enterprise’s latest quarterly or annual financial statement prior to the time of decision on the project;
b/ For an investment project or investment item with a value exceeding the level specified at Point a of this Clause, the Members’ Council or the Company President shall decide on investment in such investment project or investment item after reporting on the purpose, investment capital contribution, funding source and implementation schedule to the owner’s representative agency for consideration and approval.
4. An enterprise may not make investment to contribute capital to or purchase shares or capital contributions of another enterprise whose manager or representative is the spouse, biological parent, adoptive parent, parent-in-law, step-parent, biological child, adopted child, son-in-law, daughter-in-law, sibling, brother-in-law or sister-in-law of any of the following persons:
a/ Chairperson of the Members’ Council or a member of the Members’ Council;
b/ Company President;
c/ Chief Executive Officer;
d/ Supervisor;
dd/ Chief Accountant.
5. The transfer of profits and other incomes, and recovery of capital upon completion of overseas investment projects to the home country, or the continued investment in foreign countries must comply with the charter and financial regulations of enterprises, this Law, the law on investment, and relevant regulations.
6. The Government shall detail this Article.
Article 21. Transfer of investment projects and investment capital of enterprises
1. The transfer of investment projects and domestic investment capital of enterprises must adhere to the following principles:
a/ Complying with this Law, the law on enterprises and other relevant laws;
b/ Fully reflecting the actual value of investment projects and investment capital of enterprises, including also the value of land use rights in accordance with the land law and other relevant laws;
c/ Adhering to market principles, and ensuring publicity, transparency, and non-restriction by conditions on public offering of securities as specified in the law on securities.
2. The Members’ Council or the Company President shall decide on the transfer of an investment project or investment capital amount with a value not exceeding 50% of equity or not exceeding 50% of the owner’s investment capital in case equity is lower than the owner’s investment capital, which, however, must not exceed the cap set by the Government. Equity and owner’s investment capital referred to in this Clause shall be determined based on an enterprise’s latest quarterly or annual financial statement prior to the time of decision on the transfer. In case the value of the transferred investment project or investment capital amount exceeds the level specified in this Clause, the Members’ Council or the Company President shall report thereon to the owner’s representative agency for approval before deciding on the transfer.
3. Methods of transfer of investment capital of enterprises:
a/ The transfer of capital contributions of enterprises in limited liability companies with two or more members must comply with the law on enterprises;
b/ The transfer of share capital of enterprises in joint stock companies already listed or registered for trading on the securities market must comply with the law on securities;
c/ The transfer of investment capital of enterprises in joint stock companies not yet listed or not yet registered for trading on the securities market shall be carried out through public auctions in accordance with law or by other methods as specified by the Government;
d/ The transfer of investment capital of enterprises under business cooperation contracts must comply with the law on investment.
4. Transfer of investment projects:
a/ An enterprise may transfer the whole or part of an investment project to another investor when satisfying the transfer conditions specified in the law on investment, the land law, the housing law, the law on real estate business, and other relevant laws;
b/ The transfer of investment projects must ensure publicity and transparency, and must comply with relevant laws and the Government’s regulations.
5. The transfer and methods of transfer of investment projects and investment capital of enterprises in foreign countries must comply with the law of the host country or territory and international practices, ensuring adherence to the principle of maximizing the recovery of investment capital of enterprises. The competence to decide on the transfer must comply with Clause 2 of this Article.
6. The Government shall detail Clauses 2 and 3; Point b, Clause 4; and Clause 5, of this Article.
Article 22. Lease, hire-purchase, mortgage, pledge, purchase and sale of fixed assets
1. The competence to decide on the purchase or hire-purchase of fixed assets depends on the value thresholds specified at Points a and b, Clause 3, Article 20 of this Law. A person who decides on the purchase or hire-purchase of fixed assets shall take responsibility for any decision made ultra vires or in case the purchased or hire-purchased fixed assets are unusable or inefficiently used.
2. The lease, mortgage or pledge of fixed assets must ensure efficiency and capital preservation and development.
3. Enterprises may sell fixed assets that are damaged, technologically obsolete, no longer needed, unusable or inefficiently used to recover capital. The competence to decide on the sale of fixed assets must comply with Clause 1 of this Article.
Article 23. Enterprises’ management of companies in which enterprises hold 100% of charter capital and management of enterprises’ capital contributions in joint stock companies or limited liability companies with two or more members
Enterprises shall manage companies in which enterprises hold 100% of charter capital and manage their capital contributions in joint stock companies or limited liability companies with two or more members through representatives of their capital contributions. Enterprises shall perform management in accordance with the law on enterprises and the following regulations:
1. For companies in which enterprises hold 100% of charter capital:
a/ To give opinions on the issuance of financial regulations of the companies;
b/ To approve plans on investment activities, purchase, hire-purchase and sale of fixed assets, transfer of investment projects, and transfer of investment capital exceeding 50% of equity or exceeding 50% of the owner’s investment capital in case equity is lower than the owner’s investment capital, or another lower ratio as stated in the company charter. Equity and the owner’s investment capital referred to at this Point shall be determined based on the company’s latest quarterly or annual financial statement prior to the date of approval;
c/ To adhere to the principles specified in Article 19 of this Law in the provision of guarantees and loans;
d/ To adhere to the principles in Clauses 1, 3, 4 and 5, Article 21 of this Law in the transfer of investment projects and investment capital;
2. For enterprises’ capital contributions in joint stock companies or limited liability companies with two or more members:
a/ To decide, or propose competent authorities to decide, on increase, reduction or transfer of the enterprises’ capital invested in the joint stock companies or limited liability companies with two or more members in accordance with law and the company charter;
b/ To specify criteria for, appoint, remove from office, relieve from duty, commend and discipline, representatives of the enterprises’ capital contributions as specified in Articles 37 and 38 of this Law, and promulgate regulations on representatives of enterprises’ capital contributions;
c/ To request representatives of the enterprises’ capital contributions to give opinions on the distribution of profits and dividends of the joint stock companies or limited liability companies with two or more members;
d/ To request representatives of the enterprises’ capital contributions to make scheduled or unscheduled reports on the financial status and production and business activities of the joint stock companies or limited liability companies with two or more members in accordance with law and the company charter;
dd/ To inspect and supervise activities of representatives of the enterprises’ capital contributions to promptly prevent and remedy their shortcomings and weaknesses.
3. The restructuring of enterprises’ capital invested in joint stock companies or limited liability companies must comply with the law on enterprises, the law on securities, other relevant laws, and the Government’s regulations.
Article 24. Salaries, remuneration and bonuses
1. Principles of determination of salaries, remuneration and bonuses:
a/ Compliance with the labor law;
b/ Being based on agreements in labor contracts;
c/ Being based on production and business performance, and conformity with the market, sectors/fields and nature of operation of enterprises;
d/ Being based on productivity and performance of workers, and extent of performance of the owner’s direct representatives and supervisors.
2. Bonuses for workers, the owner’s direct representatives and supervisors in enterprises shall be deducted from after-tax profits of enterprises.
3. The owner’s direct representatives, supervisors, Chief Executive Officers and other managerial title holders specified in the company charter are entitled to receive salaries from the salary fund of enterprises.
4. Based on the principles specified in Clause 1 of this Article, the Members’ Council or the Company President shall decide on salaries, remuneration, bonuses and other benefits for workers and managerial title holders of enterprises.
5. The Government shall provide salaries, remuneration and bonuses of the owner’s direct representatives and supervisors.
Article 25. Distribution of after-tax profits
1. After being used for dividing profits to capital-contributing members under business cooperation contracts (if any) and for offsetting losses for the previous years that are no longer eligible for deduction from pre-tax profits under the Law on Corporate Income Tax (if any), after-tax profits shall be used to pay:
a/ Expenses permitted for use from after-tax profits as specified in relevant laws;
b/ Expenses for mineral survey and exploration for investment purposes while the Government-specified conditions for project implementation are not yet satisfied; and expenses incurred from inefficient investment in investment projects, or special, high-risk investment items as specified by the Government;
c/ Expenses for performing political tasks assigned by competent agencies under the Government’s regulations.
2. After being used to pay the expenses specified in Clause 1 of this Article, the remainder of after-tax profits shall be distributed in adherence to the following principles:
a/ No more than 50% shall be deducted to the development investment fund for use for expanding production and business activities of enterprises and for increasing charter capital.
For credit institutions, no more than 50% shall be deducted to the charter capital increase reserve fund and the development investment fund in accordance with the Law on Credit Institutions;
b/ An amount not exceeding 3 months’ actually paid salaries shall be deducted for set aside as the bonus and welfare fund, based on the results of evaluation and ranking of enterprises.
Particularly for enterprises directly serving national defense and security activities, if they do not have sufficient sources from after-tax profits, the State shall provide support to the enterprises for setting up the bonus and welfare fund, at a level not exceeding 2 months’ actually paid salaries, based on the results of evaluation and ranking of enterprises;
c/ Making deductions for funds in accordance with relevant laws;
d/ Enterprises shall pay the remaining profit amounts into the state budget, unless such amounts are used to increase charter capital or invest in projects under the Government’s regulations.
3. The Government shall detail this Article.
Article 26. Preservation and development of capital of enterprises
1. The owner’s representative agency and the Members’ Council or the Company President shall be responsible for the preservation and development of capital of the enterprise within the ambit of its/his/her tasks and powers.
2. The preservation and development of capital of enterprises shall be evaluated on the basis of the overall performance of enterprises.
3. Annually, an enterprise shall report to the owner’s representative agency on changes in its equity for monitoring and supervision. In case of failure to preserve the equity, the Members’ Council or the Company President shall clearly explain causes of the failure, propose remedial measures, and take responsibility for the enterprise’s financial status.
4. The Government shall detail this Article.
Section 2
MANAGEMENT OF STATE CAPITAL IN ENTERPRISES IN WHICH THE STATE HOLDS UNDER 100% OF CHARTER CAPITAL
Article 27. Management of state capital in an enterprise in which the State holds between over 50% and under 100% of charter capital
1. The owner’s representative agency shall manage the State’s capital contribution in an enterprise in which the State holds between over 50% and under 100% of charter capital through the representatives of the State’s capital contribution.
2. Matters that are reported by the representative of the State’s capital contribution to the owner’s representative agency for opinion before voting at the General Meeting of Shareholders or meetings of the Board of Directors or the Members’ Council:
a/ The company’s development orientations, including business lines, objectives and tasks;
b/ Issuance, and modification and supplementation of the charter; charter capital increase or reduction;
c/ Election, relief from duty or removal from office of members of the Board of Directors or the Members’ Council; Chief Executive Officer; Head of the Supervisory Board; and supervisors of the enterprise;
d/ Reorganization, dissolution, or request for bankruptcy, of the company;
dd/ Deciding on investment activities, transfer of investment projects, or transfer of the enterprise’s investment capital in joint stock companies or limited liability companies with two or more members in case the transfer value exceeds 50% of equity of the enterprise or exceeds 50% of the owner’s investment capital if equity is lower than the owner’s investment capital. Equity and the owner’s investment capital shall be determined based on the latest quarterly or annual financial statement;
e/ Deciding on distribution of after-tax profits for setting up funds under Article 25 of this Law. The profit and dividend amount distributed in cash in proportion to the State’s shareholding or capital-contribution ratio in the enterprise shall be remitted into the state budget. The distribution of stock dividends and the use of after-tax profits distributed in proportion to the State’s shareholding or capital-contribution ratio in the enterprise to add state capital in the enterprise must comply with the Government’s regulations.
3. In pursuance to Articles 19 and 20; Clause 2, Article 21; and Article 22, of this Law, the owner’s representative agency shall direct the representative of the State’s capital contribution to give opinions on the issuance or modification and supplementation of the company’s charter and financial regulations in accordance with the law on enterprises and the Government’s regulations.
4. The owner’s representative agency shall direct the representative of the State’s capital contribution to give opinions on the formulation of the enterprise’s annual business plan, which must have the contents specified by the Government, for use as a basis for evaluation of the enterprise’s performance.
5. The enterprise shall manage its capital invested in joint stock companies and limited liability companies through the representative of the enterprise’s capital contribution accordance with the law on enterprises and the company charter.
6. The reorganization of an enterprise invested by another enterprise in which the State holds between over 50% and under 100% of charter capital must comply with the law on enterprises, the law on securities and other relevant laws.
7. The transfer of investment projects and investment capital of enterprises in which the State holds between over 50% and under 100% of charter capital must comply with Clauses 1, 3, 4 and 5 Article 21 of this Law.
8. Credit institutions shall mobilize capital, and provide loans and guarantees in accordance with the law on credit institutions.
Article 28. Management of state capital in enterprises in which the State holds 50% or less of charter capital
The owner’s representative agency shall manage the State’s capital contribution in an enterprise in which the State holds 50% or less of charter capital through the representative of the State’s capital contribution in accordance with the law on enterprises, the company charter, and the regulations on operation of representatives of the State’s capital contributions.
Chapter IV
RESTRUCTURING OF STATE CAPITAL IN ENTERPRISES
Article 29. Restructuring of state capital in enterprises
1. State capital in enterprises shall be restructured according to the forms, methods and roadmaps suitable to market conditions, and development strategies and operation conditions of enterprises, and based on enterprise classification criteria and plans on restructuring state capital in enterprises as approved by the state owner’s representatives in accordance with the Government’s regulations.
2. Forms of restructuring state capital in enterprises:
a/ Reorganization of enterprises;
b/ Transfer of state capital invested in joint stock companies and limited liability companies with two or more members;
c/ Transfer of the right to act as the owner’s representatives of the State’s capital contributions in enterprises;
d/ Transfer of investment projects, capital and assets of enterprises; transfer of the right to purchase shares, the preemptive right to purchase shares and the right to purchase capital contributions;
dd/ Dissolution or bankruptcy of enterprises.
3. The reorganization, dissolution or bankruptcy of enterprises in which the State holds 50% or less of charter capital must comply with the law on enterprises, the law on securities, the law on bankruptcy and other relevant laws.
Article 30. Reorganization of enterprises
1. Forms of reorganization of enterprises:
a/ Consolidation, merger, division and splitting of enterprises;
b/ Transformation of one-member limited liability companies in which the State holds 100% of charter capital into joint stock companies or limited liability companies with two or more members;
c/ Transformation of enterprises in which the State holds between over 50% and under 100% of charter capital.
2. The consolidation, merger, division and splitting of enterprises must comply with the law on enterprises, the law on securities, other relevant laws, and the Government’s regulations.
3. Transformation of enterprises under Point b, Clause 1 of this Article:
a/ The owner’s representative agency shall hire an organization with valuation function to determine the value of an enterprise and the reserve price in accordance with the regulations on valuation for use as a basis for formulating and deciding on the transformation plan;
b/ The offering of shares or capital contributions, and additional mobilization of capital contributions for the transformation shall be carried out in the form of public auction or by other methods as specified by the Government. The share offering shall not be restricted by conditions on public offering of securities under the law on securities;
c/ When determining an enterprise’s value upon the transformation, not to include the State-invested infrastructure works or projects that are of economic, social, national defense or security importance and which the enterprise as transferee only has the right to manage, operate and exploit. Land management and use by the enterprise must comply with the land law;
d/ The handling of revenues and expenditures arising in the transformation process must comply with the Government’s regulations.
4. The transformation of enterprises in which the State holds between over 50% and under 100% of charter capital must comply with the law on enterprises, the law on securities and the Government’s regulations.
5. The Government shall provide the competence, forms, order and procedures for, and handling of financial matters upon, consolidation, merger, division, splitting and transformation of enterprises.
Article 31. Transfer of state capital invested in joint stock companies and limited liability companies with two or more members
1. The owner’s representative agency shall hire an organization with valuation function to determine the reserve price in accordance with the regulations on valuation for use as a basis for deciding on the plan on transfer of state capital.
2. The transfer of state capital invested in joint stock companies already listed or registered for trading on the securities market must comply with the law on securities.
3. The transfer of state capital invested in joint stock companies not yet listed or not yet registered for trading on the securities market shall be conducted by public auction or by other methods as specified by the Government. Public auction shall not be restricted by conditions on public offering of securities specified by the law on securities.
4. The transfer of capital contributions in limited liability companies with two or more members must comply with the law on enterprises.
5. The handling of revenues and expenditures arising during the transfer of state capital invested in joint stock companies and limited liability companies with two or more members must comply with the Government’s regulations.
6. The Government shall detail this Article.
Article 32. Transfer of the right to act as the owner’s representatives of the State’s capital contributions in enterprises
1. Cases of transfer:
a/ Transfer of the right to act as the owner’s representatives of the State’s capital contributions in enterprises with the State’s capital contributions between the owner’s representative agencies;
b/ Transfer of the right to act as the owner’s representatives of the State’s capital contributions in enterprises with the State’s capital contributions from the owner’s representative agencies to enterprises in which the State holds 100% of charter capital;
c/ Other cases as specified by the Government.
2. The Government shall provide the competence, order and procedures for, and handling of financial matters upon, transfer of the right to act as the owner’s representatives of the State’s capital contributions in enterprises.
Article 33. Transfer of investment projects, capital and assets of enterprises; transfer of the right to purchase shares, the preemptive right to purchase shares and the right to purchase capital contributions
1. Forms of transfer of investment projects, capital and assets of enterprises:
a/ Transfer of investment projects, capital and assets among enterprises in which the State holds 100% of charter capital;
b/ Transfer of capital and assets of enterprises in which the State holds 100% of charter capital that are invested in joint stock companies or limited liability companies to the owner’s representative agencies;
c/ Other cases as specified by the Government.
2. The transfer of the right to purchase shares, the preemptive right to purchase shares or the right to purchase capital contributions between the owner’s representative agencies and enterprises in which the State holds 100% of charter capital, and the post-transfer management mechanism must comply with the Government’s regulations.
3. The Government shall provide the competence, order and procedures for, and handling of financial matters upon, transfer as referred to in this Article.
Article 34. Dissolution or bankruptcy of enterprises
1. Dissolution of enterprises:
a/ The dissolution of enterprises must comply with this Law, the law on enterprises and other relevant laws;
b/ Upon dissolution of enterprises in which the State holds 100% of charter capital that are established before the effective date of this Law and operate in the field of agriculture or forestry, state budget funds shall cover part of expenses for the settlement of outstanding problems resulting from insolvency and enterprise dissolution expenses in case the proceeds from asset sale are insufficient to ensure the solvency;
c/ After enterprise dissolution expenses and debts of the enterprises are paid, the remainder in proportion to the State’s shareholding or capital-contribution ratio shall be remitted into the state budget;
d/ The Government shall provide the competence, order and procedures for, and handling of financial matters upon, dissolution of enterprises.
2. Bankruptcy of enterprises must comply with the law on bankruptcy and other relevant laws.
Chapter V
THE STATE OWNER’S REPRESENTATIVES, REPRESENTATIVES OF CAPITAL CONTRIBUTIONS OF ENTERPRISES, SUPERVISORS
Article 35. Rights and responsibilities of the Government
1. To provide the assignment of responsibilities, decentralization or delegation of powers for exercising the rights and performing the responsibilities of the state owner’s representatives.
2. To provide operation mechanisms and financial management mechanisms for enterprises having the function of state capital investment and trading and enterprises in certain specific sectors.
3. To provide the supervision, inspection and evaluation of the efficiency of investment activities and the management of state capital in enterprises; and reporting and information disclosure.
4. To provide the recruitment, appointment, reappointment, approval of resignation, relief from duty, commendation, disciplining, and termination of contracts on hiring of corporate managers and supervisors, and the assignment of representatives of the State’s capital contributions.
5. To provide mechanisms on order placement and task assignment by the State for enterprises to meet political, external affairs, national defense and security requirements, and in urgent or necessary situations.
6. To detail the contents assigned under this Law.
7. To report to the National Assembly at its year-end session on management and investment of state capital in enterprises nationwide in the preceding year.
Article 36. Rights and responsibilities of the Members’ Council or the Company President in an enterprise in which the State holds 100% of charter capital
1. To promulgate the financial regulation, the regulation on management of receivables and payables, the regulation on management and use of fixed assets, the regulation on salaries, remuneration and bonuses, and other regulations of the enterprise.
2. To approve annual financial statements of the enterprise.
3. To promulgate regulations on operation, and management and use of capital and assets, of the enterprise in foreign countries in accordance with the laws of the host countries or territories, ensuring the strict management and loss prevention.
4. To promulgate regulations on operation of representatives of capital contributions of the enterprise.
5. The Members’ Council or the Company President in charge of managing and administering the enterprise shall comply with law and decisions of the owner’s representative agency.
6. The Members’ Council or the Company President is accountable to the Government, the Prime Minister and the owner’s representative agency for managing, preserving and developing capital of the enterprise, and shall:
a/ Give prompt forecasts, warnings and reports to the owner’s representative agency when the enterprise encounters risks likely to cause capital loss, unprofitable operation, insolvency, failure to accomplish assigned tasks, or problems seriously affecting investment activities, and other violations;
b/ Annually report on the implementation progress of overseas projects in the investment process; and report on investment efficiency of overseas projects in operation.
7. A member of the Members’ Council or the Company President may not continue to act as the owner’s direct representative if he/she no longer meets the law-specified criteria, improperly performs the assigned tasks and powers, or is evaluated as failing to accomplish tasks, or when there are abnormal signs in the enterprise’s operation that are likely to affect its lawful interests.
8. The Members’ Council or the Company President shall take responsibility before law for violations causing loss of capital or assets of the enterprise.
9. To exercise other rights and perform other responsibilities as specified in this Law, the law on enterprises, the Government’s regulations, the company charter, and relevant regulations.
10. The Members’ Council or the Company President may decentralize powers to the Chief Executive Officer for deciding on matters falling within the latter’s competence as stated in the charter or financial regulations of the enterprise.
Article 37. Criteria for a representative of the State’s capital contributions or a representative of capital contributions of enterprises
1. Being a Vietnamese citizen permanently residing in Vietnam.
2. Having full civil act capacity.
3. Possessing professional competency and qualifications and work experience meeting the requirements of the position or title to which he/she is appointed or assigned to act as representative.
4. Not currently being subject to prohibition from holding positions, consideration for disciplinary handling, investigation, prosecution, trial, serving of an imprisonment sentence, or execution of a disciplinary decision.
5. Not being the spouse, biological parent, adoptive parent, parent-in-law, step-parent, offspring, adopted child, son-in-law, daughter-in-law, sibling, brother-in-law or sister-in-law of any of the following persons:
a/ Head or deputy head of the owner’s representative agency;
b/ Chairperson of the Members’ Council or member of the Members’ Council;
c/ Chairperson of the Board of Directors or member of the Board of Directors;
d/ Company President;
dd/ Chief Executive Officer;
e/ Supervisor;
g/ Chief Accountant.
6. Having never been dismissed from the position of Chairperson of the Members’ Council or member of the Members’ Council; Chairperson of the Board of Directors or member of the Board of Directors; or Company President or Chief Executive Officer of an enterprise with the State’s capital contributions.
7. Other criteria and conditions specified in the company charter and relevant regulations.
Article 38. Designation of representatives of the State’s capital contributions and representatives of capital contributions of enterprises
Based on the criteria specified in Article 37 of this Law, the owner’s representative agency and an enterprise in which the State holds over 50% of charter capital shall select and designate a representative of the State’s capital contribution and a representative of the enterprise’s capital contribution. The designation must comply with the law on enterprises and the following provisions:
1. A full-time representative of the State’s capital contribution or a full-time representative of the enterprise’s capital contribution may only personally work in one enterprise.
2. A part-time representative of the State’s capital contribution may act as representative of the State’s capital contributions at no more than 3 enterprises; the number of part-time representatives of the State’s capital contributions in an enterprise must not exceed 30% of total members of the Members’ Council or the Board of Directors.
A part-time representative of the capital contribution of an enterprise may act as representative of capital contributions in one or more other enterprise(s) as stated in the company charter.
Article 39. Rights and responsibilities of representatives of the State’s capital contributions
1. To exercise the rights and perform the responsibilities in an honest, prudent and the best manner so as to guarantee to the utmost the lawful interests of the State and enterprises; refrain from abusing their positions or using information, know-how, business opportunities or assets of enterprises for personal gain or for benefits of other organizations or individuals.
2. To promptly report to and consult the owner’s representative agency before giving opinions, voting, or making decision at the General Meeting of Shareholders or meetings of the Members’ Council or the Board of Directors as specified in Section 2, Chapter III of this Law.
3. To take responsibility before the state owner’s representatives for exercising the rights and performing the responsibilities of representatives of the State’s capital contributions under this Law and the regulations on operation of representatives of the State’s capital contributions in enterprises, covering the formulation of development strategies, annual business plans and profit distribution plans of enterprises; to promptly report to the owner’s representative agencies on the fact that an enterprise with the State’s capital contributions suffers loss, becomes insolvent, encounters problems likely to seriously affect its operation, commits other violations, is proposed for dissolution or is at risk of bankruptcy.
4. To give warnings and promptly report to the owner’s representative agency, and propose appropriate intervention measures when an enterprise with the State’s capital contributions encounters risks likely to cause loss, unprofitable operation, insolvency, problems seriously affecting operation or other violations, is proposed for dissolution or is at risk of bankruptcy.
5. To make scheduled reports, unscheduled reports, and reports upon requests of the owner’s representative agencies on the investment and management of state capital in enterprises.
6. To take responsibility before law for violations in the management and investment of state capital in enterprises.
7. To exercise other rights and perform other responsibilities specified in the company charter, the law on enterprises, regulations on operation of representatives of the State’s capital contributions promulgated by the owner’s representative agencies, and relevant legal provisions.
8. To refrain from continuing to act as representatives of the State’s capital contributions when no longer meeting the criteria for representatives of the State’s capital contributions or when improperly performing the assigned rights and responsibilities, or when being evaluated by the owner’s representative agencies as failing to accomplish assigned tasks.
Article 40. Rights and responsibilities of a representative of capital contributions of an enterprise
1. To report to and consult the enterprise before giving opinions, voting, or making decision at the General Meeting of Shareholders or meetings of the Members’ Council or the Board of Directors with respect to matters requiring consultation under the law on enterprises, the company charter, and regulations on operation of representatives of capital contributions of enterprises.
2. To promptly report on the fact that a joint stock company or limited liability company suffers loss, becomes insolvent, fails to accomplish assigned tasks, or encounters problems likely to seriously affect the enterprise’s operation, or on other violations.
3. To make scheduled reports, unscheduled reports, and reports upon requests of the enterprise on production and business activities and financial status of the enterprise, and recommend solutions.
4. To take responsibility before the enterprise for exercising the rights and performing the responsibilities of representatives of capital contributions of enterprises in accordance with this Law and the enterprise-issued regulation on operation of representatives of capital contributions of enterprises.
5. To take responsibility before law for violations causing loss of capital of the enterprise.
6. To exercise other rights and perform other responsibilities in accordance with the law on enterprises, the company charter, and relevant legal regulations.
7. To refrain from continuing to act as representative of capital contributions of the enterprise if improperly performing the assigned rights and responsibilities or when no longer meeting criteria for a representative.
Article 41. Salaries, remuneration, bonuses and other benefits of representatives of the State’s capital contributions
1. A full-time representative of the State’s capital contributions in an enterprise is entitled to salaries, bonuses and other benefits paid by the enterprise.
2. A part-time representative of the State’s capital contributions in an enterprise is entitled to salaries, bonuses and other benefits as follows:
a/ Remuneration (if any) paid by the enterprise;
b/ Salaries, bonuses and other benefits paid by the owner’s representative agency.
3. The Government shall detail this Article.
Article 42. Supervisors in enterprises in which the State holds 100% of charter capital and supervisors of enterprises in which the State holds between over 50% and under 100% of charter capital
1. Supervisors in enterprises in which the State holds 100% of charter capital shall be appointed, reappointed, relieved from duty or removed from office by the owner’s representative agencies.
2. The election, appointment, relief from duty or removal from office of supervisors of enterprises in which the State holds between over 50% and under 100% of charter capital must comply with the law on enterprises.
3. Criteria, conditions, working regime, rights and responsibilities of supervisors must comply with the law on enterprises, relevant legal provisions, and regulations on operation of supervisors promulgated by the owner’s representative agencies.
Chapter VI
SUPERVISION, EXAMINATION, INSPECTION, AND EVALUATION OF EFFICIENCY OF THE MANAGEMENT AND INVESTMENT OF STATE CAPITAL IN ENTERPRISES
Section 1
SUPERVISION, EXAMINATION AND INSPECTION OF THE MANAGEMENT AND INVESTMENT OF STATE CAPITAL IN ENTERPRISES
Article 43. Contents of supervision, examination and inspection of the investment of state capital in enterprises
1. Promulgation, and organization of implementation, of policies and laws on the investment of state capital in enterprises.
2. Compliance with this Law’s provisions on principles and scope of investment of state capital in enterprises.
3. Levels and sources of investment capital in enterprises.
4. Decision on investment policy and decision on the investment of state capital in enterprises.
5. Economic and social efficiency; results of the performance of political tasks assigned by competent agencies; and results of the performance of national defense and security tasks in relation to the investment of state capital in enterprises.
6. Exercise of the rights and performance of the responsibilities of the state owner’s representatives in the investment of state capital in enterprises.
Article 44. Contents of supervision, examination and inspection of the management of state capital in enterprises
1. Contents of supervision, examination and inspection of the management of state capital in enterprises:
a/ Promulgation, and organization of implementation, of policies and laws on the management of state capital in enterprises;
b/ Exercise of the rights and performance of the responsibilities of the state owner’s representatives;
c/ Assignment of targets for evaluation of enterprises in which the State holds 100% of charter capital; and direction for representatives of the State’s capital contributions to give opinions, vote, and make decisions at the General Meeting of Shareholders or meetings of the Members’ Council or the Board of Directors with respect to annual business plans of enterprises in which the State holds between over 50% and under 100% of charter capital;
d/ Implementation of development strategies and annual business plans of enterprises; provision of public products and services under the State’s order placement or plan assignment; and performance of political tasks assigned by competent agencies, and national defense and security tasks;
dd/ Mobilization of capital and use of mobilized capital; lending, lease, hire-purchase, mortgage, pledge, and purchase and sale of fixed assets; management of receivables and payables; and preservation and development of capital of enterprises;
e/ Promulgation of financial regulations, internal regulations and other regulations of enterprises;
g/ Investment activities of enterprises;
h/ Transfer of investment projects; transfer of investment capital; collection of profits and dividends from investment activities of enterprises;
i/ Management of enterprises’ capital invested in joint stock companies or limited liability companies;
k/ Recruitment, appointment, reappointment, approval of resignation, relief from duty, commendation, disciplining, and termination of contracts on hiring of corporate managers and supervisors, and designation of representatives of the State’s capital contributions;
l/ Implementation of regimes on salaries, remuneration, bonuses and other benefits of enterprises;
m/ Performance of obligations toward the state budget; distribution of after-tax profits; and setting up and use of funds of enterprises.
2. Contents of supervision and inspection of the restructuring of state capital in enterprises:
a/ Promulgation of policies and laws on the restructuring of state capital in enterprises;
b/ Exercise of the rights and performance of the responsibilities of the owner’s representative agencies and representatives of the State’s capital contributions in the restructuring of state capital in enterprises;
c/ Planning and organization of the restructuring of state capital in enterprises.
Article 45. Oversight by the National Assembly
1. The National Assembly, the National Assembly Standing Committee, the Ethnic Council, the Committees of the National Assembly, National Assembly deputies’ delegations and National Assembly deputies shall oversee the management and investment of state capital in enterprises in accordance with the regulations on supervisory activities of the National Assembly.
2. The National Assembly shall consider the Government’s report presented at the National Assembly’s year-end session on the management and investment of state capital in enterprises nationwide in the preceding year.
Article 46. Supervision, examination and inspection by the Government
1. Within the ambit of their tasks and powers, the Government and the Prime Minister shall direct the supervision, examination and inspection of:
a/ Formulation, promulgation, and organization of implementation, of policies and laws on the management and investment of state capital in enterprises;
b/ Exercise of the rights and performance of the responsibilities of the owner’s representative agencies;
c/ Matters concerning the investment of state capital in enterprises, management of state capital in enterprises, and restructuring of state capital in enterprises.
2. The Government shall assign the Ministry of Finance, other ministries and ministerial-level agencies to supervise and examine the management and investment of state capital in enterprises.
3. Inspection of the management and investment of state capital in enterprises must comply with the law on inspection.
Article 47. Supervision and inspection by the owner’s representative agencies
1. The owner’s representative agencies shall supervise and inspect:
a/ Management and investment of state capital in enterprises; efficiency of production and business activities; and preservation and development of state capital in enterprises;
b/ Exercise of the rights and performance of the responsibilities of the Members’ Council, the Board of Directors, supervisors, and representatives of the State’s capital contributions;
c/ Transfer and recovery of capital, and collection of profits and dividends in joint stock companies and limited liability companies;
d/ Implementation of recommendations and warnings of state management agencies, inspection agencies, audit agencies, and the owner’s representative agencies regarding the management and investment of state capital in enterprises.
2. Based on results of the supervision and examination specified in Clause 1 of this Article, the owner’s representative agencies shall:
a/ Give warnings and promptly handle issues detected during the supervision and examination;
b/ Request adequate and timely implementation of recommendations and warnings of state management agencies, inspection agencies and audit agencies regarding the management and investment of state capital in enterprises;
c/ Within their competence, handle, or recommend handling of, the owner’s direct representatives and other managers under the company charter, supervisors, and representatives of the State’s capital contributions who commit violations of regulations on the management and investment of state capital in enterprises;
d/ Annually summarize and send to the Ministry of Finance results of the supervision and examination of the management and investment of state capital in the enterprises under their management as assigned.
Article 48. Internal supervision by enterprises
1. Enterprises shall conduct internal supervision of:
a/ Efficiency of production and business activities, and preservation and development of state capital in enterprises;
b/ Exercise of the rights and performance of the responsibilities of the Members’ Council, the Board of Directors or the Company President, supervisors, representatives of the State’s capital contributions, and representatives of capital contributions of enterprises;
c/ Investment, transfer of investment capital, and collection of profits and dividends in joint stock companies and limited liability companies;
d/ Other contents at the request of the owner’s representative agencies.
2. The Members’ Council, the Company President or the Board of Directors shall promptly implement measures to prevent safety risks in the management of capital and assets in enterprises based on internal supervision results; and fully and promptly implement recommendations and warnings of supervision, inspection, examination and audit agencies.
Article 49. Accountability
The Members’ Council, the Company President or the Board of Directors, and representatives of the State’s capital contributions shall be accountable for the management and investment of state capital in enterprises at the request of supervision, inspection, examination and audit agencies, the owner’s representative agencies, and other competent agencies; and shall take responsibility before law for the accuracy and truthfulness of the provided information and documents.
Section 2
EVALUATION OF ENTERPRISES, THE OWNER’S DIRECT REPRESENTATIVES, REPRESENTATIVES OF THE STATE’S CAPITAL CONTRIBUTIONS, AND SUPERVISORS
Article 50. Assignment of targets for evaluation of enterprises in which the State holds 100% of charter capital
1. Annually, simultaneously with the formulation of state budget estimates, the state owner’s representatives shall assign a number of orientation targets to serve as a basis for enterprises to formulate their business plans for the subsequent year.
2. Before 31 March of the year of implementation, the state owner’s representatives shall review and assign certain basic criteria for evaluation of enterprises under the Government’s regulations.
3. The assignment of certain targets shall be based on:
a/ Annual macro-economic development targets; strategies and targets for development of production and business sectors and fields; and development strategies of enterprises;
b/ Production and business results in the year preceding the year of assignment of targets and production and business results by the time of assignment;
c/ Tasks assigned by competent authorities in the year of assignment of targets.
4. The Government shall detail this Article.
Article 51. Evaluation and ranking of enterprises in which the State holds 100% of charter capital
1. Evaluation and ranking of enterprises shall be based on:
a/ Level of fulfilment of tasks and basic targets assigned annually by the state owner’s representatives;
b/ Provision of public products and services under the State’s task assignment or order placement; performance of political tasks assigned by competent agencies and national defense and security tasks;
c/ Overall operation efficiency of enterprises, excluding impacts arising from performance of political tasks assigned by competent agencies; national defense and security tasks; tasks for not-for-profit purposes; and trial of new products, services, technologies and business models; and impacts of objective factors.
2. Enterprises shall prepare reports on enterprise evaluation and ranking and submit them to the state owner’s representatives for the latter to decide on evaluation and ranking of enterprises.
3. The Government shall detail this Article.
Article 52. Evaluation of performance of enterprises in which the State holds between over 50% and under 100% of charter capital
The state owner’s representatives shall evaluate the performance of enterprises in which the State holds between over 50% and under 100% of charter capital, based on the results of implementation of plans approved by the General Meeting of Shareholders or the Members’ Council, and in pursuance to Points b and c, Clause 1, Article 51 of this Law.
Article 53. Assessment of the owner’s direct representatives, representatives of the State’s capital contributions, and supervisors
1. The assessment of the owner’s direct representative in an enterprise shall be based on:
a/ The results of evaluation and ranking of the enterprise;
b/ The enterprise’s compliance with policies and laws;
c/ The representative’s compliance with policies and laws on management and investment of state capital in enterprises.
2. The assessment of a representative of the State’s capital contributions in an enterprise shall be based on:
a/ The results of evaluation of operation of the enterprise;
b/ The representative’s compliance with policies and laws on management and investment of state capital in enterprises.
3. The assessment of a supervisor of an enterprise shall be based on the results of ranking of the enterprise and the supervisor’s exercise/performance of his/her rights/responsibilities.
4. The results of assessment of the owner’s direct representatives, representatives of the State’s capital contributions, and supervisors in enterprises serve as a basis for considering appointment, nomination, recommendation, hiring, appointment, reappointment, approval of resignation, dismissal, relief of duty, termination of contract, and commendation and disciplining of these persons in accordance with law.
5. Representatives of the State’s capital contributions and supervisors shall prepare the previous year’s assessment reports with the required contents and submit them to the owner’s representative agencies for the latter to decide on evaluation and ranking.
6. The Government shall detail this Article.
Chapter VII
REPORTING AND INFORMATION DISCLOSURE
Article 54. Reporting on operation of enterprises
1. An enterprise in which the State holds over 50% of charter capital shall report to the state owner’s representative on:
a/ The enterprise’s development strategy and annual business plan;
b/ Resolutions and decisions issued by the Members’ Council, the General Meeting of Shareholders and the Board of Directors;
c/ The results of implementation of quarterly plans, covering information on investment projects of the enterprise and the progress of implementation thereof;
d/ The management and investment of state capital in the enterprise;
dd/ Other contents required to be reported to the owner’s representative agency in accordance with this Law;
e/ Arising issues that affect the enterprise’s business results;
g/ Results of internal supervision.
2. The Members’ Council, the Chairperson and members of the Members’ Council, or the Company President, the Board of Directors, the Chairperson and members of the Board of Directors in an enterprise in which the State holds over 50% of charter capital shall take responsibility for the accuracy and truthfulness of the contents specified in Clause 1 of this Article.
3. The representative of the State’s capital contributions in a joint stock company or a limited liability company with two or more members in which the State holds 50% or less of charter capital shall report to the owner’s representative agency on the management and investment of state capital in the enterprise as specified at Point d, Clause 1 of this Article. The representative of the State’s capital contributions shall take responsibility for the accuracy and truthfulness of the reported contents.
4. The owner’s representative agencies shall summarize and prepare reports on the management and investment of state capital in enterprises under their management, and send them to the Ministry of Finance before June 30 every year.
5. The Ministry of Finance shall summarize and prepare a report on the management and investment of state capital in enterprises nationwide, and submit it to the Government for consideration and approval for further reporting to the National Assembly at the year-end session.
6. The Government shall detail this Article.
Article 55. Disclosure of information on operation of enterprises
1. Enterprises in which the State holds over 50% of charter capital shall disclose information on a periodical basis or an extraordinary basis in accordance with the law on enterprises.
Enterprises in which the State holds over 50% of charter capital and for which the Ministry of National Defense or the Ministry of Public Security acts as the owner’s representative agency shall disclose information in accordance with the Government’s regulations.
2. The owner’s representative agencies shall publicly and promptly publish on their portals the information on operation of enterprises under their management.
3. The Ministry of Finance shall publicly and promptly publish on its portal the Government’s reports on the management and investment of state capital in enterprises nationwide after the Government submits the reports to the National Assembly.
4. The Government shall detail this Article.
Chapter VIII
IMPLEMENTATION PROVISIONS
Article 56. Management and investment of capital in enterprises of political organizations, or the Vietnam Fatherland Front and its member organizations
1. Political organizations, and the Vietnam Fatherland Front and its member organizations may apply this Law to the management and investment of capital of the organizations in enterprises.
2. The Government shall detail this Article.
Article 57. Investment, support and management of state capital in the Cooperative Bank of Vietnam
The investment, support and management of state capital in the Cooperative Bank of Vietnam must comply with the Law on Credit Institutions and this Law’s provisions applicable to credit institutions in which the State holds over 50% of charter capital.
Article 58. Effect
1. This Law takes effect on August 1, 2025.
2. The distribution of profits of enterprises with the State’s capital contributions for the 2025 fiscal year must comply with this Law.
3. Law No. 69/2014/QH13 on Management and Investment of State Capital Invested in Production and Business at Enterprises, which has a number of articles amended and supplemented under Law No. 35/2018/QH14 (below referred to as Law No. 69/2014/QH13), ceases to be effective on the effective date of this Law, except the cases specified in Article 59 of this Law.
Article 59. Transitional provisions
1. From the effective date of this Law, enterprises in which the State holds over 50% of charter capital shall review and promulgate or propose competent agencies to promulgate modified and supplemented charters, financial regulations and internal regulations of the enterprises, ensuring their compliance with this Law; the promulgation of such charters and regulations shall be completed before December 31, 2026.
Pending the promulgation of the modified and supplemented charters, financial regulations and internal regulations, enterprises may continue to apply the provisions in the previous charters, financial regulations and internal regulations that are not contrary to this Law, and the more favorable provisions in accordance with this Law and detailing and guiding documents.
2. Enterprises’ business strategies decided by competent agencies in accordance with Law No. 69/2014/QH13 may continue to be implemented until development strategies are promulgated in accordance with this Law.
3. For schemes on investment of state capital to establish enterprises in which the State holds 100% of charter capital; plans on increase of charter capital for operating enterprises in which the State holds 100% of charter capital; plans on increase of state capital at joint stock companies or limited liability companies with two or more members; plans on investment of state capital to redeem part or the whole of an enterprise; capital raising plans and projects on investment, construction, purchase and sale of fixed assets; outside investment projects; offshore investment projects of enterprises in which the State holds 100% of charter capital; schemes or plans on restructuring of state capital in enterprises and other related contents which have the policy approved by competent agencies or which have been approved or decided by competent agencies before the effective date of this Law according to the law-specified order, procedures and competence, and Law No. 69/2014/QH13 and detailing and guiding documents, enterprises may choose whether to continue to implement the approved or decided schemes, plans and projects or to modify and supplement them for implementation in accordance with this Law.
4. Agreements signed between enterprises and strategic shareholders before the effective date of this Law that have contents different from those of this Law and have not yet been completed by the effective date of this Law may continue to be implemented until their expiry dates. From the effective date of this Law, the modification and supplementation of the signed agreements concerning contents regulated by this Law must comply with this Law.
5. Loan contracts that are signed before the effective date of this Law but have not yet been completed by the effective date of this Law may continue to be implemented until their expiry dates. From the effective date of this Law, the modification and supplementation of the signed loan contracts concerning contents regulated by this Law must comply with this Law. The Members’ Councils or Company Presidents shall take responsibility for the signed contracts, the recovery of loans and the preservation and development of capital of enterprises in accordance with law.
6. The evaluation and ranking of enterprises; the assessment of the owner’s direct representatives, representatives of the State’s capital contributions and supervisors for the fiscal years from 2025 backward must comply with Law No. 69/2014/QH13 and detailing and guiding documents.
7. During the period of implementation of enterprise restructuring plans approved by competent agencies, for enterprises in which the State holds 100% of charter capital transformed into joint companies that are being listed and registered for trading on the Stock Exchanges but have not yet satisfied the conditions for public companies concerning structure of shareholders as specified in Law No. 54/2019/QH14 on Securities, which has a number of articles amended and supplemented under Law No. 56/2024/QH15, they are not subject to cancellation of public company status.
8. Within 1 year from the effective date of this Law, the state owner’s representatives shall re-determine the charter capital of enterprises in which the State holds 100% of charter capital under their management in accordance with the Government’s regulations.
9. The Government’s 2024 report on the investment, management and use of state capital in enterprises nationwide must comply with Law No. 69/2014/QH13.
This Law was passed on June 14, 2025, by the 15th National Assembly of the Socialist Republic of Vietnam at its 9th session.-
Chairman of the National Assembly
TRAN THANH MAN
[1] Công Báo Nos 965-966 (24/7/2025)
Vietnamese
Law 68/2025/QH15 PDF (Original)
Law 68/2025/QH15 DOC (Word)
