Decree 23/2022/ND-CP establish, transform enterprises with 100% charter capital held by the State

DECREE

On establishment, transformation and rearrangement, transfer of the right to represent the owner at enterprises with 100% charter capital held by the State

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Pursuant to the Law on Organization of the Government dated June 19, 2015; the Law Amending and Supplementing a Number of Articles of the Law on Organization of the Government and the Law on Organization of Local Administration dated November 22, 2019;

Pursuant to the Law on Enterprises dated June 17, 2020;

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

Pursuant to the Law on Property Auction dated November 17, 2016;

At the proposal of the Minister of Planning and Investment;

The Government promulgates the Decree on establishment, transformation and rearrangement, transfer of the right to represent the owner at enterprises with 100% charter capital held by the State.

Chapter I

GENERAL REGULATIONS

Article 1. Scope of regulation

1. This Decree regulates in detail a number of articles of the Enterprise Law and the Law on Management and Use of State Capital Invested in Production and Business at Enterprises on establishment and rearrangement (excluding bankruptcy of enterprises), transformation (excluding transformation of enterprises with 100% charter capital held by the State into joint stock companies), transfer of the right to represent the owner at enterprises with 100% charter capital held by the State.

2. Bankruptcy of enterprises with 100% charter capital held by the State is carried out in accordance with the Law on Bankruptcy. The transformation of enterprises with 100% charter capital held by the State into joint stock companies shall comply with the Government's regulations on transformation of enterprises with 100% charter capital held by the State into joint stock companies.

3. The establishment, rearrangement, transformation and rearrangement, transfer of the right to represent the owner at credit institutions being enterprises with 100% charter capital held by the State and agricultural and forestry companies shall comply with this Decree and relevant legal provisions. In case there are differences between documents, the provisions of banking law and relevant laws, except for the case specified in Clause 2, Article 156 of the Law on Promulgation of Legal Documents, shall apply.

Article 2. Subjects of application

The subjects of application of the Decree include:

1. The agency representing the owner. For State Capital Investment Corporation, the Government's specific regulations shall apply.

2. The enterprises with 100% charter capital held by the State under Clause 2, Article 88 of the Law on Enterprises.

3. Organizations and individuals involved in the establishment, rearrangement, transformation, transfer of the right to represent the owner at enterprises with 100% charter capital held by the State.

Article 3. Interpretation of terms

In this Decree, the following terms are construed as follows:

1. Forms of rearrangement include: Consolidation, merger, division, separation, and dissolution of enterprises with 100% charter capital held by the State.

2. Forms of transformation include: Sale of part of state capital invested in the enterprise for transformation into a limited liability company with two or more members; sale of the whole enterprise with 100% charter capital held by the State.

3. Agencies representing the owner include: Ministries, ministerial-level agencies, and Government-attached agencies; People's Committees of provinces and centrally run cities (hereinafter collectively referred to as Provincial-level People's Committees).

4. Enterprises established under the Prime Minister’s decisions as parent company with 100% charter capital held by the state economic groups, State Capital Investment Corporation and enterprises whose assets for production and business activities are created from the implementation of important national projects on which investment policy has been decided by the National Assembly.

Chapter II

ESTABLISHMENT OF ENTERPRISES WITH 100% CHARTER CAPITAL HELD BY THE STATE

Article 4. Conditions of establishment

Enterprises with 100% charter capital held by the State can only be considered for establishment upon fully meeting the following conditions:

1. Have industries and fields of operation within the scope of investment of state capital to establish enterprises in accordance with law on management and use of state capital invested in production and business at enterprises.

2. Ensure sufficient charter capital as prescribed in Article 5 of this Decree.

3. Have valid documents specified in Article 6 of this Decree.

4. The establishment of enterprises must conform with socio-economic development strategies and plans and sectoral master plans.

Article 5. Charter capital level

1. Upon establishment, an enterprise must have a charter capital of not less than 100 billion VND.

2. In case of its business lines requiring legal capital, in addition to the conditions specified in Clause 1 of this Article, upon establishment, the charter capital of the enterprise must not be lower than the legal capital prescribed for such business lines.

3. For enterprises providing essential public products and services, ensuring social security or operating in a number of sectors and trades, locations that require the investment of state capital to establish the enterprises, the charter capital may be lower than the level specified in Clause 1 of this Article but not lower than the legal capital level prescribed for business lines requiring legal capital.

Article 6. Dossier of request for establishment of enterprises with 100% charter capital held by the State

1. Dossier of request for establishment for enterprises established under the Prime Minister’s decisions shall include:

a) Submission paper on the proposal of establishment of enterprises;

b) Scheme on establishment of enterprises specified in Clause 3 of this Article;

c) Draft Charter of the enterprises specified in Clause 4 of this Article.

2. Dossier submitted to the Prime Minister for consideration and approval of the policy when establishing an enterprise under the decision of the agency representing the owner shall include:

a) Submission paper on the proposal of establishment of enterprises;

b) Scheme on establishment of enterprises specified in Clause 3 of this Article;

3. The scheme on establishment of enterprises includes the following main contents:

a) Legal basis, objectives, necessity of establishment of the enterprise;

b) Name, organization and management model and operation duration of the enterprise;

c) Location of head office of the enterprise, location of production and business establishments and land area in use; branches, representative offices (if any);

d) Tasks assigned by the State; business lines; list of products and services to be provided by the enterprise;

dd) Assessment of the conformity of the enterprise establishment with socio-economic development strategies and plans, and sectoral master plans;

e) Market situations, market demands and prospects for each product or service rendered by the enterprise; technologies to be applied to production and business; production, business and investment plan for a period of 05 years after establishment;

g) Charter capital level; estimated total investment capital (in case of establishment of enterprise with 100% charter capital held by the State associated with investment project implementation); funding sources and methods of raising funds other than the State initial investment; methods for repaying raised funds; demands and methods for generating working capital;

h) Expected economic and social efficiency;

i) Expected supply of labor, raw materials, energy, technology and other necessary conditions for operation after establishment.

4. The enterprise's draft Charter includes the following main contents:

a) Name, address, head office of the enterprise; name and addresses of branches and representative offices (if any);

b) Business lines; operational objectives; tasks assigned by the State;

c) Charter capital, methods of adjusting charter capital;

d) Name and address of the enterprise's owner;

dd) Rights and obligations of the enterprise's owner;

e) Organization and management structure;

g) At-law representative of the enterprise; division of the rights and obligations of at-law representatives in case the enterprise has more than one at-law representative;

h) Procedure for adoption of decisions of the enterprise; principles for resolution of internal disputes;

i) Financial operating mechanism, principles of after-tax profit distribution and handling of business losses of the enterprise; bases and methods for determining remuneration, salaries and bonuses for managers and the Board of Supervisors, Supervisors;

k) Rights and obligations of the Chairperson and members of the Members’ Council or the President, the Chief Executive Officer and other managerial titles of the enterprise;

l) Cases of dissolution, dissolution procedures and procedures for liquidating assets of the enterprise;

m) Procedures for amending and supplementing the Charter;

n) Other regulations decided by the agency or organization assigned to exercise the rights and obligations of the enterprise owner in accordance with law.

5. In case the establishment of an enterprise is associated with the formation of the investment project, the investment procedures shall comply with the provisions of investment law.

Article 7. Competence to decide on establishment of enterprises

1. The Prime Minister shall decide to establish the enterprises specified in Clause 4, Article 3 of this Decree.

2. The Ministers, the Heads of ministerial-level agencies, the Heads of Government-attached agencies, the Chairpersons of the Provincial-level People's Committee shall decide to establish enterprises with 100% charter capital held by the State other than the subjects specified in Clause 1 of this Article.

Article 8. Appraisal of dossier of request for establishment of the enterprise

Appraisal of dossier of request for establishment of the enterprise means inspection and assessment of the conformity of the enterprise establishment with legal regulations, socio-economic development strategies and plans and sectoral master plans; such appraisal shall be used as the basis for competent persons to consider making decision, and ensure the effectiveness of enterprise establishment.

The head of the agency representing the owner is the applicant for enterprise establishment and is responsible for the accuracy of the content of the dossier of request for establishment of the enterprise.

Article 9. Procedures for establishment of enterprises established under the Prime Minister’s decisions

1. The agency representing the owner shall prepare 07 sets of original dossiers of request for establishment of the enterprise as specified in Clause 1, Article 6 of this Decree and send it to the Ministry of Planning and Investment for appraisal.

2. After receiving complete dossier, the Ministry of Planning and Investment shall assume the prime responsibility for collecting opinions from the Ministry of Finance, the Ministry of Home Affairs, the Ministry of Justice, the Ministry of Labor, Invalids and Social Affairs, the line ministry, Provincial-level People's Committee where the enterprise intends to locate its headquarters and relevant agencies and organizations (if necessary).

Within 15 working days from the date of receiving the dossier, the relevant agencies shall send written comments on the contents within the scope of management to the Ministry of Planning and Investment for consolidating and issuing an appraisal report.

3. Within 10 working days from the receipt of opinions from relevant authorities, the Ministry of Planning and Investment shall submit the report on appraisal of dossier of request for establishment of the enterprise to the Prime Minister and also send it to the agency representing the owner for knowing or providing explanations.

If different opinions are given about the same main contents of the dossier, the Ministry of Planning and Investment shall coordinate with relevant agencies before submitting the appraisal report to the Prime Minister; the time limit for submitting the appraisal report may be extended for a period not exceeding 10 working days.

4. The agency representing the owner shall accept and explain the appraisal opinions of the Ministry of Planning and Investment and complete the dossier and submit it to the Prime Minister for consideration and decision on enterprise establishment.

Article 10. Procedures for establishment of enterprises established under the decision of the agency representing the owner

1. The agency representing the owner shall prepare 03 sets of original dossiers of request for establishment of the enterprise as specified in Clause 2, Article 6 of this Decree and send it to the Ministry of Planning and Investment for appraisal.

2. After receiving complete dossier, the Ministry of Planning and Investment shall assume the prime responsibility for collecting opinions from the Ministry of Finance and the line ministry (in case the enterprise is established by the decision of the Provincial-level People's Committees, ministerial-level agencies, and Government-attached agencies) or the Provincial-level People's Committee where the enterprise intends to locate its headquarters (in case the enterprise is established by the decision of the Ministries, ministerial-level agencies, and Government-attached agencies).

Within 10 working days from the date of receiving the dossier, the relevant agencies shall send written comments on the contents within the scope of management to the Ministry of Planning and Investment for consolidating and issuing an appraisal report.

3. Within 10 working days from the date of receiving comments from relevant agencies, the Ministry of Planning and Investment shall prepare an appraisal report and send it to the agency representing the owner.

4. The agency representing the owner shall accept and explain the appraisal opinions of the Ministry of Planning and Investment and complete the dossier and submit it to the Prime Minister for consideration and approval of enterprise establishment policy.

5. The agency representing the owner shall issue the decision on establishment of the enterprise within 30 working days from the date of approval of the policy by the Prime Minister.

Article 11. Decision on enterprise establishment

The decision on enterprise establishment includes the following main contents:

1. Enterprise name, including full name in Vietnamese, name in foreign language, abbreviated name (if any).

2. Type of enterprise.

3. Address of the head office of the enterprise.

4. Tasks assigned by the State; business lines.

5. Charter capital.

6. Organizational structure, managerial and executive apparatus of the enterprise.

7. Names and addresses of branches and representative offices (if any).

8. Names and head office addresses of subsidiaries and affiliated companies (if any).

Article 12. Business registration and business time of the enterprise

1. After the enterprise establishment decision has been issued, the agency representing the owner shall prepare dossier of request for investment of state capital in establishment of enterprise in accordance with the Government’s regulations.

2. The enterprises shall follow procedures for enterprise registration in accordance with law and be entitled to start their business from the date of issuing the enterprise registration certificate. With respect to conditional business lines, the enterprises are entitled to engage in such business lines from the day on which the enterprise obtains permission from competent authorities or on which all business conditions have been satisfied by the enterprise as prescribed.

Chapter III

RE-ARRANGEMENT, TRANSFORMATION OF ENTERPRISES WITH 100% CHARTER CAPITAL HELD BY THE STATE

Section 1

CONSOLIDATION, MERGER, DIVISION, SEPARATION OF ENTERPRISES WITH 100% CHARTER CAPITAL HELD BY THE STATE

Article 13. Consolidation, merger, division, separation of enterprises

1. Consolidation of enterprises with 100% charter capital held by the State:

Two or more enterprises with 100% charter capital held by the State (hereinafter referred to as the consolidated companies) may be consolidated into a new enterprise with 100% charter capital held by the State (hereinafter referred to as the consolidating company), and at the same time, the existence of the consolidated companies shall be terminated.

2. Merger of enterprises with 100% charter capital held by the State:

One or several company(ies) (hereinafter referred to as the merged company(ies)) may be merged into another company (hereinafter referred to as the merging company) by transferring all lawful assets, rights, obligations and interests to the merging company; at the same time, the existence of the merged company(ies) shall be terminated.

3. Division of enterprises with 100% charter capital held by the State:

An enterprise with 100% charter capital held by the State may divide its existing assets, rights and obligations (hereinafter referred to as the divided company) to establish two or more new enterprises with 100% charter capital held by the State, and at the same time, the existence of the divided company shall be terminated.

4. Separation of enterprises with 100% charter capital held by the State:

An enterprise with 100% charter capital held by the State may be separated by transferring part of its existing assets, rights, obligations (hereinafter referred to as the separated company) to establish one or more enterprises with 100% charter capital held by the State (hereinafter referred to as the separating company) without terminating the existence of the separated company.

Article 14. Conditions for consolidation, merger, division and separation of enterprises

Enterprises with 100% charter capital held by the State may consolidate, merge, divide or separate when they fully meet the following conditions:

1. Merger, consolidation, division or separation of enterprises must be in accordance with the document on arrangement and renewal of enterprises approved by the Prime Minister. In case not yet specified in these documents, the agency representing the owner shall submit the case to the Prime Minister for consideration and decision.

2. New enterprises formed after division or separation must meet the same conditions as those for establishing enterprises specified in Article 4 of this Decree.

3. The consolidation and merger of enterprises must ensure compliance with the provisions of the Competition Law on consolidation and merger of enterprises.

Article 15. Competence to make decisions on consolidation, merger, division and separation of enterprises

1. In case of consolidation, merger, division or separation of enterprises decided on establishment or assigned to manage by the same individual or agency (hereinafter referred to as the establishment decision-making authority), the establishment decision-making authority shall make the decision on consolidation, merger, division or separation of enterprises.

2. In case of merger of enterprises which are established by different establishment decision-making authorities, the establishment decision-making authority of the merged company shall issue merger decision on the basis of written consents obtained from establishment decision-making authorities of the merged company. In case either the merged company or the merging company is established under the Prime Minister’s decision, the Prime Minister shall issue the merger decision.

3. In case of consolidation of enterprises which are established by different establishment decision-making authorities, the authority assigned by the Prime Minister to perform rights and obligations of the owner’s representative in the consolidated enterprises shall issue the consolidation decision. In case of consolidation of enterprises established under the Prime Minister’s decision, the Prime Minister shall issue the consolidation decision.

Article 16. Dossier of request for consolidation, merger, division or separation of enterprises

1. Dossier of request for consolidation, merger, division or separation of enterprises include:

a) Submission paper on the proposal of consolidation, merger, division or separation of enterprises;

b) Scheme on consolidation, merger, division, separation of enterprises;

c) Audited financial statements of the preceding year of the enterprise and the financial statements of the quarter closest to the time of consolidation, merger, division, or separation;

d) Draft Charter of a new enterprise formed after consolidation, merger, division, or separation;

dd) Draft of consolidation and merger contract as prescribed in Article 200 and Article 201 of the Law on Enterprises for cases of merger and consolidation of enterprises;

e) Other documents related to consolidation, merger, division, separation of enterprises (if any).

2. Scheme on consolidation, merger, division and separation of enterprises include the following main contents:

a) Names and addresses of enterprises before and after consolidation, merger, division, separation;

b) Necessity of consolidation, merger, division, and separation of enterprises; conformity with socio-economic development strategies and plans, and sectoral master plans;

c) Level of charter capital of enterprises after consolidation, merger, division, or separation;

d) Plan for labor arrangement and use;

dd) Plan for financial settlement, transfer, handover of capital and assets and settlement of rights and obligations of enterprises related to consolidation, merger, division and separation;

e) Time limit for consolidation, merger, division and separation of enterprises;

g) In case of division or separation of enterprises to form new enterprises, the scheme for division and separation of enterprises includes other additional contents specified in Clause 3, Article 6 of this Decree.

Article 17. Procedures for consolidation, merger of enterprises

1. Procedures for consolidation and merger of enterprises established under the Prime Minister’s decisions:

a) The agency representing the owner shall direct one of the consolidated companies (in case of consolidation) or the merging company (in case of merger) to prepare the dossier of request for consolidation or merger as stipulated in Article 16 of this Decree, have opinions on consolidation and merger and send 06 sets of original dossiers to the Ministry of Planning and Investment for appraisal;

b) After receiving complete dossier of request for enterprise consolidation or merger proposed by the agency representing the owner, the Ministry of Planning and Investment shall assume the prime responsibility for collecting opinions from the Ministry of Finance, the Ministry of Home Affairs, and the Ministry of Justice, the Ministry of Labor, Invalids and Social Affairs, the line ministry and relevant agencies (if necessary).

Within 15 working days from the date of receiving the dossier of request for consolidation or merger, the relevant agencies shall send written comments on the contents within the scope of management to the Ministry of Planning and Investment for consolidating and issuing an appraisal report;

c) Within 10 working days from the receipt of opinions from relevant authorities, the Ministry of Planning and Investment shall submit the report on appraisal of the dossier of request for consolidation or merger of the enterprise to the Prime Minister and also send it to the agency representing the owner for knowing or providing explanations.

If different opinions are given about the same main contents of the dossier, the Ministry of Planning and Investment shall coordinate with relevant agencies before submitting the appraisal report to the Prime Minister; the time limit for submitting the appraisal report may be extended for a period not exceeding 10 working days;

d) The agency representing the owner shall accept and explain the appraisal opinions of the Ministry of Planning and Investment and complete the dossier and submit it to the Prime Minister for consideration and decision.

2. Procedures for consolidation and merger of enterprises established under the decision of or assigned to manage by the agency representing the owner:

a) Enterprises with 100% charter capital held by the State shall coordinate and agree to prepare the dossier of request for consolidation or merger according to Article 16 of this Decree, and submit it to the authority issuing establishment decision or assigned to manage such enterprises for consideration and decision;

b) Within 30 working days from the date of receipt of the dossier of request for consolidation or merger, the competent authority prescribed in Article 15 of this Decree shall appraise and approve the dossier and make decisions on consolidation and merger of enterprises.

3. After the consolidation or merger decision has been issued, the at-law representatives of the enterprises shall sign the consolidation and merger contract and be responsible for implementing the consolidation and merger scheme.

The merging enterprises and enterprises with 100% charter capital held by the State established on the basis of consolidation shall carry out business registration procedures in accordance with the law.

Article 18. Procedures for division, separation of enterprises

1. Procedures for division, separation of enterprises established under the Prime Minister’s decisions:

a) The agency representing the owner shall direct the enterprise to prepare the dossier of request for division or separation under Article 16 of this Decree, and send 06 sets of original dossiers to the Ministry of Planning and Investment for appraisal;

b) After receiving complete dossier of request for division and separation, the Ministry of Planning and Investment shall assume the prime responsibility for collecting opinions from the Ministry of Finance, the Ministry of Home Affairs, the Ministry of Justice, the Ministry of Labor, Invalids and Social Affairs, and the line ministry and relevant agencies (if necessary).

Within 15 working days from the date of receipt of the dossier of request for division or separation, the relevant agencies shall send a document to the Ministry of Planning and Investment to give opinions on contents within the scope of management.

c) Within 10 working days from the receipt of opinions from relevant authorities, the Ministry of Planning and Investment shall submit the report on appraisal to the Prime Minister and also send it to the agency representing the owner for knowing or providing explanations.

If different opinions are given about the same main contents of the dossier, the Ministry of Planning and Investment shall coordinate with relevant agencies before submitting the appraisal report to the Prime Minister; the time limit for submitting the appraisal report may be extended for a period not exceeding 10 working days;

d) The agency representing the owner shall accept and explain the appraisal opinions of the Ministry of Planning and Investment and complete the dossier and submit it to the Prime Minister for consideration and decision on division and separation.

dd) After the division and separation decision has been issued, the enterprise established by the Prime Minister's decision is responsible for implementing the scheme on division and separation.

2. Procedures for division and separation of enterprises with 100% charter capital held by the State established under the decision of or assigned to manage by the agency representing the owner:

a) The enterprise shall prepare 04 sets of original dossiers of request for division and separation specified in Article 16 of this Decree and send it to the agency representing the owner for appraisal;

b) After receiving complete dossier of request for division and separation, the agency representing the owner shall assume the prime responsibility for collecting opinions from the Ministry of Planning and Investment, the Ministry of Finance, and the line ministry (in case of an enterprise with 100% charter capital held by the State and established under the decision of the Provincial-level People's Committee).

Within 10 working days from the date of receiving the dossier, the relevant agencies shall send written comments on the contents within the scope of management to the agency representing the owner.

c) Within 10 working days from the date of receiving comments from relevant agencies, the agency representing the owner shall prepare an appraisal report and submit it to the Prime Minister for consideration and approval of the policy.

d) The agency representing the owner shall issue the decision on division and separation of the enterprise within 30 working days from the date of approval of the policy by the Prime Minister.

dd) After the division and separation decision has been issued, the enterprise is responsible for implementing the scheme on division and separation.

3. The enterprise established under the basis of division and separation shall carry out the business registration procedures in accordance with the law.

Article 19. Decision on consolidation, merger, division and separation of enterprises

1. The decision on consolidation, merger, division and separation of the enterprise must clearly stipulate the inheritance of rights and obligations of the consolidated, merged, divided or separated enterprise.

2. Decisions on consolidation, merger, division, separation, consolidation contract, and merger of enterprises must be sent to all creditors and notified to employees within 15 working days from the date of issuance.

Article 20. Policies for employees and holders of managerial positions

1. Employees who are eligible for retirement benefits shall be treated according to the law on social insurance and provided with other benefits according to the labor law.

2. Employees who wish to terminate employment contracts shall be provided with redundancy or severance allowance in accordance with labor law or policies for employees redundant after consolidation, merger, division, separation of enterprises with 100% charter capital held by the State.

3. The assignment of works to the Chairperson and members of the Members’ Council or the Company's President, the Chief Executive Officers, Supervisors working according to the appointment regime shall be considered by the agency representing the owner on a case-by-case basis when carrying out consolidation, merger, division or separation. In case the assignment of works to persons who are working under appointment regime cannot be carried out, these cases shall be settled according to downsizing policies as prescribed.

Article 21. Suspension of operation, termination of business at enterprises with 100% charter capital held by the State

1. Enterprises shall suspend operations and terminate business at the request of the agency representing the owner and in the cases specified in Clause 2, Article 206 of the Law on Enterprises.

2. Order and procedures for suspension of operation, and termination of business:

After the agency representing the owner issues a decision on suspension of operation, and termination of business, the enterprise is responsible for implementing procedures for suspension of operation, and termination of business in accordance with the law.

In case the business registration agency or competent state agency requests suspension of business in conditional business line, the enterprise with 100% charter capital held by the State is responsible for reporting to the agency representing the owner of the enterprise to make a decision on suspension of business.

3. During the suspension of business, the enterprise is responsible for implementing the contents specified in Clause 3 Article 206 of the Law on Enterprises.

SECTION 2

SALE OF THE WHOLE ENTERPRISE WITH 100% CHARTER CAPITAL HELD BY THE STATE

Article 22. Cases of sale of the whole enterprise

1. An enterprise is subject to equitization but fails to meet equitization requirements, and is entirely sold under the Prime Minister’s decision.

2. Other cases decided by the Prime Minister based on the request of the agency representing the owner.

Article 23. Subjects ineligible to buy the enterprise

1. A person having no civil act capacity, person having lost his/her civil act capacity or having his/her civil act capacity restricted, person having difficulties in cognition or behavior control, or person having no cognition or behavior control ability.

2. Financial intermediaries or audit organizations in charge of business valuation of the enterprise, and employees of these organizations who directly carry out appraisal, valuation or audit of the enterprise; parents, spouse, children, and siblings of persons who directly carry out appraisal, valuation or audit of the enterprise.

The organization conducting the auction of the enterprise and its employees who directly take charge of the auction; parents, spouse, children, and siblings of auctioneer who manages the auction.

3. The person who is authorized by the agency representing the owner to take charge of the sale of the enterprise; the person competent to decide the sale of enterprise, and the person who signs the auction service contract;

4. Parents, spouse, children, and siblings of the persons mentioned in Clause 3 of this Article;

5. Persons who do not have the right to establish and manage enterprises as prescribed by law.

6. Foreign investors as prescribed in the law on investment in respect of conditions concerning market access, assurance of national defense and security to be satisfied by foreign investors, and the land law.

Article 24. Principles of sale of the whole enterprise

1. Financial settlement, determination and adjustment of enterprise value, use of valuation consulting service, determination of starting price and plan for selling the whole enterprise shall comply with the Government’s regulations on transformation of enterprises with 100% charter capital held by the State into joint stock companies.

2. The starting price used for selling the whole enterprise shall not be lower than total value of state capital determined according to Clause 1 of this Article.

Article 25. Order for sale of the whole enterprise

1. Develop a plan on sale of the whole enterprise including:

a) Prepare records and documents, including: Legal documents on enterprise establishment; legal documents on assets, capital, and debts; financial statements, tax settlement report to the time of determining enterprise value; land use plan of the enterprise under management in accordance with the land law, the regulations on rearrangement and settlement of house and land under state ownership in each period and approved by a competent authority; the labor rearrangement plan; estimate of costs incurred from the sale of the whole enterprise; method and time of enterprise valuation, and other relevant documents (if any);

b) Organize listing and settlement of financial issues, and organize enterprise valuation;

c) Decide and disclose the enterprise value;

d) Complete and submit the plan for selling the whole enterprise to competent authorities for approval. The plan for selling the whole enterprise shall, inter alia, have the following contents: Current status of the company at the time of enterprise valuation; enterprise valuation results; determination of selling price and selling method, estimated costs; plan for land use approved by competent authorities; plan for use of current employees and settlement of benefits for redundant employees.

2. Organize and implement the plan to sell the whole enterprise by auction method.

3. Complete the sale of the whole enterprise: Make statements of costs incurred and proceeds from the sale of the whole enterprise; make payments; transfer assets, records/books and other relevant documents to the auction winner; publish the completion of the whole enterprise.

Article 26. Organization of enterprise auction

1. After the plan on sale of the whole enterprise has been approved, the agency representing the owner shall publicly announce on its website and on the specialized property auction website information about the selection of property auction organization, and carry out selection of qualified property auction organization in accordance with Article 56 of the Law on Property Auction.

2. The agency representing the owner shall sign enterprise auction service contract with the selected property auction organization. Main content of the property auction service contract shall comply with Article 33 of the Law on Property Auction.

3. Within 05 working days from the date the agency or organization competent to decide the sale of the whole enterprise announces the starting price, the professional auction organization shall make information about the property auction publicly available in accordance with Article 57 of the Law on Property Auction.

4. Procedures for auction of the enterprise shall be carried out following the ascending-price auction method prescribed in Chapter III of the Law on Property Auction.

5. In case only one person registers for participation in the auction, attends the auction, offers bid or accepts the price, the provisions of Article 49 of the Law on Property Auction shall apply.

In case of sale of the whole enterprise accompanied by the land use rights over the land plot allocated by the State with collecting land levies or leased in accordance with the land law, if only one person registers for participation in the auction, attends the auction, offers bid or accepts the price, the auction shall be considered unsuccessful as prescribed in Article 52 of the Law on Property Auction, and another auction must be conducted. If the third auction is conducted but still unsuccessful, the agency representing the owner shall report the case to the Prime Minister for consideration and decision.

Article 27. Responsibility for organizing the sale of the whole enterprise

1. Responsibility of the Prime Minister and the agency representing the owner upon selling enterprises established under the Prime Minister’s decisions:

a) The Prime Minister shall approve the plan for selling the whole enterprise at the request of the agency representing the owner, on the basis of appraisal report given by the Ministry of Finance and opinions given by the Ministry of Planning and Investment, the Ministry of Home Affairs, the Ministry of Justice, the Ministry of Labor, Invalids and Social Affairs, and the line ministry.

b) The agency representing the owner shall decide to select a qualified financial intermediary to provide valuation consulting service, and directly sign or authorize the enterprise to sign valuation consulting service contract; select and conclude contract with the auction organization; consider giving approval for the plan for use of existing employees and settlement of benefits to redundant employees; publish enterprise value; submit the plan for selling the whole enterprise to the Prime Minister for approval; consider giving approval for statements of financial accounts, costs incurred from the sale of the whole enterprise, payments made to redundant employees, and proceeds from the sale of the whole enterprise; consider giving approval for enterprise selling results and conclude the contract for sale and purchase of the whole enterprise; notify the completion of the sale of the whole enterprise;

c) The agency representing the owner shall settle difficulties, complaints and denunciations concerning the sale of the whole enterprise within its competence and in accordance with law in force; consider issuing decisions on payment of costs incurred from the sale of enterprise in case the sale of the whole enterprise is unsuccessful or suspended;

d) The agency representing the owner shall guide, inspect and supervise the process of selling the whole enterprise according to the contents specified in Article 25, Article 26 and Article 29 of this Decree.

2. Responsibilities of the agency representing the owner when selling the enterprise established under the decision of or assigned to manage by the agency representing the owner:

a) The agency representing the owner shall decide to select a qualified financial intermediary to provide valuation consulting service, and directly sign or authorize the enterprise to sign valuation consulting service contract; select and conclude contract with the auction organization; publish enterprise value; consider giving approval for the plan of selling the whole enterprise; consider giving approval for statements of financial accounts, costs incurred from the sale of the whole enterprise, payments made to redundant employees, and proceeds from the sale of the whole enterprise; consider giving approval for enterprise selling results and conclude the contract for sale and purchase of the whole enterprise; notify the completion of the sale of the whole enterprise;

b) Implement the contents specified at Points c, d Clause 1 of this Article.

3. Responsibilities of the sold enterprise:

a) Proactively prepare documents and records specified at Point a Clause 1 Article 25 of this Decree; organize handling of financial issues and determine enterprise value in accordance with law;

b) Submit to the agency representing the owner to make decision or consider giving approval within its competence for the contents specified at Point b Clause 1 of this Article (in case of an enterprise established under the Prime Minister’s decision) or Point a Clause 2 of this Article (in case of an enterprise established under the decision of or assigned to manage by the agency representing the owner).

c) Conclude the enterprise valuation consulting service contract with authorization of the agency representing the owner;

d) Create conditions for persons registering for purchase of the enterprise to survey and access the documents as prescribed in Clause 1 Article 28 of this Decree;

dd) Organize and implement the plan to sell the whole enterprise according to the auction method specified in Article 26 of this Decree; report to the agency representing the owner on the results of the sale of the enterprise;

e) Handover the property, records/books and other relevant documents to the auction winner;

g) Report to the agency representing the owner to consider issuing decisions on payment of costs incurred from the sale of enterprise in case the sale of the entire enterprise is unsuccessful or suspended.

Article 28. Rights and responsibilities of entities registering for purchase of enterprise and auction winner

1. Entities registering for purchase of enterprise shall:

a) Have the right to do surveys of existing conditions of the enterprise; learn about documents, financial statements, list of assets, certificates of ownership and rights to use assets and land, and other contracts concerning the enterprise to be sold;

b) Assume responsibility to protect confidentiality of information collected from their visits at the enterprise and the enterprise’s documents; not disclose and use such information to cause damage to the enterprise. Any entities that register for purchase of enterprise disclose or use information in such a manner that causes damage to the enterprise shall be treated in accordance with law;

c) Satisfy conditions for land allocation or land lease, purchase of assets on land as prescribed in Article 58 and Article 189 of the Land Law in case of purchase of the enterprise accompanied with land use rights and assets on land.

2. The auction winner shall:

a) Make payment of enterprise purchasing price specified in the signed contract;

b) Not sell or transfer a part of capital and assets of the enterprise before making full payment of enterprise purchasing price and fulfill other commitments (if any) specified in the contract for sale and purchase of the whole enterprise;

c) Have the right to choose the legal form of the enterprise after purchasing and registering the enterprise at the business registration agency. Enterprise registration dossier is carried out in accordance with the Government's regulations on business registration, in which the transfer contract or documents proving the transfer completion are replaced by a decision of the competent authority approving the plan to sell the whole enterprise and notice on the completion of the sale of the whole enterprise;

d) Have the right and assume responsibility to inherit legitimate rights and benefits and obligations of the enterprise as specified in the contract for sale and purchase of the whole enterprise and signed contracts; assume responsibility to make payment of debts payable and recover debts receivable as committed.

dd) The credit institution that wins the auction shall satisfy the requirements set out in the law on banking after completing the purchase of enterprise.

Article 29. Approval of sale results, contract conclusion, handover, payment, notification of completion of sale of the whole enterprise

1. Within 05 working days from receiving the enterprise's report on the auction's progress and the enterprise auction results, the agency representing the owner is responsible for reviewing and approving the results of sale of the whole enterprise.

2. Within 02 working days from the date of approval of the sale of the whole enterprise, the auction organization shall refund the advance payment to lawful bidders that fail to win the auction. The advance payment of the auction winner shall be deducted from the enterprise purchasing price. Bidders that violate the internal regulations of the auction session and auction winner that fails to conclude the contract as prescribed shall not be entitled to refund of the advance payment. Such advance payment which is not refunded to payers shall be recorded as increase in proceeds from the sale of the entire enterprise and shall be managed and used according to Article 31 of this Decree.

3. Within 10 working days from the date of decision approving the sale of the whole enterprise, the agency representing the owner or organization or individual authorized or assigned by the agency representing the owner in writing and the auction winner shall conclude the contract for sale and purchase of the whole enterprise. The contract for sale and purchase of the whole enterprise includes the following main contents:

a) Name, address, account number of the sold enterprise;

b) Name, address, account number (if any) of the auction winner;

c) Enterprise selling price;

d) Commitments of the auction winner and the organization or individual selling the enterprise;

dd) Time limit for payment of enterprise purchasing price; method and time limit for handover of the enterprise;

e) Settlement of relevant issues and contract disputes.

The contract shall be enclosed with the list of assets and debts (if any) as agreed upon between the auction winner and the sold enterprise.

4. The auction winner shall make full payment of the enterprise purchasing price within the time limit specified in the contract. The Members’ Council or the Company's President of the sold enterprise shall continue managing the enterprise until the handover is completed. The Members’ Council or the Company's President shall pay compensation for any property lost in accordance with law.

5. Within 15 working days from the date of completing payment responsibilities and signing the handover minutes, the agency representing the owner shall notify the completion of the sale of the whole enterprise with the following contents:

a) Name and address of the sold enterprise;

b) Name and address of the auction winner;

c) Selling price, selling method;

d) Responsibilities of the auction winner, organizations and individuals selling the whole enterprise and related agencies in handling existing and other arising problems.

Notice of completion of sale of the whole enterprise will be posted on mass media and sent to the following agencies: Finance, Taxation, Labor - Invalids and Social Affairs, and Statistics of provinces and centrally run cities where the enterprise is headquartered.

Article 30. Costs of sale of the whole enterprise

1. Costs of sale of the whole enterprise are expenses incurred in connection with the sale of the enterprise from the issue date of the decision to sell the enterprise to the date of handover of the sold enterprise to the auction winner. The agency representing the owner shall decide to approve and make statement of costs of sale of the whole enterprise with 100% charter capital held by the State. The Chief Executive Officer of the sold enterprise shall decide the specific spending amounts according to contents approved by the agency representing the owner and assume legal responsibility for their decision. Costs of sale of enterprise must be supported by adequate, valid and reasonable documents as prescribed by law.

2. Costs of sale of the whole enterprise include:

a) Direct costs at the enterprise: Cost of inventory and enterprise valuation; costs of developing the plan for sale of enterprise; costs of organizing employees’ meeting to disseminate information about the sale of the whole enterprise; costs of disseminating and disclosing information about the enterprise; costs of auction of the enterprise.

b) Costs of hiring a qualified financial intermediary to provide valuation consulting or organize auction of the enterprise. Consulting service fees shall be paid under the contract signed between the parties.

c) Other costs related to the process of selling the whole enterprise (if any).

3. Costs of hiring audit of financial statements at the time of valuation of the enterprise shall not be included in the costs of sale of entire enterprise but shall be recorded by the sold enterprise as its business expenses in the period according to regulations.

4. In case the sale of the whole enterprise is unsuccessful or suspended, or estimated proceeds from the sale of whole enterprise are not sufficient to cover costs of sale of the whole enterprise, the agency representing the owner shall consider recording such costs as the enterprise's expenses. These costs shall be considered as non-deductible expenses when determining taxable income if the enterprise still operates as an enterprise with 100% charter capital held by the State. If the enterprise makes arrangements in other forms, the agency representing the owner shall send a written request to the Ministry of Finance to allocate funding for covering costs of sale of enterprise. Such request should be supported by relevant documents.

Article 31. Management and use of proceeds from sale of the whole enterprise

Proceeds from selling the whole enterprise with 100% charter capital held by the State after deducting the costs of selling the whole enterprise and policy implementation costs for employees and holders of managerial positions shall be paid to the central budget and local budget according to the Government's regulations.

Article 32. Policies for employees and holders of managerial positions when selling the whole enterprise

1. Employees who continue employment with the enterprise after it is sold shall enter into new employment contracts.

2. Employees who wish to terminate employment contracts shall be provided with redundancy or severance allowance in accordance with labor law or policies for employees redundant when selling the whole enterprise.

3. Employees who are eligible for retirement benefits shall be treated according to the law on social insurance and provided with other benefits according to the labor law.

4. The assignment of works to the Chairperson and members of the Members’ Council or the Company's President, the Chief Executive Officers, Supervisors working according to the appointment regime shall be considered by the agency representing the owner on a case-by-case basis after selling the enterprise. In case the assignment of works to persons who are working under appointment regime cannot be carried out, these cases shall be settled according to downsizing policies as prescribed.

SECTION 3

TRANSFORMATION OF THE ENTERPRISE WITH 100% CHARTER CAPITAL HELD BY THE STATE INTO A LIMITED LIABILITY COMPANY WITH TWO OR MORE MEMBERS

Article 33. Conditions and forms of transformation of an enterprise into a limited liability company with two or more members

An enterprise with 100% charter capital held by the State is transformed into a limited liability company with two or more members when the following conditions are simultaneously met:

1. Meet the same conditions as those for equitization of enterprise (except transformation of agricultural enterprises and forestry enterprises).

2. Be considered and decided by the Prime Minister in case it is necessary to limit the number of members contributing capital due to national defense, security or other cases.

The transformation of an enterprise with 100% charter capital held by the State into a limited liability company with two or more members is carried out in the form of transferring part of the existing state capital in the enterprise.

Article 34. Principles for transformation of an enterprise into a limited liability company with two or more members

1. Financial settlement, determination and adjustment of enterprise value, use of valuation consulting service, determination of starting price and plan for transformation of the enterprise shall comply with the Government’s regulations on transformation of enterprises with 100% charter capital held by the State into joint stock companies.

2. Based on the structure of charter capital, offering rate and criteria for selection of investors approved by competent authorities under the Plan for transformation into a limited liability company with two or more members, an auction shall be conducted to transfer state capital in accordance with transformation of enterprises with 100% charter capital held by the State into joint stock companies. Successful bidders shall be selected in descending order and limited to 50 investors as prescribed in Clause 5, Article 35 of this Decree.

Article 35. Contents of plan for transformation of an enterprise into a limited liability company with two or more members

The transformation plan includes the following basic contents:

1. Current status of the enterprise at the time of enterprise valuation.

2. Enterprise valuation results and issues to be further resolved.

3. Criteria for selection of investors receiving transfer of state capital in connection with business lines, scope of operation, financial capacity, corporate governance, technology and market.

4. Level of charter capital under the requirements of the enterprise's production and business activities.

5. Charter capital structure, starting price and capital transfer method according to the principles: Based on scale, business lines and development requirements, the minimum amount of capital to be received by each investor must be determined so as to ensure that no more than 50 investors will be selected as prescribed by the law on enterprises. The provision on minimum amount of capital to be purchased by each investor included in the transformation plan shall abide by the principle of equality for investors of all economic sectors.

6. The draft charter on organization and operation of the limited liability company with two or more members that is drawn up in accordance with the Law on Enterprises and other legislative documents in force.

7. The plan for rearrangement of existing employees.

8. The business plan for the following 3-5 years.

9. The land use plan approved by a competent authority.

Article 36. Responsibility in implementing transformation

1. Responsibility of the Prime Minister and the agency representing the owner in transformation of enterprises established under the Prime Minister’s decisions:

a) The Prime Minister shall decide to approve the plan for transformation of enterprises with 100% charter capital held by the State established under his decision at the request of the agency representing the owner and based on opinions given by the Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Home Affairs, the Ministry of Justice, the Ministry of Labor, Invalids and Social Affairs and supervisory ministries; issue decision to assign the agency representing the owner to manage the state capital in the enterprise after transformation.

b) The agency representing the owner shall decide to select providers of valuation consulting service and auction service, and conclude contracts or authorize the enterprise to conclude contracts with these service providers; consider approving the plan for management of existing employees and settlement of benefits for redundant employees; publish enterprise value; submit the plan for transformation into limited liability company with two or more members to the Prime Minister for approval; decide to approve statements of financial accounts; transformation costs; payments made to redundant employees; proceeds from transformation process, and decide to announce the actual state capital at the time when the limited liability company with two or more members is initially issued with enterprise registration certificate.

c) The agency representing the owner is responsible for resolving these problems, complaints and denunciations related to enterprise transformation according to authority and law in force;

d) The agency representing the owner shall guide, inspect and supervise the process of transformation of enterprises according to the contents specified in this Decree.

2. Responsibilities of the agency representing the owner upon transformation of the enterprise established under the decision of or assigned to manage by the agency representing the owner:

a) The agency representing the owner shall decide to select providers of valuation consulting service and auction service, and conclude contracts or authorize the enterprise to conclude contracts with these service providers; publish enterprise value; decide to approve transformation into limited liability company with two or more members; decide to approve statements of financial accounts; transformation costs; payments made to redundant employees; proceeds from transformation process, and decide to announce the actual state capital at the time when the limited liability company with two or more members is initially issued with enterprise registration certificate.

b) The agency representing the owner shall carry out the responsibilities specified at Points c, d Clause 1 this Article.

3. Responsibilities of the enterprise:

a) Proactively prepare documents and records to develop plan on transformation; organize handling of financial issues and determine enterprise value in accordance with law;

b) Submit to the agency representing the owner to make decision or consider giving approval within its competence for the contents specified at Point b Clause 1 of this Article (in case of an enterprise established under the Prime Minister’s decision) or Point a Clause 2 of this Article (in case of an enterprise established under the decision of or assigned to manage by the agency representing the owner).

c) Sign service contracts with enterprise valuation consulting service provider and auction organization with authorization of the agency representing the owner;

d) Organize the implementation of the Plan and complete the transformation into a limited liability company with two or more members.

dd) Carry out registration procedures for transformation into a limited liability company with two or more members at the business registration agency. Business registration documents are carried out in accordance with the Government's regulations on business registration, in which the transfer contract or documents proving the completion of the transfer are replaced by a decision of the agency representing the owner announcing the actual value of state capital in the enterprise after selling the state capital, decision to appoint a representative of the state capital portion of the agency representing the owner (if any).

Article 37. Policies for employees and holders of managerial positions

1. Employees who continue employment with the enterprise after it is transformed shall enter into new employment contracts.

2. Employees who wish to terminate employment contracts shall be provided with redundancy or severance allowance in accordance with labor law or policies for employees redundant after transformation of enterprises with 100% charter capital held by the State.

3. Employees who are eligible for retirement benefits shall be treated according to the law on social insurance and provided with other benefits according to the labor law.

4. The assignment of works to the Chairperson and members of the Members’ Council or the Company's President, the Chief Executive Officers, Supervisors working according to the appointment regime shall be considered by the agency representing the owner on a case-by-case basis after transformation. In case the assignment of works to persons who are working under appointment regime cannot be carried out, these cases shall be settled according to downsizing policies as prescribed.

Article 38. Management and use of proceeds from transformation of the enterprise with 100% charter capital held by the State into a limited liability company with two or more members

Proceeds from transformation of the enterprise with 100% charter capital held by the State into a limited liability company with two or more members after deducting the costs of transformation and policy implementation costs for employees and holders of managerial positions shall be paid to the central budget and local budget according to the Government's regulations.

SECTION 4

DISSOLUTION OF ENTERPRISES WITH 100% CHARTER CAPITAL HELD BY THE STATE

Article 39. Conditions for dissolution of enterprises

1. Enterprises with 100% charter capital held by the State are considered for dissolution in the following cases:

a) Enterprise registration certificate is revoked, unless otherwise prescribed by the Law on Tax Administration;

b) The enterprise shows signs of financial insecurity, is subjected to the special financial supervision after the permitted duration for application of corrective and remedial measures or restructuring plan has expired but it fails to restore business operations, and is not suitable for other forms of transformation and rearrangement as prescribed by law;

c) The enterprise fails to fulfill tasks assigned by the State for 02 consecutive years after all necessary measures have been adopted;

d) Maintenance of operation of the enterprise is unnecessary;

dd) The operating period specified in the enterprise’s charter expires without an extension decision.

2. The enterprise shall only be dissolved after all of its debts and liabilities are fully paid and it is not involved in any dispute at a Court or arbitral tribunal. The concerned managers and the enterprises specified at Point a, Clause 1 of this Article shall be jointly liable for the enterprises' debts.

3. The dissolution of enterprises must be in accordance with the document on arrangement and renewal of enterprises approved by the Prime Minister. If the dissolution of enterprise is not approved by the Prime Minister under these documents, the agency representing the owner shall submit the case to the Prime Minister for consideration and decision (unless an enterprise is dissolved in case its enterprise registration certificate is revoked or the operating period specified in the enterprise’s charter expires without an extension decision).

If an enterprise fails to meet the aforesaid conditions for dissolution or goes bankrupt, the agency representing the owner shall report the case to the Prime Minister for considering and deciding to employ another reorganization method or to file for bankruptcy.

Article 40. Competence to request dissolution and decide on dissolution of the enterprise

1. Competence to request dissolution of the enterprise:

a) Enterprises with 100% charter capital held by the State;

b) Agency representing the owner;

c) Inspection, audit, tax agencies or other State authorities, when performing their duties according to their authority, find that the enterprise is in a state of dissolution.

2. Competence to decide on dissolution of the enterprise:

a) For enterprises established under the Prime Minister's decision, the Prime Minister shall decide to dissolve based on the request of the agency representing the owner and opinions of the Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Home Affairs, the Ministry of Justice, the Ministry of Labor, Invalids and Social Affairs and the line ministry.

b) For enterprises established under the decision of or assigned to manage by the agency representing the owner, the agency representing the owner shall decide on dissolution of the enterprise.

Article 41. Procedures for dissolution of enterprises

1. Within 30 working days from the day on which the enterprise is determined to fall in one of the dissolution cases specified in Article 39 of this Decree, the person having authority to decide the dissolution shall issue a dissolution decision and establish a dissolution council to follow dissolution procedures.

2. The person having authority to decide the dissolution shall dissolve the enterprise according to the contents specified in Article 42 of this Decree.

3. After the dissolution decision is issued:

a) The dissolution council is responsible for implementing the provisions in Article 43 of this Decree;

b) Enterprises are responsible for implementing the provisions in Article 45 of this Decree;

c) The tax agency directly managing tax collection shall make a certification of enterprise’s fulfillment of tax obligations within 05 working days from the receipt of the enterprise’s request on certification of enterprise’s fulfillment of tax obligations.

4. The dissolution council shall automatically terminate its operation when the enterprise has completed dissolution procedures as prescribed by law and the enterprise’s legal status on the National Enterprise Registration Database has been changed into “dissolved” by the business registration office.

Article 42. Decision on dissolution of the enterprise

1. The decision on dissolution of the enterprise with 100% charter capital held by the State includes the following main contents:

a) Name and address of the head office of the dissolved enterprise;

b) Reason for dissolution;

c) Time limit and procedures for contract liquidation and payment of debts of the enterprise;

d) Plan for dealing with obligations arising from labor contracts;

dd) Full name and signature of the Chairperson of the Members’ Council or the President of the dissolved enterprise.

2. Within 07 working days from the date of decision on dissolution of the enterprise, this decision must be made sent to the dissolved enterprise and:

a) Employees in the enterprise;

b) Agency or organization requesting dissolution of the enterprise;

c) Creditors, people with related rights, obligations and interests in case the enterprise has unpaid financial obligations;

d) Specialized agencies under the Provincial-level People's Committees in the field of finance and investment planning for enterprises whose dissolution is decided by the Chairpersons of the Provincial-level People's Committees;

dd) Tax authorities directly managing enterprise tax collection;

e) Provincial-level People's Committee, Statistical Office and the business registration office of the province where the dissolved enterprise is located and the business registration office of province where its branch or representative office is located.

Article 43. Dissolution council of enterprises with 100% charter capital held by the State

1. The person having authority to decide the dissolution shall establish the dissolution council of the enterprise. The dissolution council has the function of advising the person having authority to decide the dissolution on the organization and implementation of enterprise dissolution. The composition of the dissolution council shall comply with Clauses 2 and 3 of this Article.

2. The dissolution council of the enterprises established under the Prime Minister's decision includes representatives of the following agencies:

a) The head of the agency representing the owner is the Chairperson of the dissolution council;

b) Representatives of ministries: The Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Labor, Invalids and Social Affairs;

c) Representatives of organizations representing employees at the dissolved enterprises;

d) Chairperson of the Members’ Council or the President of the dissolved enterprises with 100% charter capital held by the State;

dd) On a case-to-case basis, the additional representatives of other agencies and organizations may be invited to participate in the dissolution council.

3. The dissolution council of the enterprise established under the decision of or assigned to manage by the agency representing the owner includes representatives of the following agencies:

a) The representative of the agency representing the owner is the Chairperson of the dissolution council;

b) Representative of the affiliated unit or specialized agency of the agency representing the owner in charge of managing the fields of finance, planning, and labor;

c) Representatives of organizations representing employees at the dissolved enterprises;

d) Chairperson of the Members’ Council or the President of the dissolved enterprises with 100% charter capital held by the State;

dd) On a case-to-case basis, the additional representatives of other agencies and organizations may be invited to participate in the dissolution council.

Article 44. Rights and responsibilities of the dissolution council

1. The dissolution council is entitled to use the enterprise’s seal to serve the dissolution process and request relevant competent authorities to assist in recovery of assets.

2. After the dissolution decision has been issued and published on newspapers as prescribed, the dissolution council shall:

a) Revoke the seal of the dissolved enterprise to serve the dissolution process;

b) Organize the dissolution of the enterprise according to the approved dissolution decision; the agency representing the owner or the Members’ Council or the company's President directly organizes the liquidation of the enterprise's property, unless otherwise prescribed by the enterprise's charter; payment of debts of the dissolved enterprises shall be carried out in the order specified in Clause 5, Article 208 of the Law on Enterprises;

c) Within 07 working days from the completion of the dissolution process and payment of debts of the dissolved enterprise, the dissolution council shall prepare and submit financial reports on enterprise dissolution to the person having authority to issue dissolution decision; prepare an application for dissolution according to Article 210 of the Law on Enterprises and send it to the business registration office where the enterprise is registered.

Article 45. Responsibilities of the dissolved enterprise

1. When the dissolution decision has been issued, the dissolved enterprise must publicly post the dissolution decision at the head office, branches, representative offices of the enterprise and publish it in an electronic or written newspaper for 03 consecutive issues accompanied by a notice of the date of termination of business operations and the time required for creditors to compare debts.

2. From the effective date of the dissolution decision, the dissolved enterprises with 100% charter capital held by the State shall:

a) Not perform all prohibited activities as prescribed in Article 211 of the Law on Enterprises;

b) Terminate business operation, payment of debts payable, lending of assets to others for free use, and management of assets of others;

c) Close accounting books; carry out inventory of assets; compare debts receivable and debts payables; prepare financial statements by the time the dissolution decision becomes effective;

d) Make a list of creditors and debts payable (sorted by secured debts, partially secured debts and unsecured debts); list of debtors and debts receivable (sorted by recoverable debts and irrecoverable debts);

dd) Send a written request to the tax authority to confirm the fulfillment of the enterprise's tax obligations.

3. Within 30 working days from the date the dissolution decision takes effect, the enterprise must hand over the followings to the dissolution council:

a) Financial statements, accounting books and documents related to the dissolution of the enterprise; list of creditors and debtors of the enterprise;

b) All assets under the enterprise’s lawful ownership, management and use (including recovered assets), assets managed on behalf of others, borrowed or leased assets.

Article 46. Policies for employees and holders of managerial positions

1. Employees who are eligible for retirement benefits shall be treated according to the law on social insurance and provided with other benefits according to the labor law.

2. Employees who wish to terminate employment contracts shall be provided with redundancy or severance allowance in accordance with labor law or policies for employees redundant after rearrangement of enterprises with 100% charter capital held by the State.

3. The assignment of works to the Chairperson and members of the Members’ Council or the Company's President, the Chief Executive Officers, Supervisors working according to the appointment regime shall be considered by the agency representing the owner on a case-by-case basis after the dissolution of the enterprise. In case the assignment of works to persons who are working under appointment regime cannot be carried out, these cases shall be settled according to downsizing policies as prescribed.

Article 47. Time limit for dissolution of the enterprise

1. The time for dissolution of an enterprise shall not exceed 01 year from the effective date of the dissolution decision and may be extended but not more than 06 months if approved in writing by the person having authority to issue dissolution decision. In case of difficulties arising during the dissolution resulting in further extension required, the case should be reported to the Prime Minister for consideration and decision.

2. In case the enterprise registration certificate is revoked, the time limit for completion of dissolution process shall comply with regulations of the law on enterprises.

Chapter IV

TRANSFER OF THE RIGHT TO REPRESENT THE OWNER AT ENTERPRISES WITH 100% CHARTER CAPITAL HELD BY THE STATE

Article 48. Cases of transfer of the right to represent the owner at enterprises with 100% charter capital held by the State

1. The forms of transfer of the right to represent state capital owners at enterprises specified in this Decree only apply to the transfer without payment. The transfer with payment shall comply with legal regulations on sale of the whole enterprise and transfer of capital and assets at the enterprise.

2. Forms of transfer of the right to represent the state capital owner at enterprises:

a) Transfer between agencies representing the owner means the transfer of rights to represent the owner in enterprises with 100% charter capital held by the State between Ministries, ministerial-level agencies, Government-attached agencies and Provincial-level People's Committees;

b) Transfer of partial capital and assets between enterprises with 100% charter capital held by the State means the transfer of rights to represent the owner of partial capital and assets between enterprises with 100% charter capital held by the State. This form shall only apply to capital or assets between enterprises directly engaging in national defense and security to serve the performance of national defense and security tasks and other cases decided by the Prime Minister;

c) Transfer of public investment projects or works from such project or work managing agencies or organizations to enterprises with 100% charter capital held by the State shall comply with regulations of law on transfer of state assets;

d) Transfer of state capital in enterprises between agencies representing the owner and organizations or enterprises specializing in investment and trading of state capital shall comply with specific regulations of the Government or the Prime Minister.

Article 49. Conditions for transfer between agencies representing the owner

The transfer of rights to represent the owner for enterprises with 100% charter capital held by the State between agencies representing the owner must meet the following conditions:

1. The business lines of the enterprise in which the rights to represent state capital owner are transferred are suitable for the business lines or objectives of the agencies representing the owner receiving the transfer.

2. The enterprise is not subjected to dissolution or becomes insolvent.

3. The enterprise is not subjected to transfer of rights to represent state capital owners at enterprises in documents on enterprise arrangement and renewal approved by the Prime Minister. In cases not specified in this document, the agencies representing the owner involved in the transfer of the agreement shall report to the Prime Minister for consideration and approval.

Article 50. Principles for organizing the transfer of the right to represent the state capital owner at enterprises

1. The transfer of the right to represent the state capital owner at enterprises is implemented according to the principle of transferring the enterprise's status quo.

2. In case of changes in data after the transfer, the relevant parties shall jointly find out reasons and take measures for settling and correcting data to be officially transferred.

3. Data transferred is those on the latest annual or quarterly financial statements which have been prepared and audited in accordance with regulations.

If the audited annual or quarterly financial statements are unavailable, data transferred shall be those on the enterprise’s latest financial statements. The agency representing the owner or enterprise that receives transfer shall hire an independent audit organization to conduct audit of the received financial statements and correct transferred data (if any) according to Clause 2 of this Article.

Article 51. Order and procedures for transfer of the right to represent the state capital owner at enterprises

1. The enterprise shall prepare adequate documents, legal documents, ongoing contracts, certificates of ownership and rights to use assets and land or capital and assets to be transferred and the latest audited annual or quarterly financial statements, and submit reports to the agency representing the owner.

2. In case of transfer between agencies representing the owner, these agencies shall cooperate together in appraising and reaching agreement on documents and data; transfer method; conditions and commitments to transfer and receive the enterprise, commitments to pay debts; sending written notifications to creditors, debtors and relevant parties.

In case of transfer of partial capital and/or assets between enterprises, the agencies representing the owner shall direct relevant enterprises to cooperate together in appraising and reaching agreement on documents and data; transfer method; conditions and commitments to transfer and receive the capital and/or assets, commitments to pay debts; sending written notifications to creditors, debtors and relevant parties.

3. Organize the signing of the minutes of transfer of the right to represent the state capital owner at enterprises, including the following main contents:

a) Name and address of the agency representing the owner;

b) Name and address of the transferred enterprise or information about the transferred capital or asset;

c) Enterprise value or value of capital or asset transferred; delivery and receipt method;

d) Commitments, rights and obligations of the agency representing the owner and related enterprises.

Such minutes shall be announced at the enterprise's head office, in at least one written or electronic newspaper for three consecutive issues.

4. After transferring between the agencies representing the owner, the transferred enterprise shall register to change the agency representing the owner at the business registration agency. Business registration dossiers are carried out in accordance with the Government's regulations on business registration. The dossier must be accompanied by the minutes of transfer of the right to represent the state capital owner at enterprises.

The at-law representative of the transferred enterprise shall publish the transfer of rights to represent state capital owner in enterprise, change of name (if any) and enterprise’s owner on mass media within 30 working days from the issue date of its enterprise registration certificate.

Article 52. Rights and responsibilities of the agency representing the owner and the enterprise

1. Rights and responsibilities of the agency representing the owner:

a) Transfer the right to represent state capital owners at enterprises according to the policy of Prime Minister and the minutes of transfer of the right to represent the state capital owner at enterprises;

b) Implement rights, responsibilities and obligations according to the transfer minutes.

2. Rights and responsibilities of the enterprise:

a) Assume responsibility for the accuracy of documents and data.

b) Implement rights, responsibilities and obligations according to the transfer minutes. In case of transfer of partial capital and/or assets between enterprises, the receiving enterprise shall inherit rights and legal liabilities for economic contracts, responsibility to collect and pay debts, and fulfill obligations to the State in accordance with regulations of law and other responsibilities (if any).

Article 53. Policies for employees when carrying out transfer

1. The transferred enterprise shall make the list of existing employees, the list of employees who continue employment after transfer, the list of employees to be trained for continuing employment after transfer, the list of employees receiving retirement policies, and the list of employees who are required to terminate employment contracts.

2. Employees whose employment contracts are terminated shall be provided with redundancy or severance allowances in accordance with labor law.

3. Employees who are eligible for retirement benefits shall be treated according to the law on social insurance and provided with other benefits according to the labor law.

Chapter V

IMPLEMENTATION PROVISIONS

Article 54. Effect

1. This Decree takes effect from June 1, 2022 and replaces the following legal documents:

a) Decree No. 172/2013/ND-CP dated November 13, 2013 of the Government on the establishment, reorganization, dissolution of state-owned single-member limited liability companies and single-member limited liability companies which are subsidiaries of state-owned single-member limited liability companies;

b) Decree No. 128/2014/ND-CP dated December 31, 2014 of the Government on sale, allocation and transfer of enterprises with 100% charter capital held by the State.

2. Decree No. 69/2014/ ND-CP of the Government dated July 15, 2014, on state economic groups and state corporations shall be annulled;

3. The Members’ Council or the President of parent company that is enterprise with 100% charter capital held by the State shall consider deciding the establishment, reorganization and transformation of their subsidiaries that are single-member limited liability companies after obtaining approval for their policies by competent authorities under schemes for restructuring of parent companies. If this content is not prescribed in the enterprise restructuring scheme, it is required to submit the scheme to competent authorities for revisions. Parent companies may apply provisions of this Decree to establishment, reorganization and transformation of their subsidiaries that are single-member limited liability companies.

4. Public non-business providers that are required to be transformed into single-member limited liability companies in accordance with regulations of specialized laws are entitled to comply with regulations on conditions and procedures for establishment of enterprise with 100% charter capital held by the State laid down in this Decree when carrying out transformation. The handling of finances and assets during the transformation process shall comply with regulations of law on management and use of public property.

Article 55. Responsibility for implementation

1. The Ministry of Planning and Investment shall monitor the implementation of this Decree.

2. The ministers, the heads of the ministerial-level agencies, the heads of the Government-attached agencies, the chairpersons of the People's Committees of provinces and centrally run cities, the chairpersons of the Members’ Council or the Presidents of enterprises with 100% charter capital held by the State shall implement this Decree./.