What are the cases in which an entire wholly state owned enterprise is sold? Who is ineligible to buy a wholly state owned enterprise in Vietnam?
- What are the cases in which an entire wholly state owned enterprise is sold?
- What are the rules for selling an entire wholly state owned enterprise in Vietnam?
- Who is ineligible to buy a wholly state owned enterprise in Vietnam?
- What are the regulations on the management and use of proceeds from sale of an entire wholly state owned enterprise in Vietnam?
What are the cases in which an entire wholly state owned enterprise is sold?
According to the provisions of Article 22 of Decree 23/2022/ND-CP of Vietnam as follows:
Cases in which an entire enterprise is sold
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 made according to the Prime Minister’s decision issued at the request of the owner’s representative agency.
Thus, in the following cases, a wholly state owned enterprise will be sold in its entirety:
- An enterprise is subject to equitization but fails to meet equitization requirements, and is entirely sold under the Prime Minister’s decision.
- Other cases made according to the Prime Minister’s decision issued at the request of the owner’s representative agency.
What are the cases in which an entire wholly state owned enterprise is sold? Who is ineligible to buy a wholly state owned enterprise in Vietnam?
What are the rules for selling an entire wholly state owned enterprise in Vietnam?
Article 24 of Decree 23/2022/ND-CP of Vietnam stipulates the rules for selling an entire wholly state owned enterprise as follows:
Rules for selling an entire wholly state owned enterprise
1. Financial settlement, determination and adjustment of enterprise value, use of valuation consulting service, determination of starting price and plan for selling the entire enterprise shall comply with the Government’s regulations on conversion of wholly state-owned enterprises into joint-stock companies.
2. The starting price used for selling an entire enterprise shall not be lower than the total value of state capital determined according to Clause 1 of this Article.
Thus, the sale of the entire enterprise must comply with the following rules:
- Financial settlement, determination and adjustment of enterprise value, use of valuation consulting service, determination of starting price and plan for selling the entire enterprise shall comply with the Government’s regulations on conversion of wholly state-owned enterprises into joint-stock companies.
- The starting price used for selling an entire enterprise shall not be lower than the total value of state capital determined according to Clause 1 of this Article.
Who is ineligible to buy a wholly state owned enterprise in Vietnam?
Pursuant to Article 23 of Decree 23/2022/ND-CP of Vietnam, entities ineligible to buy a wholly state-owned enterprise include:
- Persons who lack legal capacity, are incapacitated or have limited legal capacity, have difficulty in controlling their behaviors, or persons who are unable to control their behaviors at the date of application for participation in auction.
- Financial intermediaries or audit organizations that take 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 the auctioneer who manages the auction.
- The person who is authorized by the owner’s representative agency 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;
- Parents, spouse, children, and siblings of the persons mentioned in Clause 3 of this Article;
- Persons who do not have the right to establish and manage enterprises as prescribed by law.
- 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.
What are the regulations on the management and use of proceeds from sale of an entire wholly state owned enterprise in Vietnam?
Pursuant to Article 31 of Decree 23/2022/ND-CP of Vietnam stipulating management and use of proceeds from sale of an entire wholly state owned enterprise as follows:
After deducting costs of sale of enterprise and benefits paid to employees and managerial position holders, the remaining proceeds earned from the sale of an entire wholly state-owned enterprise shall be submitted to the central government budget and local government budget in accordance with the Government’s regulations.
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