Procedures for transferring wholly state-owned enterprises in 2022? Policies to support employees when transferring businesses?

Main Content

• Principles of transferring the right to represent the owner of state capital in enterprises?
• Procedures for transferring enterprises in which 100% charter capital is held by the State?
• How are employees in wholly state-owned enterprises supported when transferring? 

Principles of transferring the right to represent the owner of state capital in enterprises?

Pursuant to Article 50 of Decree 23/2022/ND-CP::

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

1. The transfer of the right to represent the owner of state capital in an enterprise shall comply with the principle of transferring the status quo of the enterprise.

2. In case after the transfer, if the data changes, the concerned parties shall cooperate to clarify the cause, take measures to handle and adjust the officially transferred data.

3. Transfer data is defined as the data on the audited annual or quarterly financial statements at the time nearest to the time of transfer and is prepared in accordance with the prescribed regime.

In case the enterprise has not had audited annual or quarterly financial statements, the transferred data shall be determined as the data on the most recent financial statement of the enterprise. The agency representing the owner or the enterprise when receiving the transfer is responsible for hiring an independent audit service to audit the financial statements of the enterprise and adjust the transferred data (if any) in accordance with regulations in Clause 2 of this Article.” 

Accordingly, the transfer of enterprises in which wholly state-owned enterprises is carried out according to the principle of transferring the status quo of the enterprise.

Procedures for transferring wholly state-owned enterprises in 2022? Policies to support employees when transferring businesses?

Procedures for transferring enterprises in which 100% charter capital is held by the State?

Pursuant to Article 51 of Decree 23/2022/ND-CP:

“Article 51. Order and procedures for transferring the right to represent the owner of state capital in enterprises 

1. Enterprises fully prepare dossiers, legal papers, unliquidated contracts, certificates of ownership, right to use assets and land of the enterprise or capital and implemented assets. transfer and audited annual or quarterly financial statements at the latest time; report to the owner's representative agency. 

2. In the case of transfer between agencies representing the owner, these agencies shall coordinate in appraising and agreeing on dossiers and data; agreement on the method of transfer; conditions, commitments on delivery and receipt of enterprises, commitments on debt payment; written notice to creditors, debtors and related parties. In the case of partial transfer of capital and assets between enterprises, the owner's representative agency shall direct relevant enterprises to coordinate in appraising and agreeing on dossiers and data; agreement on the method of transfer; conditions and commitments to deliver and receive capital and assets; commitment to pay debt; written notice to creditors, debtors and related parties. 

3. The organization signs the minutes of transfer of the right to represent the state owner at the enterprise, including the following main contents: a) Name and address of the agency representing the owner b) Name and address of the transferring enterprise or information about the transferred capital and assets; c) The value of the enterprise or the value of the capital and assets transferred; delivery method; d) Commitments, rights and obligations of the agency representing the owner and the relevant enterprise. These minutes shall be announced at the head office of the enterprise, on at least one written or electronic newspaper with three consecutive issues. 

4. After the transfer between the owner's representative agencies, the transferring enterprise shall register the change of the owner's representative agency at the business registration office. An enterprise registration dossier must comply with the Government's regulations on enterprise registration, accompanied by a record of transfer of the right to represent the owner of state capital in the enterprise. The legal representative of the enterprise transfers the public notice to the mass media in accordance with the law on the transfer of the right to represent the owner of state capital in the enterprise, and changes the name (if any) and the owner of the enterprise within 30 working days from the date of issuance of the Certificate of Business Registration.”

Accordingly, the enterprise prepares documents, papers, contracts related to the enterprise or the most recently audited portion of transferred capital and assets, and then reports it to the owner's representative agency. The minutes of transfer of the right to represent the state owner at the enterprise after signing shall be announced at the head office of the enterprise, in at least one written or electronic newspaper in 3 consecutive issues.

After the transfer, the transferring enterprise shall register the change of owner at the business registration office.

How are employees in wholly state-owned enterprises supported when transferring? 

Pursuant to Article 53 of Decree 23/2022/ND-CP:

“Article 53. Policies for employees in enterprises when transferring”

1. The transferring enterprise makes a list of all existing employees, a list of employees who continue to work at the enterprise after the transfer, and a list of employees sent for re-training to continue working at the enterprise. after the transfer, the list of retired employees, the list of employees who must terminate their labor contracts.

2. The employee who terminates the labor contract is entitled to the allowance for job loss or job severance according to the regulations of the labor law.

3. Employees who are eligible for the retirement regime shall comply with the provisions of the law on social insurance and other benefits in accordance with the provisions of the labor law.” 

Thus, employees in wholly state-owned enterprises that terminate contracts when transferring, will be supported with unemployment allowance and severance allowance. Employees who are eligible for retirement benefits shall comply with the provisions of law.