What are regulations on adjustment in charter capital at wholly state-owned enterprises in Vietnam?

What are regulations on adjustment in charter capital at wholly state-owned enterprises in Vietnam? Thank you!

Pursuant to Clause 1 Article 2 of the Circular 36/2021/TT-BTC (takes effect from 10/07/2021) stipulating adjustment in charter capital at wholly state-owned enterprises in Vietnam as follows:

1. Adjustment in charter capital at wholly state-owned enterprises.

a) For newly established enterprises, based on enterprise establishment projects decided by competent authorities and actual amounts of state capital allocation (for enterprises newly established by executing construction investment projects), state capital already issued according to the final settlement of completed works approved by competent authorities (for enterprises newly established by carrying out the process of handover of construction investment projects), an increase in the owner's investment capital shall be recorded in their accounting books. These enterprises shall register the amount of charter capital in the Certificates of Business Registration upon establishment which is equal to the actual state allocation and investment amount in accordance with the Law on Enterprises.

b) For active enterprises, the adjustment of charter capital shall be subject to the provisions of Article 11 of Decree No. 91/2015/ND-CP, Clause 4, Article 1 of Decree No. 32/2018/ND-CP and Clause 7, Article 2 of Decree No. 140/2020/ND-CP of the Government.

Enterprises whose charter capital has been approved by competent authorities since 2020 or earlier must review and develop plans to determine charter capital and additional investment in charter capital as prescribed in Clause 21, Article 2 of Decree No. 140/2020/ND-CP for submission to competent authorities for approval. When determining the indicator "the most recently approved charter capital before the time of re-determination" specified in Article 9 of Decree No. 91/2015/ND-CP and Clause 5, Article 2 of Decree No. 140/2020/ND-CP, enterprises shall refer to the actual equity available on their financial statements as of December 31, 2020, based on which profits have been distributed according to regulations. Actual equity is determined by paid-in capital (No. 411), Development Investment Fund (No. 418) and capital construction investment (No. 422) on the Balance Sheet of each enterprise. For enterprises on the list of businesses to be equitized that is approved by competent authorities, when determining the charter capital, the addition to charter capital from the state budget and the Support Fund for business reorganization and development shall not be included.

For enterprises that do not require any addition to their charter capital or prepare plans for determination of their charter capital and additional investment in charter capital specified in Clause 7, Article 2 of Decree No. 140/2020/ND-CP, the owner's representative agency shall be responsible for checking, deciding and directing them to make payment of the differences between equity and charter capital to the state budget. Such payment of differences does not affect their solvency and debt repayment obligations. Within 10 days from the date on which the owner’s representative agencies issue their decisions, enterprises shall be responsible for remitting differences between equity capital and charter capital into the state budget and, at the same time, accounting for reduction in paid-in capital according to current regulations.

Best regards!

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