Decree 128: Order and procedures for conversion of wholly State-owned enterprises in Vietnam

Decree No. 128/2014/NĐ-CP of Vietnam’s Government stipulates the order and procedures for conversion of wholly State-owned enterprises are as follows:

1. Pursuant to the overall scheme on arrangement of wholly State-owned enterprises approved by the Prime Minister or the Prime Minister's decision on enterprise conversion, ministries, provincial-level People's Committees, parent companies with enterprises subject to conversion shall notify the transferable enterprises to prepare to transfer the enterprise.

2. The Board of Members or the President of the company subject to conversion assign the Innovation Board at the enterprise to prepare all documents, legal papers, unliquidated contracts, certificates of ownership, right to use property and land of the enterprise;

 to the Innovation Board at the enterprise prepares all documents, legal papers, unliquidated contracts, certificates of ownership, right to use use the property and land of the enterprise; conduct inventory and compare assets and liabilities, list of creditors and debtors of the enterprise, debts of creditors and payable debts; determine the current state of the property, its quality and technical features in accordance with regulations; make financial statements; make estimated costs of organizing the transfer of the enterprise and reporting to the business owner.

3. Transferee party assigns the Steering Committee receiving enterprises to develop a plan to receive enterprises, including the plan for receiving and handling finance and labor, assessing the impact of the transfer on the financial situation and business results of the transferee and supervises the transfer - receive the business transfer to report to the Board of Innovation and Business Development of the receiving party to submit to the Chairman of the Board of Members of the parent company for approval.

4. The Boards of Innovation and Business Development of the transferor and transferee agree on the method of handing over the business, conditions, commitments on conversion of the business, and commitments to pay debts. (The Ministry of Finance specifically guides these regulations)

5. Organize the signing of the Contract on business conversion between the transferor and transferee. The Contract on business conversion includes the following main contents and is announced at the enterprise, on one of the written or electronic newspapers in 03 (three) consecutive issues. Attached to the Contract is a declaration of transferred assets converted into value.

The Contract on business conversion shall be sent to following agencies: Business Finance, Tax, Business Registration, Planning and Investment; Labor - War Invalids and Social Affairs, Statistics of provinces and central-affiliated cities where enterprises are headquartered.

6. The Board of Innovation and Business Development together with the General Director or Director of the transfering enterprise organize the handover of the enterprise according to the agreed plan to the transferee in the presence of representatives of the agency deciding on the transfer of the enterprise and the corporate finance agency where the head office of the transferring enterprise is located.

7. After the conversion, the transferring enterprise shall register the change of name, owner or owner's representative at the business registration office. Dossier for change of enterprise registration must include the decision on transfer of the enterprise, the minutes on the transfer of the enterprise.

8. The representative of the enterprise shall make a public announcement on the mass media in accordance with the law and the enterprise website of the Ministry of Planning and Investment (www.business.gov.vn) on the transfer of the enterprise, change of name (if any) and the owner of the enterprise within 30 (thirty) days from the date of issuance of the Certificate of Business Registration.

View more details at the Decree No. 128/2014/NĐ-CP of Vietnam’s Government, effective from March 01, 2015.

Ty Na

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