Principles for Restructuring Enterprises through Debt Trading Activities

The restructuring of enterprises through debt trading shall be carried out according to the following principles:

- The restructuring plan shall be implemented on the principle of consensus between the representative agency of the owner of the restructured enterprise and the Debt Trading Company or the creditors participating in the restructuring. The Debt Trading Company has the right to proactively negotiate debt purchases with creditors and propose an enterprise restructuring plan.- The Debt Trading Company shall decide to purchase debt only after having agreed with the representative agency of the owner and obtained the results of debt purchase negotiations with the creditors of the restructured enterprise. The debt trading plan for enterprise restructuring must ensure feasibility, effective capital recovery, and sufficient difference between the cost of debt purchase and the book value of the debt to handle finances and successfully transform the state enterprise into a joint-stock company as per regulations.- In case the debt purchase plan for enterprise restructuring is not feasible and effective, the Equitization/Restructuring Steering Committee shall report to the representative agency of the owner for consideration and decision on other forms of transformation in accordance with the law.

In addition to the contents prescribed in Circular 69, the restructured enterprise, the Debt Trading Company, and relevant agencies shall comply with Decree 126/2017/ND-CP and the guiding Circulars of the Ministry of Finance.

Circular 69/2018/TT-BTC takes effect from October 01, 2018.

- Thanh Lam -

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