Public service providers in Vietnam that were officially converted into joint-stock companies before October 01, 2021, are allowed to maintain the current state ownership ratio

Public service providers in Vietnam that were officially converted into joint-stock companies before October 01, 2021, are allowed to maintain the current state ownership ratio ​(Image from the internet)

On October 25, 2024, the Prime Minister of the Government of Vietnam issued Decision 17/2024/QD-TTg, amending Decision 26/2021/QD-TTg regarding the list of industries and fields for the conversion of public service providers into joint-stock companies.

Public service providers in Vietnam that were officially converted into joint-stock companies before October 01, 2021, are allowed to maintain the current state ownership ratio

As per Clause 6, Article 1 of Decision 17/2024/QD-TTg (Clause 1a, Article 5 of Decision 26/2021/QD-TTg has been supplemented):

1a) For public service providers officially converted into joint-stock companies (first issued a business registration certificate as a joint-stock company) before Decision No. 26/2021/QD-TTg becomes effective, where the state capital ratio in the enterprise is lower than the ratio stipulated in Article 2 of this Decision, the existing state capital ratio shall be maintained unless otherwise adjusted, as approved by the Prime Minister of the Government of Vietnam, to comply with the provisions of Article 2 of this Decision.

Thus, according to the above regulation, public service providers officially converted to joint-stock companies before October 1, 2021, with a state capital ratio lower than the stipulated ratio, will maintain the current state capital ratio.

Adding 3 industries, fields for the conversion of public service providers into joint-stock companies in Vietnam

As per Clause 1, Article 1 of Decision 17/2024/QD-TTg (Clause 1, Article 2 of Decision 26/2021/QD-TTg regarding the list of industries and fields for public service providers' conversion into joint-stock companies has been amended and supplemented):

The list of industries and fields for the conversion of public service providers into joint-stock companies, where the State holds more than 50% of charter capital:

- Exploitation, production, and supply of clean water; urban and rural drainage;

- Technical inspection of labor safety;

- Construction inspection;

- Technical inspection of road motor vehicles and inland watercraft (excluding the field of marine and offshore construction registration).

Currently, according to Decision 26/2021/QD-TTg, the list of industries and fields for the conversion of public service providers into joint-stock companies, where the State holds more than 50% of charter capital includes only the exploitation, production, and supply of clean water; urban and rural drainage.

List of industries and fields for the conversion of public service providers into joint-stock companies, where the State holds up to 50% of charter capital or holds no shares in Vietnam

According to Clause 2, Article 2 of Decision 26/2021/QD-TTg, the list of industries and fields for public service providers' conversion into joint-stock companies, where the State holds up to 50% of charter capital or holds no shares; upon initial share offerings, the State holds more than 35% to 50% of charter capital to ensure the role of the State, organizational stability, and maintenance of service quality after equitization:

- Environmental sanitation, wastewater treatment;

- Public lighting;

- Consulting services in various fields: urban planning, accounting, auditing, taxation, valuation, market research, public opinion surveys, business management consulting;

- Technical support services for scientific and technological research; services related to intellectual property, technology transfer, standards, technical regulations, measurement of product quality; information, consulting, training, development, dissemination, and application of scientific and technological achievements in socio-economic fields;

- Labor market information services, employment services, support for labor relations development, sending Vietnamese workers to work abroad under contracts (excluding Employment Service Centers under Departments of Labor, Invalids and Social Affairs of provinces, central-affiliated cities, and under the Ministry of Labor, Invalids and Social Affairs);

- Road systems management and maintenance;

- Management and maintenance of ports and bus stations;

- Driver training and testing (not operating in the school model);

- Fairground, exhibition space business, trade and investment promotion;

- Support services, market information provision, tourism promotion;

- Real estate management, market management, shopping centers;

- Guesthouse, lodging house businesses; short-term accommodation services and meeting services;

- Development of industrial park infrastructure, industrial clusters, and support services within industrial parks and clusters (excluding land fund development).

Refer to Decision 17/2024/QD-TTg effective from December 10, 2024.

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