Vietnam: Procedures for equitization of state-owned enterprises

Kim Linh

08:58, 01/01/2018

On November 16, 2017, the Government of Vietnam issued Decree No. 126/2017/ND-CP on conversion from state-owned enterprises and single-member limited liability companies with 100% of charter capital invested by state-owned enterprises into joint-stock companies.

According to Decree No. 126/2017/ND-CP of Vietnam’s Government, equitization shall follow the procedures, which include the following basic steps:

Step 1: Developing the equitization plan

- Establish the steering committee and assistance team.

- Prepare relevant documents (including the land use plan approved by the competent authority).

- Carry out stocktaking, settle financial issues and determine the enterprise value.

- Make decisions on and publish the enterprise value.

- Complete the equitization plan to request a competent authority for approval.

Step 2: Implementing the equitization plan

Step 3: Finalizing the equitization

- Hold the first General meeting of shareholders and register the enterprise.

- Make financial statements and convert to the joint stock company.

Details of the above steps can be found in Appendix II attached to Decree No. 126/2017/ND-CP of Vietnam’s Government, which takes effect from January 01, 2018.

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