Laws of Vietnam

THE PRIME MINISTER

Article 1.- To issue together with this Decision the classification criteria and list of to be-classified State enterprises and State corporations of various types.

Article 2.- Subject to the application of this Decision are independent State enterprises, member enterprises of State corporations and the existing State corporations.

Article 3.- This Decision takes effect 15 days after its signing for promulgation. All the previous stipulations, which are contrary to the classification criteria and list of to be-classified State enterprises and State corporations of various types, issued together with this Decision, are hereby annulled.

The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, the presidents of the People’s Committees of the provinces and centrally-run cities and the chairmen of the managing boards of Corporations 91 shall have to base themselves on this Decision to draw up general schemes on restructuring State enterprises and State corporations under their respective management and submit them to the Prime Minister for approval.

The Steering Committee for Enterprise Renewal and Development shall monitor and urge the ministries, branches, localities and Corporations 91 to draw up and implement the approved general schemes on restructuring State enterprises strictly according to the set tempo.

Prime Minister
PHAN VAN KHAI

A. STATE ENTERPRISES (including independent State enterprises and member enterprises of State corporations)

I. The State holds 100% capital of those State enterprises, which are engaged in the following branches and domains:

1. State enterprises engaged in business activities:

1.1. State enterprises engaged in business activities in the domains where the State holds monopoly:

- Manufacture and supply of explosive materials;

- Manufacture and supply of toxic chemicals;

- Manufacture and supply of radioactives;

- National electricity transmission system;

- National and international communication axis networks;

- Production of cigarettes.

1.2. State enterprises engaged in business activities, which fully meet the following conditions: having the State capital of VN dong 20 billion or more; having the average level of State budget remittance of VN dong 3 billion or higher for 3 preceding consecutive years; taking the lead in applying spearhead technologies and high technologies; contributing an important part to stabilizing macro economy; and being engaged in the following branches and domains:

- Manufacture of electricity;

- Exploitation of important minerals:

+ Crude oil and natural gases;

+ Coal;

+ Bauxite;

+ Copper ore;

+ Tin ore;

+ Ores containing radioactives;

+ Gold;

+ Gemstones.

- Manufacture of a number of mechanical-engineering products:

+ Machine tools;

+ Dynamos;

+ Machinery and equipment in service of agriculture, forestry and fishery;

+ Electric technical equipment and electric materials;

+ Special-use industrial machines;

+ Building and repair of seaway, railway and airway transport means.

- Manufacture of electronic equipment;

- Information technology;

- Manufacture of non-ferrous metals (tin, copper);

- Manufacture of ferrous metals (pig iron, steel) with capacity of more than 100,000 tons/year;

- Manufacture of base chemicals;

- Manufacture of chemical fertilizers and plant protection drugs;

- Manufacture of high-quality cement by modern technologies, with capacity of more than 1.5 million tons/year;

- Exploitation, filtering and supply of clean water in cities;

- Building industry;

- Manufacture of a number of important consumer goods and foodstuff products:

+ Newsprint, writing paper;

+ Textiles, fibers;

+ Printing of more than 3 billion finished product-equivalent pages (13 x 19 cm)/year;

+ Production of salt;

+ Manufacture of beer with capacity of more than 50 million liters/year;

+ Manufacture of alcohol and liquor with capacity of more than 10 million liters/year;

- Manufacture and supply of preventive and curative medicines, and pharmaceutical chemicals;

- Wholesale of food;

- Wholesale of petroleum;

- Airway, railway and seaway transportation;

- Base telecommunications services;

- Trading in currencies and insurance.

1.3. State enterprises engaged in business activities, which ensure the essential demand for developing production and improving the material and spiritual life of people in rural areas and ethnic minority people in mountainous, deep-lying and remote areas.

1.4. State enterprises engaged in business activities of particular nature:

- Publishers (excluding those which publish textbooks, political books and newspapers, children’s books and newspapers, and books written in languages of ethnic minority people);

- Construction lottery;

- A number of State enterprises engaged in important branches under the Prime Minister’s decisions.

2. State enterprises engaged in public-utility activities in the following domains:

- Printing of money and valuable certificates;

- Flight control;

- Maritime security;

- Control and distribution of radio frequencies;

- Manufacture and repair of weapons, ammunition and equipment used exclusively for national defense and security;

- Enterprises assigned to perform the special defense and security task and enterprises situated in important strategic localities where economy and defense are combined under the Prime Minister’s decisions;

- The publication of textbooks, political books and newspapers, children’s books and newspapers, books written in languages of ethnic minority people, the production of scientific films, newsreels, documentary films and films for children;

- Technical expertise of big motorized means of transport;

- Management and maintenance of national railway systems and airports;

- Management and maintenance of important land-road, waterway and harbor systems;

- Management and exploitation of head-water irrigation works and large-scale irrigation works;

- Planting and protection of head-water forests and protection forests;

- Water drainage in urban centers;

- Public lighting.

II. State enterprises which diversify the ownership in forms of equitization, assignment of enterprises to labor collectives, or sale of enterprises

1. State enterprises, where the State holds more than 50% of the total shares upon their equitization.

1.1. State enterprises engaged in business activities:

a/ State enterprises engaged in business activities, which have the State capital of VN dong 10 billion or more; and the average level of State budget remittance of VN dong 1 billion or higher for 3 preceding consecutive years; and are engaged in the branches and domains prescribed at Point 1.2 of Section I.

b/ State enterprises engaged in other business activities:

- Manufacture of sugar, milk and edible vegetable oil;

- Assessment of goods;

- Printing of various kinds (excluding the printing of labels, marks or packings);

- Labor cooperation services;

- Trading in fair and exhibition floor-space.

1.2. State enterprises engaged in public-utility activities:

- Manufacture of plant varieties and animal breeds, and frozen sperm;

- Off-shore fishing services;

- Technical expertise of motorized means of transport;

- Management and maintenance of land-road and waterway systems;

- Management and maintenance of important railway stations and car terminals;

- Management and exploitation of irrigation works.

2. State enterprises engaged in a number of important domains, where the State does not hold more than 50% of the total shares when they are equitized, but shall hold special shares in order to make decisions on several important issues, under the Prime Minister’s decisions.

3. For those State enterprises not defined at Points 1 and 2 of this Section, when they are equitized, the competent State agencies shall base themselves on the specific conditions of the enterprises to decide whether the State shall hold shares with a small percentage or shall not hold shares.

4. Those State enterprises, which have the State capital of VN dong 5 billion or less and can not be equitized, shall convert their ownership in forms of assignment of enterprises to labor collectives or sale of enterprises.

III. State enterprises not defined in Section I above, which suffer from prolonged losses in their business activities or have not fulfilled their assigned tasks in the public-utility activities or which can not convert their ownership

1. State enterprises engaged in business activities:

a/ Those enterprises, which have conducted business without efficiency, suffered from losses for two consecutive years but not to the extent of being dissolved or declared bankrupt, shall be merged.

b/ Those enterprises, which have suffered from losses in their business activities for three consecutive years and have the accumulated loss amount equal to three-fourths (3/4) or larger of the State capital at enterprises, but do not yet fall into insolvency, and which, though having applied the reorganizing measures can not overcome the situation, shall be dissolved.

c/ Those enterprises, which have suffered from losses in their business activities for two consecutive years and can not repay their due debts, shall be declared bankrupt.

2. For those public-utility enterprises, which have not fulfilled their assigned tasks for two consecutive years, the competent State agencies shall decide on the merger, dissolution or bankruptcy.

B. STATE CORPORATIONS (including corporations set up under the Prime Minister’s Decision No. 90/TTg and Decision No. 91/TTg of March 7, 1994)

State corporations must fully meet the following conditions:

1. Being engaged in the following branches and domains: oil and gas exploitation and processing as well as petroleum wholesale; electricity manufacture and supply; exploitation, processing and supply of coal and important minerals; metallurgy; manufacturing mechanical-engineering; cement production; post and telecommunications, and electronics; airlines; maritime; railway; chemicals and chemical fertilizers; manufacture of a number of important consumer goods and foodstuff products (textiles, paper, salt, coffee, rubber, wood processing, liquor, beer, and cigarettes); pharmaceutical chemistry; construction; food wholesale; banking; and insurance.

2. Having the State capital of VN dong 500 billion or more; for the specific branches under the Prime Minister’s decisions, the State capital amount may be smaller but not less than VN dong 100 billion.

3. Having the average level of State budget remittance of VN dong 50 billion or higher for 3 preceding consecutive years; for the specific branches under the Prime Minister’s decisions, it must be no less than VN dong 10 billion.

4. Having advanced technological and managerial levels, high-quality products, high efficiency in production and business activities, and competitiveness on domestic and international markets.

Those State corporations, which do not fully meet the above-said four conditions, shall be restructured along the direction of merger, consolidation or dissolution.

Prime Minister
PHAN VAN KHAI