Complete institutions to promote equitization and divestment

VCN - The production and business activities experience fluctuations due to the Covid-19 pandemic, plus the equitization and divestment progress was still slow compared to the plan approved by the Prime Minister, which placed an urgent requirement for further improvement of legal documents.
Slow equitization and divestment put burden on investment spending Slow equitization and divestment put burden on investment spending
Equitization: Heads must take responsibilities under Prime Minister for failure to fulfill assigned plans Equitization: Heads must take responsibilities under Prime Minister for failure to fulfill assigned plans
3949-3143-11
Some criteria related to equitized SOEs are also being considered for revision. Photo: ST

Difficult to obtain target

The recent report by the Ministry of Finance said that the total revenue of corporations in 2020 is expected to reach VND1,327,496 billion. Profit before tax is expected to reach VND78,086 billion and arising amounts payable to the state budget is expected to reach VND157,273 billion. However, due to the impact of the Covid-19 pandemic, most of the state-owned economic groups and corporations may not meet the targets for 2020.

According to statistics for the whole period from 2016 to September 2020, there are 178 enterprises approved by competent authorities with their equitization plans with a total enterprise value of VND443,503 billion, of which the value of state capital isVND207,116 billion. However, out of which there are only 37 equitized enterprises under the plan, reaching 28%. The number of enterprises that still have to equitize according to the 3-month plan in the rest of 2020, is 91 enterprises.

With divestment, accumulated from 2016 to September 2020, the total divestment is VND25,669 billion, earning VND172,917 billion.

Of which, state capital divestment in 102 units according to the plan approved by the Prime Minister reached a value ofVND4,964 billion, earning VND9,643 billion. State capital divestment from non-listed businesses is VND3,785 billion, earning VND110,392 billion. State corporations and corporations withdrew VND16,919 billion, earning VND52,881 billion.

With the achieved results, it can be affirmed that the progress of equitization and divestment is still slow compared to the plan. The Prime Minister has issued Decision No. 26/2019 / QD-TTg approving the list of enterprises to be equitized until 2020 with 93 enterprises having to complete the enterprise value announcement.Three of 93 have been completed so far.

Enterprises implementing large-scale equitization such as Vietnam Posts and Telecommunications Group (VNPT), Vietnam Chemical Group, Vietnam Coal and Mineral Group, Northern Food Corporation, Vien Corporation through Mobifone, the Bank for Agriculture and Rural Development (Agribank) have not yet completed the approval of the land use plan to be able to conduct enterprise valuation. Divestment progress also only reached 26.4% of the plan.

Recently, the Prime Minister issued Decision No. 908 / QD-TTg dated June 29, 2020 approving the list of enterprises with state capital to withdraw capital until the end of 2020 with 124 enterprises having to complete the divestment; and 14 enterprises transferred to SCIC (State Capital Investment Corporation).

Facing this situation, the Ministry of Finance has proposed a series of solutions in the remaining months of the year, in which the most important is to continue to improve the institutional and legal framework. In the immediate future, it is to develop and submit to the Government for promulgation a Decree amending and supplementing a number of articles of Decree No. 126/2017 / ND-CP on the transformation of state enterprises and single-member limited liability companies with joint ventures. State-owned enterprises invest 100% of their charter capital into joint stock companies, Decree No. 91/2015 / ND-CP on state capital investment in enterprises and management and use of capital and assets in enterprises and Decree No. 32/2018 / ND-CP amending and supplementing a number of articles of Decree No. 91/2015 / ND-CP. This is considered the overall correction, expected to bring about many changes.

Adjust capital every year

One of the important contents that the Ministry of Finance pays attention to in the amendment and supplementation of the above documents is the regulations on charter capital, re-determination of capital, increase and decrease of charter capital, as well as the additional investment of the charter capital of SOEs.

According to the draft, the enterprise will develop and report to the owner's representative agency a plan to determine the charter capital and additional investment in charter capital (determined at least within three years). The owner's representative agency shall appraise and consult the finance agency of the same level to sum up and submit to the Prime Minister for consideration and decision on the plan to determine charter capital and additional investment sources for enterprises.

The draft also adds the content before December 31, 2020, based on the regulations on the determination of charter capital and additional investment in capital for operating SOEs.

SOEs must prepare a plan to determine charter capital and sources of investment capital for supplemental investment to report to the owner's representative agency for submission to the Prime Minister for consideration, decision and implementation of additional capital investment and adjustment of charter capital according to regulations.

A number of criteria related to equitized SOEs are also being considered for revision. Accordingly, regarding the valuation of the enterprise, the Ministry of Finance plans to complete the direction: if the enterprise has to re-conduct the valuation, suspend equitization or stop the implementation of equitization according to the decision of the competent authority, the representative agency of the owner will consider and decide to handle the equitization expenses (ensuring sufficient reasonable and valid documents) to account into the expenses production and business of enterprises and enterprises are not allowed to deduct when determining taxable income of enterprise income tax.

Regarding regulations related to the comparison of specific receivables and payables to a number of enterprises (state-owned commercial banks, Vietnam Posts and Telecommunications Group) in accordance with the nature and specificity of assets and liabilities of each of these subjects are feasible and do not affect the equitization progress, the Ministry of Finance proposes to supplement in the following direction: for receivables from customers using services, postpaid telecommunications, information technology and television (domestic and foreign) regularly arise with a large number of customers of equitized enterprises, but the comparison and confirmation of debt with each customer arising a large amount of work, time and expenses, the owner's representative agency decides the appropriate comparison and certification based on the accounting records and the information technology system of guest management in equitized enterprises.

By Hong Van/Bui Diep

Related News

Fast and effective in restructuring state-owned enterprises

Fast and effective in restructuring state-owned enterprises

VCN - The equitization and divestment situation at enterprises in the first half of 2024 progressed slowly, but state-owned enterprises (SOEs) are making efforts to implement restructuring plans, thereby helping to improve production and business efficiency.
Promoting reforms and supporting businesses to spread farther

Promoting reforms and supporting businesses to spread farther

VCN - According to Professor Dr. Hoang Van Cuong, a member of the National Assembly's Finance and Budget Committee and Vice Chairman of the State Council of Professors for the term 2024-2029, institutions play a very important role. Therefore, it is necessary to continue to promote reforms to create changes that support businesses in expanding their reach.
Cooperate to build leading and "rich in vitality" state-owned enterprises

Cooperate to build leading and "rich in vitality" state-owned enterprises

VCN - In Vietnam, the contribution ratio of state-owned enterprises (SOEs) to GDP is approximately 30% but their competitiveness is not commensurate with the resources they hold, and many SOEs operate ineffectively.
New solutions should be provided for equitization and restructuring of state-owned enterprises

New solutions should be provided for equitization and restructuring of state-owned enterprises

VCN – In the first two months of 2024, the equitization and divestment of state-owned enterprises is still delayed, so this work needs to be innovated to implement effectively in 2024.

Latest News

Continue to handle cross-ownership in banks

Continue to handle cross-ownership in banks

VCN - The situation of excess share ownership, cross-ownership between credit institutions (CIs), CIs and enterprises, although has decreased significantly compared to previous periods, is still complicated and requires continued inspection and control.
Striving for average CPI not to exceed 4%

Striving for average CPI not to exceed 4%

VCN - According to the report of the Ministry of Finance, there are still some factors that put pressure on price levels in the remaining months of 2024, so the Ministry has updated 2 scenarios of average inflation in 2024 increasing in the range of 3.7-3.92%.
Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

VCN - Discussing in groups about the project "1 law amending 7 laws" in the financial sector according to the program of the 8th Session on October 29, 2024, National Assembly delegates proposed that the Government should be assigned to make specific regulations on decentralization, granting the right to exempt and reduce taxes, and handling penalties for late payment of taxes...
Removing difficulties in public investment disbursement

Removing difficulties in public investment disbursement

VCN - According to the report of the Investment Department (Ministry of Finance), the estimated disbursement from the beginning of the year to October 31, 2024 is VND 355,616.1 billion, reaching 47.43% of the 2024 plan, reaching 52.29% of the plan assigned by the Prime Minister.

More News

State-owned commercial banking sector performs optimistic growth, but more capital in need

State-owned commercial banking sector performs optimistic growth, but more capital in need

VCN - According to the report sent to the National Assembly before the 8th Session of the Government on investment, management and use of state capital in enterprises nationwide in 2023, the business performance of the state-owned commercial banking sector achieved positive growth.
Stipulate implementation of centralized bilateral payments of the State Treasury at banks

Stipulate implementation of centralized bilateral payments of the State Treasury at banks

VCN - The Ministry of Finance (MOF) gathers feedback on the draft Circular regulating the management and use of accounts of the State Treasury opened at the State Bank of Vietnam (SBV) and commercial banks.
Rush to finalize draft decree on public asset restructuring

Rush to finalize draft decree on public asset restructuring

VCN - According to the Ministry of Finance, the draft Decree regulating the rearrangement and handling of public assets is being urgently completed by the Ministry of Finance to submit to the Government for promulgation.
Inspection report on gold trading activities being complied: SBV

Inspection report on gold trading activities being complied: SBV

The State Bank of Vietnam (SBV) has announced that inspections on compliance with legal policies in gold trading activities of credit institutions and gold trading businesses have been completed and an inspection report is being compiled.
Budget revenue in 2024 is estimated to exceed the estimate by 10.1%

Budget revenue in 2024 is estimated to exceed the estimate by 10.1%

VCN -The Government estimates that state budget revenue in 2024 will exceed VND 172.3 trillion, up 10.1% over the estimate, of which tax and fee revenue will reach 13.1% of GDP.
Ensure timely and effective management and use of public asset

Ensure timely and effective management and use of public asset

VCN – In order to promptly and effectively implement public asset management and use, ensuring compliance with legal regulations, the Ministry of Finance has just issued an official dispatch requesting ministries, branches and localities to comply with regulations in the Government’s Decree No. 114/2024/ND-CP dated September 15, 2024.
Accelerating decentralization in public asset management

Accelerating decentralization in public asset management

VCN - Amending the Law on Management and Use of Public Assets aims to improve regulations on accelerating decentralization and improving efficiency in management and use of public assets, and promoting financial resources, ensuring that the unified application the Law on Management and Use of Public Assets and other legal documents.
Difficulty in finding banks eligible to receive compulsory transfers

Difficulty in finding banks eligible to receive compulsory transfers

VCN - Reporting to the National Assembly, the State Bank of Vietnam (SBV) said that one of the difficulties in restructuring the credit institution system is the long process of finding and negotiating banks eligible to receive compulsory transfers.
Businesses can choose a suitable electronic invoice model generated from the cash register

Businesses can choose a suitable electronic invoice model generated from the cash register

VCN - The Ministry of Finance said that individual business households can choose a suitable model to apply electronic invoice solutions from cash registers, depending on the number of invoices used in the year, in the month and the current status of software solutions and technical infrastructure.
Read More

Your care

Latest Most read
Continue to handle cross-ownership in banks

Continue to handle cross-ownership in banks

VCN - The situation of excess share ownership, cross-ownership between credit institutions (CIs), CIs and enterprises, although has decreased significantly compared to previous periods, is still complicated and requires continued inspection and control.
Striving for average CPI not to exceed 4%

Striving for average CPI not to exceed 4%

VCN - According to the report of the Ministry of Finance, there are still some factors that put pressure on price levels in the remaining months of 2024, so the Ministry has updated 2 scenarios of average inflation in 2024 increasing in the range of 3.7-3
Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

National Assembly delegates proposed that the Government should be assigned to make specific regulations on decentralization, granting the right to exempt and reduce taxes, and handling penalties for late payment of taxes...
Removing difficulties in public investment disbursement

Removing difficulties in public investment disbursement

VCN - According to the report of the Investment Department (Ministry of Finance), the estimated disbursement from the beginning of the year to October 31, 2024 is VND 355,616.1 billion, reaching 47.43% of the 2024 plan, reaching 52.29% of the plan assigne
State-owned commercial banking sector performs optimistic growth, but more capital in need

State-owned commercial banking sector performs optimistic growth, but more capital in need

According to the report of the Government on investment, management and use of state capital in enterprises nationwide in 2023, the business performance of the state-owned commercial banking sector achieved positive growth.
Mobile Version