Important innovation in the draft Law on Management and Investment of State Capital at Enterprises

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Discussion on the draft Law on Management and Investment of State Capital at Enterprises.

Speaking at the discussion on the draft Law on Management and Investment of State Capital at Enterprises on July 10, Ms. Nguyen Thu Thuy, Deputy Director of the Department of Enterprise Finance (Ministry of Finance) said, according to the program To develop laws and ordinances in 2024 that have been approved by the National Assembly, the Ministry of Finance has established a Drafting Committee and an Editorial Team to develop the Law as well as organize consultations with ministries, departments, branches, businesses and relevant organizations, etc so that the draft Law is approved at the 9th Session (May 2025) and takes effect from January 1, 2026.

One of the most concerning issues is the subject of application. The Ministry of Finance proposed to submit to the Government for decision under the direction of determining the subjects of regulation in the draft Law as enterprises with state capital investment, including: enterprises with direct state capital investment and "other enterprises with state capital investment which is an enterprise with investment capital from an enterprise with direct state capital investment”.

According to assessments, this regulation aims to ensure the principle of management according to investment capital flows, the state actually plays the role of capital owner, capital investor, equality in rights, obligations and responsibilities with other investors in the enterprise, that does not expand the scope of management subjects compared to the present.

Sharing more, expert Dr. Pham Phan Dung commented that the basic innovation when amending the law this time is that the State does not manage corporate legal entities but only manages investment capital flows into enterprises. This shows a clear division of duties and strong decentralization when the State only manages capital flows, enterprises with direct state investment are responsible for managing capital for other state-invested enterprises. Specifically, the State only manages the capital flow of enterprise F1, from enterprise F2 onwards, F1 will manage, F2 will manage F3, etc.

In addition, commenting on the draft Law, the representative of the Committee for Management of State Capital at Enterprises said that regulations need to be more decentralized to the owner's representative agencies and the Board of Members, executive board, etc to reduce the problem that must be submitted to the Government and Prime Minister.

On the side of state-owned enterprises, representatives of leaders of state-owned enterprises all assessed that this is a very important Law and has a great impact on investment, production and business activities, etc.

According to Mr. To Dung Thai, Chairman of the Board of Directors of Vietnam Posts and Telecommunications Group (VNPT), as a 100% state-owned enterprise, he is very interested in the law-making stage because he is a direct beneficiary. Mr. Thai emphasized that this is also a difficult Law to construct, so it is necessary to create convenience and certainty for the regulations, helping implementers to make it simpler and more convenient.

VNPT Chairman gave an example: VNPT is submitting a restructuring project that includes merging two businesses that are 100% VNPT's capital but are accounted independently. However, because there is no law providing specific guidance on state capital flows and business capital flows, it has not yet been passed.

Also regarding law development, Mr. Nguyen Hong Hien, Chairman of the Board of Directors of MobiFone Telecommunications Corporation, acknowledged that state-owned enterprises have many intersecting activities, so the law needs to design principles to have coordination between specialized management agencies and capital management agencies. Furthermore, in developing the Law, the Drafting Committee needs to strengthen regulations related to decentralization associated with supervision responsibilities, to avoid the story of "untying one string but tying another", this regulation waits for another regulation, etc.

MobiFone leaders also stated that legal documents often have interference and overlap, leading to the replacement of laws on management and investment of state capital in enterprises towards stronger decentralization but other specialized laws "tie up" the operations of the enterprise. In addition, this leader also proposed the need to regulate the assessment and classification of state-owned enterprises in an overall manner, from revenue, profit to public benefit activities.

Along with the above issues, representatives of some businesses that are subsidiaries of state-owned enterprises proposed to have more open regulations for independent accounting units in terms of ensuring capital safety, along with regulations to facilitate staff work, salary and income regimes, etc.