Revise Law to promote autonomy, and self-determination of the state-owned enterprises

	Fast and effective in restructuring state-owned enterprises
	Reviewing policies when state-owned enterprises are not profitable

The seminar on the draft Law on Management and Investment of State Capital in Enterprises.

At the seminar on the draft Law on Management and Investment of State Capital in Enterprises to replace the Law on Management and Use of State Capital Investment in Production and Business at Enterprises (Law No. 69/ 2014/QH13) held on August 22, 2024, Mr. Duong Manh Son, Deputy General Director of Vietnam Oil and Gas Group (PVN), said that PVN is a large economic corporation, so the amendment to the Law will certainly have impacts on all operations of the parent company and its member companies.

According to Mr. Son, the completion of regulations on State capital management in enterprises will ensure the effectiveness of state capital management and investment in enterprises, create the most favorable conditions for state-owned enterprises to avoid problems due to administrative procedures.

Furthermore, citing a recent event that the US Department of Commerce has not recognized Vietnam as a country with a market economy, Mr. Duong Manh Son said one of the reasons for not being recognized is the Government's impact on the business activities of state-owned enterprises, with concerns about inequality between state-owned enterprises and other types of businesses.

Mr. Cao Hoai Duong, Chairman of the Board of Directors of Vietnam Oil Corporation (PVOIL) said that state-owned enterprises are heavily imposed many regulations by management agencies. PVOIL currently has more than 80% of PVN's capital as a joint stock company listed on the stock exchange, so it not only must comply with the provisions of Law No. 69 but also must comply with the Enterprise Law and internal regulations company and resolutions of the general meeting of directors.

Duong said that in 2022 there was a crisis in supply and gasoline prices due to market fluctuations after the conflict between Russia and Ukraine, import surcharge prices increased while domestic gasoline prices were not adjusted in time. This situation led to the lack of the supply and gas stations had to close, so the Government directed PVOIL to promote its political mission and open gas stations, leading to a tripling of sales volume, but the more it sold, the more it loss.

Therefore, Duong said that state-owned enterprises are not favored, and even have many losses compared to many private enterprises who have the right to self-determination. When private enterprises see profits, they will sell products, and they will stop when they see the loss, and enjoy more open business regulations.

The leader of PVOIL and PVN said that the draft Law on Management and Investment of State Capital in Enterprises needs to improve and clarify the content, to create equal treatment between the enterprises. Son also said that regulations should aim to assign state-owned enterprises to perform the task of preserving state capital in business operations, but needs to specify the appropriate regulations for enterprises when they face the loss in the current market having fluctuations.

The representative of Vietnam Gas Corporation proposed that the regulations in the draft Law need to ensure consistency with other laws such as the Enterprise Law, Securities Law, Investment Law, and Bidding Law as well as ensure equality with other businesses and promote autonomy and self-responsibility for businesses, thereby improving business efficiency for businesses.

Mr. Tran Thai Bao, Deputy General Director of Binh Son Refining and Petrochemical Joint Stock Company (BSR) also expressed his agreement with goal of the draft Law that the State is the owner of capital investment, but does not interfere the business and management activities of the enterprise, thereby, promoting decentralization of power but must have a strict management mechanism to avoid loss of State assets.

Regarding the distribution of after-tax profits, the BSR representative proposed that the distribution of profits should be decided by the business to comply with the provisions of the Enterprise Law. Meanwhile, Vietnam Gas Corporation proposed to remain the current regulations in Decree No. 53/2016/ND-CP.

Regarding investment decentralization of enterprises at level 2, the draft stipulates that investment activities such as investment approval power, investment policies... must be reported and consulted with the ownership agency, but the BSR representative said that these contents should be assigned to enterprises to decide in accordance with the Enterprise Law, charter and internal management regulations of the enterprises.

Mr. Doan Thanh Tuan, Deputy Director of the Department of Corporate Finance (Ministry of Finance) said that the Ministry of Finance and the drafting committee will complete the draft Law to report the Government and the National Assembly, which will facilitate the business operation of the State-owned enterprises.