Under the decree, the parent company in a State economic group must have the minimum charter capital of VND10 trillion (US$470 million) and have at least 50% of their subsidiaries operating in key stages of their main businesses.
The decree stipulated that subsidiaries are not allowed to buy shares of other subsidiaries within a parent company, as well as the company having control over the State-run economic groups and corporations to which they belong.
State economic groups and corporations are also required to disclose key information related to their operations on a website for enterprises run by the Ministry of Planning Investment.
The issuance of the decree is part of the Government’s effort to restructure State-run companies which, along with bad debt, have slowing down Vietnam’s economic growth in recent years.
In 2013, the Government equitised 74 SOEs but most of them were small companies and only a small share of equitised assets has been transferred to non-State shareholders, according to a World Bank report.
Vietnam has set a target to equitise more than 400 State firms over the next two years.
