The government has passed decree 32/2018/ND-CP amending decree 91/2015/ND-CP. The decree regulates investment of State capital in enterprises; financial management of State owned enterprises [SOEs] and management of State capital invested in shareholding companies and in multiple member limited liability companies.

The decree applies to SOEs and representatives of a person being the representative of the State capital portion invested in the shareholding company or multiple member LLC, or other agencies or individuals actively involved in managing capital and investment with SOEs.

Chapter 2, Sections 1 to 3 of the decree sets out the industrial / business sector priorities and objectives for state investment, critieria and process for additional investment in existing SOEs, and the scope of additional investment in state capital in SOEs.

Chapter 2, Section 4 sets out the scope of investment of State capital in order to acquire a part of or an entire enterprise, principles and process for investing in state capital for part of an enterprise.

The decree also provides for the

1. Management and use of capital and assets in SOEs, including

(i) chapter capital

(ii) capital mobilisation

(iii) outward capital investment

(iv) preservation of capital

(v) investing in fixed assets

(vi) renting or hiring operating assets

(vii) leasing out,

(viii) mortgaging or pledging assets, and

(x) liquidation and transferring out of assets,

2. Management of capital of SOEs Invested in Shareholding Companies and Limited Liability Companies, and

3. Management of State Capital Invested in Shareholding Companies and Multiple Member Limited Liability Companies.

The amended decree seeks to improve compliance with relevant laws, information transparency, and pricing regarding the transfer of capital, specifically the transfer of state capital / capital of SOEs in other enterprises.

The amended decree addresses the situation where foreign investors buy shares or inject capital contributions and where the representative body of the owner / SOEs transfer capital must ensure the ownership ratio capital actually contributed to the charter capital of an enterprise with shareholding or capital contribution is in accordance with the law.

The amended decree provides for the determination of a reserve price when transferring capital which shall be effected through enterprises having a price appraising function, ensuring full price determination. The actual value of state capital invested in other enterprises includes the value created by the land use right, the land use right paid in a lump sum payment for the whole lease term, the right to use land lawfully transferred under the provisions of land law and the value of intellectual property rights (if any) of other enterprises according to the provisions of law at the time of capital transfer.