LEGAL UPDATES VOL 8, JULY 2021

LEGAL UPDATES
VOL 08, JULY 2021

Dear Valued Customers and Partners,

ADK Lawyers Law Firm would like to introduce to you the Legal Updates, Vol 08 July 2021 with new legal provisions, which have notable contents as follows:

1. The criteria for classifying the wholly State-owned enterprises (SEs), partially State-owned enterprises (SOEs) undergoing restructuring in 2021-2025 under Decision 22/2021/QĐ-TTg.

0n July 02, 2021, Prime Minister promulgated the Decision 22/2021/QĐ-TTg stipulating the criteria for classifying SEs, SOEs making a transition ownership, rearrangement, divestment in the period of 2021 – 2025, stipulating the criteria for classifying SOEs, SOEs conducting ownership conversion, rearrangement, divestment during the period. 2021-2025. The decision shall take force from August 19, 2021, replacing Decision No. 58/2016/QD-TTg dated December 28, 2016 of the Prime Minister on criteria for classification of SOEs.

Under the decision, the State shall hold 100% of charter capital in SOEs operating in 13 fields and sectors including mapping services for national defense and security, manufacture and sale of industrial explosives, electricity transmission, national electricity system dispatching, management of electrical grids, construction and operation of major power plants, and national defense and security, lottery business, printing and manufacture of notes and gold bullion and golden souvenir, credits in service of socio-economic development, deposit insurance, bad debt settlement associated with restructuring the system of credit institutions among others.

The State shall hold 65 percent of charter capital in SOEs undergoing privatization and restructuring and operating in seven fields and sectors, including management and operation of airports and airfields, large-scale mining exploitation, finance, banking (excluding insurance, securities, fund management companies, finance companies and financial leasing companies).

The State shall hold between 55 percent and 65 percent of charter capital in SOEs undergoing privatization and restructuring and operating in seven fields and sectors namely exploitation, production, and supply of clean water and drainage in urban and rural areas, manufacture of basic chemicals, air transportation and others.

In the case the enterprises do not adapt the criteria for above-mentioned classification, they can use one of the following criteria to make the transition of ownership, rearrangement, divestment:

(i) Cement manufacturing enterprises holds a market share of 30% or more, including exploitation of raw material mines in areas important to national security and defense;

(ii) Rubber or coffee planting or processing enterprises in strategic areas; mountainous areas; deep areas; remote areas associated with national defense and security;

(iii) Public-utility enterprises products have the ratio of revenue from public activities to the total revenue of enterprise for 03 consecutive years before the time of considering conversion to reach 50% or more;

(iv) Enterprises with cultural values; historical value; architectural value; play an important role in national defense and security; carry out political tasks or socio-economic development of branches and localities in each period.

Without adaptation of the above-mentioned criteria, the SEs, SOEs, in this case, will make the transition of the ownership, rearrangement, divestment in non-Stated-owned form of holding shares, capitals.

Within 30 days from the effective date of this Decision, the agency representing the owner is responsible for reviewing, developing and submitting the Business Reorganization Plan for the 2021-2025 period to the Ministry of Planning and Investment for synthesis as prescribed.

Assigning to the Board of Members, the President of the parent company, the representative of the State capital share in the parent company-subsidiary model: the Board of members, the President of the company of the enterprise 100% owned by the State charter capital to develop a scheme on restructuring a State-owned enterprise, including the arrangement of enterprises with contributed capital of the parent company, and submit it to competent authorities for approval as prescribed.

2. Procedures for receiving support for groups of employees affected by COVID-19 in Resolution No.68/NQ-CP dated July 1, 2021

The Prime Minister has just issued Decision No.23/2021/QD-TTg stipulating the implementation of some policies to support employees facing difficulties due to the COVID-19 pandemic.

(i) The employees suspend the performance

of the labour contract, take unpaid leave or stop working

(ii) The employees terminate the labour contract but is not

eligible for unemployment benefits

(iii) The employees who are tour guides