On 4 November 2009, the Prime Minister issued Official Letter No. 2104/TTg-DMDN regarding re-arrangement and equitisation of State enterprises belonging to the Ministry of Industry and Trade for the 2009-2010 stage ("Letter 2104").

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Pursuant to the 2005 Enterprise Law, no later than 1 July 2010 a State enterprise established under the 2003 Law on State Enterprises must be converted into a limited liability company or shareholding company. Conversion of such State enterprises is implemented in accordance with the annual schedule of conversion.

In Letter 2104, the Prime Minister agrees with the Ministry of Industry and Trade's plan of re-arrangement and equitisation of the Ministry's sixteen State enterprises as follows:

Enterprises to be equitised:

  1. Electrical Equipment Corporation
  2. Vietnam Industrial Construction Corporation
  3. Vietnam Vegetable Oils Industry Corporation
  4. Electric Appliances and Technology Company
  5. Foreign Trade Forwarding and Warehousing Company
  6. Company for Distribution of Electric Apparatuses, Bicycles and Motorcycles
  7. Complete Equipment and Technics Import-Export Company
  8. Construction and Building Materials Company V
  9. Trade Promotion and Tourist Company
  10. Building Materials and Construction Company BMC
  11. Agricultural Products Company II
  12. Forest Products and Building Materials Company

Enterprises to be converted into ones operating in the form of the parent company-subsidiary:

  1. Machines and Industrial Equipment Corporation
  2. Vietnam Engine & Agricultural Machinery Corporation

Enterprises to be converted into one-member limited liability companies with 100% charter capital held by the State:

  1. Foodstuff and Technology Investment Company
  2. Hai Phong Electric Apparatuses Company

Pursuant to Decree No. 109/2007/ND-CP on conversion of enterprises with 100% State capital into shareholding companies ("Decree 109"), to be equitised, an enterprise with 100% State capital must satisfy the two following conditions:

(a) being not an enterprise where the State needs to hold 100% charter capita; and

(b) still having State capital after financial matters are settled and its value re-assessed.

Of interest, domestic and foreign investors may purchase shares of these enterprises upon their equitisation.

Decree 109 provides that a foreign investor wishing to purchase shares must open a deposit account at a payment service-providing organisation operating in Vietnam. All activities of purchasing and selling shares, receiving and using dividends or other share-related revenues and expenses must be conducted via this account.

For inquiries related to this Client Alert, please contact:

Dao Nguyen (

Thinh Dan (

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