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Investment Restrictions of State – owned Enterprises in Vietnam

The new law of Vietnam has been promulgated that restrict the investment of state-owned enterprise in its non-core business areas.  According to Decree 71/2013/ND-CP dated July 11th, 2013, state-owned enterprises are not allowed to make capital contribution or investment in real estate sector (excluding the business with business line in the real estate sector), in banks, insurance companies, securities firms, venture capital funds, securities investment fund or investment company securities, except in special cases as decided by the Prime Minister.

In addition, state-owned enterprises are not allowed to make capital contribution and share purchase in enterprises managed by or owned by the relatives of the Chairman, members of the Board members, CEO, Director of the respective state-owned enterprises.

This regulation will be effective from Sep 1st, 2013.

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