Directive No. 05/2007/CT-BXD on continuing to improve the quality of work in the reorganization, reform, and development of state-owned enterprises under the Ministry of Construction for the period 2007-2010

DIRECTIVE

Regarding further improving the quality of work on restructuring, reforming, and developing state-owned enterprises under the Ministry of Construction for the period of 2007-2010

state-owned enterprise under the Ministry of Construction for the period from 2007 to 2010

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Implementing Resolution No. 3 and No. 9 of the Central Committee of the Communist Party of Vietnam, Term IX; implementing tasks assigned by the Prime Minister through Decisions No. 235/QĐ-TTg dated February 28, 2003, and No. 102/2005/QĐ-TTg dated May 12, 2005, approving the overall plan for restructuring and reforming state-owned enterprises under the Ministry of Construction for the period of 2003-2005, during the two years 2005 and 2006; up to now, all State-owned Joint Stock Corporations and independent companies directly under the Ministry have completed equitization and implemented other restructuring solutions for most independent accounting units and many dependent units; all State-owned Joint Stock Corporations and independent companies under the Ministry have shifted to operate according to the holding company-subsidiary model; holding companies after conversion will be equitized according to the approved roadmap by the Prime Minister.

To ensure the completion of the plan and continue to improve the quality and effectiveness of restructuring and reforming state-owned enterprises under the Ministry for the period of 2007-2010; implementing the Prime Minister's directive at document No. 1447/VPCP-ĐMDN dated March 20, 2007, regarding restructuring and reforming state-owned enterprises under the Ministry of Construction for the period of 2007-2010, the Minister of Construction requests: Chairmen of the Board of Directors, General Directors of State-owned Joint Stock Corporations-holding companies directly under the Ministry to promptly organize and implement the following contents of work:

1. Continue to improve the organizational structure and operation quality of State-owned Joint Stock Corporations (Companies) according to the holding company-subcompany model

1.1. Organize the thorough implementation of the provisions of the Charter on organization and operation of State-owned Joint Stock Corporations according to the holding company-subcompany model which has been approved by the Minister of Construction, particularly the provisions on the relationship between State-owned Joint Stock Corporations and subcompanies, establish and issue Financial Management Regulations of State-owned Joint Stock Corporations and organize their implementation.

1.2. Improve the number and quality of members of the Board of Directors of State-owned Joint Stock Corporations, ensuring clear division of responsibilities, clarifying the rights and responsibilities of each member of the Board of Directors.

1.3. Develop and report to the Ministry plans for selling off or selling out shares of State-owned Joint Stock Corporations in units that have been equitized but are deemed unnecessary to hold shares or controlling shares; contribute capital to establish new joint stock companies in fields that need development in order to achieve a reasonable investment structure in other enterprises, reduce the number of small-scale enterprises operating in the same industry, profession, and area. The reduction in the proportion of State-owned shares may be carried out through maintaining the State-owned shares and increasing the registered capital of joint stock companies.

1.4. Review and adjust the list of officials appointed as representatives of State-owned shares in other enterprises; develop and issue Regulations on the activities of representatives, specifying the specific rights, responsibilities, obligations, and relationships of these officials with the enterprises they represent, with the Board of Directors, General Director, and functional departments of State-owned Joint Stock Corporations.

1.5. Organize monitoring and grasping the operational situation of equitized enterprises, promptly identifying abnormal developments to take appropriate measures.

1.6. Develop and implement solutions to financial health of enterprises, classify and handle bad debts, flexibly mobilize and use funds for production-business and development investment.

1.7. Develop and implement training plans, retraining, and enhancing knowledge about market economy, business management, and commitments when Vietnam joins the WTO related to enterprise operations for the management cadre; build a workforce of highly skilled technical workers to proactively meet the requirements of production-business of State-owned Joint Stock Corporations.

2. Accelerate equitization of holding companies converted from State-owned Joint Stock Corporations under the Ministry

The equitization plan of holding companies converted from State-owned Joint Stock Corporations under the Ministry has been approved by the Prime Minister through Decision No. 1729/QĐ-TTg dated December 29, 2006. Under conditions where some policies related to equitization have changed and the nature and characteristics of each unit are different, the implementation of equitization steps must be carefully studied and conducted cautiously, especially the stage of determining enterprise value, determining the capital structure, auctioning shares...

2.1. For 05 holding companies (including 04 State-owned Joint Stock Corporations and 01 independent company) that have received decisions on equitization in 2007, the implementation of the equitization process should be promptly initiated at the beginning of the year. Units develop specific roadmaps, clearly defining key time points: submitting to the Ministry for approval of enterprise value, submitting to the Ministry for review to submit to the Prime Minister for approval of the equitization plan, ensuring completion of equitization according to the schedule.

2.2. For holding companies (State-owned Joint Stock Corporations) to be equitized in the years 2008-2010, while continuing to improve organizational structures and operations according to the contents mentioned in Section 1 above, necessary conditions must be prepared to be ready to implement equitization or apply other restructuring methods as soon as possible according to the Prime Minister's directives.

3. Study and develop orientations for the development of State-owned Joint Stock Corporations towards strengthening the concentration of resources, forming strong economic organizations with diversified ownership, including State-owned shares playing a dominant role; engaging in multi-industry operations, including core industries in the national development strategy; having modern technology, management, and high specialization levels; possessing sufficient competitive capabilities and effectively integrating into the international economy; serving as the backbone in building material and technical foundations for the country's industrialization and modernization efforts:

3.1. Analyze, review, accurately, honestly, and objectively assess the current status of the unit regarding organizational structure, personnel, finance, capacity, and business production efficiency - operations, development potential to meet requirements during the period from 2007 to 2010.

3.2. Based on analyzing market factors and the current status of the unit, organize the formulation of development orientations and determine solutions related to organization, capital, technology, market... to implement these development orientations.

3.3. Study the current legal provisions related to the formation and organizational methods, operational mechanisms of strong economic organizations (Economic Groups) to propose reform plans for the organizational structure of the unit, in compliance with legal regulations and consistent with the development orientation of the unit during the period from 2007 to 2010.

3.4. The Board of Directors of the Vietnam Thuong Son Corporation and the Vietnam Construction Machinery Corporation shall cooperate with the Enterprise Reform and Development Committee of the Ministry to urgently direct the drafting and completion of the proposal for the formation of Economic Groups, reporting to the Ministry in the second quarter of 2007; the Enterprise Reform and Development Committee of the Ministry of Construction shall organize research on the formation of a Housing and Urban Development Group to dominate the real estate market, submitting to the Prime Minister according to the directive of the Prime Minister in Document No. 1447/VPCP-ĐMDN dated March 20, 2007.

With the above tasks, the Boards of Directors and General Managers of the Corporations (Parent Companies) shall develop specific and detailed plans down to each task, reporting to the Ministry before April 20, 2007.

Assign the Enterprise Reform and Development Committee of the Ministry of Construction, the Departments of Personnel and Organization, Economics and Finance, Planning and Statistics, and Installation Works to monitor, urge, and guide units in organizing implementation according to their functions and responsibilities; regularly compile reports every quarter to the Ministry's leadership on the results of implementation by the units.

The Chairmen of the Boards of Directors and General Managers of the Corporations, Parent Companies within the Parent Company - Subsidiary Company model, and the Heads of Units under the Ministry are responsible for strictly implementing this Directive.