Decree No. 104/2010/ND-CP On the organization, management, and operation of a single-member limited liability company directly owned by the State serving national defense and security.

DECREE

Regarding the organization, management, and operation of a single-member limited liability company established by the State as the direct owner to serve national defense and security

Decree on the organization, management, and operation of a single-member limited liability company established by the State as the direct owner to serve national defense and security

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THE GOVERNMENT

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Pursuant to the Enterprise Law dated November 29, 2005;

The Prime Minister issues this Decision on principles, criteria, and allocation standards for state budget investment capital development phase 2016-2020.

DECREE:

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Decree stipulates the establishment, organization, management, and operation of a single-member limited liability company established by the State as the direct owner to serve national defense and security.

Article 2. Applicability

This Decree applies to single-member limited liability companies established by the State as the direct owner to serve national defense and security as provided for in Article 3 of this Decree; organizations and individuals related to the establishment, organization, management, operation, and inspection and supervision of single-member limited liability companies established by the State as the direct owner to serve national defense and security.

Article 3. Single-member limited liability company established by the State as the direct owner to serve national defense and security

1. A single-member limited liability company established by the State as the direct owner to serve national defense and security (hereinafter referred to as the enterprise directly serving national defense and security) is a company held 100% by the State's subscribed capital, established or reorganized under the form of a single-member limited liability company operating according to the Enterprise Law to directly perform tasks with stability and regularity in areas and regions directly serving national defense and security related to ensuring state secrets, enhancing national defense and security capabilities.

2. Criteria for determining enterprises directly serving national defense and security:

a) Established or reorganized according to the provisions of the law by a competent state agency, held 100% by the State's subscribed capital, operating under the form of a single-member limited liability company;

b) Ordered by the State to produce and supply products and services regularly and directly serving national defense and security, or assigned to perform tasks in national defense and security as specified in the Appendix on the List of Products, Services, and Tasks Directly Serving National Defense and Security issued together with this Decree.

Article 4. Rights and obligations of enterprises directly serving national defense and security

In addition to the rights and obligations of enterprises producing and supplying public goods as stipulated in Article 10 of the Enterprise Law and relevant laws, enterprises directly serving national defense and security have the following rights and obligations:

1. To be invested by the State with sufficient subscribed capital to serve the goal of directly serving national defense and security activities.

2. To use allocated resources to conduct supplementary business operations or invest and contribute capital to other enterprises for business outside the production and supply plan of products and services directly serving national defense and security or performing assigned national defense and security tasks when:

a) The enterprise owner permits in writing;

b) Supplementary business operations aim to support national defense and security tasks or to utilize capacity and efficiency of assets after completing the production and supply of products and services directly serving national defense and security or performing assigned national defense and security tasks;

c) Does not reduce capacity and does not affect the production and supply of products and services directly serving national defense and security or performing assigned national defense and security tasks;

d) If the enterprise registers additional business operations, such operations must be technologically similar, serving or derived from established business operations based on the purpose of establishment and development strategy of the enterprise;

đ) To account separately for supplementary business operations in accordance with the law;

e) To fulfill tax obligations as prescribed by law.

3. The transfer, lease, or mortgage of assets serving the goal of directly serving national defense and security activities managed by the enterprise shall be carried out upon permission by the agency exercising the rights and obligations of the owner. The mortgage of land use rights and assets of the enterprise attached to land use rights serving the goal of directly serving national defense and security activities shall be carried out in accordance with the law on land.

4. To manage allocated resources to perform national defense and security tasks in accordance with relevant laws.

5. To comply with the decision of the owner regarding the reallocation of part of the capital or assets serving the goal of directly serving national defense and security activities of the enterprise to perform national defense and security tasks at another enterprise if necessary.

6. All joint ventures with foreign organizations or individuals for the production, provision of products, services, or tasks directly serving national defense and security shall be carried out in accordance with regulations on international cooperation by the Ministry of National Defense, the Ministry of Public Security, and the Ministry of Home Affairs.

Chapter II

ESTABLISHMENT, ORGANIZATION, MANAGEMENT AND OPERATIONS OF ENTERPRISES DIRECTLY SERVING NATIONAL DEFENSE AND SECURITY

Article 5. Establishment of new enterprises directly serving national defense and security

1. The Minister of National Defense, the Minister of Public Security, and the Minister of Interior Affairs shall propose the establishment of new enterprises directly serving national defense and security. Based on development needs and criteria for enterprises directly serving national defense and security as stipulated in Clause 2, Article 3 of this Decree, the proposer shall develop a proposal for establishing a new enterprise to be submitted to the Prime Minister for consideration and approval after obtaining the opinions of the Ministry of Planning and Investment and the Ministry of Finance.

The Prime Minister decides to establish new enterprises directly serving national defense and security that have particularly important positions and roles.

The Minister of National Defense, the Minister of Public Security, and the Minister of Interior Affairs decide to establish new enterprises directly serving national defense and security after the Prime Minister approves the proposal for establishing a new enterprise.

2. The dossier for proposing the establishment of new enterprises directly serving national defense and security includes:

a) A request for establishing the enterprise;

b) The proposal for establishing a new enterprise as specified in Clause 3 of this Article;

c) Draft Articles of Organization and Operation of the enterprise.

3. The proposal for establishing a new enterprise directly serving national defense and security shall include the following main contents:

a) The necessity of establishing the enterprise; the ability to meet the conditions and criteria for enterprises directly serving national defense and security as stipulated in Article 3 of this Decree; the enterprise's goals and development orientation over the next five years;

b) List of products, services, or tasks directly serving national defense and security produced, supplied, or carried out by the enterprise; other business sectors (if any); market situation, demand, and market prospects for each type of product or service provided by the enterprise; the enterprise's sales capacity for its products and services;

c) Proposed name of the enterprise;

d) Location of the enterprise's headquarters and land area used;

đ) Ability to utilize labor resources; ability to supply products, services, raw materials, materials, energy, and other necessary conditions for the enterprise's operation after establishment;

e) Registered capital scale; projected total investment capital; initial state investment capital; sources and methods of raising the remaining capital (if any); working capital requirements and measures for the enterprise;

g) Compatibility of the enterprise's establishment with industry and sector development plans and economic region strategies;

h) Projected organizational management model and duration of operation;

i) For enterprises requiring investment construction at the time of establishment, the proposal for establishing a new enterprise must also include a new investment project. The content of the investment project related to the establishment of a new enterprise directly serving national defense and security shall comply with laws on investment in the field of national defense and security.

4. The Articles of Organization of enterprises directly serving national defense and security shall be implemented in accordance with the Law on Enterprises, this Decree, and other relevant legal documents.

Article 6. Business Registration

1. Enterprises directly serving national defense and security shall be registered to operate under the form of a limited liability company with one member.

2. The documents, procedures, and formalities for registering new establishment and changing business registration content of enterprises directly serving national defense and security shall be carried out in accordance with the Enterprise Law and guiding documents.

For new establishment documents, the enterprise must submit a copy of the Decision on establishing the enterprise issued by the competent authority.

3. Enterprises directly serving national defense and security may register their business sectors and activities in accordance with the provisions of the law and the Prime Minister's decision regarding special sectors and activities related to national defense and security.

4. In cases where necessary, enterprises directly serving national defense and security may register to change their charter capital after transferring state assets serving national defense and security tasks to other units according to the decision of the owner.

Enterprises directly serving national defense and security that register to reduce their charter capital must commit to ensuring full payment of debts and other property obligations after the reduction. The owner shall jointly bear responsibility for the debts and other property obligations of the enterprise in cases where part of the capital or assets serving the direct service of national defense and security is transferred.

The procedures for registering to change the charter capital shall be implemented in accordance with Decree No. 43/2010/NĐ-CP dated April 15, 2010, of the Government on business registration.

Article 7. Recognition and Re-recognition of Enterprises Directly Serving National Defense and Security

1. Every three years, the Ministry of National Defense, the Ministry of Public Security, and the Ministry of Home Affairs shall review and compare the operations of wholly state-owned enterprises under their management with the provisions of Clause 2, Article 3 of this Decree to consider recognizing such enterprises as those directly serving national defense and security.

2. The Minister of National Defense, the Minister of Public Security, and the Minister of Home Affairs shall decide on recognition and re-recognition of enterprises directly serving national defense and security after obtaining opinions from the Ministry of Planning and Investment and the Ministry of Finance.

Specifically, for limited liability companies with one member owned by the State that have been recognized as key defense industries according to the criteria stipulated in Article 3 of Decree No. 46/2009/NĐ-CP dated May 13, 2009, of the Government detailing and guiding the implementation of certain provisions of the Defense Industry Ordinance, the Ministers of National Defense, Public Security, and Home Affairs shall consider and decide to recognize them as enterprises directly serving national defense and security in accordance with this Decree.

The Ministry of National Defense, the Ministry of Public Security, and the Ministry of Home Affairs shall report to the Prime Minister and notify the Ministry of Planning and Investment and the Ministry of Finance the list of enterprises recognized as enterprises directly serving national defense and security under their management.

3. The main bases for recognizing and re-recognizing enterprises directly serving national defense and security include:

a) The list of products, services, and direct national defense and security tasks performed by the enterprise within the last three years up to the time of consideration;

b) A report on the production and supply situation of products, services, or direct national defense and security tasks ordered or planned by the State within the last three years up to the time of consideration;

c) The current status of the enterprise's operations; the enterprise's development goals and plans for the next three years;

d) Other explanations regarding issues related to the recognition of enterprises directly serving national defense and security.

Article 8. Management organizational structure of enterprises directly serving national defense and security

1. Based on scale and specific characteristics of operations, the owner of enterprises directly serving national defense and security decides to apply management organizational structures according to the model of Board of Members, General Director (Director), Supervisor or the model of Chairman of the Company, General Director (Director), Supervisor.

For enterprises directly serving national defense and security operating in special industries and fields, the management organizational structure of the enterprise shall be decided by the Prime Minister.

2. The Chairman of the Board of Members or the Chairman of the Company may concurrently hold the position of General Director (Director). In cases where the Chairman of the Board of Members or the Chairman of the Company concurrently holds the position of General Director (Director), the following conditions must be ensured:

a) The person proposed for concurrent appointment must have good health and meet the standards and conditions for both positions;

b) Specific provisions and clear separation of functions, duties, powers, and responsibilities of the Chairman of the Board of Members or the Chairman of the Company and the General Director (Director) must be established;

c) The person proposed for concurrent appointment must be responsible for the functions, duties, and roles as the Chairman of the Board of Members or the Chairman of the Company and the General Director (Director) of the company.

3. Rights, obligations, and duties of the Chairman of the Board of Members, members of the Board of Members, Chairman of the Company, Supervisor, and General Director (Director) shall be implemented in accordance with the provisions of the Enterprise Law and guiding documents and the Articles of Association of the company.

4. The Chairman of the Board of Members, members of the Board of Members, Chairman of the Company, Supervisor, General Director (Director), and other important managerial positions, and positions directly related to the performance of national defense and security tasks or ensuring state secrets in enterprises directly serving national defense and security belong to the establishment of the Ministry of National Defense, the Ministry of Public Security, and the Ministry of Home Affairs.

5. The Minister of National Defense, the Minister of Public Security, and the Minister of Home Affairs shall specify the criteria, conditions, procedures for appointment, removal, dismissal, commendation, and disciplinary action for managerial positions in enterprises directly serving national defense and security based on legal regulations.

Article 9. Implementation of rights and obligations of the State owner towards enterprises directly serving national defense and security

The organization and implementation of the rights and obligations of the owner at enterprises directly serving national defense and security shall be carried out in accordance with current regulations on the implementation of rights and obligations of the owner for state-owned single-member limited liability companies.

Chapter III

ORDERING, ASSIGNING PLANS, ASSIGNING TASKS AND SUPPORT FOR ENTERPRISES DIRECTLY SERVING NATIONAL DEFENSE AND SECURITY

Article 10. Ordering, assigning plans or assigning tasks to enterprises directly serving national defense and security

1. Annually, the Minister of National Defense, the Minister of Public Security, and the Minister of Home Affairs organize ordering, assigning production plans and supplying products and services directly serving national defense and security or assigning national defense and security tasks to enterprises directly serving national defense and security within the central budget expenditure plan.

2. Mechanisms for ordering, assigning plans, prices, or fees for producing and supplying products and services directly serving national defense and security and national defense and security tasks shall be implemented in accordance with legal regulations.

Article 11. Support for enterprises directly serving national defense and security

1. In addition to general provisions on encouraging and supporting investment as stipulated by law, enterprises directly serving national defense and security and workers in such enterprises shall be subject to the State's policies for core defense industry establishments and workers therein as provided in Article 8 of Decree No. 46/2009/NĐ-CP dated May 13, 2009 of the Government detailing and guiding the implementation of certain provisions of the Defense Industry Ordinance.

2. Enterprises directly serving national defense and security may include certain specific expense items in their production and business costs, including expenses for defense work, defense service work, and military-civil relations.

3. The Ministry of Finance shall take the lead and coordinate with the Ministry of Labor, Invalids and Social Affairs, the Ministry of National Defense, the Ministry of Public Security, and the Ministry of Home Affairs to guide the implementation of this Article.

Chapter IV

IMPLEMENTING PROVISIONS

Article 12. Effective date and implementation

1. This Decree takes effect from December 1, 2010.

2. Within one year from the date this Decree takes effect, based on the criteria specified in Clause 2 of Article 3 of this Decree, the Ministry of National Defense, the Ministry of Public Security, and the Ministry of Home Affairs shall review state-owned enterprises holding 100% of the charter capital under their management (including those enterprises already recognized as defense and security companies according to the criteria set forth in Decree No. 31/2005/NĐ-CP dated March 11, 2005 of the Government on the production and supply of public goods and services) to consider recognizing them as enterprises directly serving national defense and security. The consideration and recognition of enterprises directly serving national defense and security shall be carried out in accordance with the provisions of Article 7 of this Decree.

State-owned enterprises holding 100% of the charter capital that do not meet the conditions for recognition as enterprises directly serving national defense and security shall be reorganized according to the criteria and classification list of 100% state-owned enterprises issued by the Prime Minister and in accordance with the restructuring plan for state-owned enterprises approved by the Prime Minister.

3. The transformation of enterprises directly serving national defense and security into parent company-subcompany structures, state economic groups, or other types of enterprises shall be implemented in accordance with the provisions of the Enterprise Law and related laws or decisions of the Prime Minister.

4. The merger, consolidation, and division of enterprises directly serving national defense and security shall be carried out in accordance with the provisions of the law.

5. Other organizational, management, and operational matters concerning enterprises directly serving national defense and security not covered by this Decree shall be implemented in accordance with the provisions of the Enterprise Law and guiding documents.

6. The Ministry of National Defense, the Ministry of Public Security, and the Ministry of Home Affairs shall implement this Decree for subordinate enterprises. The Ministry of Planning and Investment, the Ministry of Finance, and the Ministry of Labor, Invalids and Social Affairs shall be responsible for guiding the implementation of this Decree.

7. Organizations and individuals related to the organization, management, and operation of enterprises directly serving national defense and security shall be responsible for implementing this Decree./.