Decision No. 249/2006/QĐ-TTg On the establishment of the Parent Company - Vietnam Rubber Group Corporation

Pursuant to …;

Regarding the establishment of the Parent Company - Vietnam Rubber Industry Group

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PRIME MINISTER

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

Pursuant to the Law on State-Owned Enterprises dated November 26, 2003;

Pursuant to the Enterprise Law dated November 29, 2005;

Pursuant to Decree No. 153/2004/NĐ-CP dated August 9, 2004 of the Government on the organization and management of state-owned holding companies and the transformation of state-owned holding companies and independent state-owned enterprises into parent company - subsidiary models;

Pursuant to Decision No. 248/2006/QĐ-TTg dated October 30, 2006 of the Prime Minister approving the pilot project for the formation of the Vietnam Rubber Industry Group;

Considering the proposal of the Board of Directors of the Vietnam Rubber Corporation.

        DECISION

Article 1. Establishing the Parent Company - Vietnam Rubber Industry Group (hereinafter referred to as the Vietnam Rubber Industry Group) based on restructuring the management and operation organs of the Vietnam Rubber Corporation:

1. The Vietnam Rubber Industry Group is a state-owned enterprise with legal personality, seal, emblem, Charter of organization and operation; it is entitled to open accounts at the State Treasury and banks in accordance with the law, and operates independently; it shall assume all legal rights and obligations of the Vietnam Rubber Corporation as of January 1, 2006 after auditing.

2. Name: Vietnam Rubber Industry Group; International trade name: Vietnam Rubber Group, abbreviated as VRG.

3. Head office: No. 236 Nam Ky Khoi Nghia Street, Ward 6, District 3, Ho Chi Minh City.

4. Representative office: No. 56 Nguyen Du Street, Hai Ba Trung District, Hanoi City.

5. Registered capital of the Vietnam Rubber Industry Group: the ownership capital of the Vietnam Rubber Corporation as of January 1, 2006 after auditing.

6. The State shall transfer land to the Parent Company - Vietnam Rubber Industry Group as the central entity to unify the management and allocation of rubber production and business areas for subsidiaries.

7. Business sectors and activities of the Vietnam Rubber Industry Group:

- Planting, caring for, tapping, and processing rubber latex;

- Livestock breeding, planting industrial crops, and processing agricultural products;

- Rubber industry: producing and trading rubber industrial products and raw materials for the rubber industry;

- Reforestation and production, trading of timber raw materials and finished wood products;

- Power industry: investing in construction, operating thermal power plants and hydropower plants; selling electricity to businesses and consumers according to the law;

- Machinery: casting, rolling steel; repairing, assembling, manufacturing machinery products and other industrial equipment;

- Management and operation of seaports, inland waterway ports, and specialized road and water transport, loading and unloading, transshipment of goods;

- Production and trading of construction materials;

- Investment and trading in infrastructure and real estate;

- Water supply, wastewater treatment, environmental protection services;

- Services: surveying and mapping, geological exploration; investment consulting, design; science and technology, information technology, inspection and certification of goods; printing and publishing; training, occupational disease treatment and rehabilitation; commerce, import and export, hotels, tourism; labor export; finance;

- Other industries and activities as prescribed by law.

8. Management and operational structure of the Vietnam Rubber Industry Group includes:

a) The Board of Directors of the Vietnam Rubber Industry Group represents the direct state ownership at the Vietnam Rubber Industry Group, consisting of a maximum of seven members. Members of the Board of Directors are appointed by

b) The Audit Committee of the Vietnam Rubber Industry Group is appointed by the Board of Directors, consisting of a maximum of five members, including the Chairman of the Audit Committee who is also a member of the Board of Directors;

c) The General Director of the Vietnam Rubber Industry Group is appointed, dismissed, or contracted by the Board of Directors of the Vietnam Rubber Industry Group after being

d) Supporting the General Director of the Group are Deputy General Directors and Chief Accountants. The Board of Directors of the Group appoints Deputy General Directors and Chief Accountants upon the recommendation of the General Director of the Group;

đ) The support staff for the Board of Directors and the General Director of the Group include the Group Office and advisory boards.

9. Relationships between the Vietnam Rubber Industry Group and the state owner and affiliated units shall be implemented in accordance with the law and the Charter of Organization and Operation of the Vietnam Rubber Industry Group.

10. The Government shall uniformly manage and implement the rights and obligations of the state owner towards the Vietnam Rubber Industry Group.

a) The Prime Minister decides:

- Approving the objectives, strategies, long-term plans, and business sectors and activities of the Vietnam Rubber Industry Group based on the proposal of the Board of Directors of the Vietnam Rubber Industry Group and the opinions of the Ministries of Agriculture and Rural Development and Planning and Investment;

- Approving the Charter and amendments and supplements to the Charter of the Vietnam Rubber Industry Group based on the proposal of the Board of Directors of the Vietnam Rubber Industry Group and the opinions of the Ministries of Agriculture and Rural Development, Finance, and Planning and Investment;

- Reorganizing, dissolving, and diversifying ownership of the Vietnam Rubber Industry Group based on the proposal of the Board of Directors of the Vietnam Rubber Industry Group and the opinions of the Ministries of Agriculture and Rural Development, Finance, and Planning and Investment;

- Appointing, dismissing the Chairman and members of the Board of Directors of the Vietnam Rubber Industry Group based on the proposal of the Minister of Agriculture and Rural Development and the review of the Ministry of Home Affairs;

- Approving the appointment, dismissal, or contracting of the General Director of the Vietnam Rubber Industry Group based on the proposal of the Board of Directors of the Vietnam Rubber Industry Group and the review of the Ministry of Agriculture and Rural Development;

- Approving the establishment of new enterprises invested 100% by the Vietnam Rubber Industry Group; reorganization, ownership conversion, dissolution, bankruptcy of affiliated enterprises of the Vietnam Rubber Industry Group; the Vietnam Rubber Industry Group accepting new members.

- Approve investment projects of the Vietnam Rubber Industry Group, investment projects outside the Vietnam Rubber Industry Group within the Prime Minister's decision-making authority as prescribed by laws on investment;

- Decide on capital investment to form registered capital and adjust registered capital during the operation of the Vietnam Rubber Industry Group based on the proposal of the Vietnam Rubber Industry Group Board of Directors and opinions from the Ministries of Agriculture and Rural Development, Finance, Planning and Investment;

b) Ministry of Agriculture and Rural Development:

- Submit to the Prime Minister for decision on the appointment, dismissal of the Chairman and members of the Vietnam Rubber Industry Group Board of Directors;

- Review the implementation of procedures, formalities, standards, and conditions for appointing or signing contracts with the General Director of the Vietnam Rubber Industry Group when the Vietnam Rubber Industry Group Board of Directors submits to the Prime Minister;

- Direct the implementation, inspection of the execution of long-term goals, strategies, and plans of the Vietnam Rubber Industry Group approved by the Prime Minister;

- Report to the Prime Minister on opinions when the Vietnam Rubber Industry Group Board of Directors submits to the Prime Minister on:

+ Long-term goals, strategies, plans, and business sectors of the Vietnam Rubber Industry Group;

+ Articles of Association, approval of amendments and supplements to the Articles of Association of the Vietnam Rubber Industry Group;

+ Restructuring, dissolution, diversification of ownership of the Vietnam Rubber Industry Group;

- Supervise the implementation of investment projects of the Vietnam Rubber Industry Group within its authority as prescribed by laws on investment;

c) Ministry of Finance:

- Implement capital investment to form registered capital and adjust registered capital during the operation of the Vietnam Rubber Industry Group after obtaining approval from the Prime Minister;

- Inspect and supervise the use of capital, implementation of financial management regulations for the Vietnam Rubber Industry Group; evaluate the effectiveness of business operations and management activities of the Vietnam Rubber Industry Group Board of Directors;

d) The Ministry of Home Affairs:

Review the procedures, formalities, standards, and conditions for appointing the Chairman and members of the Vietnam Rubber Industry Group Board of Directors submitted by the Ministry of Agriculture and Rural Development; Prime Minister;

đ) The Ministry of Planning and Investment:

Supervise the implementation of objectives and tasks assigned by the Prime Minister to the Vietnam Rubber Industry Group;

e) Ministries, agencies at ministerial level, and government agencies perform state management functions in relevant fields concerning the Vietnam Rubber Industry Group;

g) The Vietnam Rubber Industry Group Board of Directors represents the State direct owner at the Vietnam Rubber Industry Group and the owner in companies wholly owned by the Vietnam Rubber Industry Group;

The Vietnam Rubber Industry Group Board of Directors:

- Submit to the Prime Minister for approval, amendment, and supplementation of the Articles of Organization and Operation of the Vietnam Rubber Industry Group;

- Develop proposals for establishing new organizations, restructuring, dissolution, and conversion of ownership within the Vietnam Rubber Industry Group, submit to the Prime Minister, and implement according to the approved proposals;

- Decide on long-term goals, strategies, plans, and business sectors of the Vietnam Rubber Industry Group (after approval by the Prime Minister) and of companies wholly owned by the Vietnam Rubber Industry Group;

- Approve articles of association, approve amendments and supplements to the articles of association of member companies wholly owned by the Vietnam Rubber Industry Group;

- Decide on the use, investment, and adjustment of capital and other resources invested by the Vietnam Rubber Industry Group in member companies, but must ensure the required initial registered capital when establishing a business or the statutory capital for industries and professions as prescribed by law;

- Approve the use of Vietnam Rubber Industry Group capital to invest in setting up member units wholly owned by the Vietnam Rubber Industry Group without exceeding the investment capital under the Board of Directors' decision-making authority and after obtaining approval from the Prime Minister;

- Approve proposals for member companies wholly owned by the Group to contribute capital to establish new joint-stock companies, limited liability companies with one member, and limited liability companies with two or more members outside the industry, sector, and area specified in Article 6 of the Law on State-Owned Enterprises;

- Decide or authorize the General Director to decide joint venture capital contribution projects with foreign investors and overseas investment projects of member companies wholly owned by the Vietnam Rubber Industry Group within the Board of Directors' decision-making authority as prescribed by laws on investment;

- Decide on the appointment, dismissal, removal, signing of contracts, termination of contracts, rewards, and disciplinary actions against the General Director after obtaining approval from the Prime Minister;

11. Organizational structure of the Vietnam Rubber Industry Group at the time of establishment, including:

- The Office of the Vietnam Rubber Industry Group;

- The Representative Office of the Vietnam Rubber Industry Group in Hanoi;

12. Subsidiaries of the Vietnam Rubber Industry Group:

a) Holding companies wholly owned by the Vietnam Rubber Industry Group operating under the parent company-subcompany model, including:

- Dong Nai Rubber Holding Company;

- Rubber Industry Holding Company;

- Vietnam-Laos Rubber Holding Company;

b) Wholly-owned subsidiaries:

- Dau Tieng Rubber Company (operating under the parent company-subcompany model);

- Rubber Financial Company (Limited Liability Company);

c) Companies over 50% owned by the Vietnam Rubber Industry Group, including:

- Joint-stock companies and limited liability companies:

+ Hoa Binh Rubber Joint-Stock Company;

+ Ho Nai Industrial Zone Investment and Development Joint-Stock Company;

+ Song Con Joint-Stock Company;

+ Binh Duong BOT 741 Limited Liability Company;

- Companies to be listed:

+ Vung Tau Rubber Company;

+ Phước Hoà Rubber Company;

+ Bình Long Rubber Company;

+ Loc Ninh Rubber Company;

+ Dong Phu Rubber Company;

+ Phu Rieng Rubber Company;

+ Tan Bien Rubber Company;

+ Krông Buk Rubber Company;

+ Eah Leo Rubber Company;

+ Chu Pah Rubber Company;

+ Chu Prong Rubber Company;

+ Mang Yang Rubber Company;

+ Chu Se Rubber Company;

+ Kon Tum Rubber Company;

+ Binh Thuan Rubber Company;

+ Quang Tri Rubber Company;

+ Quang Nam Rubber Company;

+ Quang Ngai Rubber Company;

+ Ha Tinh Rubber Company;

+ Thanh Hoa Rubber Company;

+ Rubber Machinery Company;

+ West Ninh Rubber Joint Stock Company Limited;

13. The associated companies held by the Vietnam Rubber Industry Group with less than 50% of charter capital:

- Joint stock companies:

+ Warehouse and Cargo Services Joint Stock Company;

+ Basic Engineering Construction and Real Estate Joint Stock Company;

+ Rubber Investment and Construction Joint Stock Company;

+ Construction and Investment Consulting Joint Stock Company;

+ Rubber Trade and Tourism Service Joint Stock Company;

+ Fico Cement West Ninh Joint Stock Company;

+ Nam Tan Uyen Industrial Zone Joint Stock Company;

+ Han Bridge Investment and Construction Joint Stock Company;

+ Geruco Urban Development and Industrial Zone Investment and Development Joint Stock Company;

+ Thong Nhat Joint Stock Company;

+ Cuu Dat Hydro Power Joint Stock Company;

- Limited liability company:

+ Dong Thap BOT Infrastructure Limited Liability Company;

- Joint ventures:

+ Visorutex Joint Venture Enterprise;

14. The affiliated units with income held by the Vietnam Rubber Industry Group with 100% capital:

- Vietnam Rubber Research Institute;

- Technical Vocational High School of Rubber;

- Rubber Health Centre;

- Vietnam Rubber Magazine;

15. For new members, the Board of Directors of the Vietnam Rubber Industry Group decides on their acceptance according to the provisions of the law.

Article 2. Implementation organization:

1. The Ministry of Agriculture and Rural Development shall submit to the Prime Minister for decision on the appointment of the Chairman and members of the Board of Directors of the Vietnam Rubber Industry Group (in the fourth quarter of 2006).

2. The Ministry of Natural Resources and Environment shall guide the provinces and the Vietnam Rubber Industry Group on the transfer and reclamation of the entire land fund of member enterprises of the Vietnam Rubber Corporation to the Parent Company - Vietnam Rubber Industry Group for unified management and allocation of rubber production and business areas for subsidiaries according to the provisions of the Land Law.

3. The Ministry of Finance: determine the level of charter capital of the Vietnam Rubber Industry Group.

4. The Chairman and members of the Board of Directors, General Director of the Vietnam Rubber Corporation will continue to manage and operate the Vietnam Rubber Industry Group until the Chairman and members of the Board of Directors, General Director of the Vietnam Rubber Industry Group are appointed according to the provisions of the law.

5. The Board of Directors of the Vietnam Rubber Industry Group:

- Submit to the Prime Minister for approval of the Charter on organization and operation of the Vietnam Rubber Industry Group in the first quarter of 2007.

- Issue the Financial Management Regulation of the Vietnam Rubber Industry Group after receiving comments from the Ministry of Finance.

- Submit to the Prime Minister for approval to appoint or sign a contract with the General Director of the Vietnam Rubber Industry Group (in the fourth quarter of 2006).

- Submit to the Prime Minister for approval of the project to establish the corporations mentioned in point a, clause 12; restructuring the company mentioned in point b, clause 12 Article 1 of this Decision; the project on investment and development of rubber in Cambodia.

- Submit to the Ministry of Agriculture and Rural Development for decision on the shareholding reform of the companies mentioned in point c, clause 12 Article 1 of this Decision.

Article 3. This Decision takes effect fifteen days after its publication in the Official Gazette.

The Ministers of the Ministries of Agriculture and Rural Development, Industry, Finance, Planning and Investment, Natural Resources and Environment, Labour, Invalids and Social Affairs, Heads of relevant agencies, the Steering Committee for Enterprise Reform and Development, the Board of Directors of the Vietnam Rubber Corporation, and the Board of Directors of the Vietnam Rubber Industry Group are responsible for implementing this Decision./.