Decree 365/2025/ND-CP: Supervision and Management of State Capital in Enterprises

Overview

Decreed 365/2025/ND-CP was issued by the Government on December 31, 2025, effective immediately from the date of promulgation. It provides comprehensive regulations on supervision, inspection, evaluation, classification, reporting, and public disclosure of information in the management and investment of state capital in enterprises.

Scope of Application

This decree applies to:

• State-owned enterprises (100% state-owned capital)
• Joint-stock companies and limited liability companies with state capital contribution
• Organizations representing state capital owners
• Competent state management agencies
• Units related to the management of state capital in enterprises

Main Content

1. Supervision of State Capital

The decree provides detailed regulations on:

• Regular supervision mechanism: Continuous monitoring of investment activities and use of state capital
• Periodic supervision: Conducted quarterly, semi-annually, and annually
• Ad-hoc supervision: When violations are detected or upon request by competent authorities
• Supervision tools: Reporting systems, management software, centralized databases

2. Enterprise Inspection

Inspection forms include:

• Periodic inspection: According to annual plans of management agencies
• Thematic inspection: Focused on specific areas such as finance, investment, governance
• Ad-hoc inspection: When violations are discovered or complaints/denunciations are received
• Inspection content: Legal compliance, capital efficiency, corporate governance, personnel management

3. Enterprise Evaluation and Classification

Evaluation criteria:

• Business performance (revenue, profit, profit margins)
• Efficiency of state capital use (ROE, ROA)
• Compliance with laws and management regulations
• Corporate governance quality
• Fulfillment of obligations to the state (taxes, fees, budget contributions)
• Social responsibility and sustainable development

Classification categories:

• Category A: Outstanding task completion
• Category B: Good task completion
• Category C: Task completion
• Category D: Task non-completion

4. Reporting Regime

Periodic reports:

• Quarterly reports: Financial situation, business results
• Semi-annual reports: Mid-term evaluation, plan adjustments
• Annual reports: Comprehensive summary, next year's plan

Thematic reports:

• Reports on major investment projects
• Reports on enterprise restructuring
• Reports on related-party transactions
• Reports on risk management

Reporting formats:

• Written reports
• Electronic reports via information management systems
• Direct reports at conferences and meetings

5. Information Disclosure

Mandatory disclosure information:

• Capital structure, state ownership ratio
• Audited financial statements
• Annual business results
• Business and production plans
• Remuneration and salaries of enterprise managers
• Major transactions, related-party transactions
• Enterprise evaluation and classification results

Disclosure formats:

• Publication on enterprise websites
• Publication through mass media
• Posting at enterprise headquarters
• Reporting at general shareholders' meetings

Disclosure timelines:

• Annual financial reports: Within 90 days after the end of the fiscal year
• Quarterly reports: Within 30 days after the end of the quarter
• Ad-hoc information: Within 24-48 hours from when information becomes available

6. Responsibilities of Parties

Enterprises with state capital:

• Develop and implement business plans
• Report fully, accurately, and timely
• Cooperate in inspection and supervision activities
• Disclose information as required
• Preserve relevant documents and records

Owner's representatives:

• Organize supervision and inspection according to plans
• Evaluate and classify enterprises annually
• Consolidate reports to competent authorities
• Handle violations or recommend handling

State management agencies:

• Issue detailed guidance documents
• Inspect and supervise implementation
• Handle violations within authority
• Consolidate and analyze state capital management data

Implications for Private Enterprises

Although the decree primarily regulates enterprises with state capital, private enterprises and SMEs should note:

• Transaction transparency: When partnering with state-owned enterprises, ensure transparency and compliance with bidding and procurement regulations
• Business opportunities: Public information helps identify cooperation opportunities and supply of goods/services
• Partner assessment: Provides basis for assessing financial capacity and reputation of state partners
• Governance learning: Evaluation and classification criteria can be referenced for private enterprise application

Impact on SME Operations

For suppliers to state enterprises:

• Greater transparency requirements in transactions
• Need for proper documentation and compliance
• Opportunities to participate in public procurement processes
• Understanding of state enterprise evaluation cycles

For customers of state enterprises:

• Better access to financial information of state partners
• More predictable business relationships
• Enhanced ability to assess partner stability
• Clearer understanding of governance structures

For potential partners:

• Improved due diligence capabilities
• Access to performance data for decision-making
• Better risk assessment of state enterprise partners
• Understanding of reporting and accountability mechanisms

Implementation Timeline

The decree is effective from December 31, 2025, with:

• Immediate application of supervision and reporting requirements
• First evaluation and classification cycle to be completed within the following fiscal year
• Full implementation of disclosure requirements within 6 months
• Establishment of centralized databases and IT systems within 12 months

Key Takeaways

1. Enhanced transparency: State enterprises must disclose significantly more information publicly
2. Stricter accountability: Regular evaluation and classification based on clear criteria
3. Systematic supervision: Multi-layered monitoring mechanisms from regular to ad-hoc
4. Digital transformation: Emphasis on electronic reporting and centralized data management
5. Stakeholder benefits: Improved information access for partners, suppliers, and the public

Conclusion

Decreed 365/2025/ND-CP establishes a synchronized and rigorous legal framework for state capital management, promoting transparency and improving the operational efficiency of state-owned enterprises, contributing to sustainable economic development. For private sector SMEs, understanding these requirements creates opportunities for better business relationships and more informed decision-making when engaging with the state enterprise sector.