Buying State Capital in Vietnamese Enterprises: Auction and Approval [2026]

Buying state capital in Vietnamese enterprises — whether in an initial equitization or by acquiring divested state capital in an already-equitized enterprise — has operated under a brand-new framework since February 2026: Decree 57/2026/ND-CP (applicable from 13 February 2026). This article guides investors (especially foreign investors) through the two sale methods, eligibility conditions, approval authorities, and the practical process — current as of October 2026.

1. The new framework: Decree 57/2026/ND-CP

Decree 57/2026/ND-CP (issued 12 February 2026, applicable from 13 February 2026, published in the Official Gazette on 27 February 2026) is the current legal framework for restructuring state capital in enterprises, covering both initial equitization and divestment of state capital in equitized enterprises. The parent law on state capital in enterprises is Law 69/2014/QH13 (still effective).

Do not cite Decree 126/2017/ND-CP or Decree 140/2020/ND-CP as current authority — the old equitization framework has been replaced.

2. Two methods for selling state capital

Under Article 9 of Decree 57/2026/ND-CP, initial share sales use two methods:

• Public auction: the primary method, ensuring competition and transparency. A minimum 20% of charter capital must be sold via public auction — a mandatory floor so pricing reflects the market.
• Direct agreement: available in qualifying cases (e.g., sales to selected strategic investors, or other statutory cases).

Beyond initial equitization, the new framework also governs divestment — sales of state capital in already-equitized enterprises — under the same principles: publicity, transparency, and preservation and growth of state capital.

3. Who may buy? Conditions per investor group

Article 8 of Decree 57/2026/ND-CP sets out eligible buyers and conditions:

Domestic investors

Generally unrestricted in buying shares, except where specifically prohibited or limited by law.

Foreign investors

Eligible subject to specific conditions on accounts at credit institutions and foreign-currency deposits for auction participation — open the account and arrange foreign-currency flows early to avoid disqualification on technical payment grounds.

Strategic investors

Entitled to preferential treatment (direct-agreement purchases) but must meet strict criteria under Article 8.3:

• Profitable in the last 2 years, with no accumulated losses;
• Operating for at least 3 years;
• Commitment to maintain the core business lines and brand for at least 3 years post-acquisition.

The Stock Exchange auction mechanism applies when subscription demand exceeds the offered volume — investors must master the Exchange’s auction rules.

4. Approval authorities

• The Prime Minister approves the 5-year plan for state-capital restructuring and the equitization plans of major groups and corporations (listed in Appendix III of the Decree).
• Ownership-representative agencies (line ministries, provincial People’s Committees, or assigned bodies) approve plans for remaining enterprises under decentralization.

Investors must identify the approved equitization/divestment plan of each target enterprise — the legal “map” of the deal (starting price, sale ratio, priority buyers, etc.).

5. The practical process for investors: 5 steps

1. Enterprise valuation: the enterprise value is re-determined before equitization; the auction starting price is based on it — run your own independent valuation for comparison.
2. Study the approved plan: sale ratio, buyers, methods, timeline — all deal terms live here.
3. Register for the auction: file the dossier, open accounts, place the deposit (foreign investors: foreign-currency deposit) per the auction rules.
4. Bid at auction / negotiate direct agreement: follow the Stock Exchange auction rules; strategic investors negotiate per the plan.
5. Close before the first General Meeting of Shareholders: payment, share transfer, and procedures completed ahead of the new joint-stock company’s first GMS.

Note on transfer restrictions: strategic investors’ shares are typically subject to transfer restrictions during the commitment period — factor this into exit planning.

6. Frequently asked questions

Can foreign investors buy shares in equitization?

Yes, subject to credit-institution account and foreign-currency deposit conditions under Article 8 of Decree 57/2026/ND-CP. Some sectors have foreign ownership caps under specialized laws.

What is the minimum public-auction ratio?

20% of charter capital under Decree 57/2026/ND-CP.

What qualifies an investor as strategic?

Profits in the last 2 years, no accumulated losses, ≥3 years of operation, and a ≥3-year commitment to keep business lines/brand (Article 8.3, Decree 57/2026).

7. Legal bases (as of 14 October 2026)

• Decree 57/2026/ND-CP (12 February 2026) — applicable from 13 February 2026: state-capital restructuring framework; Article 8 (buyers, conditions), Article 9 (sale methods).
• Law 69/2014/QH13 — parent law on management and use of state capital invested in enterprises.

This article is general information; specific deals require counsel and verification of each enterprise’s approved plan.

Contact us

FLAT Law Firm advises domestic and foreign investors on auction participation, direct-agreement purchases of state capital, due diligence on equitization/divestment plans, and deal structuring. Reach us via our contact page.