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Abuse of Position and Power in State-Owned Enterprises: How Is It Punished?

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Abuse of Position and Power in State-Owned Enterprises: How Is It Punished?

Office holders in state-owned enterprises (SOEs) — including managers and state-capital representatives — who abuse their positions to embezzle assets or peddle influence for gain face criminal prosecution under Chapter XXIII of the Penal Code (position-related offences). The two central provisions are Article 355 (abusing position/power to embezzle assets) and Article 358 (abusing position/power to influence others for gain), with a maximum penalty of 20 years’ imprisonment or life imprisonment.

⚠️ Important note on article numbers: “Abusing position and power to influence others for gain” is Article 358 — not Article 356. Article 356 is a different offence (“abusing position and power while performing official duties” — i.e., acting against official duties), used here only for distinction.

Short answer

Government office building
Illustration: Government office building
  • Article 355 — abusing position/power to embezzle assets: from 1–6 years’ imprisonment up to 20 years or life imprisonment (embezzlement of VND 1 billion or more, or property damage of VND 5 billion or more).
  • Article 358 — abusing position/power to influence others for gain: from 1–6 years’ imprisonment up to 20 years or life imprisonment (gains of VND 1 billion or more, or property damage of VND 5 billion or more).
  • None of Articles 355, 356, 357 or 358 carries the death penalty.
  • Applicable text: the Penal Code as consolidated in 135/VBHN-VPQH (5 September 2025); supplementary penalties amended by Law 86/2025/QH15 (effective 1 July 2025).

Article 355 — Abusing position and power to embezzle assets

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Illustration: judge gavel on wooden sounding block

Subject: “a person who abuses their position or power to embezzle another’s assets” — SOE managers are the typical subjects.

Penalty frames:

  • Paragraph 1 — 1 to 6 years’ imprisonment: embezzlement of assets valued from VND 2 million to under VND 100 million; or under VND 2 million where the offender was previously disciplined for this act or convicted of a position-related offence without expungement and reoffends.
  • Paragraph 2 — 6 to 13 years’ imprisonment: committed by an organized group; embezzlement from VND 100 million to under VND 500 million; property damage from VND 1 billion to under VND 3 billion; embezzlement of poverty-alleviation funds, relief funds, etc.
  • Paragraph 3 — 13 to 20 years’ imprisonment: embezzlement from VND 500 million to under VND 1 billion; property damage from VND 3 billion to under VND 5 billion; causing the enterprise or organization to go bankrupt or cease operations, etc.
  • Paragraph 4 — 20 years’ imprisonment or life imprisonment: embezzlement of assets valued at VND 1 billion or more; or property damage of VND 5 billion or more. Article 355 carries no death penalty.
  • Paragraph 5 — supplementary penalties (amended by Law 86/2025, effective 1 July 2025): prohibition from holding certain positions for 1–5 years; possible fine of VND 60–200 million; confiscation of part or all of the assets.

Article 358 — Abusing position and power to influence others for gain

Constituent act: abusing one’s position or power, directly or through an intermediary, to demand, receive, or agree to receive any benefit in any form, in order to use one’s influence to cause a person holding a position or power to do or refrain from doing something within their responsibility, directly related to their work, or to do something they are not permitted to do.

Penalty frames:

  • Paragraph 1 — 1 to 6 years’ imprisonment: benefits valued from VND 2 million to under VND 100 million; or under VND 2 million where the offender was previously disciplined for this act and reoffends; non-material benefits.
  • Paragraph 2 — 6 to 13 years’ imprisonment: committed by an organized group; benefits from VND 100 million to under VND 500 million; property damage from VND 1 billion to under VND 3 billion.
  • Paragraph 3 — 13 to 20 years’ imprisonment: benefits from VND 500 million to under VND 1 billion; property damage from VND 3 billion to under VND 5 billion.
  • Paragraph 4 — 20 years’ imprisonment or life imprisonment: benefits valued at VND 1 billion or more; or property damage of VND 5 billion or more.
  • Paragraph 5 — supplementary penalties (amended by Law 86/2025): prohibition from holding positions for 1–5 years; possible fine of VND 60–200 million. Note: outdated secondary sources still cite “VND 30–100 million” — that is the old version, do not use it; the current figure is VND 60–200 million.

Article 356 — for distinction only

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Illustration: task list on a clipboard

Article 356 is “Abusing position and power while performing official duties” — i.e., abusing position/power to act against official duties for personal gain or other personal motives, causing property damage from VND 10 million to under VND 200 million (paragraph 1: non-custodial reform up to 3 years or 1–5 years’ imprisonment). The highest frame (paragraph 3): 10–15 years’ imprisonment where property damage reaches VND 1 billion or more.

Supplementary penalties at paragraph 4 (amended by Law 86/2025 — note the paragraph numbering: the supplementary penalties of Article 356 sit in paragraph 4, not paragraph 5): prohibition from holding certain positions for 1–5 years; possible fine of VND 20–200 million (no asset confiscation as in Article 355).

Subjects in SOEs and limits of application

These offences belong to Chapter XXIII (position-related offences); their subjects are persons holding positions or power — including managers and state-capital representatives in SOEs.

A boundary note: the 2015 Penal Code extends some position-related offences to the non-state sector (e.g., Article 354(6), Article 364(6)) — but do not infer an extension for Articles 355/358 beyond the letter of the law. Application must stay within the scope the provisions prescribe.

Frequently asked questions

Is “abusing position to influence others for gain” Article 356 or 358?
Article 358. Article 356 is the offence of “abusing position and power while performing official duties” (acting against official duties) — a different offence, used here only for distinction.

What is the current supplementary fine for influence-peddling for gain?
VND 60–200 million (Article 358(5) after Law 86/2025, effective 1 July 2025). The “VND 30–100 million” figure in some older sources is outdated.

Do these offences carry the death penalty?
No. None of Articles 355, 356, 357 or 358 carries the death penalty.

Sources

  • Penal Code — consolidated text 135/VBHN-VPQH (5 September 2025): Articles 355, 356, 358; in force at the time of writing (14 October 2026).
  • Law 86/2025/QH15 (effective 1 July 2025): amended Article 355(5), Article 356(4), Article 357(5), Article 358(5) (supplementary penalties).

Need a legal-risk assessment on position and power? The FLAT Law Firm team advises company managers on compliance, reviewing criminal-law risks in executive operations. Contact us at contact us.

This article is for general reference only based on the laws in force at the time of writing (14 October 2026) and does not constitute legal advice for any specific case.

Transparency note: This article was drafted by FLAT Law Firm’s AI content production system and is undergoing internal review (AI Legal Council QA and owner approval before publication). It has not been reviewed by a human lawyer.

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