BSC Insight | Market Waves – Equitization and State Capital Divestment at State-Owned Enterprises (Part 4)

[UPDATE ON STATE-OWNED ENTERPRISE EQUITIZATION AND STATE CAPITAL DIVESTMENT]

On August 5, 2026, the Government issued Decision No. 40/2026/QD-TTg on the “Criteria for classifying enterprises for the restructuring of State capital in State-owned enterprises and enterprises with State capital.” Compared with the previous five phases, several notable features of Decision 40 are as follows:

1. A broader definition of the “State economy”: Decision 40 is aligned with the spirit of Resolution No. 79-NQ/TW, shifting the focus beyond the management of individual corporate legal entities toward the broader management and commercialization of national resources—including land, digital resources, underground space and other assets—to generate economic returns for the State, rather than merely preserving existing State capital.
2. Higher State ownership requirements in selected sectors compared with the previous draft: Decision 40/2026 narrows the scope for State capital divestment and raises the minimum State ownership thresholds in several strategic sectors, including food security, public utilities, aviation infrastructure and basic chemicals.
3. A stronger push toward decentralization and delegation of authority:

• Instead of requiring each restructuring proposal to be submitted to the Prime Minister for approval, as under Phase 5, State ownership representative agencies—including ministries and provincial People’s Committees—are now authorized to directly approve five-year State capital restructuring plans for the 2026–2030 period. The Prime Minister will only approve plans involving certain special enterprises or cases that deviate from the general criteria.
• One of the key bottlenecks in equitization and State capital divestment remains asset valuation and enterprise valuation. Accordingly, enterprises with large asset bases are likely to require more time to complete the valuation process. The pace of determining enterprise value will depend significantly on coordination between valuation firms and State-owned enterprises.

BSC Research’s view: This decentralization is intended to institutionalize the 2025 Law on the Management and Investment of State Capital in Enterprises, together with its implementing decrees and circulars. Policymakers have granted greater autonomy to State ownership representative agencies and shifted the performance benchmark from “administrative compliance” to “financial efficiency.” This gives State capital representatives and owners greater flexibility to proactively cut losses and divest in a timely manner in response to market conditions, rather than having to seek approval through multiple administrative layers—a process that could otherwise exacerbate the risk of capital losses. Overall, we view these developments as positive signals for the equitization of State-owned enterprises and State capital divestment in the coming period.