From July 1, the Central Support Fund for Reorganization of State Enterprises will be transformed into the Support Fund for Enterprise Reorganization and Development in order to uniformly and effectively manage revenues from state capital portions in enterprises, including also proceeds from the reorganization of wholly state-owned enterprises.

As specified in Decision No. 21/2012/QD-TTg of May 10, promulgating the Regulation on management and use of the Support Fund for Enterprise Reorganization and Development, the State Capital Investment Corporation (SCIC) is assigned to manage these sources of revenue, and periodically report the management and use of this fund to the Ministry of Finance for subsequent reporting to the Prime Minister.

Sources of revenue for the fund includes: (i) proceeds from the equitization of enterprises with 100% state capital according to the law on transformation of enterprises with 100% state capital into joint-stock enterprises; (ii) proceeds from other reorganization or transformation forms such as assignment, sale, dissolution and bankruptcy under the law on enterprises, for those with 100% state investment capital; (iii) proceeds from the equitization, benefits and dividends for state capital portions in transformed enterprises representatively owned by ministries, ministerial-level agencies and provincial-level Peoples Committees as assigned by the Prime Minister.

The fund will be used for:

(i) supporting state-run agricultural and forestry farms, enterprises with 100% state investment capital under ministries and ministerial-level agencies to reorganize or transform their ownership in order to deal with redundant laborers and other financial issues;

(ii) supporting parent companies of state economic groups and corporations, and parent companies in parent - subsidiary company complexes which do not have sufficient capital to deal with redundant laborers upon reorganization or ownership transformation of their member units;

(iii) supplementing charter capital of parent companies of state economic groups and corporations, and enterprises with 100% state investment capital under the Prime Minister’s decisions;

(iv) additionally investing capital in maintaining or increasing state capital portions in other enterprises as decided by the Prime Minister and at the request of the Ministry of Finance; and