State-owned enterprises to be permitted to invest in real estate sector from August 1
A provision that prohibits all State-owned enterprises from investing in real estate, with the exception of large-scale ones, awas deemed inconsistent with the Party’s policy on enhancing the operational efficiency of SOEs.
With 440 out of 451 deputies voting in favor (92.05%), the National Assembly (NA) approved the Law on Management and Investment of State Capital in Enterprises on June 14. The law, consisting of eight chapters and 59 articles, is set to take effect on August 1, 2025.
One of the notable changes in the newly passed law is the removal of the provision restricting State-owned enterprises (SOEs) from investing in the real estate sector, which was included in the initial draft submitted to the NA.
Previously, some lawmakers proposed limiting real estate investments to large SOEs.
Mr. Phan Văn Mai, Chairman of the NA Economic and Financial Committee, clarified that enterprises with State capital are authorized to conduct business activities in line with legal regulations and State directives, which are defined through the enterprise's charter and development strategies.
A provision that prohibits all State-owned enterprises from investing in real estate, with the exception of large-scale ones, was deemed inconsistent with the Party’s policy on enhancing the operational efficiency of SOEs. As a result, the NA Standing Committee recommended excluding the restriction from the final draft of the law.
Another key provision introduced in the new law grants decision-making power on salaries, remuneration, bonuses, and employee benefits to the Members' Council or company chairman of SOEs, marking a shift from the current system, where such policies were determined by the Government. Under the revised framework, the Government will regulate salaries and bonuses only for direct owner's representatives and controllers within SOEs.
Furthermore, employee and executive bonuses must now be drawn from the enterprise's after-tax profits. Regarding the allocation of after-tax profits, SOEs are permitted to direct up to 50% toward their Development Investment Fund, supporting business expansion and production growth after fulfilling statutory obligations.
