Finance ministry issues new law for Debt and Asset Trading Corporation
Finance ministry issues new law for Debt and Asset Trading Corporation
The Ministry of Finance has just issued a document on the financial regulations of Viet Nam's Debt and Asset Trading Corporation (DATC), effective from September 15, 2021.
Under Circular 62/2021/TT-BTC, DATC is entitled to establish ownership, management and use rights over debts and assets it purchased and received; perform the management, use and accounting of debts and assets according to the provisions of this circular and the current provisions of relevant laws.
Each debt DATC purchased is identified as a commodity. The corporation is responsible for organising the accounting and tracking of each purchased debt.
For debts and assets received from enterprises with 100 per cent charter capital held by the State, the corporation manages, monitors the assets, reports the financial situation to the State and handles the assets in accordance with the provisions of the circular.
The conversion of debt into contributed capital of enterprises with 100 per cent of charter capital owned by the State shall be carried out according to a written plan approved by the competent authority.
For other enterprises, the conversion of debt into contributed capital shall comply with the principle of agreement between DATC and the owner of the enterprises.
DATC will divest within 5 years from the date DATC officially becomes a shareholder in enterprises with dominant capital contribution through restructuring. In case DATC has not divested after 5 years, DATC has to report the cause and propose handling measures to the Ministry of Finance.
As for capital use, the corporation is entitled to actively use its own capital to serve business activities, ensuring efficiency, preservation and development of capital and in accordance with the provisions of law. DATC must prioritise resources to support the restructuring, arrangement over the ownership conversion of enterprises with 100 per cent of charter capital owned by the State.
DATC also can use capital to invest outside the corporation, buy debts and assets for business purposes in accordance with the provisions of law and this regulation. DATC is responsible for the efficiency of buying, selling and handling debts and assets according to the market mechanism.
The corporation uses capital to perform tasks assigned by competent authorities in accordance with the corporation's business lines. It uses its operating capital to repair and upgrade assets for the purpose of increasing value and facilitating the settlement of assets to recover capital.
DATC is responsible for preserving and developing the State capital invested in enterprises in accordance with the law. The preservation of capital of the enterprises is carried out by the following measures: use and manage capital and assets, distribute profits, buy property insurance, promptly handle the value of lost assets, irrecoverable debts and set up provisions for risks in accordance with the provisions of this circular.
