NA passes amended Law on Enterprises

NA passes amended Law on Enterprises

Addressing concerns over the regulation of private corporate bond issuance, particularly by non-public companies, the government shall retain the requirement that the debt-to-equity ratio must not exceed five times

NA deputies vote on the amended Law on Enterprises this morning, June 17, 2025 in Hà Nội. VNA/VNS Photo

With 455 out of 457 deputies voting in favour, the 15th National Assembly passed the amended Law on Enterprises, introducing new regulations on beneficial ownership disclosure and tightening corporate bond issuance rules yesterday.

The approval followed a presentation by Minister of Finance Nguyễn Văn Thắng, on behalf of Prime Minister Phạm Minh Chính, addressing lawmakers’ feedback on the draft law.

One key addition to the amended law is the inclusion of provisions on an enterprise's 'beneficial owner', aimed at supporting anti-money laundering laws. While supporting the general principle, the government clarified that businesses established before the law’s enforcement will not be required to submit ownership updates immediately.

Instead, they will provide beneficial ownership information when applying for changes to their business registration, avoiding the need for a separate procedure.

Minister Thắng noted that introducing a standalone administrative process would increase compliance costs and contradict the government’s ongoing efforts to streamline procedures and reduce red tape.

He also cited the non-retroactive principle in legal applications and highlighted that about 35 per cent of businesses update their registration details annually, ensuring a gradual transition.

The amended law also updates rules on who can establish and manage enterprises. In line with the Law on Public Employees and the Law on Science and Technology, the revised law permits civil servants and public employees to engage in business activities under certain legal frameworks, such as innovation, digital transformation and scientific research.

Addressing concerns over the regulation of private corporate bond issuance, particularly by non-public companies, the government shall retain the requirement that the debt-to-equity ratio must not exceed five times, as initially outlined in the draft. This was confirmed by the National Assembly Standing Committee to strengthen financial discipline and reduce default risks for issuers and investors.

While some deputies proposed delegating bond issuance conditions to government decrees, the Government maintained that such criteria should remain in the law to ensure transparency and accountability.

The government also clarified that the regulation does not apply to State-owned enterprises, real estate developers, credit institutions, insurers, reinsurers, securities firms or fund management companies, all of which are subject to sector-specific laws. Detailed implementation guidelines have been appended to the report submitted to the National Assembly.

To enhance transparency and shift the regulatory approach, the law assigns provincial People’s Committees the responsibility of registering enterprises and developing clear inspection procedures. This supports the government's plan to boost private sector development by moving from pre-licensing checks to post-establishment monitoring. 

The legislative move is in line with Resolution 68-NQ/TW of the Politburo and the Law on Organisation of Local Government, promoting decentralisation while maintaining robust oversight. 

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