Analyst's Pick

 Võ Trí Thành*

The Ministry of Planning and Investment has put forth a proposal to broaden the pool of eligible entities for establishing businesses by suggesting amendments to certain provisions of the 2020 Law on Enterprises.

This proposal signifies a shift in mindset towards creating a conducive environment for development. It aligns with the ongoing trend of socialisation, which is a state policy aimed at mobilising all resources for public goods and social services, as exemplified in sectors such as education and healthcare.

In accordance with the 2010 Law on Public Employees, a public employee is defined as a Vietnamese citizen employed based on job positions, working at public service providers under the terms of employment contract policies, and receiving remuneration from the salary funds of public service providers as prescribed by law.

Public employees are generally prohibited from engaging in the management and administration of limited liability companies, joint-stock companies, partnerships, cooperatives, private hospitals, schools or scientific research institutions unless specified otherwise by law.

This regulation is designed to mitigate conflicts of interest and prevent unhealthy competition. By maintaining this separation, the regulation seeks to safeguard the public interest, ensure accountability and promote ethical conduct among public employees.

However, according to the proposed amendments to the Law on Enterprises, employees who are scientists will be permitted to establish and oversee businesses dealing with researched scientific products. This adjustment reflects the recognition that Việt Nam prioritises people-centric development and positions science and technology-based enterprises as key drivers of progress. Party General Secretary Tô Lâm underscored that science and technology play pivotal roles in national advancement, serving as essential prerequisites for the nation to prosper in the new era.

First, the proposal to broaden the scope of subjects allowed to engage in business activities presents a significant opportunity for increasing the number of businesses operating nationwide, thereby offering individuals and enterprises the chance to expand their investments and business ventures.

Despite setting a target of reaching one million enterprises five years ago, the current number remains below that threshold. Therefore, amending various regulations within the existing Enterprise Law aims to create more opportunities for individuals to feel confident in investing in businesses, emphasising the importance of the freedom to engage in lawful business activities.

Development of businesses is not merely increase in quality but also improvement in quality through the commercialisation and transfer of scientific and technological research results.

The commercialisation of scientific research results plays a vital role in fostering motivation for research endeavours. It serves as a driving force from the inception of ideas, through the implementation process, to the concerted efforts required to achieve final results.

Additionally, commercialisation not only facilitates the creation and supplementation of research activities but also serves as a means of compensating scientists, thereby ensuring their livelihoods and professional status. By turning scientific research outcomes into commercial ventures, researchers are incentivised to pursue innovative ideas, conduct rigorous investigations, and strive for tangible results that can be applied in practical settings.

Moreover, the commercialisation of research results can lead to the development of products, services, and technologies that benefit society, drive economic growth, and address real-world challenges. By translating scientific findings into marketable products or services, researchers can not only advance their own careers but also contribute to the broader advancement of knowledge and innovation in various fields.

However, achieving a breakthrough in quantity is not guaranteed, as the growth of the business community hinges on other essential factors. Key elements crucial in promoting the entrepreneurial spirit among the populace include creating stability and safety in the business environment and developing a systematic and transparent legal framework.

Stability and safety in the business environment means implementing policies and regulations that provide a stable and secure business environment where rules are consistent and not subject to frequent changes. Meanwhile, a systematic and transparent legal framework is to ensure that the legal system is coherent, free of overlaps and contradictions that could impede individuals and officials when interpreting and implementing laws.

In addition to amending the Enterprise Law to broaden participation, a gradual reform of business activities should be undertaken in the short, medium and long term, simultaneously across all sectors in a comprehensive manner. For instance, immediate actions may include reducing the number of conditional business lines and digitising administrative procedures to simplify processes and reduce bureaucratic hurdles.

Đà Nẵng City's officials visit the facility used for the training course on semiconductor IC. Under a newly-signed resolution, public scientific and technological organisations, as well as public higher education institutions, are allowed to establish, participate in the establishment of businesses, and contribute capital to businesses in order to commercialise the scientific research and technological development results. — VNA/VNS Photo Văn Dũng

In the latest move, National Assembly Chairman Trần Thanh Mẫn has signed off Resolution No. 193/2025/QH15 on piloting several special mechanisms and policies to create breakthroughs in the development of science, technology, innovation, and national digital transformation. The resolution is deemed a legal foundation for amendments to the Law on Enterprises to be approved.

However, it should be noted that there is still cases of interest conflicts when public employees are assigned to manage a business so it is necessary to have a sanction to deal with the conflict.

Besides, the resolution does not mention the case when the business established by a public employee wants to mobilise capital, or list in the stock market or do M&A transaction. How to evaluate it when a part of the business’ asset is managed by the public service providers is another matter.

So it is on the one hand plausible for the MPI to put forth the amendments, on the other hand, to realise it properly and effectively, the ministry should prepare more thoroughly related legal documents.

*Võ Trí Thành is former vice-president at the Central Institute for Economic Management (CIEM) and a member of the National Financial and Monetary Policy Advisory Council. With a doctorate in economics from Australian National University, Thành mainly undertakes research and provides consultation on issues related to macroeconomic policies, trade liberalisation and international economic integration. Other areas of interest include institutional reforms, financial systems and economics of development. He authors the Việt Nam News column Analyst’s Pick.