DECREE

AMENDMENTS TO GOVERNMENT’S DECREE NO. 39/2019/ND-CP DATED MAY 10, 2019 ON ORGANIZATION AND OPERATION OF THE SMALL AND MEDIUM ENTERPRISE DEVELOPMENT FUND

Pursuant to the Law on Government Organization dated June 19, 2015; the Law on Amendments to the Law on Government Organization and the Law on Local Government Organization dated November 22, 2019;

Pursuant to the Law on management and use of state capital invested in manufacturing and business operations of enterprises dated November 26, 2014;

Pursuant to the Law on State Budget dated June 25, 2015;

Pursuant to the Law on assistance for small and medium-sized enterprises dated June 12, 2017;

Pursuant to the Law on Credit Institutions dated June 16, 2010 and the Law providing amendments to the Law on Credit Institutions dated November 20, 2017;

Pursuant to the Law on enterprises dated June 17, 2020; the Law providing amendments to the Law on Public Investment, the Law on Public-Private Partnership Investment, the Investment Law, the Housing Law, the Law on Electricity, the Law on Enterprises, the Law on Excise Duties, and the Law on Civil Judgment Enforcement dated January 11, 2022;

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The Government promulgates a Decree providing amendments to the Government’s Decree No. 39/2019/ND-CP dated May 10, 2019 on organization and operation of the Small and Medium Enterprise Development Fund (SMEDF).

Article 1. Amendments to Government’s Decree No. 39/2019/ND-CP dated May 10, 2019

1. Clause 1 and Clause 2 Article 4 are amended as follows:

“1. “Fund's manager” means the holder of any of the following titles or positions, including: Chairperson or member of Board of Members, Director, or Deputy Director.

2. “Fund's employee” means a person who works for the Fund under an agreement, is paid, and bears management and supervision of the Fund in accordance with provisions of the labour code, but does not hold any of the titles and positions specified in clause 1 of this Article.”.

2. Clause 2 Article 6 is amended as follows:

“2. Board of Controllers;”.

3. Clause 4, Clause 5, Clause 6 and Clause 7 Article 7 are amended as follows:

a) Points a, d, dd Clause 4 are amended and points i, k are added to clause 4 as follows:

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d) Make decisions on financial statements; annual profit distribution and establishment of funds/provisions after obtaining approval from the Ministry of Planning and Investment of Vietnam;

dd) Appoint, re-appoint, dismiss, reward, discipline or hire, under the Fund’s personnel plan, the Fund’s Director after obtaining approval from the Ministry of Planning and Investment of Vietnam;

i) Make decisions on salaries, remunerations, bonuses and other benefits of Director, and other title holders appointed by the Board of Members;

k) Appoint, re-appoint, dismiss, reward, discipline, make decisions on salaries, remunerations, bonuses and other benefits of Deputy Director(s).”.

b) Point e is added to Clause 5 as follows:

“e) Except Chairperson of the Board of Members, a member of the Board of Members may concurrently hold the position of Director.”.

c) Point c Clause 6 is amended as follows:

“c) Inspect, examine, access, copy and extract logbooks, and monitor contracts, transactions, accounting books, financial statements, minutes of meetings of the Board of Members, and other documents of the Fund;”.

d) Point d Clause 7 is amended as follows:

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4. Clause 4 Article 8 is amended as follows:

“4. Develop quarterly and annual plans for activities of the Board of Members.”.

5. Article 9 is amended as follows:

a) Article 9 is amended as follows:

“Article 9. Board of Controllers and Controllers”.

b) Clause 1 is amended as follows:

“1. Based on the Fund's scale, the Ministry of Planning and Investment of Vietnam decides to establish the Board of Controllers that shall have 01 - 05 Controllers, including the Chief Controller. A Controller shall hold a term of office not exceeding 05 years, and may be re-appointed for up to 02 consecutive terms. In case the Board of Controllers only has 01 Controller, he/she shall act as the Chief Controller and be required to satisfy corresponding eligibility requirements for Chief Controller".

c) Heading of Clause 2 is amended as follows:

“2. Eligibility requirements and standards to be satisfied by Chief Controller and Controllers”.

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“a) He/she must have a bachelor’s degree or higher in economics, finance, banking, accounting, audit, law, or business administration, and at least 03 years’ experience. The Chief Controller must have at least 05 years’ experience;

c) He/she is not the Fund's manager, a Controller of an enterprise that is not a state-owned enterprise, or the Fund’s employee;”.

dd) Heading of Clause 3 is amended as follows:

 “3. Rights and obligations of Board of Controllers”.

e) Points b, c, d, and dd clause 3 are amended, and points e, g, h and i are added to clause 3 as follows:

“b) Supervise and assess the performance of rights and obligations by members of the Board of Members and by the Board of Members, Director;

c) Supervise and assess actual financial health and operations of the Fund, actual application and validity of the Fund’s operating regulations;

d) Supervise implementation of major investment projects; sale and purchase contracts/transactions and other large-scale business transactions of the Fund at the request of the Ministry of Planning and Investment of Vietnam;

dd) Prepare and send evaluation reports and proposals of the matters specified in Points a, b, c, and d of this Clause to the Ministry of Planning and Investment of Vietnam and the Board of Members;

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g) Examine accounting books, reports, contracts, transactions and other documents of the Fund; inspect the management and administration by the Board of Members and its members, and Director where necessary or at the request of the Ministry of Planning and Investment of Vietnam;

h) Request the Board of Members and its members, Director, and Deputy Director(s) to submit reports and/or provide information about the Fund's management and operation;

i) Perform other rights and obligations at the request of the Ministry of Planning and Investment of Vietnam.”.

g) Points d, dd and e are added to Clause 4 as follows:

“d) Promptly send a notification to the Ministry of Planning and Investment of Vietnam of violations committed by another Controller during his/her performance of rights, obligations and responsibilities, and request the violating Controller to stop the violation and implement remedial measures;

dd) Request the violating entity to stop the violation and implement remedial measures, and notify to the Ministry of Planning and Investment of Vietnam, other Controllers and relevant individuals in the following cases: A member of the Board of Members, Director or another executive violates or is going to violate regulations on their rights, obligations and responsibilities; violations against the law, provisions of this Decree or the Fund’s operating regulations are discovered;

e) The Controller that violates the regulations of this clause and causes damage to the Fund shall personally or jointly pay compensation, be held liable to disciplinary actions, administrative penalties or criminal prosecution depending on the nature and severity of the violation, and have to return the incomes and benefits earned from the violation to the Fund.”.

h) Clause 5 is amended as follows:

 “5. Working regulations of Board of Controllers

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b) Controllers shall perform their assigned tasks actively and independently; propose other tasks where necessary;

c) Meetings of the Board of Controllers shall be held at least once every month to review, evaluate and approve monthly operation reports before they are submitted to the Ministry of Planning and Investment of Vietnam; discuss and approve its operation plans of the next month;

d) A decision of the Board of Controllers will be ratified when it is voted for by the majority of the participating members. Dissenting opinions shall be fully and accurately recorded and reported to the Ministry of Planning and Investment of Vietnam.”.

6. Article 10 is amended as follows:

a) Clause 1 is amended as follows:

“1. The Director shall be appointed or hired by the Board of Members under a personnel plan approved by the Ministry of Planning and Investment of Vietnam. An appointed Director shall hold a term of office of 05 years, and may be re-appointed.”.

b) Heading of Clause 3 is amended as follows:

“3. The Director shall manage the Fund’s everyday business and has the following rights and obligations:”.

c) Point k is added to clause 3 as follows:

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7. Article 11 is amended as follows:

a) Heading of Article 11 is amended as follows:

“Article 11. Relationship between Board of Members, Board of Controllers, Controllers and Director in Fund’s management and administration”.

b) Clause 4 is amended as follows:

“4. The relationship between the Board of Controllers or Controllers and the Ministry of Planning and Investment of Vietnam, the Board of Members and the Director shall comply with regulations of law applicable to wholly state-owned single-member limited liability companies, and operating regulations of the Board of Controllers, Controllers, and the Board of Members.”.

8. Clause 4 is added to Article 15 as follows:

“4. Small and medium-sized enterprises that have got loans from the Fund but fully paid off principal and interest amounts on the agreed schedule (except force majeure events) may be eligible to get new loans from the Fund.”.

9. Clauses 1, 2 and 3 Article 16 are amended as follows:

a) Points a, b Clause 1 are amended as follows:

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b) Have feasible business projects or plans which must satisfy criteria for small and medium-sized startup enterprises;”.

b) Points a and b Clause 2 are amended and Point c is added to Clause 2 as follows:

“a) Participate in sectoral complexes in accordance with provisions of the Law on assistance for small and medium-sized enterprises and its guiding documents;

c) Meet the requirements set forth in Points c, d Clause 1 of this Article.”.

c) Points a and b Clause 3 are amended and Point c is added to Clause 3 as follows:

“a) Participate in value chains in accordance with provisions of the Law on assistance for small and medium-sized enterprises and its guiding documents;

b) Have feasible business projects or plans, and have products in these value chains;

c) Meet the requirements set forth in Points c, d Clause 1 of this Article.”.

10. Article 22 is amended as follows:

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“2. The bank shall receive funds from the Fund and carry out indirect lending activities in accordance with regulations on loans granted by credit institutions and foreign bank branches to their clients and provisions of this Decree.”.

b) Clause 3 is amended as follows:

“3. The bank shall itself carry out appraisal of loan applications and make decisions to grant loans to small and medium-sized enterprise when meeting the conditions set out in regulations of law on loans granted by credit institutions to their clients, and lending requirements set out in Article 23 of this Decree; assume responsibility for their lending decisions and incur all relevant risks.”.

c) Clause 6 is added as follows:

“6. Small and medium-sized enterprises that have got loans from the Fund but fully paid off principal and interest amounts on the agreed schedule (except force majeure events) may be eligible to get new loans from the Fund.”.

11. Clauses 2 and 3 Article 23 are amended as follows:

a) Point a Clause 2 is amended as follows:

“a) Meet the requirements set forth in Point c Clause 1, Points a and b Clause 2 Article 16 of this Decree;”.

b) Point a Clause 3 is amended as follows:

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12. Clause 3 is added to Article 28 as follows:

“3. No more than one financing application submitted by a small and medium-sized enterprise will be considered and approved by the Fund.”.

13. Clause 1 Article 29 is amended as follows:

“1. Each small and medium-sized enterprise may be eligible for financing granted by the Fund when meeting the conditions set out in Points a, b, c Clause 1 or Point c Clause 1, Points a, b Clause 2 or Point c Clause 1, Points a, b Clause 3 Article 16 of this Decree,”.

14. Clause 1 Article 38 is amended as follows:

“1. The Fund shall set aside provision for direct lending losses which may be included in the Fund’s operating expenses. General and specific provisions for losses shall comply with regulations of law on provisions for losses of credit institutions.”.

15. Clause 6 Article 45 is amended as follows:

“6. The idle capital included in the working capital as prescribed in Article 43 of this Decree may be deposited at commercial banks provided that capital adequacy requirements must be met.”.

16. Clause 1 Article 52 is amended as follows:

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17. Clause 3 Article 53 is amended as follows:

“3. After obtaining approval from the Ministry of Planning and Investment of Vietnam, the Board of Members shall decide to send annual audited financial statements to the Ministry of Planning and Investment of Vietnam and the Ministry of Finance of Vietnam.”.

18. Points a and b Clause 4 Article 54 are amended as follows:

“a) The Board of Controllers shall take charge of supervision tasks;

b) Contents of supervision shall comply with Points a, b, c, d and dd Clause 3 Article 9 of this Decree.”.

19. Point c Clause 2 Article 56 is amended as follows:

“c) There is a change of Chairperson or member of the Board of Members, Director, Deputy Director, Chief Controller or Controller;”.

20. Clauses 5, 6, 8, 10 Article 57 are amended and Clause 12 is added to Article 57 as follows:

a) Clause 5 is amended as follows:

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b) Clause 6 is amended as follows:

“6. Make decisions on appointment, re-appointment, dismissal, reward, discipline, salaries, remuneration, bonuses and other benefits of Chairperson and members of the Board of Members, Controllers; make decisions on salary fund and annual remuneration of the Fund’s manager and Controllers.

Consider giving approval for the Board of Members' requests for appointment, re-appointment, dismissal, reward, discipline or hiring, under the Fund’s personnel plan, of the Fund’s Director.”.

c) Clause 8 is amended as follows:

“8. Promulgate operating regulations of the Board of Controllers and Controllers.”.

d) Clause 10 is amended as follows:

“10. Evaluate business performance and operating efficiency of the Fund; evaluate the performance of the Fund’s manager and Controllers.”.

dd) Clause 12 is added as follows:

“12. Approve financial statements, and plans to distribute profits and set up annual funds of the Fund.”.

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“Article 58. Responsibilities of Ministry of Finance of Vietnam

Allocate the amount of charter capital which has been approved by the Prime Minister to the Fund.".

Article 2. Replacement of some phrases in some Articles, Clauses and Points of Government’s Decree No. 39/2019/ND-CP dated May 10, 2019

The phrase “người quản lý của Quỹ” (“the Fund’s manager”) and the phrase “người quản lý” (“the manager”) are replaced with the phrase “người quản lý, Kiểm soát viên” (“the Fund’s manager and Controllers”) in Point a Clause 2 Article 48; Article 49; Point c, Point dd, Point e Clause 2, Clause 4, Clause 5 Article 50; Point a Clause 2, Clause 4, Clause 5, Clause 6 Article 51 and Article 59.

Article 3. Entry into force and implementation

1. This Decree comes into force from June 10, 2024.

2. Business projects and plans of small and medium-sized enterprises to which the Fund has made decisions to finance, give direct loans or transfer funds to banks for giving indirect loans before this Decree comes into force shall continue to be implemented in accordance with the provisions of the Government’s Decree No. 39/2019/ND-CP dated May 10, 2019.

3. Ministers, heads of ministerial agencies, heads of Governmental agencies, Chairpersons of People’s Committees of provinces and central-affiliated cities and relevant agencies, organizations and individuals shall be responsible for the implementation of this Decree.

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ON BEHALF OF THE GOVERNMENT
 PP. PRIME MINISTER
DEPUTY PRIME MINISTER




Le Minh Khai

Nghị định 45/2024/NĐ-CP sửa đổi Nghị định 39/2019/NĐ-CP tổ chức và hoạt động của Quỹ Phát triển doanh nghiệp nhỏ và vừa