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A draft decree regulating enforcement against corporate legal entities is being assessed, following the evolution of corporate criminal enforcement in Vietnam. The draft was prepared by the Ministry of Public Security and is intended to detail provisions of the Criminal Enforcement Law 2025, which continues to govern enforcement against corporate entities. The decree draft consists of six chapters and 63 articles, including rules on coercive enforcement measures against corporate entities.
The draft decree includes provisions on coercive enforcement measures and sets out scenarios for transferring enforcement obligations in cases of corporate restructuring, including split, spin-off, mergers, and consolidations.
Under Article 17, coercive enforcement measures against corporate entities include account freezing and asset seizure.
Article 34 addresses “seizure of mortgaged assets.” It provides that if a corporate entity has no other assets or if available assets are insufficient to satisfy the obligation, criminal enforcement authorities may seize and dispose of mortgaged assets of the corporate entity. This applies where the value of the mortgaged assets exceeds the secured obligation and the costs of enforcement.
The draft also lists asset types not subject to seizure. It includes, among others, contributed capital, vehicles, intellectual property rights, and land-use rights.
Regarding Article 34, the State Bank of Vietnam (SBV) proposed removing the provision that allows seizure of mortgaged assets of corporate entities and adding a rule stating that mortgaged assets under pledge may not be seized.
SBV’s position is that the purpose of secured transactions is to guarantee performance of obligations identified at the time the contract is made. By contrast, obligations arising from enforcement decisions by criminal enforcement authorities occur after the contract. SBV argues that allowing seizure of mortgaged assets to enforce criminal penalties could undermine the effectiveness of security interests and fail to protect creditors’ rights.
SBV also cites Civil Code Article 307 and the Law on Credit Institutions Article 199, which recognize the secured creditor’s priority when disposing of secured assets, noting that enforcement seizures do not ensure such priority.
SBV further notes that Decree 296/2025/NĐ-CP on enforcing administrative penalties does not regulate seizures of mortgaged assets. Based on this input, the drafting authority proposes retaining the rule in the current draft.
Article 35 provides for “seizure of assets of a corporate entity held by a third party.” If a third party is determined to hold the corporate entity’s assets, the criminal enforcement authority may issue a seizure order. If the third party does not voluntarily surrender the assets, the enforcement authority may compel delivery.
The draft also addresses situations where seized assets are leased: in such cases, the lessee may continue under the existing contract.
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