Illustrative image (Photo: dauthuanvien.blogspot.com) Hanoi (VNA) – The wrongdoingsin State-owned Mobifone’s acquisition of the Audio Visual Global Joint StockCompany (AVG) are attracting public attention, with wide expectations that thecase should be handled strictly and lost State asset must be recovered.
Inspection of the acquisitionwas launched in September 2016, but due to the complicated nature andseriousness of the deal, the Government Inspectorate (GI) only releasedconclusion on the inspection outcomes on March 14.
Mobifone’s purchase of 95percent of AVG was a major deal between a State-owned enterprise and a privatecompany, but what made it come under spotlight was the lack of transparency. Inthe first quarter of 2016, Mobifone announced the decision to buy 95 percent ofAVG, but did not disclose the value of the transaction. The company’sleadership refused to answer the press on this question, claiming that it was classifiedinformation. The case was raised repeatedly at the National Assembly and many pressconferences after the Cabinet’s regular meetings.
“Which were the needs and basisfor Mobifone to use State capital to buy AVG? How much was the real value ofthe acquisition? How did the AVG operate after the acquisition and did thebusiness outcome match the investment?”, were the questions posed by Le ThanhVan, standing member of the NA’s Committee on Financial-Budgetary Affairs, atthe 4th session of the 14th NA in November 2017.
The answer to those questions camein the GI’s conclusion released on March 14. The GI stressed that this is avery serious economic case, with real risk of great damage worth over 7 trillionVND to State capital at Mobifone. The damage included 1.134 trillion VND worthof AVG’s debt.
The obscure deal has made a negativeimpact on the image of Mobifone, reducing the value of its shares during theequitisation process.
It can be seen through the casethat the lack of transparency in State-owned enterprises’ operation will posebig risks of causing losses and wastefulness of State resources.
The inspection of the case hasbeen made under the close and drastic instruction of the Party and theGovernment towards an accurate final conclusion in line with the law whilepreserving the firm’s value and maintaining the operation of a large-scale SOEduring preparation for equitisation.
At the 12th meetingof the Central Steering Committee for Corruption Prevention and Fight, Party GeneralSecretary and head of the committee Nguyen Phu Trong requested urgentinspection and early conclusion, along with clarification of the causes andresponsibilities of involved persons in nine major loss-making projects ofpublic concern, including the Mobifone’s acquisition of AVG.
Recently, the Party CentralCommittee Secretariat asked the Government standing board to instruct relevantagencies to quickly handle the case in an objective and accurate manner in linewith the Party’s guidelines and State laws, to ensure that punishment is givento the right person and lost State assets are revoked.
In the newly announcedconclusion of the Mobifone case, the GI not only made clear law violations inthe transaction but also clarified the responsibilities of related agencies andproposed measures and tasks to deal with the violations, in both administrativeand economic terms.
Among the measures, the GI recommendedrecovering the amount of money that Mobifone had paid for the acquisition of a95 percent stake of AVG, enforcing decisions on the case issued by relevantagencies, and collecting 1.3 billion VND in corporate income tax arrears fromMobifone, among others.
The clear conclusion on the violation,along with directions for strict handling of the case demonstrated thedetermination of the Party and the State in tightening discipline and rules,enhancing publicity and transparency, and in fighting negative phenomena,corruption and wastefulness, thus creating a healthy and stable environment forthe sustainable development of the national economy.-VNA
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