Providing professional training for insolvency administrators in Vietnam
05:20 24/10/2015
On 20 October 2015, with the support of IFC, a member of the World Bank Group and the International Association of Restructuring, Insolvency, and Bankruptcy Professionals (INSOL International), the Ministry of Justice held a training workshop for insolvency practitioners to help them quickly and efficiently manage the assets of insolvent businesses in Vietnam.
Deputy Minister of Justice Nguyen Khanh Ngoc, Deputy Chief Justice of the People’s Supreme Court of Vietnam Tong Anh Hao, former president of INSOL International Neil Cooper, senior expert of the World Bank Justin Yap and more than 90 insolvency practitioners attended the workshop.
During the workshop, held from 20 to 21 October in Hanoi and from 23 to 24 October in Ho Chi Minh City, experts from IFC and INSOL International has supported Vietnam’s Ministry of Justice in training more than 90 insolvency practitioners to help them quickly and efficiently manage the assets of insolvent businesses. This will improve resource allocation and create a more stable environment for creditors and investors, spurring increased credit flow and business interest in Vietnam. In addition, they will train participants in the key areas of insolvency proceedings including case engagement management, assessment of the debtor’s business, case strategy, maximizing the value of debtor’s assets, and agreeing and paying claims, according to IFC.
According to Deputy Chief Justice of the People’s Supreme Court of Vietnam Tong Anh Hao, the training will equip insolvency practitioners with the necessary professional knowledge of insolvency resolution to enable them to practice their job more effectively, helping increase the efficiency of insolvency resolution in Vietnam. The country currently ranks only 109th out of 185 economies for resolving insolvency in the World Bank Group’s Doing Business 2015 report. It generally takes more than five years to complete the official procedures and secured creditors on average have recovered only 18.6% of the outstanding value.
Mentioning another aspect of the issue, Mr. Neil Cooper emphasized that Vietnam’s move to license insolvency practitioners is an important step that is in line with good practice in major economies such as the United Kingdom, France, Japan, China and Russia. Therefore, INSOL International looked forward to working with the Government of Vietnam and the World Bank Group in training the first cohort of Vietnamese insolvency practitioners.
Addressing the training workshop, Deputy Minister Nguyen Khanh Ngoc affirmed that in order to meet the requirement of socio-economic development and international integration recently, the appearance of insolvency administrators is very important and necessary to contribute to improving the efficiency of handling enterprises losing their solvency in Vietnam. He believes that although it is a newly established occupation, insolvency administration will be a long lasting one in Vietnam, contributing to the socio-economic development of the country and protecting the legitimate interest of creditors and stakeholders./.
On 19 June 2014, a new bankruptcy law was adopted by the National Assembly of Vietnam. As from 1 January 2015, Law No. 51/2014/QH13, entitled Law on Bankruptcy 2014 replaced Law No. 21/2004/QH11, entitled Law on Bankruptcy, passed by the National Assembly of Vietnam on 15 June 2004.
Following the enactment of Vietnam’s Law on Bankruptcy 2014, insolvency administration is now a regulated profession. Up to now, the Ministry of Justice has licensed 284 insolvency practitioners, who are mainly lawyers or who have a background in accountancy and auditing.