Clarifying the "venture capital" mechanism and criteria for establishing a "Security Industrial Complex"

On the morning of October 31, during a discussion at Group 6 (including the National Assembly delegations of Dong Nai, Lang Son provinces and Hue City) on the draft Law amending and supplementing a number of articles of the Law on Defense Industry, Security and Industrial Mobilization, delegates suggested clarifying the mechanism of "venture investment" and the criteria for establishing a "security industrial complex"...

Need for legal basis for "venture investment" mechanism of Funds

Commenting on the draft Law amending the Law on National Defense and Security Industry, delegates from Group 6 unanimously agreed that the draft Law amending and supplementing a number of articles of the Law on National Defense and Security Industry and Industrial Mobilization has a tight structure, focusing on 3 major groups of changes: Special financial mechanism - establishing and operating two parallel funds; supplementing the National Security Industry Complex - a model of state-enterprise linkage; establishing the Security Industry Development Management Council - a focal point for coordinating industry strategies. However, commenting on each specific content, delegates said that the Drafting Committee needs to review and supplement a number of provisions accordingly.

View of the meeting at Group 6 on the morning of October 31. Photo: Ho Long

Regarding the establishment of two parallel funds, the National Defense Industry Fund and the Security Industry Development Investment Fund (Article 22), National Assembly Deputy Nguyen Thi Suu (Hue City) said that this is a new thing, the draft clearly defines two non-budgetary state financial funds: the National Defense Industry Fund managed by the Ministry of National Defense; the Security Industry Development Investment Fund managed by the Ministry of Public Security . Both funds operate not for profit, accept risks, and invest in venture capital. However, the delegate noted: "venture investment" needs a more specific legal basis to avoid violating the State Budget Law and the Law on State Capital Management. Therefore, the delegate proposed: assign the Ministry of Finance to preside over the issuance of operating regulations and annual independent audits. Along with that, clearly stipulate the allocation rate, conditions of use and "capital recovery" mechanism when the project is successful to ensure transparency, avoid overlap, and comply with international practices on state investment funds.

National Assembly Delegate Nguyen Thi Suu ( Hue City) speaks. Photo: Ho Long

Regarding the establishment of the "National Security Industrial Complex" (Chapter II - Section 8), delegate Nguyen Thi Suu emphasized: this is the biggest change of the draft, creating a national security industrial complex structure similar to the "Defense Industrial Complex". The complex includes: the core is the core security industrial facilities; members are organizations and enterprises inside and outside the People's Public Security force. This is a modern multi-component industrial association model, but requires a strict legal mechanism on ownership, benefit sharing and information security. There are no criteria for selecting members or recognition process. Therefore, it is necessary to assign the Government to stipulate the recognition criteria, the mechanism for withdrawing from the complex, and clearly define the legal responsibilities of each party; at the same time, add the principle of "equality in access to information, technology and product security" to ensure safety - efficiency - transparency, while avoiding the form of "nominal complex".

National Assembly Delegate Nguyen Tuan Anh (Dong Nai) speaks. Photo: Ho Long

Agreeing with the above opinion, National Assembly Deputy Nguyen Tuan Anh (Dong Nai) also said that the draft Law amending and supplementing a number of articles of the Law on National Defense and Security Industry and Industrial Mobilization shows new features with regulations on funds, aiming to create a legal corridor to resolve shortcomings and breakthroughs in the field of national defense and security industry.

However, discussing the national security complex, delegates said that to ensure feasibility, it is necessary to supplement and specify a number of issues, that is, in addition to creating favorable tax policies, it is necessary to create a mechanism for this complex to work well, and there needs to be a special mechanism to attract and treat high-quality human resources. Specifically, it is necessary to stipulate a special salary regime, higher than the salary prescribed in the administrative salary system for experts and scientists to attract high-quality human resources for industrial establishments. In addition, there are incentives for land use in specialized areas as well as clearly defining priority in allocating and leasing land to members implementing strategic projects, thereby creating conditions for the complexes to promote their effectiveness.

National Assembly Deputy Nguyen Cong Long (Dong Nai) speaks. Photo: Ho Long

Commenting on the issue of the National Defense Industry Fund and the Security Industry Development Investment Fund, National Assembly Deputies Nguyen Cong Long and Trinh Xuan An (Dong Nai) also emphasized: the national defense and security funds, the national defense and security tasks are different, so there needs to be a clear separation. However, the ultimate goal is still to develop the national defense industry, so the Drafting Committee should review and supplement the provisions accordingly to ensure legality, transparency and effectiveness in implementation.

National Assembly Delegate Trinh Xuan An (Dong Nai) speaks. Photo: Ho Long

Elevating the legal status of the Security Industry Development Management Council

Regarding the issue of establishing the "Security Industry Development Management Council" (Article 79, Clause 7), the National Assembly Deputies commented: the establishment of the National Council is an important step forward in governance, helping the Minister of Public Security coordinate the complex, manage funds and deploy the security industry strategy.

However, to ensure national coordination and avoid duplication of functions, some delegates proposed to clarify the legal position and inter-sectoral coordination authority of the Council. Specifically, in terms of personnel and structure, the Council should have the Deputy Prime Minister in charge of the internal affairs and security sector as Chairman, with permanent members from the Ministry of National Defense, the Ministry of Science and Technology, and the Ministry of Finance. In terms of functions, it is necessary to add the function of monitoring the implementation of preferential policies, product standards, and coordinating the export of security products to avoid duplication of functions and ensure national coordination.

Regarding the policy of promoting research and innovation in the national defense and security industry (Article 45d, clauses 3 and 4), delegates highly appreciated the policy to encourage the development of a national science and technology program specifically serving the security industry. However, it was suggested that it is necessary to supplement a mechanism for transferring civil-military technology and an R&D fund in parallel with two large financial funds. Delegates also proposed the need to establish a "Fund for supporting research and innovation in national defense and security technology" at the same level as the National Science and Technology Fund. Prioritizing core technologies: AI, big data, new materials, automation.

Source: https://daibieunhandan.vn/lam-ro-co-che-dau-tu-mao-hiem-va-tieu-chi-thanh-lap-to-hop-cong-nghiep-an-ninh-10393815.html