The Phuc Loc Corporation Ecosystem
Mr. Luong Minh Tuong (born in 1973) has permanent residence in Hanoi but is a well-known businessman in Ninh Binh. In this land, he built the Phuc Loc Corporation, which has become one of the names in the construction and infrastructure industry.
The full name of the Phuc Loc Corporation (Phuc Loc Group) is Phuc Loc Group Joint Stock Company, founded in April 2010. This company has an enormous charter capital of VND 2,689 billion (updated in September 2019).
Since late January 2024, Mr. Vu Trong Kien (born in 1975), along with Chairman Luong Minh Tuong, has been the representative of this company.
Businessman Luong Minh Tuong. Photo: Phuc Loc Group
The mark of Phuc Loc Group is a series of infrastructure projects such as the Eastern Ring Road project in Hai An District (with a total investment of VND 800 billion in Hai Phong); the project to upgrade National Road 4D and build Provincial Road 155 connecting Lao Cai City and Sapa; the Ninh Binh – Nghi Son expressway project; the BOT project for the Bach Dang Bridge (with a total investment of VND 7,600 billion)…
Phuc Loc Group is in charge of the industrial real estate sector through Phuc Loc Industrial Zone Development Investment Joint Stock Company (Phuc Loc Industrial Zone Company) established in March 2014 with the goal of implementing Phuc Son Industrial Zone.
At the time of its establishment, Mr. Luong Minh Tuong assumed the position of Chairman of the Board of Directors and legal representative. Since July 2015, Mr. Nguyen Trung Dung (born in 1977) has been the General Director and currently holds the position of Chairman of the Board of Directors and legal representative.
With an initial charter capital of VND 100 billion, the shareholder structure of Phuc Loc Industrial Zone at that time consisted of: Mr. Tuong contributing VND 23 billion, Phuc Loc Group Joint Stock Company contributing VND 75 billion, and Mr. Dung contributing VND 2 billion.
After 4 adjustments, from July 2021 to now, Phuc Loc Industrial Zone Company has a charter capital of VND 375 billion, and the shareholder structure is not disclosed.
In addition to Phuc Son Industrial Zone, in Ninh Binh, Phuc Loc Group also invests in the Phuc Loc Import and Export Commodities Services Complex in Khanh Phu Industrial Zone. This comprehensive project includes dry port ICD, seaport, customs warehouse, clearance point… reflecting the ambitions of the company in the field of import and export cargo services.
Phuc Loc Company Limited – Phuc Loc Real Estate, established in May 2016, is also in charge of the real estate sector. By April 2018, the company increased its charter capital from VND 50 billion to VND 200 billion. The shareholder structure includes: Phuc Loc Group holding 99.8%, and two other individual shareholders, Mr. Luong Minh Tuong and Mr. Vu Van Vuong.
Currently, Mr. Nguyen Trung Dung, Chairman of the Board of Directors of Phuc Loc Industrial Zone Company, is also the Chairman of the Board of Directors and legal representative of Phuc Loc Real Estate Company.
In the Phuc Loc Group ecosystem, Mr. Tuong and his younger brother Luong Minh Tuyen (born in 1977) also founded Phuc Loc Company Limited in 2005, headquartered in Ninh Binh Province. Initially, this company had a charter capital of VND 100 billion, with two founding shareholders, Luong Minh Tuong (98% charter capital) and Luong Minh Tuyen (2% charter capital) holding the positions of Chairman of the Board of Directors.
In 2015, the shareholder structure of Phuc Loc Company Limited changed, with Mr. Luong Minh Tuong no longer being a founding shareholder. Instead, Phuc Loc Group owned 99% of the charter capital, and the charter capital increased to VND 250 billion.
In February 2019, the company changed its name to Vietnam Construction and Engineering Installation Corporation. The main business area is the exploitation of stones, sand, gravel, and clay. The charter capital is VND 250 billion.
At this time, the shareholder structure consisted of: Phuc Loc Group holding 90%, Chairman Luong Minh Tuyen holding 5%, and Mrs. Le Thu Trang holding 5%.
Phuc Loc Group headquarters in Ninh Binh
In addition, Luong Minh Tuong’s business ecosystem also includes many other legal entities operating in provinces and cities throughout the country, such as Phuc Loc Hai Phong Joint Stock Company, Phuc Loc Quang Ngai Joint Stock Company, and project companies such as Lao Cai – Sa Pa BOT Investment Joint Stock Company, Vietnam PPP Investment Corporation…
Quietly taking over Cienco 8
One of the ambitions of businessman Luong Minh Tuong in the infrastructure sector is the acquisition of Cienco 8 Corporation.
According to the approved equitization plan of the Government (early 2014), Cienco 8’s charter capital is VND 350 billion, equivalent to the issuance of 35 million shares with a face value of VND 10,000 per share.
Specifically, the State holds 17.15 million shares, accounting for 49% of the charter capital; 21% of shares are offered to strategic investors; more than 10 million shares, equivalent to 28.6% of the charter capital, are auctioned publicly; the remaining 1.4% is issued to employees.
The three strategic shareholders of Cienco 8 are: Long Bien Bridge Joint Stock Company contributes VND 35 billion (representing 10% of the charter capital), Vinaconex – PVC Construction Investment Joint Stock Company contributes VND 21 billion (representing 6% of the charter capital), and Vietnam Export Import Commercial Joint Stock Bank Securities Limited contributes VND 17.5 billion (representing 5% of the charter capital).
In the period from 2013 to 2015, the Ministry of Transport promoted the equitization of transportation companies (the Cienco group). From 2014 to 2015, Cienco 8 continued to offer public shares several times but all were unsuccessful.
The strategic shareholders of Cienco 8 then quietly divested. In October 2015, Luong Minh Tuong was appointed Chairman of the Board of Directors and CEO of Cienco 8. At that time, investors were surprised that Luong Minh Tuong and his wife, Ms. Dinh Thi Huong Giang, had completed the purchase of state capital and from strategic shareholders, holding a total of 51.99% of the total shares in Cienco 8.
After the Phuc Loc Group shareholder group took control, Cienco 8 increased its charter capital to VND 589.9 billion. At this time, the State shareholder held about 18% of the charter capital, while the Phuc Loc shareholder group held the majority with 78.51% ownership.
Subsequently, the Phuc Loc – Cienco 8 consortium won many infrastructure projects, notably the urgent construction project of the Cau River flood control system, combined with the completion of urban infrastructure on both sides of the Cau River (Cau River Project) using the PPP public-private partnership investment form – Build-Transfer contract in Thai Nguyen Province. The total investment capital of the project is over VND 18,211.61 billion.
Continuous Reputation for Violations
Although leaving a mark in many major projects, Phuc Loc Group has faced numerous setbacks in its over 10 years of development due to continuous violations in its projects.
In early February 2024, the Government Inspectorate issued a Notice of Conclusion on the inspection of responsibility for implementing the law on inspection, citizen reception, complaint settlement, denunciation, and anti-corruption; land management, permit issuance for exploiting land mines, stones as construction materials, planning, and implementing construction planning in Ninh Binh Province.
One of Phuc Loc’s industrial zones in Ninh Binh. Photo: Phuc Loc Group
In this inspection, the Government Inspectorate pointed out some violations at the Phuc Son Industrial Zone by Phuc Loc Industrial Park Development Investment Joint Stock Company as the investor.
Specifically, the Provincial People’s Committee approved the investment policy and the Industrial Park Management Board issued investment registration certificates for 4 commercial and service projects that were not suitable for the detailed planning of Phuc Son Industrial Park (industrial land). This does not comply with the provisions of Article 51(1) of the Construction Law 2014, Article 33(3) of the Investment Law 2014.
In addition, the Provincial People’s Committee leased land for 3 out of 4 aforementioned commercial and service projects that did not comply with the land use plan, violating Article 52 of the Land Law 2013.
In addition, the investor of the industrial park infrastructure project has not fulfilled its financial obligations, has not issued land use right certificates, but has allowed sub-investors to lease land, violating Article 168(1) of the Land Law 2013.
In addition, the Industrial Park Management Board issued investment registration certificates to secondary investors to implement 6 projects in the industrial park without ensuring required records as stipulated in Point d Clause 1 of Article 33 of the Investment Law 2014, Point d Clause 1 of Article 33 of the Investment Law 2020.
Based on the inspection results above, the Government Inspectorate recommended that the Prime Minister direct the Chairman of the Provincial People’s Committee of Ninh Binh province to handle matters within its jurisdiction, ensure the correct land use function of the industrial park, review, calculate the correct and sufficient land lease fees, and require Phuc Loc Industrial Park Company to fully pay without any loss to the budget.
Prior to this, in 2014, the Binh Dinh Provincial People’s Committee assigned Phuc Loc Group as the investor to implement two projects: the extended Dien Bien Phu Street project and the project to renovate and upgrade the drainage system of Phu Hoa Lake using the Build-Transfer investment form. At the same time, the project of exploiting land funds for Phu Hoa Urban – Tourist – Cultural – Sports Area (Quy Nhon City) was also assigned to the investor for implementation.
However, in the announcement of the inspection conclusion No. 1348 dated August 9, 2019, the Government Inspectorate pointed out many violations by Phuc Loc Group in the implementation of the two above-mentioned projects.
Specifically, according to the Government Inspectorate, although not yet being handed over land, the investor organized the implementation and construction of some works and items of the Dien Bien Phu Street project and the project to renovate and upgrade the drainage system of Phu Hoa Lake without having construction design drawings, construction methods, and approved construction permits, violating construction management regulations.
In addition, the investor was slow in adjusting the projects, construction designs, construction drawings, and construction estimates to submit them to competent authorities for consultation, appraisal, and approval; slow in disbursing funds to compensate, clear land, and support affected households due to build-transfer projects, Phu Hoa Urban-Tourist-Cultural-Sports Area and funding for bomb clearance, having not completed procedures for converting forest protection land (7.6 ha), slow in constructing resettlement areas for local residents.
The Government Inspectorate also pointed out that the Project Management Board was slow in negotiating, adjusting, and finalizing contracts for the two build-transfer projects and lacked determination in handling violations by investors.
In addition, Binh Dinh also approved the urgent construction project of anti-erosion dike and renovation and upgrade of the flood drainage system of Ha Thanh River, with a total investment of VND 3,006 billion (including 90% from the state budget and 10% from the local budget) when there were not enough grounds and foundation, so the project could not be implemented.
