Latest Updates on the Restructuring Plan for Lottery Companies

The Ministry of Finance has announced a restructuring plan for lottery businesses in Vietnam, in line with the government’s policies on administrative reorganization and state-owned enterprise consolidation. This initiative aims to streamline the lottery industry, ensuring each province or city operates only one lottery company.

Currently, Vietnam has 64 state-owned lottery companies, including 63 provincial Traditional Lottery Companies (under the management of provincial People’s Committees) and Vietlott (managed by the Ministry of Finance). These companies are divided into three regional zones for traditional lottery operations, while Vietlott operates a nationwide digital lottery system.

The Northern region comprises 28 Traditional Lottery Companies, covering provinces from Ha Giang (now Tuyen Quang) to Ha Tinh. The Central region includes 14 companies, spanning from Quang Binh (now Quang Tri) to Ninh Thuan (now Khanh Hoa). The Southern region consists of 21 companies, operating from Binh Thuan to Ca Mau.

As of 2024, the total lottery market revenue reached 159.477 trillion VND, with 50.907 trillion VND contributed to the state budget. This revenue is allocated entirely to local budgets, supporting development, healthcare, education, social welfare, and public services.

Over the years, several Southern and Central Traditional Lottery Companies have significantly contributed to local budgets, notably in Ca Mau, Ben Tre, Bac Lieu, Phu Yen, Dak Lak, and Khanh Hoa.

In contrast, some Northern Traditional Lottery Companies have made limited contributions to local budgets. A few have even operated inefficiently, accumulating losses over multiple years and facing negative equity.

To address these challenges and reorganize the lottery system, the Ministry of Finance has proposed a restructuring plan for lottery businesses.

For the Central and Southern regions, provincial People’s Committees will consolidate Traditional Lottery Companies according to new provincial administrative units, ensuring each province has only one lottery operator. This process will follow legal provisions for restructuring state-owned enterprises.

In the Northern region, the lottery market will be reorganized under a parent-subsidiary model, with Vietlott as the parent company and Northern Traditional Lottery Companies as subsidiaries, fully owned by Vietlott.

The Ministry of Finance justifies Vietlott’s role as the parent company due to its substantial capital (500 billion VND) and expertise in applying technology to lottery issuance, distribution, and management.

Since its inception in 2016, Vietlott has demonstrated effective operations with an average annual growth rate of 16%. Post-restructuring, Northern Traditional Lottery Companies can leverage Vietlott’s technology to enhance their business efficiency.

During a meeting on this matter, Deputy Prime Minister Ho Duc Phoc emphasized the importance of unified management and operational efficiency, stating that each province should have only one Traditional Lottery Company. These companies may establish branches or offices in various locations to optimize existing facilities, manage agents effectively, reduce operational costs, and alleviate pressure on headquarters.

For Traditional Lottery Companies transitioning to the Ministry of Finance (represented by Vietlott), the Deputy Prime Minister instructed the Ministry to coordinate handover plans with provincial People’s Committees, ensuring compliance with legal regulations.