Fuel trading and distribution is excluded from the WTO commitments of Vietnam on distribution services. Crude oil and processed oil under “HS code: 2710” are goods not permitted to be distributed by foreign invested companies. In addition, in the WTO Commitments, Vietnam has expressly reserved fuel trading rights to various State-owned enterprises:

The above reservation suggests that Vietnam does not commit to open fuel trading to foreign investment. Therefore, technically, foreigners are not allowed to own shares in a Vietnamese company (including public listed, unlisted public and non-public companies) involving in fuel trading.

In practice, allowing foreign investment in fuel trading at top level seems to be a sensitive subject. It is reported that many foreign investors have tried to invest in certain top level distributors when they were privatized. However, in case of Petrolimex, foreign investors are expressly excluded from investing in the company when the company was privatized in June 2011.

In case of middle level distributors, in theories, middle level distributors are subject to the same legal restrictions as top level distributors. However, in practice, certain middle level distributors listed on the stock exchange still have foreign shareholders. This appears to be due to the lack of enforcement by the authorities rather than an intentional approval by the authorities. In fact, according to newspaper report, in a similar situation, a listed company involving in pharmaceutical trading has been forced to de-list and to buy back the shares owned by foreign shareholders in order to continue pharmaceutical trading business. In practice, the same may be applied to a listed middle level fuel distributors.