May a Public Employee at a Public Hospital Participate in Establishing a Private Hospital?

Short answer: No. Public employees working at public hospitals may not participate in establishing, managing, or operating private hospitals, under Clause 2, Article 17 of the Law on Enterprises 2020 (amended and supplemented by Law No. 76/2025/QH15, effective from 01/7/2025). Public employees may contribute capital to a private hospital as investors, but establishing and managing an enterprise remains prohibited under enterprise law — this is precisely the “otherwise provided by enterprise law” case referenced in Clause 3, Article 13 of the Law on Public Employees 2025 (except as permitted under the law on science, technology, innovation and national digital transformation).

Legal basis

• Law on Enterprises 2020 (amended and supplemented by Law No. 76/2025/QH15, effective from 01/7/2025);
• Law on Public Employees 2025 (Law No. 129/2025/QH15, effective from 01/7/2026, replacing the Law on Public Employees No. 58/2010/QH12).

Who is a public employee?

Under Article 1 of the Law on Public Employees 2025, a public employee is a Vietnamese citizen recruited for a job position, working at a public non-business unit under a working contract regime, receiving salary from the unit’s salary fund and from other lawful revenue sources as prescribed by law. Doctors, nurses, and medical staff working at public hospitals are all public employees.

Why may public employees not establish or manage private hospitals?

Clause 2, Article 17 of the Law on Enterprises 2020 (as amended by Law No. 76/2025/QH15) clearly provides that cadres, civil servants, and public employees under the Law on Cadres and Civil Servants and the Law on Public Employees do not have the right to establish and manage enterprises in Vietnam, except as permitted under the law on science, technology, innovation, and national digital transformation.

Thus, public employees of public hospitals may not:

• Stand as founders of a private hospital (in any enterprise form);
• Hold management or executive positions in a private hospital;
• Participate in managing their contributed capital in a private hospital in the capacity of an enterprise manager.

Note: Clause 3, Article 13 of the Law on Public Employees 2025 allows public employees to contribute capital to, and participate in the management and operation of enterprises, cooperatives, non-public hospitals, educational institutions, and scientific research organizations — but except where the laws on anti-corruption, the laws on enterprises, or sectoral legislation provide otherwise. Clause 2, Article 17 of the Law on Enterprises 2020 (as amended by Law No. 76/2025/QH15) is precisely that “otherwise” provision of enterprise law: public employees do not have the right to establish and manage enterprises, except as permitted under the law on science, technology, innovation and national digital transformation.

What may public hospital employees do outside working hours?

Under Article 13 of the Law on Public Employees 2025 (rights of public employees regarding professional practice and business activities), public employees have the following rights:

• Enter into labor contracts or service contracts with other agencies, organizations, or units where sectoral law does not prohibit it, ensuring no conflict of interest under anti-corruption law, no conflict with the terms of their working contract, and no breach of professional ethics — e.g., public hospital doctors may sign contracts to provide medical services outside hours in accordance with regulations;
• Practice as individuals where sectoral law does not prohibit it, ensuring no conflict of interest under anti-corruption law and no breach of professional ethics;
• Contribute capital to, and participate in the management and operation of enterprises, cooperatives, non-public hospitals, educational institutions, and scientific research organizations — except where the laws on anti-corruption, the laws on enterprises, or sectoral legislation provide otherwise.

The key point to note: the important legal boundary lies in the phrase “except where… otherwise provided”. For private hospitals, Clause 2, Article 17 of the Law on Enterprises 2020 (as amended by Law No. 76/2025/QH15) prohibits public employees from establishing and managing enterprises — so public employees may only contribute capital as pure investors, and may not stand as founders or hold management or executive positions in a private hospital (except as permitted under the law on science, technology, innovation and national digital transformation).

Frequently asked questions

May a public employee contribute capital to establish a private hospital?

A public employee may contribute capital to a private hospital as an investor, but may not stand as a founder or participate in managing or operating the private hospital. Legal basis: Clause 3, Article 13 of the Law on Public Employees 2025 permits capital contribution, but Clause 2, Article 17 of the Law on Enterprises 2020 (as amended by Law No. 76/2025/QH15) — as the “otherwise” provision of enterprise law — prohibits public employees from establishing and managing enterprises, except as permitted under the law on science, technology, innovation and national digital transformation.

May a public employee who leaves a public hospital open a private hospital?

Once the public employee relationship has ended (resignation or termination in accordance with regulations), the individual is no longer governed by the Law on Public Employees and may establish and manage an enterprise like an ordinary citizen, provided they meet the prescribed medical practice conditions.

How are violations handled?

Unlawfully establishing or managing an enterprise may lead to disciplinary action under public employee law and administrative or civil liability depending on the severity. Specific cases should be reviewed by a lawyer before proceeding.

If you need to determine precisely whether you fall within the restricted category, or wish to invest in a private hospital lawfully, please contact ANT Legal’s lawyers for review and advice before proceeding.