The Vietnam Electrical Equipment Joint Corporation, known as Gelex Group (HOSE: GEX), has formally addressed recent public and market speculation regarding the legal status of Mr. Dang Phan Tuong, a member of its governing body. In an official communication released to shareholders and the public, the conglomerate emphasized that the legal proceedings initiated against Mr. Tuong stem entirely from his professional activities prior to his tenure with the Gelex ecosystem. Consequently, the corporation maintains that the developments bear no operational or financial nexus to the current business activities of Gelex, its subsidiary Gelex Electric (HOSE: GEE), or any associated entities within the corporate group.
According to regulatory filings and investigative disclosures, Mr. Dang Phan Tuong is currently facing criminal prosecution and detention in connection with an ongoing investigation centered at the National Power Transmission Corporation (EVNNPT). The case, which has sent ripples through both the energy and financial sectors, involves high-profile inquiries into systemic irregularities within major national infrastructure projects. Despite the gravity of the allegations, corporate representatives have moved swiftly to reassure stakeholders regarding the insulation of Gelex’s day-to-day operations, governance structures, and financial health from the unfolding legal turmoil.
Corporate Governance and Structural Insulation
At Gelex Electric, Mr. Tuong held the position of a non-executive member of the Board of Directors, a role that did not entail direct participation in the day-to-day operational management of the enterprise. Corporate governance frameworks at Gelex and its member companies ensure that production, commercial operations, financial management, and cash flow operations remain firmly under the purview of executive management teams operating according to standard corporate governance charters.
Management reiterated that the core business operations, financial strategies, and ongoing investment plans of Gelex and its key subsidiaries remain uninterrupted. Key operational units, including Gelex Electric, Vietnam Electric Cable Corporation (Cadivi), and Electrical Equipment Joint Stock Company (Thibidi), have proactively reviewed their internal administrative procedures and governance compliance frameworks upon receiving notification of the investigation.
To address the situation decisively, the Boards of Directors of Gelex Electric, Cadivi, and Thibidi convened on September 14 to initiate formal procedures for obtaining written shareholder consent. The objective of this consultation is the formal dismissal of Mr. Dang Phan Tuong from his position as a member of the Board of Directors, as he no longer fulfills the statutory criteria and regulatory requirements mandated for corporate board members under current enterprise laws.
Chronology of the Investigation and Broader Industry Impact
The sweeping investigation involving Mr. Tuong traces back to actions taken by the C01 investigative agency (the Ministry of Public Security) in late April 2026. By early July 2026, law enforcement authorities publicly disclosed the scale of the operation, revealing that criminal proceedings had been initiated against 47 suspects across 13 companies and organizational units. The suspects have been categorized under five distinct groups of criminal charges, including violations of bidding regulations resulting in serious consequences, accounting violations with serious consequences, asset embezzlement, offering bribes, and receiving bribes.
Preliminary findings from the investigative body indicate that systemic irregularities occurred during the execution of major infrastructure initiatives, most notably the 500 kV Circuit 3 transmission line project, for which EVNNPT served as the primary investor. The scope of the investigation spans the entire lifecycle of these capital-intensive projects, covering initial planning, feasibility studies, technical dossier preparation, bidding procedures, project execution, final inspection, and financial settlement.
As part of their sweeping enforcement measures, investigative authorities have seized substantial assets, including approximately VND 45.8 billion and USD 1 million in cash. Furthermore, regulatory bodies have frozen and suspended securities accounts holding a combined market value of approximately VND 1,756 billion as the comprehensive financial and legal audit continues to unfold.
Market Reactions and Investor Sentiment
The announcement of legal actions involving prominent figures associated with the energy sector triggered an immediate and pronounced reaction on the Vietnamese stock market. During the trading session on September 14, equities belonging to the broader "Gelex ecosystem" experienced severe downward pressure. Major tickers, including GEX, GEE, and related holding entities, hit their respective floor limits amid heavy selling volumes. Concurrently, associated financial equities such as VIX witnessed significant downward adjustments accompanied by exceptionally high market liquidity, with trading volumes approaching 83 million units.
Market analysts note that while the sell-off reflects acute short-term investor sentiment and risk aversion, the structural soundness of corporate balance sheets will ultimately dictate medium-term valuations. Financial institutions and institutional investors have been closely monitoring corporate disclosures to assess potential contagion risks, though fundamental operational metrics for Gelex’s core manufacturing and industrial segments remain robust.
Corporate Outlook and Strategic Continuity
Despite the headwinds generated by the executive shake-up and market volatility, Gelex leadership maintains that its strategic trajectory remains intact. The prompt removal of Mr. Tuong from subsidiary boards underscores management’s commitment to swift compliance and stringent corporate governance standards. By cleanly separating historical professional liabilities from current corporate governance, Gelex aims to restore market confidence and ensure the uninterrupted delivery of its industrial and energy infrastructure projects moving forward.
