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Concept
State-owned enterprise
Summary
A state-owned enterprise (SOE) is a government entity which is established or nationalised by the national government or provincial government, by an executive order or an act of legislation, in order to earn profit for the government, control monopoly of the private sector entities, provide products and services to citizens at a lower price, implementation of government schemes and to deliver products and services to the remote locations of the country. The national government or provincial government has majority ownership over these state owned enterprises. These state owned enterprises are also known as public sector undertakings in some countries. Defining characteristics of SOEs are their distinct legal form and possession of financial goals and developmental objectives (e.g., a state railway company may aim to make transportation more accessible and earn profit for the government), SOEs are government entities established to pursue financial objectives and developmental goals.
The terminology around the term state-owned enterprise is murky. All three words in the term are challenged and subject to interpretation. First, it is debatable what the term "state" implies (e.g., it is unclear whether municipally owned corporations and enterprises held by regional public bodies are considered state-owned). Next, it is contestable under what circumstances a SOE qualifies as "owned" by a state (SOEs can be fully owned or partially owned; it is difficult to determine categorically what level of state ownership would qualify an entity to be considered as state-owned since governments can also own regular stock, without implying any special interference). Finally, the term "enterprise" is challenged, as it implies statutes in private law which may not always be present, and so the term "corporations" is frequently used instead.
Thus, SOEs are known under many other terms: state-owned company, state-owned entity, state enterprise, publicly owned corporation, government business enterprise, government-owned company, government-owned corporation, government-sponsored enterprise, commercial government agency, state-privatised industry public sector undertaking, or parastatal, among others.
Official source
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Nationalization
Nationalization (nationalisation in British English) is the process of transforming privately-owned assets into public assets by bringing them under the public ownership of a national government or state. Nationalization contrasts with privatization and with demutualization. When previously nationalized assets are privatized and subsequently returned to public ownership at a later stage, they are said to have undergone renationalization.
Industry (economics)
In macroeconomics, an industry is a branch of an economy that produces a closely related set of raw materials, goods, or services. For example, one might refer to the wood industry or to the insurance industry. When evaluating a single group or company, its dominant source of revenue is typically used by industry classifications to classify it within a specific industry. For example the International Standard Industrial Classification (ISIC) – used directly or through derived classifications for the official statistics of most countries worldwide – classifies "statistical units" by the "economic activity in which they mainly engage".
State ownership
State ownership, also called government ownership and public ownership, is the ownership of an industry, asset, or enterprise by the state or a public body representing a community, as opposed to an individual or private party. Public ownership specifically refers to industries selling goods and services to consumers and differs from public goods and government services financed out of a government's general budget.