You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

February 26, 2023

Key Changes in Vietnam’s Draft Telecom Law

Subscribe to Updates

Vietnam’s Ministry of Information and Communications (MIC) has been working to replace the outdated 2009 Telecom Law with a new version more suited to today’s digital economy. A draft Telecom Law was made available for public consultation from October 27 to December 27, 2022. On January 17, 2023, the MIC submitted an amended draft (the “Draft”) to the Ministry of Justice for appraisal (the Vietnamese version of the Draft and accompanying documents in the dossier can be accessed here). The Draft is scheduled to be discussed by the National Assembly in May 2023 and submitted for approval in October 2023.

The key content and changes of the Draft as compared to the existing law are set out below.

1. Licensing Telecom Services

For domestic enterprises, the 2009 Telecom Law only provides two types of licenses—telecom network establishment licenses and telecom service business licenses—without differentiating the conditions and licensing procedures for various types of telecom services. This no longer meets management requirements and does not encourage enterprises to participate in providing new services on already existing infrastructure.

Although the Draft retains the two main types of licenses—licenses to provide telecom services with network establishment for a term of not more than 15 years; and licenses to provide telecom services without network establishment with a term of no more than 10 years—it also provides different licensing conditions for different types of telecom service provision, with three kinds of licensing: (i) individual licenses for certain enterprises with specific conditions and obligations based on telecom management objectives at the time of licensing; (ii) class licenses for businesses that meet the prescribed licensing conditions; and (iii) registration, which requires businesses only to submit registration information according to the prescribed form to be licensed.

In addition, to avoid the situation of licensed telecom network enterprises delaying or not implementing telecom network establishment as licensed, the Draft regulates that enterprises providing telecom services with network establishment must meet conditions of charter capital, network deployment, and service quality.

2. Cross-Border Provision of Telecom Services

For overseas enterprises, the Draft regulates that the provision of cross-border telecom services to users in Vietnam:

  • Must comply with the provisions of Vietnamese law and international treaties to which Vietnam is a member;
  • Must be done through a commercial agreement with a Vietnamese telecom enterprise that has been licensed to provide telecom services;
  • Requires Vietnamese licensed telecom enterprises to register a sample commercial agreement [with the competent agency], to have necessary technical plans to perform the task of controlling and ensuring information security or perform emergency prevention and/or stop providing telecom services at the request of competent agencies;
  • Must ensure the requirements for safety, national security and defense, and legitimate public policy objectives;
  • Will be guided in detail by the government.

3. OTT Telecom Services

The Draft supplements the definition of OTT telecom services (for example, WhatsApp, Zalo, Viber, Line, etc.) which are called “internet application services in telecom.” Accordingly, these services are telecom services providing the main function of sending, transmitting, receiving, and processing information between two or more telecom service users via the internet. The Draft allows cross-border provision of OTT telecom services to Vietnam with regulations on service providers’ responsibilities in service provision as well as requirements for notification to the MIC of contact information and other content. Forms and procedures for notification must comply with the government’s regulations.

Some key responsibilities of OTT telecom service providers include:

  • If it is necessary to access information, data, or features on the user’s terminal to serve the provision of services, the service provider must notify the user of the need and obtain the user’s consent prior to performing access.
  • Service providers must be responsible for service quality according to registered or announced standards; ensuring the correct, sufficient, and accurate calculation of charges under the contract for using telecom services.
  • Service providers must report periodically or at the request of the specialized telecom management agency on the operation of the enterprise, and must be responsible for the accuracy and timeliness of the content and data of the report.

With “internet application services in telecom” defined as a type of telecom service, the question arises whether it is also subject to the general requirement of cross-border provision of telecom services—i.e., that it must be through a commercial agreement with a Vietnamese telecom enterprise that has been licensed to provide telecom services. It is recommended that this ambiguity should be clarified by the MIC to avoid uncertainty and difficult implementation in the future.

4. Telecom Wholesale and Retail Services

The regulations on wholesale management in the existing Telecom Law are incomplete, and only provide interconnection and common use of essential facilities without regulations on buying and selling of telecom traffic for resale. This leads to difficulties for businesses to cooperate and negotiate with each other, and for state agencies to intervene when there is a dispute. The Draft aims at supplementing provisions to ensure that both wholesale and retail telecom markets are regulated, promoting healthy competition, and facilitating businesses to enter the telecom market to develop new services and provide a variety of telecom services, telecom application services, and other new services.

The Draft provides definitions of telecom wholesale and retail services, the obligations of telecom enterprises providing wholesale services for telecom services that require state management, the obligations of telecom companies with a dominant market position, and acts that restrict competition in the telecom sector.

One act of unfair competition which is not permitted for telecom enterprises or groups of telecom enterprises having a dominant market position, or telecom enterprises holding essential facilities, is to cross-offset telecom services.

Some key obligations of telecom wholesale service providers include:

  • Providing services with fair and reasonable tariff charges and conditions, without discriminating between service-buying enterprises, or between the enterprise’s own retail unit and service-buying enterprises for resale under the same circumstances.
  • Transparency of tariff charges, telecom standards, and technical regulations; quality of telecom networks and services.
  • Implementing the principles of price management of telecom wholesale services set out by the specialized telecom management agency when determining and adjusting prices.

5. Satellite Telecom Services

According to the MIC, the development trend of LEO (low-earth orbit) satellite services with cross-border services having the nature of collecting data, is likely to affect national defense, network security, information security, and protection of users’ personal data and interests, and at the same time compete directly with the domestic terrestrial mobile and fixed broadband services.

Currently, regulations on licensing satellite telecom services are at the decree level and there is no specific provision on how to license a foreign enterprise providing cross-border satellite services via an agreement with licensed telecom Vietnamese enterprises. Therefore, having learned from international experience, the MIC aims to regulate satellite services by including in the Draft a provision on cross-border telecom service provision (item 2 above), together with licensing conditions of domestic telecom enterprises providing telecom services with network establishment.

6. Data Center Services and Cloud Computing Services

The Draft has a new chapter on data center services and cloud computing services. Data center services are services that provide computing capacity, storage, and technical infrastructure of a data center, which is a complex consisting of a system of technical infrastructure, information infrastructure and ancillary equipment installed into the system to perform storage, processing, exchange, and central management of data of one or more organizations and individuals. Cloud computing is a service model that allows people to easily access shared computing resources (networks, servers, storage, applications, services) through a network connection anytime, anywhere, and as required. Cloud computing services are services that provides cloud computing resources, including information infrastructure, platform, and software as a service (IaaS, PaaS, SaaS) on a network environment. The Draft does not classify data center services and cloud computing services, as the previous draft did, but leaves this classification to be further regulated by the government.

The Draft regulates that the business of data center services and cloud computing services is a conditional business. This new chapter also provides general conditions for service provision, and responsibilities and obligations of service providers in ensuring compliance with storage regulations, announcement of standards and technical regulations, responsibility for service quality, protection of personal information and interests of users, ensuring network information security, and handling content that violates copyright or intellectual property rights or violates the law at the request of a competent authority. In addition, this chapter also regulates the rights and obligations of service users and establishes policies to encourage investment and development of data center services.

Interestingly, unlike the earlier draft, this Draft does not clearly regulate how offshore service providers can provide data center services or cloud computing services to users in Vietnam. The previous Draft set out that all providers of data center services and IaaS cloud computing services, whether onshore or offshore, had to obtain a permit to provide the services by registration with the MIC via its online portal; while PaaS and SaaS cloud computing services were exempted from this requirement. The latest Draft, instead, simply provides that providers of these services must meet the conditions on investment and business before providing the services to users in Vietnam, leaving further guidance to the government.

Related Professionals

Industries

Technology

Location

RELATED INSIGHTS​ 

February 2, 2024
The pervasive global issue of illicit personal data trading has extended its reach into Vietnam, where such sensitive information is being sold at minimal costs. A 2023 report from the Ministry of Public Security revealed that over two-thirds of the Vietnamese population has fallen victim to unlawful data collection and distribution. In the past two years, authorities have pressed charges on five criminal cases involving the buying and selling of billions of items of personal data, encompassing a wide range of sensitive information such as names, phone numbers, email addresses, and more. Notably, a person’s profile can be acquired for just USD 1, while profiles of millions of business customers can be obtained for a mere USD 100. Recognizing the severity of the problem, Vietnam has made serious efforts to combat illicit personal data trading by criminal means, encompassing both the legal framework and practical implementation.   Understanding the Criminal Legal Framework Vietnam’s 2015 Criminal Code, as amended in 2017, functions as a pivotal legal instrument delineating offenses and their corresponding punishments. Under Section 2 of Chapter XXI of the Criminal Code (“Offenses Against Regulations on Information Technology and Telecommunications Networks”), individuals engaging in the illicit trading of personal data, depending on the nature of the data (e.g., information about phone number, address, or—more dangerously—bank account) and the nature of the infringing acts, may be charged under different crimes. The sanctions can include monetary fines; non-custodial reform; imprisonment; and/or prohibition from holding certain positions, practicing certain professions, or doing certain jobs. For example, for the illicit trade of private information of an individual on a computer or telecommunications network, Article 288 of the Criminal Code specifies penalties including a monetary fine of up to VND 1 billion (equivalent to around USD 41,000); non-custodial reform of up to three years;
Read More
January 30, 2024
Thailand has made its draft Platform Economy Act (the “Draft PEA”) available to relevant entities in certain industries. The Draft PEA aims to regulate and standardize digital platform service business operations and protect consumers and other stakeholders. Once the Draft PEA becomes law, the Royal Decree on the Operation of Digital Platform Service Businesses that are subject to Prior Notification B.E. 2565 (2022) and the relevant provisions under the Electronic Transactions Act B.E. 2544 (2001), as amended, will cease to have effect. The key provisions of the Draft PEA are summarized below. Definitions The definitions of the key terms under the Draft PEA are substantially similar to the definitions of the key terms under the royal decree mentioned above. According to the Draft PEA, “digital platform services” refers to the provision of electronic intermediary services that manage data to facilitate connection, through computer networks, between business users, consumers, or users, regardless of whether remuneration is charged. Exemption The Draft PEA does not apply to digital platform services (DPSs) that are regulated by specific laws and have rules guaranteeing transparency and fairness, or that follow operational standards no less stringent than those required in the Draft PEA. Nonetheless, the Electronic Transactions Development Agency (ETDA) can request or link data relating to exempted DPSs from the relevant supervisory authorities. Extraterritorial Effect Offshore DPSs with certain characteristics are also subject to the obligations under the Draft PEA and will have to appoint a coordinating person in Thailand. However, offshore DPSs will not have to establish a business in Thailand. General Responsibilities and Obligations The Draft PEA sets out the following requirements: DPSs with (1) at least THB 100 million (approx. USD 2.8 million) in annual revenue from providing the DPSs in Thailand before deducting expenses, or (2) more than 10,000 monthly users
Read More
January 24, 2024
On 17 April 2023, the Vietnamese government issued the Personal Data Protection Decree, which is set to take effect 1 July 2023 without any transitional period. The PDPD is considered to be the first comprehensive document on data protection in Vietnam. Accordingly, it provides detailed regulations on the rights of data subjects, consent requirements and requirements for data processing impact assessments and outbound transfer impact assessments. In 2024, the adoption of the Law on the Protection of Consumer Rights and the Law on Electronic Transactions will play a vital role regarding data protection. The LPCR will require traders to obtain consent to collect consumer data and establish a mechanism enabling consumers to select the information they consent to traders collecting. Consumers must also be allowed to express consent in a suitable form. For special processing purposes — such as sharing, disclosure, or transfer of personal data to third parties, and use of personal data to send advertisements and to introduce products — the LPCR requires a mechanism which enables data subjects to clearly opt in to give, or not give, their consent. This requirement is similar to procedures currently required for regulated stakeholders under the PDPD. In the same vein, the LET strictly forbids the acts of trading data to protect Vietnamese personal data. The government is anticipated to provide more details relating to data privacy guidelines after the issuance of the Draft Law on Telecommunications. Accordingly, the draft requires enterprises to provide the requisite information — such as service user’s name and address, number and location of transmitting or receiving servers, call times, IP address and other personal information supplied by the service user when entering a contract — to the relevant authority, as per a request which is made in accordance with the law. Amendments to Decree
Read More
January 24, 2024
Thailand’s Personal Data Protection Act came into full effect on 1 June 2022 and various subordinate regulations have since been issued by the Personal Data Protection Committee. These include regulations on security measures to be implemented by data controllers, data breach notification requirements, a mandatory obligation to appoint a data protection officer when the processing activity requires regular monitoring of personal data or a system due to the large scale of personal data, administrative measures and data processors’ record of processing activities. As some areas under the PDPA still require further clarifications, a series of public consultations for the remaining draft subordinate regulations is anticipated in 2024. Potential areas include data protection impact assessments and cross-border transfers of personal data, which are crucial for organizations and particularly for entities with establishments in other jurisdictions. PDPA enforcement by Thai regulators was silent until the last quarter of 2023, when the PDPC published details about complaints that have been lodged to the Expert Committee. The committee is designated by virtue of the PDPA and has the power to make determinations related to imposing administrative fines and other penalties. Enforcement in 2024 is expected to become more active and potentially more serious, which means organizations should pay closer attention to ensure compliance with the PDPA. Similar to the GDPR, the PDPA also has extraterritorial effect. Once the subordinate regulation on international cooperation has been issued by the PDPC, this should clarify how PDPA enforcement against organizations located outside of Thailand will be conducted by Thai regulators. With respect to sector-specific data protection legislation, in September 2023, Thailand’s National Broadcasting and Telecommunications Commission issued the Notification of the NBTC Re: Measures to Protect Telecommunications Service Users’ Rights in regard to Personal Data, Privacy Rights, and Freedom of Telecommunications, which replaces the previous notification.
Read More