As Vietnam accelerates its digital transformation, data centers have emerged as critical infrastructure supporting the shift toward a digital government, digital economy, and digital society. For businesses targeting Vietnam’s rapidly growing data center market, a clear understanding of the evolving regulatory landscape, compliance obligations, and government incentives is key to successful market entry and operation. This article provides a strategic overview of investment opportunities and key compliance requirements in Vietnam’s dynamic data center sector.

Investment Incentives to Boost Data Center Growth

Since July 1, 2024, organizations and individuals across all economic sectors have been encouraged to invest in and contribute to the development of data centers. By law, there are no restrictions on shareholding ratios, capital contributions, or foreign investor participation in data center and cloud computing services under business cooperation contracts.

Currently, investment in AI data centers is classified as a specially incentivized industry, qualifying for preferential treatments and incentives in terms of investment, taxation, land use, and other related areas.

Large-scale data centers, together with AI and cloud computing, are currently considered as strategic technologies and products for which Vietnam offers significant fiscal, tax, and land incentives to promote investment. Additionally, these large-scale projects may receive direct financial support from local development budgets for facility construction, technical infrastructure, and equipment procurement, subject to state budget provisions and applicable laws. AI data center construction projects also enjoy preferential treatment under customs regulations.

Regulatory Approvals for Providing Data Center Services

The 2023 Telecom Law and its guiding documents marked a significant milestone by classifying data center services as value-added telecom services. Under the law, a data center service is defined as a telecom service that enables users to process, store, and retrieve information via a telecom network through the leasing of part or all of a data center. A data center is defined as a telecom facility consisting of buildings, stations, cable systems, computer systems, electrical systems, and auxiliary equipment, established to process, store, and manage data for one or multiple organizations or individuals.

While offshore data center service providers offering cross-border services to users in Vietnam are required to notify the Ministry of Science and Technology (MST) (formerly the Ministry of Information and Communications), onshore data center service providers that have been established in Vietnam must register with the provincial people’s committee where the enterprise is headquartered.

Key Standards and Technical Regulations for Data Center Compliance

By law, data centers in Vietnam must comply with standards and technical regulations covering design, safety, and operational assurance. These include national standards such as TCVN 9250:2021 (or international equivalents like ANSI/TIA-942-B:2017 or Uptime Institute Tier Standards), lightning protection for telecom stations and external telecom cable networks (QCVN 32:2020/BTTTT), national technical regulation on earthing for telecom stations (QCVN 9:2016/BTTTT), and fire safety for buildings and constructions (QCVN 06:2021/BXD).

Before providing data center services, enterprises are required to assess and announce conformity with the relevant standards and technical regulations and submit reports to the MST if there are changes that affect declared conformity. Data center service providers are also required to maintain and ensure compliance with all relevant standards and technical regulations throughout operation of the data center.

Key Ongoing Obligations

Data center operators must comply with a range of obligations. They are required to adhere to the laws on cybersecurity, network information security, personal data protection, and other applicable laws. At the same time, they must ensure the security of telecom infrastructure, maintain network information security, and safeguard the confidentiality of information. Operators must guarantee that service quality aligns with registered or published standards and that service pricing is accurate and consistent with contractual agreements. They are subject to oversight by state authorities and must submit periodic or ad hoc reports to the MST, ensuring timeliness and accuracy in their reporting.

Outlook

Vietnam’s regulatory framework for data centers is designed to encourage investment while ensuring compliance with essential legal standards. Clear policies, investment incentives, and operational guidelines provide a strong foundation for businesses looking to participate in Vietnam’s fast-transforming digital economy. With AI, cloud, and data center services driving this momentum, now is the time for businesses to move quickly. The key is to stay compliant, build to the right standards from the start, and make full use of investment incentives. Companies that act early will have the best chance to lead as Vietnam becomes a digital hub in the region.