Proposal for cross-border online retail platforms to have representatives in Vietnam

According to regulations, cross-border online retail platforms with Vietnamese domain names, Vietnamese display language, or with more than 100,000 transactions per year from Vietnam must register their operations with the Ministry of Industry and Trade. Last year, some cross-border platforms such as Temu and Shein did not register their operations in Vietnam but still allowed users to download applications (apps), make purchases and pay on the platform with the Vietnamese version.

To tighten management, in the draft outline of the Law on E-commerce that is being consulted, the Ministry of Industry and Trade proposes that traders and organizations with cross-border e-commerce activities in the Vietnamese market must apply for a license from the Ministry of Industry and Trade. Along with that, they must establish a representative office in Vietnam or appoint a representative under their authorization as a legal entity in Vietnam.

Cross-border retail platforms will be prohibited from selling goods and providing services without completing procedures with e-commerce management agencies.

E-commerce support service providers (intermediary services, logistics services, payment services) are also prohibited from cooperating and providing services to platforms that do not meet the operating conditions in Vietnam, according to the draft.

According to the Ministry of Industry and Trade, the Law on E-commerce is expected to stipulate the responsibilities of representative offices or authorized legal entities in Vietnam to ensure the rights of domestic consumers. The operator will issue regulations on the responsibility of authenticating foreign sellers and compensating them.
Buy before there is a breach on the platform.

Vietnam's e-commerce market ranks third in Southeast Asia in terms of size and fifth in the world in terms of growth rate. The size of this retail market has increased rapidly from 2.97 billion USD in 2014 to more than 25 billion USD at present. Thus, on average, this market increases by 20-30% per year, contributing 8% to the total revenue of consumer goods and services nationwide.

However, this sector is currently managed by two Government decrees, so according to the Ministry of Industry and Trade, current regulations are not enough to regulate important issues in e-commerce. The emergence of many new models, such as cross-border e-commerce, makes management difficult.

Furthermore, current regulations for this group are also "softer" than those for official e-commerce platforms operating domestically, causing unfairness in the competitive environment. Agencies such as customs, tax, and market management also do not have an effective coordination mechanism.

In addition to cross-border platforms, new forms such as livestream sales are only generally regulated as an advertising activity accompanying sales, without specific regulations on participating subjects, minimum information that must be provided to viewers, and account identification.

Currently, the proportion of the population participating in e-commerce is over 60% with an average purchase value of about 400 USD per person per year. Therefore, according to the Ministry of Industry and Trade, having the Law on E-commerce will meet the development requirements of the market, protect the rights of all parties and create motivation for Vietnam to develop the digital economy.

In the world, many countries have established e-commerce laws such as Malaysia, Cambodia, China, Ireland... Some countries do not have e-commerce laws but have specific regulatory documents for this field such as the European Commission. Some countries have established related laws from the perspective of user protection such as Japan, Korea, India.