Vietnam: Telecommunication draft decree – Significant proposed amendments

In brief

Earlier this month (7 August), the MIC released and called for public consultation on the draft decree amending and supplementing several provisions of Decree No. 25/2011/ND-CP guiding the implementation of the Law on Telecommunications (“Draft Decree“). The deadline for contribution to this consultation is 7 October 2021.

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Key areas of change

The Draft Decree proposes comprehensive changes focusing on the following areas:

• Telecommunication license
• Administration of competition in the telecommunication market
• Administration of telecommunication service charges
• Administration of commercial promotion in the telecommunication market
• Administration of telecommunication payment card
• Management of telecommunication digital repository
• Registration, storage and use of subscribers’ information

In more detail

1. Telecommunication license

• The minimum charter capital required for enterprises establishing a terrestrial fixed telecommunication network would be subject to the geographical scope of the network, as opposed to the current level, which is based on whether or not the network would use radio frequency bands and telecommunication numbers.
• Six months prior to the expiry of the telecommunication license, the telecommunication enterprise must notify the Vietnam Telecommunications Authority (VNTA) about its proposed business plan moving forward. Should the enterprise decide not to continue its operation, it must notify its users and other related parties, 30 days prior to such expiry at the latest.
• The circumstances under which a telecommunication license would be revoked are already provided under Article 39.1 of the Law on Telecommunications. The Draft Decree supplements a provision, thereby allowing enterprises, at their own initiative, to request for such revocation due to, for example, changes in their business operation.

2. Administration of competition in the telecommunication market

• The Draft Decree clarifies the jurisdiction of the VNTA. Practices restraining competition or those of unfair competition shall be generally under the jurisdiction of the Vietnam Competition Commission. The VNTA shall only handle those that are within the scope of Article 19.2 of the Law on Telecommunications.
• The Draft Decree introduces the following four business-to-business (B2B) and two business-to-consumer (B2C) markets that are subject to (additional) state administration of competition; enterprises having a dominant position in the following markets would also be subject to additional obligations and supervision from the state:
  1. Wholesale service market for fixed broadband access
  2. Wholesale service market for terrestrial mobile telecommunication service providers with establishment of terrestrial mobile telecommunications network infrastructure without using radio frequency bands (mobile virtual telecommunication networks (MVN))
  3. Wholesale service market for enterprises providing terrestrial mobile telecommunication services without network infrastructure
  4. Domestic roaming service market
  5. Market for fixed terrestrial broadband internet access services
  6. Market for terrestrial mobile communication services
  7. Other markets as provided by the Ministry of Information and Telecommunications (MIC)

3. Administration of telecommunication service charges

• The MIC no longer provides the charge rate of public-utility telecommunication service but may still stipulate its ceiling and floor prices.
• The retail charge rates must be registered with the VNTA and must be published by the enterprises providing retail services.

4. Administration of commercial promotion in the telecommunications market

• Provisions on the promotional activities of telecommunication services are amended and supplemented to be in line with the general regulations on promotion (as provided under Decree No. 81/2018/ND-CP).

5. The telecommunication companies’ responsibilities in the management of the telecom and digital content ecosystem

• Further to the initiative of mobile money, the Draft Decree supplements certain provisions allowing SIM mobile subscribers to use mobile accounts to pay for digital content services provided by the telecommunication network operators. The payment for using digital content services to be made by a mobile subscriber is limited at VND 500,000 per transaction and VND 2 million per month.
• Enterprises whose users use the SIM mobile subscriber account to pay for content services are subject to additional obligations, such as the obligation to verify/identify users’ identities (i.e., the obligation to know your client (KYC)), the obligation to have in place risk management tools, etc.
• Telecommunication enterprises are responsible for coordinating the removal from the telecom and digital content ecosystem, within 24 hours from the request of a competent state agency, services that violate the laws.

6. Management of telecommunication numbers repository

• Under the Draft Decree, the telecommunication numbers repository would be distributed and allocated through public auction or direct allocation, in accordance with the laws on telecommunications, on auction, and on management of public property. The MIC would promulgate the list of telecommunication subscription numbers that must be auctioned.

7. Registration, retention and use of subscribers’ information

• The execution of the (standard form) contract between a subscriber and the telecommunication provider must be carried out: (i) in person at the provider’s premise or at the provider’s point of sale; or (ii) online via an electronic application furnished by the provider. This is to ensure the verification/identification of subscribers. The service providers are also obliged to ensure that the subscribers’ information are updated in a timely manner.
• Subscribers entering into a subscription contract with the service provider must provide information about their own identity, along with ID documents. The service provider shall then verify the identity of the subscriber, which can be carried out in person or via a video call in case of online subscription form.
• The SIM activation must be carried out by a staff engaged by the telecommunication service provider.

8. Miscellaneous provisions

• The users’/subscribers’ information must be retained by the service provider, who is obliged to provide such information to a competent authority when requested, pursuant to the laws. Under the Law on Securities 2019, the State Securities Commission is allowed to request for such information from telecommunication service providers to investigate acts in violation of securities laws.
• Mobile number portability (MNP) is now recognized in the Draft Decree. MNP would be processed centrally by the Service and Network Development Support Center of the VNTA. This provision shall be stipulated in more detail by the MIC.

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