In brief
- The implementation of the new Law on Telecommunications (“New Telecom Law“), effective on 1 July 2024, requires a decree from the government to provide guidance and further details on various issues.
- On 2 February 2024, the Ministry of Information and Communications published a draft version of the decree guiding the New Telecom Law (“Draft Telecom Decree“) to collect public comments. The deadline for public comments is 2 April 2024.
- The MIC expects the Draft Telecom Decree to be issued within 2024, but has set no specific effective or issuance date yet.
- Obligations of providers of basic telecom services on the internet (including over-the-top (OTT) communications services), data centers (DC), and cloud computing (“Cloud“) services are provided under this draft version of the decree.
- The Draft Telecom Decree will likely undergo further changes in the coming months before being submitted to the government for its review and issuance.
Below are several key takeaways of the Draft Telecom Decree, which may affect the foreign businesses providing relevant online services in Vietnam.
Key takeaways
1. Overview of the Draft Telecom Decree
The draft is rather long, comprising 87 articles and 29 templates, covering the following major issues:
- Telecom business licensing
- Telecom infrastructure
- Subscriber information
- Basic telecom services on the internet, DC, and Cloud services — notably, obligations of the offshore companies that provide these services on a cross-border basis to Vietnam
- Telecom market
- Provision of telecom services, especially on a cross-border basis
2. OTT, DC, and Cloud services are classified as value-added telecoms services
The New Telecom Law defines basic telecom services on the Internet (e.g., OTT communication services), DC, and Cloud services as telecom services with specific relevant functions. However, as telecom services merely include (i) basic telecom services and (ii) value-added telecom services, under the Draft Telecom Decree, the MIC proposes to classify the three new services as value-added telecom services, among other traditional services, such as email services, voicemail services, value-added fax services and internet access services.
3. Provision of telecom services on a cross-border basis
The provision of telecom services (excluding basic telecom services on the Internet, DC, and Cloud services) on a cross-border basis to users within the territory of Vietnam must be conducted via a commercial agreement with a relevant Vietnamese telecommunications company that has duly been licensed and allowed to create an international gate, unless provided otherwise by an international treaty to which Vietnam is a signatory.
The Vietnamese telecommunications company acting as the local partner of the offshore service provider will be subject to further requirements under the draft.
4. Obligations of offshore providers of basic telecom service on the Internet
Under the New Telecom Law, there are no specific obligations applicable to offshore providers of basic telecom services on the internet. It appears that local lawmakers had not reached a consensus on how to regulate offshore providers by the time the law was passed, and hence, only onshore ones were contemplated there. The obligations applicable to offshore providers are now proposed under the Draft Telecom Decree.
Per the draft, these offshore providers will bear the following key obligations:
- Notify the Vietnam Telecommunications Authority (VNTA) of the provision of the service. The notification will include the name of the service provider, its incorporation document, types of services being provided, and other information about the quality of the services being provided.
- Comply with certain requirements under the New Telecom Law, notably:
- Suspend the service in case of riots or abuse of services to oppose the state or violate national security upon the competent authorities’ request
- Not disclose private information about the service users, except in certain cases
- Obtain users’ consent when accessing any function on the users’ end devices
- Announce the quality of the service being provided
- Verify the information about the telephone number of the users before providing the service.
- Store the information about the users (including names of the users and their phone number) and other information about the users’ use of service per cybersecurity laws.
- Comply with requests from competent authorities to ensure cybersecurity per the law.
5. Obligations of offshore providers of DC and Cloud services
Similarly, there are no specific obligations applicable to offshore providers of DC and Cloud services under the New Telecom Law. Under the Draft Telecom Decree, the obligations of these providers are clarified, which are largely similar to those of the offshore providers of basic telecom services on the Internet. However, there are several specialized differences, as follows:
- While there is no obligation regarding access to users’ end devices, providers of DC and Cloud services must refrain from accessing, exploiting or using the data of the service users without the users’ consent.
- These providers must also comply with certain additional obligations under the New Telecom Law, such as the following:
- Upon request of competent authorities, take timely measures to block access to information
- Refrain from tracking or monitoring the information of service users
- Regarding users’ information, DC and Cloud service providers must store some basic information about the individual and corporate users, such as name and contact details.
6. Provision of DC and Cloud services to state authorities
The Draft Telecom Decree states that the data of state authorities using DC or Cloud services must be stored in Vietnam only. This means that if an offshore DC and Cloud service provider plans to become a state’s contractor, they will need to set up facilities in Vietnam to store the data of the relevant state agency.
* * * * *
Should you need our assistance for this legislative progress, please contact us.
