VIETNAM – THE LATEST DRAFT DECREE ON PROVISION OF INTERNET SERVICES AND CROSS-BORDER INFORMATION

On November 2020, we reported on the first draft decree amending and supplementing Decree No. 72/2013/ND-CP and Decree No. 27/2018/ND-CP regarding the management, provision and use of Internet services and online information. Since then, the business community, among others, have been vocal on the shortcomings of the draft and offered up many comments and suggestions to address concerns. Taking these into accounts, on 5 July 2021, The Ministry of Information and Communications issued the second Draft Decree amending and supplementing Decree No. 72/2013/ND-CP and Decree No. 27/2018/ND-CP (“the Draft”). The Draft will affect telecommunications businesses, publishers of video games and businesses that engage in producing and utilizing electronic newspapers, social networks, and sales websites.

Notable provisions in the Draft

On Aggregate information:

1. Aggregate information is information retrieved from Vietnamese press sources and must relate to the following 08 sectors: science, technology, economy, culture, sports, entertainment, advertising and social security.

2. Organizations’ internal websites and specialized website providing aggregate information must obtain aggregate information website license. This measure aims to prevent internal websites from illegally posing as aggregate information websites in order to lure in viewers. Multinationals which usually have their own global websites for staff members across the world must take extra caution when handling information already published by the Vietnamese press.

3. Aggregate information websites are also required to have electronic tools to receive and handle users’ complaints about content and copyright.

4. Press agencies that have electronic newspapers/magazines are not allowed to have aggregate information websites.

On Re-releasing published contents:

1. Aggregate information websites, application distribution stores and social networks can only re-released content published by Vietnamese press sources at least 30 minutes later than the time of publishing the source content. Re-released content must be removed immediately after the source content has been removed.

2. Agreggate information must state clearly the author’s name, the source’s name, the time of posting and place a link to the source content right below the re-released content. Aggregate information must not include readers’ comment of the re-released content (except for aggregate information websites constituted by press agencies).

3. Aggregate information must not concern other localities. This measure is somewhat impractical given the fact that in this era global events closely interwove with and have direct effects on people’s everyday life, this is especially true for international organizations, and thus viewers are increasingly looking for information about other countries. For example, the war in Yemen can drive up oil price in Vietnam or the gold price fluctuates with the hourly results of the US presidential election. Putting such measure could hinder aggregate information website’s business growth.

On Cross-border provision of public information:

Foreign entities engaging in this service must comply to Vietnam laws. Failure by investors in handling violating information can lead to the Ministry of Information and Communications proactively implementing technical interventions.

Foreign organizations and individuals providing cross-border information services that have rented a place to store digital information in Vietnam or have regular access by a number of people in Vietnam (UV- Unique Visitor) within 01 (one) month from 100,000 (one hundred thousand) people or more, have the obligation to:

– Notify/confirm the notice of operation with the Ministry of Information and Communications and coordinate with the Ministry of Information and Communications to handle violating information;
– Have a process to prevent and remove infringing services and information within 24 hours upon request from Vietnamese competent authorities.

On Social networks:

1. Social networks are classified into social networks with high levels of interaction and ones with low level of interaction based on the monthly number of interaction or registered users. Social networks with high levels of interaction (at least 1 million interactions and/or 10,000 registered users per month) have to obtain a Social Network License issued by the Ministry of Information and Communications. Social networks with low levels of interaction need only notify the Ministry of Information and Communication on its operation.

2. Only licensed social networks have the right to charge fees and perform livestream services. The Ministry of Information and Communications will also embed a tool to monitor interaction levels for licensing-related purpose.

These measures, if come into effect, would seriously hamper the development of new social networks that rely on service fees in order to further expand their business. The possibility that such new social networks have to go through lengthy administrative procedures before they can carry out any fees collection and the possibility that entities have to amend their information technology system to accommodate the Ministry’s monitoring tool would not only cause them financial burdens but also interfere with their freedom of doing business.

3. Social network owners must have a solution to prevent members from taking advantage of social networks for journalistic activities. According to the Draft, only accounts that have been identified with 2 authentication layers (authenticated accounts with real names and phone numbers) can write articles, post comments, livestream, otherwise only allowed to read news and articles.

4. The license to set up an aggregate information website and the license to provide social networking services is also shortened to a maximum of no more than 5 years and renewed only once, each time not exceeding 02 years. Previously, the maximum license term was 10 years and could be renewed twice.

On Online games:

1. The Draft removes the requirement for online game providers to obtain a master license/certificate. A Dissemination License is now only required for each G1 game, while a Certificate for Game Dissemination Registration is required for each G2-4 games.

2. Providers must also show that they have (i) A head office with clear address and contact; (ii) Capacity to register and store users’ personal information including national identification information; (iii) Capacity to control players’ playtime, including restriction on children’s playtime.
The application of an uniform policy for all online games creates an imbalance in management as new games that need to prioritize attracting players or new developers short on funds must adhere to the same standards for established games/developers, thus creating difficulties in online games distribution.

3. Payment system of online games (if any) must be located in Vietnam and connected with Vietnamese payment service providers.

4. A number of regulations were also included in the Decree for the first time, such as the application dossier for G1 video games must contain “Certificate of legal copyright and consular legalization in the host country of a written agreement for enterprises to publish online video games in Vietnam”. This is to ensure that the game is licensed with the right copyright in Vietnam.

5. The licenses shall be revoked if the enterprises do not provide online game services within 12 months from the licenses’ issuance date.

Within this era of ever-changing technological advances and the society’s increasing dependence on technology, the Draft Decree would play a very important role in managing this under-regulated sector. Duane Morris will keep our readers informed on the status of the Draft.

Please do not hesitate to contact the author Dr. Oliver Massmann under omassmann@duanemorris.com. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC, Member to the Supervisory Board of PetroVietnam Insurance JSC and the only foreign lawyer presenting in Vietnamese language to members of the NATIONAL ASSEMBLY OF VIETNAM.