Legal Entity Required for Foreign E-commerce in Vietnam
The Ministry of Industry and Trade is drafting the Law on E-commerce, notably including stricter regulations on cross-border e-commerce platforms.
The draft regulation stipulates that foreign platforms operating in Vietnam, such as those using the domain name “.vn”, having 100,000 transactions per year or a Vietnamese interface, must authorize or establish a domestic legal entity, and be held responsible for violations. Some businesses believe that the feasibility and fairness of the regulation, especially the consular legalization procedure, should be reviewed and proposed to only require minimal authentication, giving flexible authority to the platform. Shopee representatives also proposed that cross-border platforms should be assessed and monitored according to the same standards as domestic businesses, to ensure a fair competitive environment, without “unbalanced taxation” among business entities.
The draft also clarifies the responsibilities of platforms, especially intermediary platforms, such as requiring the public disclosure of transaction information, products, business entities, and storage of operational data, including livestreaming, for at least three years. Platforms must handle violations within 24 hours of receiving a request from authorities. Some businesses, including the Vietnam E-commerce Association, have proposed applying post-inspection instead of pre-inspection to increase flexibility and reduce the burden on businesses.
The draft clearly defines the responsibilities of each type of platform. Direct sales platforms must publicly disclose transaction processes, prices, return policies, and product label content. Intermediary platforms must authenticate sellers, censor content before displaying, and display accurate consumer reviews. Large platforms must also control the use of artificial intelligence in product recommendations. The draft adds guidelines for developing green e-commerce, reducing emissions, and protecting the environment. The Ministry of Industry and Trade will issue criteria to assess the “green” level of platforms. Businesses are encouraged to use environmentally friendly technology, recycled packaging, and clean energy. The draft also clearly stipulates prohibited behaviors such as prioritizing product display by algorithms without publicly disclosing criteria, hiding or editing consumer feedback without justifiable reasons. False advertising, delivering products that do not match descriptions, or violating data security will all be handled.
The State plays a key role in e-commerce development, from strategy building, business support to infrastructure investment, encouraging new models and developing digital human resources.
