The international information and communications technology business community has voiced concerns on a fresh draft of amendments to the government Decree No.06/2016/ND-CP, because if applied, it will undermine online service providers and the government’s efforts to build a digital economy amid Industry 4.0.

Foreign ICT companies believe that if adopted, the draft decree could hurt foreign online service providers

The Asia Internet Coalition (AIC), an association for Internet and ICT policy issues in Asia, with members including global giants AirBnB, Amazon, Apple, Expedia, Facebook, Google, LinkedIn, LINE, Rakuten, Twitter, and Yahoo, have sent a letter to the ministers of Information and Communications, Justice, and Industry and Trade, with official industry comments and feedback on proposed amendments to Decree 06, which covers the management over, provision and use of, radio and television services.

“We are concerned that the draft decree, if passed in its current form, might set precedent for other countries to impose reciprocal regulations on online services which would negatively affect Vietnamese businesses trying to expand beyond Vietnam’s borders by erecting similar regulatory barriers,” stated the letter. 

“We request that the Vietnamese government consider the potential consequences of the draft decree to prevent unexpected negative impact on the Vietnamese economy.”

The draft decree calls for over-the-top (OTT) Internet streaming services to be regulated under traditional radio and television service rules. 

OTT refers to content providers that distribute streaming media, including audio, video, text, and images, as standalone products directly to viewers over the Internet, bypassing broadcast television platforms that traditionally act as a controller or distributor of such content.

Jeff Paine, managing director of the Asia Internet Coalition told VIR, “If passed, these amendments to Decree 06 could discourage international OTT players from providing services in Vietnam, limiting access to Vietnamese citizens for some global services thereby reducing Vietnam’s connection to the international digital economy. This could also severely limit access for Vietnamese businesses to reach millions of customers and partners globally on these cost-effective OTT platforms.”

“These amendments will certainly harm Vietnam’s digital economy, which is estimated to account for 2-3 per cent of the country’s GDP and it is expected to rise to 40-50 per cent in the future. If passed and enforced, the amendments to the decree could distract the country from achieving its ambitions for Industry 4.0,” he continued.

In the letter, AIC suggested that OTT service providers should be distinguished from broadcasters. In the draft amendments, radio and television services are proposed to include a new service type called “On-demand service on the Internet”. 

On-demand service on the Internet is defined as a type of “radio and television service using Internet connection by use of domain names of portals or identified Internet addresses and Internet applications used only to transmit on-demand contents to service subscribers,” according to the draft’s Article 4.1(e).

Under Article 3.18, “On-demand content” includes domestic and foreign radio and television programmes, films and other video and audio content meeting the specific requirements of Vietnamese law, which are provided to subscribers on demand, including content to be broadcasted live following programme schedules.

“It appears that On-demand service on the Internet would effectively include OTT services that stream video and audio,” said Paine. 

“The proposed amendments seek to bring more online services within the scope of the country’s broadcasting legislation. The extension of broadcasting regulations to OTT services is disproportionate given the wide variety of OTT services available and can stifle the growth of Vietnam’s digital economy.”

According to the Vietnam Chamber of Commerce and Industry (VCCI), the proposed introduction of “On-demand services on the Internet” into the group of “radio and television services” is inappropriate as it fails to reflect the nature of radio and television services.

Under the existing Law on Investment, the regulations on provision of On-demand services on the Internet and of radio and television services are quite different and put in different sections. 

Thus if they are put into the same group of services, they will go against the spirit of the law. Besides, many foreign investors have been providing On-demand services on the Internet in Vietnam, which is in line with the country’s commitments within the World Trade Organization. 

Thus if these services are put into the same group, the market of On-demand services on the Internet will be upset, badly affecting foreign investors and the Vietnamese economy’s competitiveness, VCCI said.

VIR