Vietnam’s Law on Digital Technology Industry needs legal framework for sandbox, digital assets
The Ministry of Information and Communications has proposed developing a Law on Digital Technology Industry with new content.
At a recent workshop, Ms. To Thi Thu Huong, Deputy director in charge of the Information Technology Department, Ministry of Information and Communications, said that by the end of 2021, the revenue of the IT and communication industry was estimated at 136 billion USD, 22 times higher than 2009.
There were 64,000 digital technology enterprises in the whole country by that time. The industry’s average growth rate in the period 2015-2020 was twice the GDP growth rate, becoming one of the economic sectors with the fastest growth rate and the largest scale in the country.
Huong said that the development of the Law on Digital Technology Industry is suitable for the development of the IT industry, forming the digital technology industry when the trend of convergence between the fields of IT, telecommunications and communication shaping the IT and media industries, and creating new activities, innovation, value creation, and new markets.
The proposed Law on Digital Technology Industry includes two groups of policies.
The first group of policies consists of industrial activities, digital technology, digital technology products and services, sandbox, management of artificial intelligence products, and management of key digital technology products and services.
The second group of policies includes ensuring the development of the digital technology industry, domestic digital technology products, digital data, high-performance computing center, and cross-border business.
Deputy Minister of Information and Communications Pham Duc Long said that digital technology has come to life, so the development of the Law on Digital Technology Industry needs a development corridor. The law will help promote digital technology, and promote the development of Make in Vietnam products. To make “Make in Vietnam” products and services, data is required and the data must be legal. The sandbox regulation is also to promote the development of this industry and to promote Make in Vietnam products and services.
Sandbox as a focus
The Draft Law on Digital Technology Industry has been reported to the Government and submitted to the National Assembly (NA) to be added to the NA agenda in 2023. In particular, the issue of digital assets and sandboxes has received special attention.
The Vietnam Chamber of Commerce and Industry (VCCI) said that digital assets include online accounts, email accounts, social network accounts and others. Digital assets, even though they are also property under civil law, have a number of different characteristics compared to traditional types of property. However, at present, the legal system does not have basic regulations to be the foundation for transactions, transfer of rights and obligations of these types of assets.
VCCI proposed that the compilation board of the draft Law on Digital Technology Industry set the basic principles applicable to digital assets.
Mr. Nguyen Quang Dong, director of the Institute for Policy Research and Communication Development, said that in 2021 the world chose NFT as the keyword of the year, but to date Vietnam has not acknowledged or had regulations on digital assets.
“The Vietnam Digital Communications Association has recommended that in the Law on Digital Technology Industry, priority should be given to solving two problems, including the sandbox mechanism and digital assets,” said Dong.
Nguyen Thanh Tuyen, Deputy Director of the IT Department (Ministry of Information and Communications), said the draft law will have a definition of digital and virtual assets.
"We consider data as a resource, but who owns that resource? It is necessary to have regulations for Vietnamese people to do business and make profits on digital assets, instead of these assets held by international giants. Those are the issues included in this draft law," Mr. Tuyen said.
The IT industry and the future of digital technology will be one of the important economic development drivers. Therefore, developing a complete and appropriate legal framework in terms of incentives and support will create an important driving force for the development of this industry.
Driven by strong performance in 2021 from digital transformation, Vietnamese technology giants are betting on strong investment on the back of strong policy support to gain higher growth in 2022.
Digital technology industry will become one pillar for the establishment of a digital government and the modernization of the agriculture, industry, and service sectors as well as all aspects of the society.
It is likely that the piloting of virtual currency will be the second sandbox in Vietnam after Mobile Money to offer the market a new and convenient means of payment in the digital economy.