The revised Telecommunications Law is expected to encourage foreign investment in digital services, offering a more open and competitive market.

A revision of Vietnam’s Telecommunications Law, discussed on October 25’s session of the National Assembly, places a significant emphasis on liberalising the sector for foreign investors.

Le Quang Huy, chairman of the Committee on Science, Technology, and Environment, highlighted certain proposed legislative changes, specifically the easing of restrictions on foreign capital contributions in emerging digital services.

“The proposed law intends to foster a flexible, competitive market, particulalry in cutting-edge services where international expertise and capital can play a transformative role,” said Huy.

Under the new amendments, services such as data centres, cloud computing, and Over-The-Top (OTT) telecommunications, which enable users to switch providers easily, will see a more open investment environment.

The draft legislation liberalises foreign investment and marks a shift towards a more nuanced regulatory approach. The revisions suggest that OTT telecom services could benefit from a self-regulatory market dynamic. Drawing from global best practices, the draft law avoids heavy-handed regulation, preferring instead to ensure user rights and information security.

This revision signals Vietnam’s readiness to embrace the digital transformation while maintaining robust information security and data protection standards.

“Vietnam’s existing regulations on information security and data protection are already comprehensive. The key is to manage these emerging services in a way that nurtures economic and digital societal growth,” explained Huy.

An intriguing aspect of the revision involves the classification of basic telecom services provided over the internet.

Do Ngoc Thinh, a representative from Khanh Hoa province suggested, “A clear distinction needs to be made if internet-based telecom services are to be distinguished from traditional telecom services, to prevent confusion in implementation and interpretation.”

Vietnam Investment Review