Concerns Mount Over Vietnam's Draft Data Protection Law

U.S. Tech Industry Warns Vietnam Over Data Law

U.S. tech companies are expressing concerns that Vietnam's draft data protection law could stifle growth for social media platforms and data center operators. With a population of 100 million, Vietnam is a significant market for tech giants like Facebook and Google, and the country aims to expand its data center industry through increased foreign investment.

Jason Oxman, chair of the Information Technology Industry Council (ITI), stated that the proposed regulations would make it challenging for tech companies to connect with their users. The draft law, currently under parliamentary discussion, seeks to facilitate government access to data, following recommendations from the Ministry of Public Security.

As Vietnam's parliament debates the legislation, there are plans to finalize it by November 30, pending eligibility checks. Although existing laws restrict cross-border data transfers, these rules are infrequently enforced. The implications of the new law on foreign investment remain uncertain; however, recent reports indicated that Google was exploring the establishment of a major data center in Vietnam before the law's introduction.

Among the law's provisions is the requirement for prior authorization to transfer "core" and "important" data overseas, raising concerns about operational hurdles for foreign businesses. Tech firms advocate for streamlined cross-border data flows to enhance services and reduce costs, yet various jurisdictions, including the EU and China, have implemented similar restrictions citing privacy protection.

Adam Sitkoff, executive director of the American Chamber of Commerce in Hanoi, highlighted that the proposed law could create significant compliance challenges, prompting industry leaders to urge Vietnamese authorities to reconsider the accelerated legislative process.