Ministry of Information and Communications Gathers Inter-Agency Feedback to Refine the Draft Law on Digital Technology Industry

The Vietnamese Ministry of Information and Communications (MIC) convened a high-level inter-ministerial working session on the morning of August 12 to gather comprehensive feedback on the finalized draft of the Law on Digital Technology Industry. The legislative proposal, slated for submission to the Government and subsequently to the National Assembly, marks a pivotal step in establishing a robust legal framework to govern, facilitate, and accelerate the transformation of Vietnam’s digital economy.

The consultation meeting was chaired by MIC Deputy Minister Bùi Hoàng Phương and brought together key stakeholders, including senior representatives from the Office of the Government, the Ministry of Planning and Investment (MPI), the Ministry of Finance, and the Department of Information and Communications Technology (ICT) Industry under the MIC—the primary unit tasked with drafting the legislation.

Legislative Background and Strategic Mandates

The initiative to draft the Law on Digital Technology Industry stems from the urgent need to address regulatory gaps, ambiguities, and operational bottlenecks identified during the enforcement of provisions relating to information technology within the broader Law on Information Technology. As Vietnam positions itself as a rising technology hub in Southeast Asia, the existing legal instruments have proven insufficient to support high-growth, high-risk sectors such as artificial intelligence, semiconductor manufacturing, and advanced software engineering.

In accordance with assignments directed by the Prime Minister, the MIC has spearheaded the inter-agency collaboration, coordinating closely with central ministries, ministerial-level agencies, local authorities, and specialized industry organizations. The overarching goal of the newly proposed law is to transition Vietnam’s digital landscape from a low-value, labor-intensive assembly and outsourcing model toward high-value activities encompassing research, design, system integration, core technology ownership, and advanced manufacturing.

Furthermore, the draft legislation aims to establish comprehensive market mechanisms that stimulate domestic demand for homegrown digital products while mitigating systemic financial, technological, and operational risks for enterprises operating within the digital technology sector.

Scope of Regulation and Core Policy Frameworks

According to the current draft proposal, the Law on Digital Technology Industry encompasses three foundational pillars: digital technology operations, digital technology products and services, and the establishment of robust safeguards to guarantee sector development. Additionally, the legislation clearly delineates the rights, obligations, and responsibilities of domestic and international organizations, enterprises, and individuals participating in or affected by digital technology ecosystems.

Significantly, the law explicitly excludes specialized activities, production, and the supply of digital products or services exclusively dedicated to national defense, state security, and cipher operations—domains governed by separate, stringent legal regimes.

During the August 12 working session, key policymakers underscored the necessity of prioritizing two distinct regulatory mechanisms: high-level investment incentives and controlled regulatory sandboxes.

Phạm Thuý Hạnh, Deputy Director-General of the Department of Law at the Government Office, emphasized that the success of the digital technology sector hinges on aggressive state support, fiscal incentives, and favorable tax regimes. “For the digital technology sector to truly thrive, the primary focus must be on investment incentives, capital support, preferential taxation, and related regulatory measures. We strongly support the MIC’s proposal to implement the highest possible tier of incentives, as these industries represent strategic sectors that must be unlocked and accelerated during this crucial developmental phase,” Hạnh stated.

Harmonizing Industrial Parks and Special Economic Zones

Addressing the session from the perspective of investment planning, Vũ Sỹ, Deputy Director-General of the Foreign Investment Agency under the MPI, offered critical insights regarding the alignment of special incentives for emerging and foundational technologies. Sỹ recommended that the provisions concerning "digital technology zones" within the draft law be closely harmonized with the Law on Industrial Parks and Economic Zones—legislation for which the MPI serves as the principal drafting authority.

Moreover, the MPI representative proposed that the MIC engage specialized legal consulting firms to conduct a meticulous, article-by-article review of the draft text to ensure absolute consistency with existing commercial and investment laws. This measure is deemed essential to preempt potential regulatory conflicts that could deter foreign direct investment (FDI) or create administrative friction for local enterprises.

Addressing Semiconductor Manufacturing, Value-Added Tax, and Sandbox Frameworks

The inter-agency consultation also served as a platform to debate several pressing economic and operational issues facing Vietnam’s technology sector. Among the most prominent topics discussed were targeted investment incentives for the semiconductor industry—particularly in light of national targets to train 50,000 high-skilled semiconductor engineers by 2030—Value-Added Tax (VAT) regulations, experimental regulatory sandboxes, and policies supporting business reinvestment.

Experts and government officials concurred that while Vietnam possesses immense potential in digital transformation, the lack of predictable fiscal policies and testing environments for novel business models remains a primary hurdle. The implementation of a controlled sandbox mechanism, as championed by the MIC, would allow technology startups and enterprises to trial disruptive innovations—such as autonomous systems, fintech applications, and health-tech platforms—under regulatory supervision, thereby minimizing legal liabilities while protecting consumer interests.

Deputy Minister Bùi Hoàng Phương acknowledged the valuable contributions made by representatives from various ministries, noting that the feedback provided during the session successfully clarified several complex structural and legal ambiguities within the draft text. He reiterated the MIC’s commitment to incorporating these expert recommendations ahead of the formal submission deadline.

Broader Economic Implications and Next Steps

The establishment of the Law on Digital Technology Industry is anticipated to yield far-reaching implications for Vietnam’s socio-economic development. By establishing a modern, forward-looking legal corridor, the government aims to increase the digital economy’s contribution to the national Gross Domestic Product (GDP), reduce reliance on traditional manufacturing, and foster an innovation-driven ecosystem capable of competing on the global stage.

As the legislative timeline enters its final stages, the MIC, in coordination with the Government Office and the MPI, will finalize the impact assessment reports and legal texts. The refined draft will then be submitted to the Government for review before being formally presented to the National Assembly for deliberation, marking a monumental milestone in Vietnam’s journey toward digital sovereignty and industrial modernization.