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NIKKEI ASIAN REVIEW
Vietnam's cybersecurity law sparks concerns from businesses
Google, Facebook and local companies say restrictions will
harm investment climate
HO CHI MINH CITY -- The National Assembly of Vietnam, the country's
legislative body, approved a controversial cybersecurity law on Tuesday,
sparking concerns about free speech from domestic as well as foreign
business communities.
Among 466 members of parliament, 423 voted for the bill, 15 against,
with 28 abstaining. With an approval rating of 86.86%, the law will come
into effect on January 1, 2019.
The new law will see all cyber activities in Vietnam come under the
control of the Ministry of Public Security, with critics claiming that
will limit freedom of expression and create barriers for
internet-related service providers.
Foreign businesses such as Google and Facebook will be required to open
representative offices or branches in Vietnam, as well as store data on
Vietnamese users of their services within the country for a period.
The new law gives the government greater control over foreign digital
groups as well as over local users who post anti-government propaganda
or information that ignites violence and disturbs public security, or
defamatory and slanderous content.
Critics argue that this runs contrary to commitments made by Vietnam
when it joined the World Trade Organization and the Vietnam-EU Free
Trade Agreement (EVFTA) as well as The Comprehensive and Progressive
Agreement for Trans-Pacific Partnership (CPTPP). Under the new law,
relevant businesses will have to place their servers within Vietnam.
However, the CPTPP, which Vietnam signed up to in March, does not allow
signatories to dictate whether or not a company can conduct business
based on where its IT infrastructure is located.
"We have reservations and suggest more careful considerations [of the
new law], that Vietnam follows conditions we agreed to under TPP 12,"
John Rockhold, executive director of the Ho Chi Minh City chapter of the
American Chamber of Commerce in Vietnam, told the Nikkei Asian Review.
Jeff Paine, managing director at the Asia Internet Coalition, an
industry association which seeks to promote the understanding of
internet policy in the Asia-Pacific region whose members include
Facebook, Google, LinkedIn, Apple, Twitter, LINE and Rakuten, told the
Nikkei he was disappointed that the National Assembly had voted in favor
of the cybersecurity law. He said the provisions for data localization,
controls on content that affect free speech, and the requirements for
local offices would "undoubtedly hinder the nation's fourth industrial
revolution ambitions to achieve [gross domestic product] and job
growth".
"These provisions will result in severe limitations on Vietnam's digital
economy, dampening the foreign investment climate and hurting
opportunities for local businesses and [small and medium enterprises] to
flourish inside and beyond Vietnam," he added.
He also said the association hoped to continue positive engagement with
the government, supporting policymakers to work towards creating a
digital future for the country.
Domestic companies are also worried about the new law. A joint letter
from 13 information technology groups -- including domestic enterprises
such as FPT, VNG and Mobifone, as well as foreign groups with interests
in Vietnam including Panasonic, Toshiba and Lazada -- was sent to the
National Assembly on Monday calling for a delay to the vote.
A group of scholars who were involved in researching Vietnam's
connection to the internet in the 1990s, led by Dang Huu, had also
suggested that lawmakers spend more time on the draft, including
amending and removing problematic articles which will hamper the free
use of the internet for study, communication and doing business,
threaten users' privacy and put enterprises at risk of breaking laws.
Some have pointed to Vietnam's two existing laws on cybersecurity -- the
Cyber Information Security Law drawn up by the Ministry of Information
and Communications which came into effect on July 1, 2016, and the
National Security Law which was implemented in 2005.
However, Hanoi has been insistent about adopting the new bill, claiming
it is an urgently-needed tool to "defend the nation against cyber
attacks" and carry out "a completed and timely institutionalization of
the Party's policies" on cybersecurity. Cybersecurity law is a must in
the current situation, said Lieutenant General Hoang Phuoc Thuan,
director of the cybersecurity department in the Ministry of Public
Security. Regarding agreements that Vietnam has signed, such as the
CPTPP, he said the law would apply to "exceptions serving security,
public order, culture, and community well-being".
Ahead of the vote, there were widespread protests in Vietnam on Sunday,
with activists seeing the new law as a copy of China's cybersecurity
legislation which came in from June last year and turned technology
companies operating in that country into de-facto state surveillance
agents.
Physical security in cities including Hanoi and Ho Chi Minh City was
tightened on Tuesday after the law was approved. The authorities also
sent mobile phone messages to the public, warning citizens not to hold
gatherings, violate transportation laws, create disorder in public
places, or be incited to break the law. "Stay calm and be awake," the
message said.
Human Rights Watch said the goal of the new law appeared to protect the
party's monopoly on power and restrict internet freedom, and, along with
London-based Amnesty International, asked Hanoi to revoke the law. "It
is no coincidence that it was drafted by the country's Ministry of
Public Security, notorious for human rights violations," said Brad
Adams, Asia director at Human Rights Watch.
In letters sent to Apple, Google, Facebook, Microsoft and Samsung, Clare
Algar, director of global operations at Amnesty International, urged the
companies to take steps to protect against potential human rights
violations resulting from the law. The Vietnam Digital Communication
Association, an organization of individuals, voluntary groups engaged in
research and training,andbusiness in the field of digital communication,
estimated in May that the cybersecurity bill could reduce Vietnam's GDP
by 1.7% and wipe off 3.1% off foreign investment if it comes into
effect.
Vu Kim Hanh, director of local business support body the Center of
Business Studies and Assistance, said that the law would damage
Vietnam's economy and create disadvantages for businesses when competing
with peers in the Southeast Asian region.
The country's two stock markets declined on Tuesday, with the VNIndex
down 1.76% and the HNX-Index down 1.66%.
(Nikkei) |