Vietnam demands Big Tech localize data storage and offices

Mandate goes into effect October 1, but industry players will have a year to comply

Vietnam's Ministry of Information and Communications updated cybersecurity laws this week to mandate Big Tech and telecoms companies store user data locally, and control that data with local entities.

The data affected goes beyond the basics of name, email, credit card information, phone number and IP address, and extends into social elements – including groups of which users are members, or the friends with whom they digitally interact.

"Data of all internet users ranging from financial records and biometric data to information on people's ethnicity and political views, or any data created by users while surfing the internet must be to stored domestically," read the decree issued Wednesday, as translated by Reuters.

The decree applies to a wide swath of businesses including those providing telecom services, storing and sharing data in cyberspace, providing national or international domain names for users in Vietnam, e-commerce, online payments, payment intermediaries, transport connection services operating in cyberspace, social media, online video games, messaging services, and voice or video calls.

According to Article 26 of the government's Decree 53, the new rules go into effect October 1, 2022 – around seven weeks from the date of its announcement.

However, foreign companies have an entire 12 months in which to comply – beginning when they receive instructions from the Minister of Public Security. The companies are then required to store the data in Vietnam for a minimum of 24 months. System logs will need to be stored for 12 months.

After this grace period, authorities reserve the right to make sure affected companies are following the law through investigations and data collection requests, as well as content removal orders.

Vietnam is an important hub for tech manufacturing. Foxconn, Samsung, Microsoft, Intel and LG all have a presence in the Southeast Asian country. Apple suppliers Luxshare Precision Industry and Foxconn are reportedly in talks to move production of Apple Watches and MacBooks out of China for the first time and into Vietnam.

Prime minister Pham Minh has expressed a desire for an even greater presence from Big Tech.

While Vietnam is a significant source of users and revenue for both Google and Meta, neither has an official office in the country. Positions related to the country's market are often based in Singapore. Reportedly, this is historically due to Vietnam's strict censorship of online content.

According to the decree, local offices may be either branches or representative offices of foreign enterprises.®

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