Bill demanding Google, Facebook install domestic servers raises eyebrows in Vietnam

A draft law on internet security that would require foreign companies such as Google and Facebook to have offices and servers in Vietnam has been met with strong opposition from experts and an influential local business advocacy group.

The bill, drafted by the Ministry of Public Security, says that “foreign companies that provide telecommunications and internet services in Vietnam have to follow the country’s laws, respect its sovereignty and national security, obtain a license, and have a representative office and server in the country to manage local data use.”

This means that Facebook, Google, Viber and Skype would have to establish offices and servers in Vietnam. But experts say it is not as simple as that and the requirements are not only unnecessary but also run counter to international conventions.

The Vietnam Chamber of Commerce and Industry (VCCI), a vociferous opponent of the bill, said it goes against commitments that Vietnam signed up to when it joined the World Trade Organization (WTO) and the EU-Vietnam Free Trade Agreement (EVFTA).

The WTO commitment Vietnam signed in 2006 says that cross-border telecommunications services are unlimited to markets that join the WTO. While there are certain exceptions to the rule, there is no requirement stipulating that foreign companies must have a representative office in member countries, Hoang Quang Phong, VCCI’s vice chairman, was quoted as saying in a letter to the legislative National Assembly.

The commitment that Vietnam signed for the EVFTA says the same thing, he said.

Regarding the stipulation for servers to be based here, the VCCI said the Trans-Pacific Partnership Agreement (TPP) that Vietnam signed in February last year does not allow signatories to dictate if a company is allowed to conduct business based on where its IT infrastructure is located.

Vietnam’s legislature has yet to approve the TPP, but the country is still involved in negotiations with ten other member countries to reach a final deal.

It would not be a good idea to backtrack on the TPP, the VCCI said.

Industry insiders said if the bill is passed, Google, Facebook, Skype and Viber would have to invest in giant servers in Vietnam to legally operate in the country.

In that case, local internet providers say there is a high possibility that they would drop out of the Vietnamese market.

Around 60 percent of the country’s population of nearly 92 million are online. Vietnam is in the top 10 countries for Facebook users by numbers and Google’s YouTube is also a popular platform.

Vietnamese authorities are constantly looking at ways to monitor what is being published on social media.

The Ministry of Information and Communications in January issued a circular asking Facebook and similar sites with more than one million Vietnam-based users to collaborate with authorities to block “toxic” content, ranging from ads for banned products to anti-state content.

The ministry also asked Google to block and remove 2,200 clips on YouTube that it said slandered and defamed Vietnamese leaders. Google partially obeyed, removing nearly 1,300 clips in April.

“We have clear policies for removal requests from governments around the world, and those polices have not changed,” a Google spokesperson said in a statement in May when asked if the company would modify its rules to accommodate the requests of the Vietnamese government.

In an article in August, President Tran Dai Quang called on for tougher controls on the internet and highlighted threats to cybersecurity.

He said hostile forces had used the internet to organize offensive campaigns that “undermined the prestige of the leaders of the party and the state, with a negative impact on cadres, party members and people.”

Quang said Vietnam needed to pay greater attention to controlling online information, especially on social networks, and needed an effective solution “to prevent news sites and blogs with bad and dangerous content.”