On 14 June 2025, Vietnam’s 15th National Assembly adopted the Law on Digital Technology Industry. The law, which will take effect on 1 January 2026, is the country’s first legal document that systematically governs the digital technology sector as a distinct industry. This marks a major shift in Vietnam’s legal framework from general policies on IT and digitalization to a codified law that recognizes and regulates the digital industry in its entirety.
Legal recognition of digital technology as an independent industrial sector
The law defines the digital technology industry as a core sector encompassing research, design, production, and commercialization of digital products and services. It includes areas such as semiconductors, artificial intelligence (AI), platform services, cloud computing, digital content. This definition creates legal grounds for treating digital technology not merely as a supporting instrument for economic growth, but as a strategic sector with its own ecosystem, value chain, and development goals.
Formalization of digital assets and emerging technologies
A breakthrough feature of the law is its provision on digital assets, which are now legally recognized in Vietnam. This creates a fundamental legal basis for managing ownership, usage, transaction, and protection of digital assets, and other virtual goods. While specific regulations on digital assets will follow, this formal recognition is a critical first step in regulating one of the most complex and dynamic components of the digital economy.
Preferential policies to promote innovation and investment
The Law on Digital Technology Industry focuses on increasing the proportion of domestically produced technology products in the sector through strategic solutions and specific support policies. Foreign-invested enterprises (FDIs) are encouraged to transfer technology and cooperate with local businesses through corporate income tax incentives over several years if they meet this requirement. Domestic startups receive support covering 50% of the costs for purchasing advanced technology and developing prototypes, thereby enhancing their capacity to produce “Make in Vietnam” products. Locally developed digital technology products are given priority in state-funded projects, ensuring a stable and sustainable market. Research and development (R&D) activities are granted maximum incentives, including tax exemptions and financial assistance, to promote innovation and creativity, enabling Vietnamese products not only to meet domestic demand but also to compete effectively in international markets.
Institutional framework and regulatory coordination
The Ministry of Science and Technology is designated as the lead agency for implementing the law. The law empowers this agency to issue technical standards, oversee product certification, and enforce requirements on cybersecurity, digital trust, and quality control. This coordinated approach ensures that digital innovation is guided by clear, enforceable, and balanced regulatory mechanisms.
Strategic implications for Vietnam’s digital transformation
From a policy perspective, this law marks Vietnam’s transition from a policy-based approach to a rule-based governance model for its digital economy. By establishing clear legal rights, obligations, and protections, the law reduces regulatory uncertainty and enhances investor confidence. It also positions Vietnam as a regional leader in proactive digital regulation, potentially giving the country a competitive advantage in attracting digital enterprises, capital, and talent.
The Law on Digital Technology Industry is not just a legislative milestone, but a strategic framework for national digital development. It paves the way for Vietnam to build a modern, sovereign, and innovation-driven digital economy. As implementation begins in 2026, the law’s real-world impact will depend on the quality of its enforcement, the responsiveness of regulatory agencies, and the ability of enterprises to navigate and comply with the new legal environment.
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