New Law on Consumer Protection 2023

    

Unlike the Consumer Law 2010, the Consumer Law 2023 broadens its scope by incorporating additional entities under its purview, encompassing foreign agencies, organizations, and individuals related to the protection of consumers’ rights. That is a stricter requirement imposed on foreign traders providing continuous services in the territory of Vietnam. 

    

In comparison with the Consumer Law 2010, the Consumer Law 2023 makes a minor change, adding “for non-commercial purpose” in the definition of “consumer”. Specifically, “consumer” means a person who purchases or uses products, goods and services to meet consumption or domestic needs of individuals, families or organizations and for non-commercial purposes. 

    

However, it is sometimes difficult to specify “non-commercial purposes” if the consumer purchases or uses products/services for both commercial and non-commercial purposes during its operation. To avoid doubt about the consumer when applying this new law, there should be further guidance on criteria to determine non-commercial purpose in those cases.  

   

Under Article 41.1 of the Consumer Law 2023, traders providing continuous services (i.e., supply of services for a duration of at least 3 months or on an indefinite basis) in the territory of Vietnam must publicize information about their legal representative in Vietnam. It seems that the term “traders” covers both domestic and foreign traders having commercial presence in Vietnam, and offshore traders providing cross-border services to consumers in Vietnam. In case a trader does not have a legal representative in Vietnam, they must appoint an authorized representative and publicize information on such person.  

     

In addition, the contract for continuous cross-border supply of services between an offshore trader and a consumer in Vietnam should be carefully prepared to comply with new requirements in the Consumer Law 2023. 

    

Under the Consumer Law 2023, data of consumer includes: 

By definition, the term “data of consumer” under the Consumer Law 2023 is broader than the term “personal data” in Decree 13/2023 on Personal data protection since it encompasses other types of information such as transaction data. 

   

In addition, the Consumer Law 2023 imposes stricter requirements concerning the time limit to notify responsible government authorities in case of detecting a violation against customer data safety. Under Article 19.3 of the Consumer Law 2023, traders and parties who store customer data must notify the responsible authority within 24 hours (which is significantly shorter than the 72 hours in Decree 13/2023) upon detecting the incident or attack against customer’s data safety. 

    

The Consumer Law 2023 and the draft Decree on detailing several articles and guidance on implementation of the Consumer Law 2023 do not further detail who is the responsible authority to receive the notifying of incident and attack against customer data from traders. It seems, however, that the Department of Cybersecurity and Hi-tech Crime Prevention, the Ministry of Public Security is the key authority responsible for this task. 

    

It is likely that the Consumer Law 2023 puts more requirements and obligations on the traders to protect the legitimate rights and interests of the consumers during the transaction for non-commercial purposes. The onshore and offshore traders accordingly should carefully check to ensure their compliance with the new regulations, which would take effect next year (i.e., 1 July 2024). 

    

For instance, continuous cross-border service supply contracts with offshore traders (such as a management consulting agreement between a company in Vietnam and its parent company/partner offshore) for non-commercial purposes must be consistent with requirements about, among other things, form, contents, obligations of trader, consumer’s right, in the Consumer Law 2023.