Illustrative image (Photo: VietnamPlus)
Hanoi (VNA) –Many businesses and foreign investors are expressing concern about the proposal to include data centre and cloud computing services in the category of telecommunications services.
The Law on Telecommunications was first promulgated in 2009. After 14 years of implementation, the law has revealed many shortcomings that need to be amended and supplemented to be suitable for the development of the telecommunications industry. The draft Law on Telecommunications (amended) is currently being reviewed and discussed at the 5th session of the 15th National Assembly.
Amending the draft Law on Telecommunications is necessary to meet the development of the telecommunications sector in the digital era. The amendment would enable businesses operating in the industry to operate more efficiently, and at the same time protect the rights and interests of consumers.
Include Data Centre and Cloud in group of telecommunications services
Vietnam is among the top 10 fastest-growing data centre and cloud computing markets in the world, experiencing impressive growth rates of 20-30% per year in the 2020-2026 period, especially after these sectors were identified as the backbone of the digital transformation process.
In the national digital infrastructure development strategy, Vietnam has set a target to have 100% of government agencies and 70% of businesses using domestic cloud computing services by 2025.
Experts said that Vietnam is still in the early stages of development in the Cloud market. The Cloud market in Vietnam is currently valued at over 400 million USD. It is projected to reach around 1 billion USD by 2025. This represents significant growth potential for domestic and international businesses and service providers.
According to the draft law, a number of new services, including data centre and cloud computing services, will be included in the group of telecommunications services.
Illustrative image (Photo: VietnamPlus)
Many businesses and investors in these services have expressed concerns about the proposal, especially changes related to investment conditions, licensing procedures and rate of capital contribution.
Under the free trade agreements that Vietnam is currently participating in such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTTP) or the EU – Vietnam Free Trade Agreement (EVFTA), Vietnam has committed to maintaining restrictions on market access in the telecommunications sector for foreign investors, except for value-added services without using facilities.
However, not all types of cloud computing and data centre services fall under the mentioned service category.
Vietnam is among the top 10 fastest-growing data centre and cloud computing markets in the world. - Illustrative image (Photo: VietnamPlus)
Accordingly, foreign investors will be restricted in terms of investment capital, ranging from 49% to 65% depending on the type of telecommunications service and the nationality of the investor.
In addition, both domestic and foreign enterprises investing in data centre projects and providing cloud computing services in Vietnam will also be required to apply for licences.
Therefore, including data centre and cloud computing services in the category of telecommunications services can create legal restrictions, barriers, and administrative procedures for the investment and provision of these services, thus reducing Vietnam's competitiveness in attracting investments in data storage services, and impacting the development of the digital data industry and the digital economy as well./.
