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Decoding Decree 147: A Christmas surprise for Vietnam's gambling industry
Vietnam introduced Decree No. 147/2024/ND-CP (“Decree 147”) on November 9, 2024, marking a transformative moment for its digital and online gaming ecosystem. Replacing the decade-old Decree 72/2013/ND-CP, the new decree brings sweeping changes to internet services, online information management, and digital gaming regulations. Scheduled to take effect on December 25, 2024, Decree 147 will redefine how both domestic and international entities operate in Vietnam’s online space.
In this article, we explore the key highlights of the decree and its implications for Vietnam’s gambling industry as it prepares for a regulatory Christmas surprise.
A comprehensive regulatory framework
Spanning over 200 pages, Decree 147 outlines detailed requirements for managing internet services, domain names, cross-border content provision, and online games. Key stakeholders—telecom operators, social network providers, app stores, and gaming platforms—are now subject to stricter compliance mandates.
The decree also formalises measures for tackling illegal content, enforcing data localisation, and regulating online gaming, aiming to bolster Vietnam’s control over its burgeoning digital economy. These measures reflect Vietnam’s efforts to align with national priorities and international norms.
Restrictions on cross-border gaming
One of the most striking provisions is the reinforcement of restrictions on cross-border gaming services. Foreign organisations must establish local entities to offer online games in Vietnam legally. This rule extends to gambling platforms, signalling the government’s commitment to safeguarding domestic interests while controlling revenue streams.
New content rating system
Decree 147 introduces a content rating system, including a 16+ category for games. This is intended to protect younger audiences while enabling a safer digital environment, which is particularly critical for gambling and betting platforms that often target broad demographics.
Data localisation and user verification
International gambling operators must comply with stringent data localisation rules, storing user information within Vietnam. Furthermore, user verification through Vietnamese mobile numbers or ID credentials is mandatory, adding another layer of accountability.
App store regulations
For offshore gambling apps, compliance with Vietnamese payment laws and submission of gaming licenses are now compulsory. This could disrupt operations for platforms that previously bypassed such requirements.
Compliance challenges for onshore providers
Local gaming platforms face heightened licensing and operational scrutiny. Platforms with significant user traffic are required to obtain formal approvals and implement robust content moderation frameworks. Non-compliance could lead to penalties, including service suspensions.
Offshore providers
For international gambling operators, the cost of compliance is expected to rise. Obligations such as local data storage, user authentication, and active content moderation will increase operational complexity. Non-compliance risks fines, operational bans, or exclusion from the Vietnamese market.
Users
For players, these regulations may result in limited access to international gambling platforms and increased oversight of online activities. However, enhanced data protection and content regulation may improve user safety.
Domain name dispute resolution
Decree 147 introduces notable changes to domain name dispute resolution, impacting gambling operators seeking to establish or maintain an online presence in Vietnam. New criteria for disputes include proving confusing similarity to trademarks, lack of legitimate rights, and bad faith. Domain names can now be deactivated at the request of authorities if found violating regulations, adding another layer of compliance risk for gambling platforms.
Moreover, plaintiffs have a 45-day grace period post-judgment to register disputed domain names, streamlining enforcement but potentially clashing with broader civil judgment laws.
Market consolidation
The requirement for foreign operators to establish local entities could drive market consolidation, as smaller players may find compliance costs prohibitive.
Growth of licensed platforms
The stringent regulatory environment may favour licensed operators who can meet compliance requirements, potentially creating a more transparent and secure market for players.
Increased government revenue
By regulating and localising online gaming operations, the government stands to benefit from increased tax revenues and tighter control over financial flows.
The road ahead
As Vietnam gears up for the implementation of Decree 147, the gambling industry faces a period of significant transformation. Companies are advised to conduct thorough compliance audits and engage with legal experts to navigate the complexities of the new regulatory landscape.
While the decree aims to ensure a safer and more accountable digital environment, its stringent measures could pose challenges, especially for offshore operators.
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