Concerned about unfair competition on e-commerce platforms, Ho Chi Minh City proposes many solutions

Many cross-border e-commerce platforms appearing in Vietnam offer promotions of up to 90%, creating unhealthy competition in the market.

In recent times, e-commerce activities have developed strongly. Besides the positive aspects, quality management, prevention of counterfeit goods, protection of consumer rights, etc. have become more complicated with the participation of many suppliers, especially foreign suppliers.

Advertising image of up to 90% discount of e-commerce platform Temu. Photo: Provided by Ho Chi Minh City Department of Industry and Trade

A typical example is the case of the newly emerged platform Temu from China in early October 2024. To attract consumers, this platform focuses on low prices and promotes promotions of up to 90%. However, according to the regulations on promotion forms in Vietnam in Decree 128/2024/ND-CP recently issued by the Government, the material value used for promotion for a unit of goods and services must not exceed 50% of the selling price immediately before the promotion period of the promoted goods and services.

Also according to this regulation, the total value of goods and services used for promotion must not exceed 50% of the total value of goods and services being promoted. In case of organizing a concentrated promotion program, the maximum limit on the value of goods and services used for promotion is 100%. The maximum limit on the value of goods and services used for promotion of 100% is also applied to promotional activities within the framework of trade promotion programs and activities decided by the Prime Minister.

Speaking to reporters of the Industry and Trade Newspaper, Mr. Nguyen Nguyen Phuong - Deputy Director of the Department of Industry and Trade of Ho Chi Minh City - said: To protect the rights of consumers and ensure fair competition between domestic and foreign enterprises, on October 23, the Department of Industry and Trade sent an official dispatch to the Ministry of Industry and Trade proposing a number of solutions to manage and promote the development of e-commerce.

Advertisements for sales that violate regulations in trade promotion activities are flooding e-commerce platforms, especially cross-border e-commerce platforms. Photo: Provided by the Department of Industry and Trade of Ho Chi Minh City

Specifically, the Department recommends that the Ministry of Industry and Trade resolutely prevent the display of advertisements and promotions that violate regulations on websites, e-commerce platforms, social networks, etc.; apply strict sanctions (prevent, suspend or stop domain names and applications in Vietnam) to websites, e-commerce platforms, social networks, etc. that repeatedly violate regulations. At the same time, review current legal regulations on e-commerce; inspect and evaluate the compliance of international cross-border e-commerce platforms; create a fair and healthy competitive environment; protect the legitimate rights and interests of domestic enterprises.

The Department also requested the Ministry of Industry and Trade to study and soon issue more specific regulations on tariffs, customs procedures and goods control in cross-border e-commerce to have a legal basis to effectively manage and regulate these activities, especially some contents that are still open or have no basis for intervention.

Along with that, perfecting tax regulations and policies, ensuring that foreign e-commerce platforms have a full tax payment mechanism when doing business in Vietnam. At the same time, strictly control and collect fair taxes on foreign products sold in Vietnam through cross-border e-commerce. In particular, tightening regulations on advertising on e-commerce platforms, preventing false information, fraud or trading in poor quality products, not as described.

In addition, it is necessary to perfect regulations related to the collection, storage and use of users' personal data in advertising campaigns; prevent violations of Vietnamese users' privacy rights.

“The Ministry of Industry and Trade has solutions to promote and support businesses to participate in e-commerce, connect with international partners, participate in e-commerce fairs, global online exhibitions, expand export markets through cross-border e-commerce…”, the Department of Industry and Trade recommended.

Source: https://congthuong.vn/lo-ngai-canh-tranh-khong-lanh-manh-tren-san-thuong-mai-dien-tu-tp-ho-chi-minh-kien-nghi-nhieu-giai-phap-354407.html