Vietnam Enacts First Standalone Digital Technology Law: A Landmark Move in Tech Governance

On 14 June 2025, Vietnam set up a historic milestone by becoming the first country to pass a “standalone” bill on Digital Technology Law ( Law on Digital Technology Industry). The bill was approved unanimously with a voting ratio of 441/445 among the National Assembly Deputies.

The drafting of the law dates back to July-September 2024, subordinated by the Ministry of Science and Technology, and is announced to be effective from 1st January 2025. The aims behind the law include propelling national digital transformation and global tech positioning, and also achieving the target of 150,000 digital tech firms by 2035 as per the “Make in Vietnam” programme. 

This law outlines some key incentives for MSMEs, startups, and FIEs (foreign-invested enterprises), including up to 50% subsidies on technology acquisition and prototype development for domestic startups. It also provides support through infrastructure, procurement priorities, and training, encouraging FIEs to transfer technology with tax breaks for doing so, especially for MSMEs. 

Other notable features of the accepted standalone bill are listed as follows:

• Fiscal and structural support: measures such as tax cuts, import-duty exemptions for R&D and high-tech equipment, launching digital zones, and establishing global representative offices to scale Vietnamese firms. Furthermore, state grants and infrastructural support through public procurement incentives are also recognised as effective support measures. 
• Digital assets and AI governance: Vietnam has adopted a risk-based classification approach for AI, where high-risk systems—such as those impacting civil rights or public safety—must adhere to stricter requirements concerning transparency, explainability, and continuous human oversight compared to low-risk systems. 
• Workforce factors: Key human capital initiatives include a five-year personal Income Tax exemption for local tech professionals and a five-year visa/work permit exemption for foreign experts.

Vietnam’s Digital Technology Law will serve as a global benchmark for regulation in the digital sector. It represents more than just policy as it’s also a vision, aiming at nurturing homegrown innovation while attracting global talent and investment, and it sets a precedent for responsible and ambitious digital governance in the region. As the implementation begins in 2026, all eyes are on Vietnam, and we are yet to see how it unfolds.