The influx of foreign e-commerce platforms: Impacts on the domestic market and Vietnam's regulatory framework

Abstract

E-commerce is a modern form of trade where the buying, selling, and exchange of goods and services are conducted partially or entirely in an online environment. According to Decree 52/2013/ND-CP and Decree 85/2021/ND-CP, it plays a crucial role in developing the digital economy, offering opportunities for businesses and consumers alike. Key features include online transactions, enabling quick contract signing between traders and consumers. Traders are registered businesses conducting regular operations, while consumers purchase products for personal use. E-commerce benefits consumers with diverse options, competitive prices, and convenience but poses risks like counterfeit goods, fraud, and cyberattacks. Hence, legal measures are needed to ensure product quality, transparency, and effective dispute resolution. The entry of international E-commerce platforms into Viet Nam has created challenges for domestic enterprises. These platforms possess advantages in capital, technology, and pricing, leading to unfair competition and disrupting market structures. Policies like heavy discounts and free shipping undermine local businesses' profitability and competitiveness. While measures such as anti-dumping and trade defense exist, the current legal framework remains insufficient for managing cross-border E-commerce effectively. The case of Temu, a foreign e-commerce platform, highlights these gaps. Temu has been criticized for not adhering to business registration requirements and using attractive pricing strategies to dominate the market, causing unfair competition. This underscores the urgent need to improve legal frameworks to ensure transparency, fairness, and consumer protection. Viet Nam must strengthen its E-commerce regulations, particularly concerning foreign platforms, by defining management responsibilities, monitoring mechanisms, and operational conditions. Advanced technology and international cooperation are also essential to combat fraud and safeguard the economy. A robust legal framework will create a fair competitive environment and protect the interests of all stakeholders.