Reporting on e-commerce to the National Assembly, Dien said e-commerce was an important distribution channel and has contributed significantly to the development of financial services and modern payment systems.

The ministry’s statistics showed that Vietnam was one among five countries in the world with the highest e-commerce growth rates in 2023, expanding at 25% over 2022. The retail-ecommerce market of Vietnam was estimated at US$20.5 billion in 2023.

Dien, however, said that there were three major challenges during the boom in e-commerce, including the risk of personal data breaches, rampant counterfeiting and tax losses.

The ministry asked e-commerce platforms and websites to check, remove and lock out more than 6,200 online stores with a total of 23,359 violating products. They investigated 834 cases and imposed total fines of VND12 billion.

Dien said one of the reasons was the lack of strict sanctions for counterfeit products.

The Law on Protection of Consumer Rights 2023, which will take effect from the beginning of July, was expected to better protect consumers in the e-commerce world.

The Ministry of Industry and Trade was also coordinating with the Ministry of Public Security to develop a law on protecting personal data, Dien said.

E-commerce platforms would also be required to make public policies about protection of personal data.

In the fight against counterfeiting, Dien said that inspection would be enhanced on product origins and quality. Along with that, it is necessary to encourage local producers to focus on improving product quality and strengthen campaigns prioritising Vietnamese-made goods.

Specially, the Ministry of Industry and Trade is proposing a decree on managing products imported through e-commerce and foreign sellers on the platforms, Dien said.

Dien added that the ministry had also proposed the removal of value-added-tax and import tax exemptions on small-value import products.

He estimated that four major foreign e-commerce platforms were transacting around US$1 billion worth of import products per month, meaning a significant loss in tax.

Tax revenues from e-commerce were estimated to be at nearly VND100 trillion, even back in 2021, on a revenue of nearly US$21 billion, he said.

It was necessary to increase data connection and information sharing to improve tax management of the e-commerce market, Dien added.