Recent Legal Developments of Digital Assets in Vietnam

Transcript

So good morning everyone and welcome. It's a great pleasure to open today's event dedicated to Vietnam legal framework for digital assets and this event is coorganized by crypto association Swiss uh Viet economic forum and the Asia legal. So huge thank you to to our partners. Uh Vietnam has become one of the most dynamic countries in the world for crypto adoption and according to the 20125 global adoption index, the country now ranks uh among the top five globally with around 17 million holders and more than $200 billion dollar in annual trading

volume. So today we are honored to have with us Richard Lu, managing partner at Asia Legal and Duan Panang, managing partner at um VC E Legal. Correct me if I misspelled it. Uh who will share with us insights on the latest legal developments and opportunities for foreign business in Vietnam. So uh please note we have a Q&A sess section. So you can either drop your question in the Q&A section in the Zoom or we also will try to give some time and maybe unmute some participants to address some

questions at at the end after the presentations. So we look forward to the engaging discussion and productive discussion and uh I suggest let's get started. Richard the the floor is yours. >> Okay. Thank you. Hi everyone. I will start with the presentation. Just wait minute. I will share my screen. Mhm. No, not not this one.

Okay. Can Can you see Can you see the slide? >> Yes. Oh, good. >> Is it okay now? >> Yes, I think it's all right. >> Okay. Thank you so much. Uh so I would like to start with uh the legal framework for crypto asset in Vietnam. And um as you may know uh Vietnam has one of the highest acception rates of crypto in the world. And um I could like to bring you some figures. In 2024, about 17 million u Vietnamese people that account let's say 15% of the population in Vietnam already own and use this asset

and the total transaction value exceeded um 100 billion US dollars in 2025 ranking Vietnam third position in the Asia-Pacific region. And Vietnam still has a high potential market with very young population and strong tech adoption. But everything was happening in a gray area for for a long time until 2025. And since 2025, Vietnam has taken a both step. We have we obviously have the law for digital asset in Vietnam. So in this presentation I will

cover three main parts. The first one the market situation and the legal background before Vietnam had had a legal framework and the second part is Vietnam current legal approach toward digital and crypto assets. And the last part the pilot program with it opportunities and challenge with for foreign investor. The rapid growth of crypto asset and crypto transaction in Vietnam also came with problems. From late 2019 to mid 2024, authority in Vietnam uncover nearly 20,000 fraud cases and causing

damage of more than um 12,000 billion Vietnamese dung. And you can see an an uh an examples on the slide anx 2021 shock wing a very well-known investor and one shock from Vietnamese version of shaktang and now 2.5 million USD investment in anxal decentralized finance ecosystem in Vietnam. And what made this project so popular in Vietnam is not just the crypto asset. It was the fact that Shakwing himself was behind it offering both mentorships and

also media support. And because of the credibility and the public image of abuse from Saktang Vietnam, the project quickly gained much attentions and many investors jump in purely out of FOMO without really understanding what he the the project is about. But but very shortly after launching the ANX token price reduced nearly 90% 99% actually and the PIK website along its uh with it social channels uh disappear and in 2022 they rebranded to rabbit but the new token also lost around 95% of its value

and this whole case exposed several issues. the transparency, the legal protection and the former driving investor who did not understand the risk. So in the past few years, Vietnam have suffered a series of incidents and claims of losses from the investor with no officer framework and the authority mainly easy warning. They send multiple warnings about using and trading crypto asset. But such winning keep chinkering debates over the crypto assets. For instance, under the degree on non-cash payment as in 2016, cryptocurrencies or crypto asset don't fall into any the list any list of the

valid non-cash payment method. So their use for payment won't be prohibited. But at that times Vietnam already have mobile a digital wallet application allowing Vietnamese citizen to top up the digital money and use for daytoday payment. The point is whether digital money store in more consider as cryptocurrencies or crypto asset or not. If yes that mean that any license provider can issues and circulate crypto asset. Then in 2017, the step on your Vietnam confirmed bitcoin and litecoins or similar token would neither recognize as a fiat money nor legal means of

payment. but after the war in several court case in 2023 and 24 involving a stealing of co wallet containing 1,000 bitcoins and also tax evasion in in Vietnam arising from from bitcoin transaction also triggered debates on whether crypto should be considered as properties or taxable income and the state bank of Vietnam repeatedly send uh different warning about the risk of unlicensed exchange um of digital asset.

The state bank of Vietnam claims such activities may fall into the scope of the foreign exchange business and this can only be performed by licensed company. So after a lot of incidents and claims in late 2023, Vietnam began to acknowledge the transformative roles of crypto asset in the modern digital world and to to adapt to new trends. Vietnam government assigned the state bank of Vietnam and also the ministries of finance to cooperate, research and develop a foundational legal framework for digital asset and crypto sector. And

in mid 2024, the first draft of the law on digital asset on digital technology industry was introduced. And for the first time, Vietnamese law formally recognize this asset as a type of property. And then in mid 20 and and and mid 2025, the law on digital technology industry will obviously enacted and become effective from the 1st of January 2026.

Just a few days after the enarchment of this law, Vietnam also made some amendment to the laws on investment and added crypto related service to the list of conditional business life. And so basically um there are two condition for free investor to conduct business in crypto in Vietnam. the market asset condition and the second the business condition since cryptoreated services only appears in the condition of business line. It it means that Vietnam consider crypto industries as a permission but risky sector open to foreign investment under

very strict regulation and also licensing requirements. So the law on digital technology industry transient introduced a new legal concept for Vietnam and it also laid out many noteworthy provisions but in this presentation I will focus on only three main points. The first one the the law classify digital asset into three categories. The first one the virtual assets and the second one the crypto asset equal to virtual asset but based on cryptography

and the third one other digital asset. It means we leave the room for future innovation. And given that framework rem given that the this framework remain very broad and experimental the government also issue resolution um 0.05 05 2025 2025 establishing a pilot mechanism for a regulated crypto asset and and this is in my view a staff as it also allows uh allow for investor to play a central roles in shaping the crypto market in Vietnam.

Uh we figure out some key principle of this resolution in terms of the business condition. There's actually two main condition applicable for foreign investor in Vietnam as I mentioned above. The first one the market assess condition and the second one is business condition and this resolution also give some offers some business condition as below. Firstly, the foreign investor must create a joy venture with a Vietnamese partner. And secondly, at least 65% charter capital of the Zoy venture must be owned by the organizational members or shareholder that engage in at least

two sectors of the following list. The bank securities insurance and techn and technology. And thirdly, the foreign ownership is C at 49% in the Z venture. And the fourth one, the cryptoreated entities must be licensed by the miser finance. And the fifth condition include other requirements and also qualification applicable to the co to the CEO the cyber security staff and also cyber security system and the risk management procedures.

The next point is in terms of financial safety first during the pilot phase the ministers of finance also reserve the right to suspend or terminate the pilot activities if system or the market risk arise and in terms of the foreign exchange control all transaction must be done in Vietnamese and foreign investor must operate through VND accounts at lic banks in Vietnam. And in terms of taxation the temporary apply similar to secure transaction security transaction it means the tax will be applied similar to security transaction

and and there's no detailed tax align but there's one another interesting point is that any issue crypto asset must be fully backed by real assets such as um risk state goals or communities. Consequently, unbuck cryptocurrency like Bitcoin or Athetherums or any NFTts that are not eligible for public trading. And each cryptoreated enterprise must must have a minimum headup cap of 10,000 billion Vietname equivalent to approximately 380 million USD.

And from my perspective, these principles are designed to control fraud and eliminate pump and dumb tokens and also foster institution of great confident in Vietnam crypto market. However, this framework also mean that only large scale players with strong balance sheets can really enter the market in Vietnam. So what does this mean to foreign investor? We can see that the first one the market behavior in Vietnam. So that the local trader in Vietnam often spec speculate um and speculation you can see that very

popular in Vietnam in any any business like real estate, gold, securities or even collectible assets. And this mindset has contributed to numerous cycles of fraud raising capitals, pumping price and dumping tokens over the past few year. So it may take a considerable amount of time and also make marketing efforts and also educational communication to form to establish a healthy transparent crypto investment culture in Vietnam. Secondly, the high energy barrier as I said above it require 10,000 billion Vietnamese

dong around 380 million USD in pup capital to together with very strict cyber securities and government requirements also mean that only well capital life financial institution will qualify for entit market diversities in in the short term of course it ensure higher institutional graduity and and reduces thematic risks. Despite this Australian we can see that uh some opportunities very clear opportunities in Vietnam.

Currently the Malaysia's finance already already announced that there are only five enterprise can enters into this market and we did not list we don't show on this line but we actually we have um um big key seven big players to join the Z. Um but there's some some confirmation from the ministries of finance that they only provide the license to seven to six uh

actually to five businesses only. So it means that um every license projects at this moment at this time will attract significant attentions and trading and and trading volume from Vietnamese investor allowing early entrance to shape market perceptions and and establish a dominant position before the um legal framework matures. And of course, we also have very strong potential give how easily Vietnamese people accept crypto assets and technology utilities and and especially the chance for to develop real estate tokenization for

real estate goals and communities. Um in short, Vietnam is um trans transitioning from a legal uh gray area to a structure but highly regulated framework for for investor. This also represent both opportunities and risk. opportunity because we have a young dynamic and fast growing market but also risk because it is closely supervised and still evolving um markets in Vietnam. So I think it's I just give you some brief information about the crypto the legal the legal development um in Vietnam in

terms of the disaster set. Thank you for listening. Thank you. Thank you. Thank you, Richard. I have a quick question about these current holders, 17 million holders, and the the legal treatment of these holdings. Are they recognized? because I believe they have some um wallets in foreign exchange otherwise how else it would be possible h how it's um how they are considered now is it >> actually they they still uh so that they interesting uh they very interested in the crypto the the crypto asset um transaction in Vietnam and of course uh

they are under the um they are submitting the application industria and try to make sure that all condition and requirement as per the law of Vietnam are met. And they are big players in Vietnam including the banks and also securities. The bank like MB Bank, the military bank in Vietnam and VP Bank also another it is actually a private banks in Vietnam or Techcom Bank very popular bank and it also private bank in Vietnam or we have the SSID um technology company in Vietnam. They are all big players in Vietnam and I believe that they understand all the requirements as per the law of Vietnam

so that they can set up the virtual asset trading platform and only when of course uh when they see that they can meet all the condition they can then they apply for the license. >> Yeah. You mean these five companies right? >> Yes. Yes. I think the question was about a 17 million user holder, right? >> Yeah. Yeah. The current because you remember at the beginning you said that part of population like 17 million it's also the data officially published they already holding crypto. So how now this this current holdings how are they

recognized? Uh I think uh because of the law of Vietnam provide that after the cryptocurrency platform uh is licensed to operate in Vietnam within a 6 month such holder must transact otherwise they can face up with some administrative penalties or criminate offense in Vietnam. So we give after yeah after the crypto asset market in Vietnam is officially come into play then these owners should transact on the platform so that they can be recognized as the official owners of crypto asset

in Vietnam >> only to licensed entities right they can only hold um crypto license >> no no also Vietnamese uh individual can also own the crypto asset. >> Yes. But own by where? Like with with some with foreign exchange. I believe they cannot. >> Yeah. We all know that before we have the new laws on on on this um technology um in in 2025, many Vietnamese people still own the crypto asset and trade it on international platforms, not in Vietnam.

So we have to recognize that fact. There's no way. We we have to accept that fact. >> Yes. >> And after 2026, this setup still will be recognized as a as legal. >> They they won't be recognized after they treat it on the license platform in Vietnam. And the law also provide them for six month as a deadline so that they can do transaction on the platform so that they can recognize as official owners of the crypto asset in Vietnam. >> Okay.

>> Yes. >> What? >> Yeah. >> May I just uh Yeah. May I just just uh add a little um you know clarification here? Uh well the thing is that uh uh the the the ownership itself by itself is not considered an an offense. So you know uh you are required to do transactions on a license uh uh exchange. Uh if they choose not to transact you know they can still hold it. So the 70 million user uh holder right as an asset that it is recognized as an asset. However, if you want to do transaction, uh you need to do it through the you know license uh uh

exchange and and then and therefore you know it's uh in one hand the government legalize the the the crypto transaction on the other hand they want to put it under the control of the of the government under the new uh new decree new new new resolution. >> Yeah. >> Okay. >> So the owners and Yeah. the owners if you just simply own and you do not carry out any transaction and it's okay but once you do transaction you must do on the license platform in Vietnam.

>> Mhm. >> Yes. >> Let's you have some crypton on your ledger and if you want to transact it you need to to convert it only with through the license platform under the new >> Yes. Yes. Yes. And if the company would collaborate like the banks, would they allow to uh provide these facilities and provide these transactions, facilitate the transactions? Let's say if Vietnam banks they enter in some collaboration or they figure out how to develop their own infrastructure for these kind of transactions, would they be allowed to to

>> No. My yeah my understanding is that it is very highly regulated um business in Vietnam. Uh infrastructure is only one of the condition as I said uh we have different uh different requirements uh so that you can do the crypto asset trading in Vietnam. So the bank will understand that they they are let's say a financial institution. They have very strong infrastructure and even they have the cheap technology. um officials you have many other condition but at least they have to apply for the license.

>> Yes. >> Well the thing is that it um sorry uh if I can jump in just uh for clarification it uh yeah the the the uh bank uh you know indeed will require to be one of the one of the obligatory kind of obligatory uh participant or or or shareholder of uh of the crypto exchange. you see uh many of those are expected. So it's a it's number one. So if the bank want to participate into this game, they should uh you know join hand with security firm with uh you know technical firm in order to be able to offer the exchange um you know technically and financially. So there is a there is an official role for the bank

to play already. So if any bank want to get into um into this activity into this trade, yes they they they they can but they do it in the way that uh that is required uh that is um you know uh regulated under the new regulation. So um to answer your question it's yes and no at the same time indeed. Yeah, >> because I believe these requirements that Richard just highlighted, this minimum capital requirements and um there's a structure of ownership, it it applies only to foreign business, right?

If your own company, >> a local for the foreign for the for foreign ownership um as per the uh the um um as per the the resolution the maximum foreign investment uh is only 49%. >> Mhm. >> Yes. only know 49% and and in terms of the organization at least 65% charter capitals must be owned by organizational members or shareholders and and those shareholders should operate in at least two sectors as I listed um banks securities insurance or technology

>> and and only one condition apply for the foreign investment is the maximum share are holding 49% only. >> Mhm. >> Yes. >> So, and I believe any other uh let's say European uh license would not be recognized, right? Let's say if European license entity would enter would want. >> Yes. Yes. Yes. Yes. Of course. Yes. Of course. Yeah. Because as you as you as you asked uh from the beginning that whether any bank with strong infrastructure in Vietnam can can do crypto asset trading. I say no because there must be a different different

license and that different license also is by the ministers of finance. So a license trading platforms in Europe does not mean that they also license trading platform in Vietnam. Only when that trading platform is licensed by the Ministry of Finance of Vietnam and of course to meet the license to obtain the license they have to satisfies a number of condition and requirement as I list in my presentation so that they can be eligible for to obtain the license to to do the the crypto asset trading in Vietnam.

>> Right. >> Yeah. >> We have also one question from from the participant. >> Yes. to define uh foreign ownership. For example, if a nonVietnam is opens a company entity that is registered in Vietnam, is it considered foreign? Let's say >> it is. Yeah. >> You have the presence substance in uh in Vietnam, but you have a foreign owner like Ubo is is a foreign um person.

>> So, Go ahead. >> Yeah. Yeah. You mean the foreign invested enterprise in Vietnam, right? They set up a company in Vietnam and then al also they want to apply to license to obtain the license for crypto asset trading. Uh actually um there's no explicit restriction on foreign investor establishing holding structure in Vietnam to indirectly control cryptoreated entities. It is not clear now. So it means that when a a foreign investor come to Vietnam and set

up a new company, we call a foreign invested companies and then the foreign invested company will set up a Zoy venture with a Vietnamese partner. So it is not clear in terms of the foreign shareholding in this scenario because the foreign invested companies in Vietnam is not considered as the foreign investor as per the law on investment of Vietnam. So we are not we we we are not clear on that issue but my my but my my understanding that the foreign shareholding also apply to the foreign invested enterprise in Vietnam.

If the foreign invested enter in Vietnam set up a Zoy venture in with with the local partners in Vietnam to apply for the license to to do crypto asset trading. Yes. What I think the the question uh the the people who asking the question uh uh uh need to provide the the the you know the the the contact. Are they asking about the owner the the trader the the the exchange itself or or what in in foreign foreign um nationality can be can be observed from different angle. Yeah. So if you're talking about the owner, the the the

trader, then uh you know uh if you are set up in Vietnam, then then you can be considered a local entity. >> Yeah, you are because you set up under the law in Vietnam, you consider a local entity and you subject to local regulation. But if you're talking about the license uh the the holder of the exchange license, then then there's a limit of 49%. Yeah. So >> yes, I think this is exactly the question. Let's say >> you set up like you as a Swiss entity, you set up uh your 100% subsidiary in Vietnam but >> this subsidiary would would this

subsidiary be considered with the local substance with everything? We are not talking yet about the license but we are talking just about the foreign ownership structure and kind of the definition what is behind in the context of this law. Let's say we set up a company in in Vietnam. Uh I believe it is allowed uh to have a 100% foreign ownership for Vietnam. >> Yes, of course. >> So uh let's say we have Vietnam entity already. So it's with the local presence with the with the local substance everything active there in Vietnam.

>> Yeah. This local entity would either establish another entity which would apply for their uh license >> or itself be active would want to be active in in let's say exchange crypto exchange transactions >> would be considered as foreign being established already in Vietnam because of the foreign UBO or uh this entity can be recognized as a local. >> Yeah.

>> With for the context of this 49 ownership >> the yeah the resolution is not clear on that issue but my suggestion and my understanding as per the law on investment in Vietnam um even the foreign invested enterprise in Vietnam is set up in Vietnam as a Vietnamese as a Vietnam entities they still subject to 49%. if they want to set up a soy venture with a local partner then apply for the license. It is my understanding because as I said from the beginning it is very let's say highly regulated business in Vietnam. So we may also control and supervise the Vietnam entity to be established by the foreign

investor properties in the second layers or the third layers. we can avoid that foreign shareholding. But for the first layer, I believe that the first with the first layer the Vietnam entities to be established by the foreign investors still subject for foreign shareholdering of maximum 49% as per um the slide I I I just mentioned before. >> Well, it is of course you know you're talking about 100% for an ownership in that company. So that company is a foreign foreignowned company, right?

>> It's a local legal entity which is owned by the foreign uh shareholder. Okay? So it's considered foreign shareholder. It's obvious. So if if you want to participate in the exchange, let's say the you want to apply for the exchange license, you have 49% cap. >> Mhm. >> Yeah. It's simple like that. Yeah. >> Okay. >> They're talking about uh lo, you know, uh the the the foreign ownership. They're not talking about, you know, just a title, >> you know, the name of the company or the type of the company. Here we're talking about ownership.

So, it's easy to identify. >> Okay. Don, I think I think we should maybe continue with your presentation because we have not much time left and part. >> Okay. Thank you. >> All right. >> While you're opening your slides, I I just wanted to clarify because we have another question about uh crypto holdings in that now use for example Binance or Kraken. Let's say if the the person from Vietnam now has a wallet with Kraken, does it mean from if consider Kraken will not be recognized from 2026 yet? Uh so this person would need to transfer this funds

from Kraken if this person would want to to uh proceed with some transactions to another wallet to the exchange which is recognized from 2026 in Vietnam. Is that correct? >> Yeah. Um I'm not sure because uh actually it is only the app pilot programs imple implement imp implementation in Vietnam. Still a big question for me but at least we see probably we may see some further instruction in the future in terms of the operation uh so that we can answer exactly the question.

>> Yeah. and >> well the technicality the technicality of that is rather unclear because uh you know but the the uh I don't know if if if they need to have a separate wallet to to join the the local uh exchange yeah the technicality is being working on as we're talking now so um we we wait to to for for the for the decree the detail decree so that that is subject to be clarified later but Yeah, there's a possibility that you can still have your wallet and if your wallet is register recognized with the local exchange and then then you can you know continue with your wallet I guess >> and once again if for example Kraken

would want to keep its presence in in Vietnam it won't be enough just to open the subsidiary or branch in Vietnam. Kraken would need first to enter to this GV as Richard described right with 65% uh structure with 49 49% structure with uh 65% of um presence. Right. >> Right. If if they want to offer the the the exchange service to the to the uh owner the to the customer in Vietnam.

So they need proceed like enter to some GV in uh locally and still it's not it won't be enough they need to be recognized and get the license from minister of >> yeah yeah if that if that platform also accept >> yes >> and do you know anything about penalties let's say okay we don't know yet what how this um um holdings will be treated where waiting for this decree for um Vietnam people but let's say for exchange if let's say still there are some holdings from Vietnam residents on Kraken

would there will be some consequences some penalties some would Vietnam impose something on this exchange >> the the penalties yeah the the penalties not clear as in not provided as as per the resolution as I said they just have some provisions uh saying that um there might be some administrative penalties or criminal penalties or something that and that's all and we still need to for further instruction from the governor of Vietnam. Uh it is easy to understand because it is actually a pilot program and then the pilot program there's a lot of question there are a lot of problems and we cannot answer at this moment.

>> Okay. >> Yeah. >> Okay. I think Don let's continue maybe with the with your presentation because we are running out of time and you have also quite um >> you can share the screen. >> So okay I can share the screen right? Okay, I'm sending the request. >> Yeah. All good. You should be able >> Uh-huh. Okay. So, how do I do it now? Uh, is it accepted already? >> Yes, you should be able to to share it now.

>> Uh-huh. Okay. Here we go. Okay. Did you see it? now. >> Yes, now we see it. >> Okay. Well, great. Um, thank you. >> Oh, hang on a second. Somehow it become All right. Oh, okay. All right. Okay. This is the first line. Okay. Right. Thank you.

You hear me? Well, right. Let's cut to the chase. Well, uh, VCI legal and this and that. It is uh you know just a introduction material uh the slide it's okay uh to skip through that and uh come to the resolution. Yeah. Oh hang on a second. It come with the uh hang on what have a caption. Okay. I want to turn off the caption here. How can I turn off the caption um

underneath? Okay. Uh okay. Do not show caps. Okay. Uh now I can say right [Music] >> okay can you see >> one minute probably >> okay okay okay >> for whatever reason uh it just pop up with the caption underneath canva somebody help with that Uh, stop the caption because I I stop. You can start

sharing now. >> Yeah, I'm sharing. Do you see that? >> Yeah. Well, but I think we keep can keep going. It's fine. >> Uh-huh. The Do you see the caption uh underneath? >> Yeah. Yeah. Yeah, we do see. >> Oh, okay. Well, it it cover my my my screen. So but anyway, so anyway, let's just jump uh into uh the uh IFC. So it's uh for a first time there's a there's a international financial center to be officially uh set up in in Vietnam. As you may notice, there's a there's some there's a congressional

resolution uh and then uh for for abbreviation, let's call it um resol resolution triple two. All right, which is um passed by the last uh June when I was in Jurich. Indeed, I was in Jurich earlier for the sweet Vietnam uh economic um forum and uh we were briefly talking about that. But then um then back then it's still it's still a draft. Now it's the officially the resolution uh of the Congress. So in terms of value it the equivalent uh of the of a new law to be to be applied and it has been you know um it has been um uh the let's say the

mother uh ship for many other new regulation which is under development now. Um and and it is uh there there would be at least eight other decree to new decree to be applied to be issued under the under the mothership here. The so so to to detail the the establishment the management and the control and the and um uh and the operation of the IFC. So um the purpose of that um so let's just um begin with uh a question that many people ask when they hear about especially people in Vietnam. It's a

pretty it's a appear to be a pretty confusing definition indeed. They uh they was asking why would anybody need an international financial center in the first place? As a matter of fact, many people believe it it still believe it as a group of as a as a areas of um real estate development with borders and fans and gate uh so that people can enter and coming in and coming out and so on and so forth. So um the concept of of the international finance center can be considered both legally and geographically uh basically. So um it's a certain it's a definitive uh area

within the existing cities of of uh Daang and Hojiming city. Okay. And it's designated for the um operation of the of the uh uh financial institution and uh and uh uh with that there's a group of regulation that are uh different from the rest of the country regulation in order to create a special treatment a special let's say special legal and financial zone which is some um virtual zone uh that exists uh within the within the activity within the cyber space so

respect of of of of the of the country as well as well anywhere in the world that international company foreign company can come in and set up their co company and uh register their status as a member and operate under the foreign law uh in particular most likely uh they will follow the UK model of the uh international financial center um and and uh and adopt the uh well at least recogn recognize up to a certain level of the common law system. Reason being um you know it's a it's a laws legal system that are most

um let's say consistent most um uh familiar with all of the uh financial institution uh operation. So um and they only they even going to have you know uh court that recognize the the common law and church uh uh you know common law church being foreign uh foreign u church uh being recruited uh for for for uh for for the international financial center dispute resolution body uh and and and there there would be a designated court called um IFC report which is reporting to the to the Supreme Court uh for the financial center. Um so it is a a

serious um uh effort trying to develop a financial and legal um areas a special one called international financial center uh with a purpose uh what uh one may wonder so what is the point Vietnam has been you know having a lot of institutional activity you know uh institution um that are uh operating in in financial markets and capital markets and there's a lot of financial transaction happen every moment of the the day. So why would Vietnam need some uh international finan center anymore? Uh the point is that um

the country development model had reached a certain limit uh or reached the ceiling of development and they want to develop more. What Vietnam uh is missing right now is the recognition on the financial market and the and the flow the the transaction uh activity that are happening uh in Vietnam is still very uh very uh uh small very insignificant comparing with the work market. Uh the good news here is that Vietnam just a few days ago recognized as a new uh status of the of the capital market as a frontier market now. So with that the rating is

increased and uh credibility is increased and therefore there should be more trade there should be more incoming outgoing uh of the capital that take place um easier. So basically that means more money and cheaper money can come into Vietnam, right? uh but even with that it going to take years before a uh a stock market uh it's a traditional financial market can be fully developed if it still function under the local regulation follow the same norm and follow the same model that are existing under the law in Vietnam such as law on uh foreign investment a

while ago and now become foreign on investment law on foreign exchange and law on credit institution, law and security, so on and so forth. The the system, the legal system in Vietnam, it's just basically inconsistent with the global financial um system and it doesn't work well with London, with Tokyo, with Hong Kong or Singapore, which is the majority of those uh New York also uh the system that work on the basis of common law. Therefore, you know, Vietnam want to uh harmonize itself, want to um synchronize itself with the rest of the world in terms of the financial transaction. And therefore

with that they hope would be bring in many more uh foreign investment um and and make the transaction from Vietnam internationalized uh as much as you as they can. And therefore in order to do that, the Congress of Vietnam decide to um to develop a u uh uh the resolution that allow that uh international financial center model to take place in Jim City and in Daang. Uh the two the two city the two biggest uh commercial hub uh in the center and the southern part of Vietnam. and uh with the with the effort

to to uh materialize the that that strategy that new uh development strategy and you may see here uh the interesting thing is that although Vietnam decided it should only have one financial center perhaps because you know one uh financial center is hard enough to attract international investor and trader uh uh you know from the point of view of uh management point of view, it probably um make more sense to have a consistent regulation, consistent uh management agency, supervisory uh agency as well as dispute resolution agency.

So um one country to system is similar concept here uh from the financial point of view. Um then um Vietnam uh consider uh since Hong Kong you know as is serving as a as a port of attracting foreign investor foreign investment to mainland China uh and that work quite well. So perhaps Vietnam should also have something in similar and therefore we also uh this part of the reason why we have the you know financial center uh officially announced and launched as a as a two commercial hub in in the center and in the southern part of Vietnam. So

um basically what you see here is um is um uh and together with the executive uh uh so basically uh within the IFC there would be two key uh agency uh that are functioning uh together in order to make sure that uh um the financial transaction in investment can take place uh smoothly. So one is executive agency that's a management board managing all the operation. The other one is super supervisory agency uh overseeing the compliant enforcement of the law within itself and uh the third one is a dispute resolution body

which is a specialized course in in astronomy Jason center as one can see. So uh um Dang is the one that probably would be serving more uh you know on the uh unconventional kind of finances uh financial activity i.e. um crypto uh as we talk about as you know dies asset as well as uh uh fintech the new green finance um and uh dig service so on and so forth and why Hoim City is more focused onto the uh traditional financial market uh being banking monetary market sandbox mechanism for

fintech innovation in the financial sectors uh trading platform commodity market so on and so forth. Um yeah but uh I do realize that uh here there's a the overlapping activity of the two of the two location but u yet that is um uh that is the purpose to have two location that are working together at the same time and maybe are complimentary to each other uh uh in terms of market um you know appeal in terms of operational uh effectiveness so on and so forth.

So um with that being said uh so what is indeed the the the uh special about uh international financial center right one may ask so basically they believe that there's 14 key areas of uh of policy that are necess that is necessary for the for the international player to come and and and and and uh doing business in the international financial center in Vietnam and the purpose is to exceed global center and align with international norm um uh in order to make it more attractive uh to so that you can attract um international um uh investor to come

in. So basically we're talking about foreign exchange policy, banking, operation, finance uh and innovation tax incentive uh which is applicable for both corporate income tax and personal income tax. the uh uh entry exit and residents of people uh who are working at international financial center. Basically, they can come into Vietnam easy with a visa and they can be exempted from uh income tax uh up to a certain level and uh and they can um and in terms of employment and social security policy also uh that uh that come with um a lot of favor shipment and the land also is uh uh designated and uh

prioritized to be to be awarded to be land uh to be um leased to uh to the customer to the uh company that are members of the uh international financing center. Uh the approach to capital market incentive by sector and infrastructure development um and uh export import distribution of good and services fee and charge labor and uh policy favor uh investment policy for strategic investor. Those are the area. The detail will come in a little uh in a few uh in a few uh uh slide. As you can see here

um the law that is applicable for the for the uh IFC as you can see here are the combination of different type of regulation. the IFC regulation by itself, the Vietnamese, the local Vietnamese, the domestic Vietnamese law, foreign law. Yeah. And uh as I mentioned before, common law uh could be uh could be adopted, could be uh recognized and foreign and with uh you know designated court with foreign church would also be um uh hearing cases and and and uh um setting the center for dispute resolution.

And in terms of authority uh um the membership uh of the of the uh financial center international financial center uh so basically they they targeting the the big player the big investor and therefore if you're a member of Fortune 500 or top 10 player in uh in finance and investment uh top 10 insurance company uh then you can be accept automatically without without um you know waiting for the recognition by the uh by the um uh management uh board of the of the IFC.

The uh other will need to register for membership and um you are own member and um uh own member are expected to have commercial present within the IFC itself and um security sector then you need to be a limited company under the with the license from the SSC the state security commission and the right of the member um you can raise foreign fund without without uh license uh without additional license from the from the from the local authority um from the state bank um and uh you can apply choose to apply the international

accounting center instead of Vietnam uh m one the uh you know uh you need to follow the forex rule but then essentially you should be able to uh convert uh you know and and do foreign foreign uh for forex um you know transaction uh without additionalize it. So yeah >> John um I'm really sorry to interrupt you. Well the the webinar was scheduled until 10. I know that people also probably have other >> uhations for today. Let's maybe uh could you just provide some bullet points about this national financial center? I

mean we see that the dispute resolutions um uh structure is already very big step and I think it will facilitate a lot of processes for foreign investments. But maybe >> also if you could summarize from the perspective of what we discussed at our first part with Richard would uh establishment an entity within um the framework of international financial center would it simplify or facilitate certain processes for digital assets?

>> Right. >> Right. So um let me say it very quickly. Yes. Yes. There's a there's a long list of thing that need to be covered. and so on and so forth in the IFC. But there's a uh what you need to take away from that uh very briefly uh from from the IFC regulation is that you have an opportunity to set up in the IFC as a foreign company and you follow the foreign uh uh you know uh law. So you can do uh it is unclear how are how is the how is um uh foreign exchange the the the crypto exchange can be set up inside the IFC but it's a poss it is a possibility also you can have the choice

to set up in the as a fintech company as a as a crypto um company as a uh crypto accent company inside uh in in inside the IFC itself and you are subject to foreign and international uh law which Vietnam is a member with. Okay. Although you are expected to follow uh the regulation that are in place but uh if you are a member of the IFC you are subject to a foreign jurisdiction. So that isn't the one number one key point that after you know reach this presentation that uh that should be taken into account. Okay, that is that is uh that is the the the

uh main uh point. But the other thing is about tradings and foreign ex foreign exchange uh control and so on and so forth. Uh we can uh you know it take a uh take a whole day to talk about it indeed. So um yeah so basically what need to uh what you can take away is that it is a special economic uh uh well special legal and financial zone that you can set up and you can trade according to international and foreign uh regulation without too much trouble um instead of going into that. But then remember there's a limit that uh what you can offer you can offer globally to the

global market instead of uh you know not not uh Vietnamese uh market without complying. If you can comply with the local regulation yes you can also provide the service um and the and the product into the domestic market. Uh but you need to comply with the domestic law. If you don't want to comply with domestic law, you focus, you just stay within IFC itself. Okay. >> Okay, that's clear. >> All right. >> Um, just one last question I see that was also from from our participants about this.

>> I think Richard maybe more question to you, but feel free to to add uh about this regulated activity from 2026. Is it only licensed activity? Is it only about crypto exchange or if the company would say be active in tokenization of real world assets or providing some infrastructure technical infrastructure would it be also subject to license or it's purely for crypto exchange transaction or like trading transactions?

The license the obligation to get the license is it for uh only for exchange or do we have any list of activities which are subject to uh license activity Richard >> hello >> you need to unmute yeah okay >> yeah y yeah okay I I believe that only license platforms are allowed to do to provide a trading activities in Vietnam.

And >> yes, but what about let's say tokenization activity? Let's say compan is active providing like tokenization services to tokenize real world assets >> tokens. >> Um tokenization uh actually there's no information no regulations under the resolutions on the tokenization service in Vietnam. But I believe that probably as per my understanding and also my experience in Vietnam is that is not allowed in Vietnam. Only licensed platforms can can can can operate and can can operate in Vietnam.

>> Okay. Well, actually it is u that is uh you know possible to do uh within the purview of of of resolution number five as a as a you know um real world asset real world asset uh offering um you know token uh tokenization is is possible to do uh subject to the license the the the regulation you know um uh in in Vietnam that the unfortunate well unfortunately at this point in time they're still working on the detail so we don't have all of the detail to to answer you. But but uh so sure because um the the new regulation doesn't list out the crypto as one of the the as the asset to be offer uh by by company set up under the

the the sandbox regulation. Instead it is um is focused onto real world asset into indeed real world asset tokenization. So it's a key areas of of of development for for that that the new sandbox regulation is aiming at. >> Okay. Okay. >> Yeah. But the detail is not available now as uh Richard mentioned. So we have to wait for for for the detail. How are we going to apply for the let's say company that are offering the service of uh uh tokenization uh real world asset. >> Mhm.

they are busy and focused onto the exchange the crypto exchange license now indeed. >> Okay, thank you. So, thank you both of you for fantastic presentations and insights. Uh we have provided your contacts and I believe our participants could be able to to contact you directly in case of some questions or followup. Uh what I also wanted to mention is about the event um the economic forum in Denang November right correct me if I'm wrong beginning. Yes, that's right.

>> So, >> if you can share a few words about this event, what the topics will be covered there, >> John, I think you will be presented there right? >> Right. I will be presented there. And uh well I >> I do I do have a lot of topic to cover indeed given the fact that Vietnam uh just in this year going to to you know pass uh 50 new regulation on especially um the one that are aiming at fin um you know financial uh sectors and new technologies and um financial center and so on and so forth. So I'm uh also I'm representing the the Vietnam association

of bit uh of of blockchain and digital assets. So uh again you know the very topic that we are talking now tokenization of real world asset is one of the topic that I'm going to cover as well as the the the you know dispute resolution mechanism under the new regulation. How are we going to adopt it? Um together with the existing uh arbitration such as Vak and and and and um so we are we are cooperation uh we are cooperating with uh with Vak and and and uh so V uh Vafi VBA and Vak are cooperating in in that fund also. So there's a uh you know um dispute

resolution in in in fintech in in um in uh in crypto uh transactions and uh so that that that that would be the key uh topics >> during the forum. Yeah. Richard, do you have anything also to add? >> Um I will also attend the events uh in Daang next month. So probably we'll we'll also talk something about um crypto asset and also digital u technology um laws in Vietnam.

>> Yes. >> Yeah. Thank you. So thank you again both of you. We we can see that Vietnam made a really step forward to to digital assets development to development of this sector in in the country and um not only like legally recognized but also providing some and facilitating certain processes through international finance financial center. Uh we will share the information with our with our participants about the DAN uh forum. So for those of you who are interested, you can also see and consider maybe coming and visit this event. And um so thank you. Thank you all of you. Thank you to our guests. And um so I wish you nice

rest of >> Thank you so much. Yeah. Thank you. Thank you so much. All right. Byebye. >> Thank you. >> Good to see you people. We'll see you later.