Promotion over 50% is a violation
The Vietnamese e-commerce market has been "stirred up" by a whirlwind of cheap goods over the past month as Temu, Taobao and Shein increased their presence in Vietnam.
Especially Temu, although not yet fully completing legal procedures in Vietnam, this e-commerce "giant" has launched a series of incentives for users opening accounts and making transactions for the first time, in which with the first order, buyers receive a discount of up to 90% of the value.
Mr. Nguyen Phong (Cau Giay, Hanoi) learned about Temu when he saw this site advertised on social networks. When clicking on the link, Mr. Phong was invited by this e-commerce site to participate in spinning the wheel showing different levels of product promotions, from 50% to 90%. Spinning the 90% discount box - the highest discount, Mr. Phong was guided to Temu's online shopping application.
The link guides him to create an account to experience shopping with many great deals. He bought a pair of fashionable glasses for 445,000 VND, 75% off the original price of 1.7 million VND and had them delivered 3 days later.
"The normal price of Cyberpunk glasses is nearly 2 million VND. Seeing that the price was so cheap, I bought it to try," said Mr. Phong.
However, according to the regulations on promotional forms in Vietnam in Decree 128/2024 recently issued by the Government, amending and supplementing a number of articles of Decree 81/2018, 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.
According to this regulation, the total value of goods and services used for promotion must not exceed 50% of the total value of the goods and services being promoted.
In case of organizing a concentrated promotional 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 programs and trade promotion activities decided by the Government.
Need strict sanctions
Regarding this issue, Mr. Vu Ba Phu - Director of the Department of Trade Promotion said that for e-commerce platforms registered in Vietnam, businesses are allowed to have promotions under 50% without having to notify; promotions over 50% are only applied when businesses participate in national promotional programs such as Tet, major holidays according to regulations.
The Ministry of Industry and Trade has directed the Departments of Industry and Trade to review the area, and if violations are detected, they have the right to directly fine the violating e-commerce platforms.
Regarding cross-border e-commerce platforms that have not registered to operate in Vietnam, the Director of the Trade Promotion Agency said that if they have not registered, it will be very difficult to handle because they do not have a presence in Vietnam. Therefore, it is necessary to study stronger solutions such as removing the app and terminating operations as some countries have done.
The Ho Chi Minh City Department of Industry and Trade has also proposed that the Ministry of Industry and Trade prevent advertising and promotions that violate regulations. Accordingly, strict sanctions will be applied, including temporary suspension or termination of operations of e-commerce platforms that repeatedly violate regulations.
Check compliance of international e-commerce platforms to create a fair competitive environment and protect the interests of domestic enterprises.
According to current regulations, the responsibility of foreign traders and organizations with websites providing e-commerce services in Vietnam is to coordinate with state management agencies in preventing transactions of goods and services that violate Vietnamese law.
At the same time, perform obligations regarding consumer rights protection, product and goods quality according to the provisions of Vietnamese law... as well as perform reporting obligations according to regulations.
The Department also recommends the issuance of regulations on tariffs and customs procedures. The goal is to ensure a legal basis for effective management of cross-border e-commerce, including fair tax collection and goods control.
