Key takeaways
Decree 211 introduces the following notable changes:
- Narrowing of the scope of civil encryption products subject to business licensing requirements
- Removal of 52 HS codes from the list of civil encryption products subject to import/export permits
- Introduction of three regulatory templates in the business license application dossier
- Other noteworthy amendments
In more detail
- Narrowing of the scope of civil encryption products subject to business licensing requirements
Pursuant to the Law on Cyberinformation Security 2015, businesses engaging in the civil encryption products and services mentioned in the list provided in Appendix I of Decree 58 are subject to business licensing requirements.
Decree 211 introduces the following amendments to Appendix I:
- Removal of certain civil encryption products from the scope of the business licensing requirement, including, for example, cryptographic components of a PKI system and channel security products
- Revision of the list of exempted products, whereby five additional categories of civil encryption products are exempted from the business licensing requirement, while two categories that were previously exempted have been removed
- Removal of 52 HS codes from the list of civil encryption products subject to import/export permits
Certain civil encryption products are subject to import and export licensing requirements. The list of these products is currently set out in Appendix II of Decree 58. Decree 211 amended this list by removing 52 HS codes from the catalogue of civil encryption products requiring import/export permits.
- Introduction of three regulatory templates in the business license application dossier
A notable change introduced under Decree 211 is the addition of three new templates in Appendix III. These are to be included in the application dossier for obtaining a business license for civil encryption products and services. Specifically, the following templates have been introduced:
- Technical Plan (Form No. 3)
- Business Plan (Form No. 4)
- Network Information Security and Safety Plan (Form No. 5)
- Other noteworthy amendments
In addition to the changes outlined above, Decree 211 introduces several further noteworthy provisions.
- Under Appendix II (i.e., List of civil encryption products subject to import/export permits), technical encryption characteristics and product descriptions are now specified for each HS code, rather than only the product name and functional description as currently provided.
- Decree 211 clearly specifies the sequence and deadlines for receiving dossiers, checking validity, supplementing dossiers and issuing licenses upon receiving a complete and valid dossier.
- Enterprises are no longer required to submit copies of certain licenses or certificates (i.e., enterprise registration certificate, investment registration certificate, the business license for civil encryption products and services, and the certificate of conformity for imported civil encryption products). Instead, the Government Cipher Committee will verify this information through the National Database.
- Decree 211 supplements new provisions regarding the responsibilities, procedures and formalities for the conformity assessment and declaration of conformity for civil encryption products.
- Administrative fines for various violations relating to the business of civil encryption products and services will be increased, such as the following:
- Engaging in business without a business license may be subject to a fine of VND 50 million to VND 180 million (previously VND 40 million to VND 50 million).
- Conducting business activities that are inconsistent with the contents of the business license may be subject to a fine of VND 50 million to VND 60 million (previously VND 20 million to VND 30 million).
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Ngoc Trung Tran, Senior Regulatory Advisor, and Trung Kien Nguyen, Tax Practitioner have contributed to this legal update.
