In recent years, Vietnam has established itself as one of the most dynamic markets in the panorama of e-commerce in Southeast Asia. In 2024, the sector reached a value of over 25 billion dollars, with a growth of 20% compared to the previous year (Source: vir.com.vn). This expansion has placed Vietnam in third place in the region, after Indonesia and Thailand. However, the recent forced retreat of two Chinese giants in the sector, Temu and Shein, highlighted the regulatory complexities that foreign operators face to operate legally in the country.
The Temu and Shein case: a warning for foreign investors
The release of Temu and Shein represents a clear signal for international investors interested in the Vietnamese E-Commerce market. Both platforms had to suspend their activities after having failed to register at the Ministry of Industry and Commerce (Moit). The Vietnamite authorities have imposed the two operators the obligation to conform by November 2024, in the meantime suspending any commercial, advertising and promotional activities. Failure to comply with the deadline led to the exclusion of Temu and Shein from the market (Source: Reuters.com).
An increasingly stringent regulatory framework
This episode confirms the intensification of controls by the Vietnamese government on the e-commerce sector, with the aim of guaranteeing compliance with local regulations and protect consumers. The Ministry of Finance is evaluating the elimination of tax exemptions for imported goods of less than 1 million dongs (about 40 dollars), a measure that could significantly impact online sales platforms (Source: Reuters.com).
Methods of access to the market
Foreign investors who wish to operate in the Vietnamese e-commerce market can choose between two options. The first is the direct investment, which implies the establishment of a limited liability company or the acquisition of shares in an already existing company, after obtaining the necessary government authorizations. The large platforms, classified among the top five of the country for business volume, are also subject to a control by the Ministry of Public Security.
Alternatively, foreign companies can operate without a physical presence in Vietnam, provided that they respect certain criteria. The platforms that use a Vietnamese domain are considered active in the local market, present content in the Vietnamese language or record over 100,000 annual transactions. In such cases, the operator is required to register at the Moit and to designate a local representative or open a representative office.
The opportunities for Italian companies
For Italian companies interested in entering the Vietnamese market, it is essential to adopt a strategic approach and in accordance with local regulations. Made in Italy exports, in particular in the fashion, design and food sectors, can benefit from the expansion of e-commerce in Vietnam, provided that operators respect the regulations on digital platforms and the protection of intellectual property.
Access to the market can take place through partnership agreements with already established local distributors, thus reducing the risks related to regulatory and logistics complexity. In addition, Italian companies can make use of the facilities provided for by bilateral commercial agreements between the European Union and Vietnam, which provide for tariff reductions and customs facilities for numerous Italian products.
Leading platforms and their successful strategies
Despite regulatory challenges, the Vietnamese e-commerce market continues to attract international investors. Platforms such as shopes (part of the Sea group based in Singapore), Tiktok Shop (e-commerce division of the Chinese Bytedance) and Lazada (controlled by Alibaba) have been able to adapt to local regulations, recording significant results. In 2024, the four main operators in the sector— WHOPEE, Lazada, Tiktok Shop and Tiki – have generated a sales volume of 13.8 billion dollars, with a growth of 40% compared to the previous year (Source: E.Vnexpress.net). Shopee recorded a gross value of the (GMV) 9.3 billion dollars, while Tiktok Shop reached 3.8 billion dollars, representing 66.7% and 26.9% of the market respectively.
Conclusions: Vietnam between opportunities and challenges
With a young population and strongly connected digitally, Vietnam is confirmed as a strategic hub for e-commerce in Southeast Asia. For investors, success depends on the ability to understand and respect the local regulatory framework. Only those who will be able to navigate with competence between regulations can fully capitalize on the opportunities offered by a rapidly expanding market. The experience of Temu and Shein shows that Vietnam does not tolerate those who do not respect the rules: a clear warning for anyone who intends to appear on one of the most promising sectors of the region.
