NEW DRAFT LAW ON PROTECTION OF CONSUMER’S RIGHTS (Vietnam)

1. Protection of Personal Information of Consumers

Currently, the provisions governing consumer information protection have been mentioned in a number of different regulations such as Law on Information Technology, Law on Cyberinformation Security, Law on Electronic Transactions, or Decree 52/2013/ND-CP on E-commerce. The current LPCR (No.59/2010/QH12) has only one article regulating basic provisions on this issue (Article 6): “Consumers’ information shall be kept safe and confidential when they participate in transactions relating to use of goods or services, except where competent state agencies require the information.”

The draft LPCR supplements a definition of consumer information and includes provisions related to the protection of consumer information by way of 6 articles (from Article 7 to 12). Specifically, the LCPR provides that “the consumer’s personal information includes consumers’ personal information, information about the consumption process and other information given by consumers or organizations and individuals in connection with transactions” (Article 3.9 of the draft).

Articles 7 to 12 of the draft LPCR set out many responsibilities of traders with respect to the protection of consumer information as follows.

These regulations are very similar to the provisions on the protection of the personal information of consumers in e-commerce activities stipulated in the Decree 52/2013/ND-CP. Thus, under the draft LPCR, consumers in e-commerce transactions as well as other types of transactions will be protected with the same policy.

2. Protection of Vulnerable Consumer

One of the notable points in the draft LPCR is the regulation on the protection of the rights of vulnerable consumers. This is a completely new regulation compared to the current LPCR. Vulnerable consumers under the draft LPCR include elderly people, people with disabilities, children, ethnic minorities, and other vulnerable groups in accordance with relevant laws (Article 3.10).

For vulnerable consumers, the traders are requested to implement the following policies:

• Have policies on and ensure priority rights in prices, fees, and other incentives for vulnerable consumers in the purchase and sale of products and provision of services.
• Provide an appropriate complaint and dispute settlement mechanism;
• Comply with regulations on prohibited activities stipulated by LPCR as well as laws and regulations regarding elderly people, people with disabilities, children, ethnic minorities etc., during the transaction process;
• Have mechanisms and policies to fight discrimination, abuse, exploitation of vulnerable consumers in the collection, storage, and use of their personal information;
• Have other incentive and support mechanisms and policies as prescribed by laws.

3. Responsibilities of Traders to Consumers

The draft LPCR adds many new responsibilities of traders to consumers as follows:

a) Responsibility to ensure safety and quality of products and services provided to consumers (Article 19)

• Traders are responsible for ensuring the safety and quality of products and services provided to consumers in accordance with the contents that are registered, notified, announced, agreed with the consumers, or prescribed under the laws.
• In the process of performing the responsibility to ensure the safety and quality of products and services, traders need to ensure their suitability with consumer groups according to age, gender, income, geographical area, ethnicity, health status, mental and physical characteristics.
• Traders are responsible to warn about products and services that are likely to be unsafe, adversely affect the health, life, and properties of consumers, and notifying prevent measures.

b) Responsibilities for receiving and handling consumer complaints or requests (Article 30)

Business organizations and individuals are responsible for:

• Developing and publicly announcing the process of receiving and resolving consumer complaints or requests at a conspicuous location at the headquarters, business locations, and on the website (if any).
• Receiving and handling consumer complaints or requests in accordance with the announced process.

c) Responsibilities for defective products (Article 31, Article 32)

Responsibilities for defective products are stipulated in the current LPCR (Article 22). The draft LPCR divides defective products into 2 groups:

The product recall process is basically the same as the current regulation, however, for products of group A, traders, when detecting a defective product, must take all necessary measures to stop the supply of defective goods in the market. For the products of group B, this action is not required.

The draft LPCR adds a new regulation on the responsibility of the competent authorities on supervising the recall of defective products to ensure that the recall is carried out in accordance with the notified contents.

4. Protection of Consumer’s Right in Particular Transactions

The draft LPCR adds a new chapter addressing some particular trading forms, i.e., distant transactions, continuous provision of services, home sales, and specifying the trader’s responsibilities when transacting with consumers. These types of transactions are increasingly popular in Vietnam but pose many potential risks to consumers.

• Distant transaction means a transaction for products and services performed in cyberspace or other indirect means, in which, consumers are not allowed to check and directly contact products and services before participating in transactions.
• Continuous provision of services is the activity of provision of services for a term of three months or more or for an indefinite term.
• Home sales is the activity of selling products and providing services, in which traders actively approach and introduce products and services for sale to consumers. Home sales include the following forms: (i) Door-to-door sales, (ii) Multi-level marketing, and (iii) Sales at a place that is not a place of regular transactions.

Currently, some regulations related to such transactions are sporadically regulated in many different legal documents, such as Decree 99/2011/NĐ-CP guiding a number of articles of current LPCR, Decree 40/2018/NĐ-CP providing a regulatory framework for multi-level marketing, or Decree 52/2013/ND-CP on e-commerce. However, they are assessed as incomplete and lacking in specificity. The supplement of specific provisions into the LPCR with greater legal effect is expected to improve the effectiveness of consumer protection.

Conclusion

The deadline for the MOIT to receive comments is 10 March 2022. The new LPCR will be enacted in the middle of next year and is likely to take effect in early 2024. With many new and specific regulations, the new LPCR is expected to protect consumers’ interests more effectively. Traders must take note of these new regulations and change and update their policies in due course when selling goods or providing services to consumers.