SINGAPORE, Feb 24 (Reuters) – U.S streaming large Netflix Inc (NFLX.O) is making preparations to open an workplace in Vietnam after years of negotiations with authorities and finishing a threat evaluation, two sources with information of the matter stated.
An area workplace would make Netflix the primary main U.S tech agency with a direct presence within the fast-growing Southeast Asian nation of 100 million, more and more seen as too profitable to disregard regardless of wariness over its stringent web guidelines.
Netflix declined to remark in response to Reuters questions on its plans and its present operations in Vietnam.
The corporate is within the early stage of planning for an area entity in Vietnam after finishing an evaluation in late 2022 that evaluated safety and political dangers of working an workplace in Vietnam and the dealing with of consumer knowledge and delicate content material, the sources stated.
The individuals declined to be recognized as a result of the preparations are confidential.
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The workplace may open as early as late 2023 however would require a prolonged regulatory course of that might take longer, in response to one of many sources.
Authorities introduced a brand new decree, efficient from January, requiring video-on-demand service suppliers to hunt licences from the Vietnamese authorities to function, which might in flip require establishing an area workplace, though particulars of implementation stay unclear.
Vietnam has confirmed complicated for tech companies to navigate, due partly to a scarcity of readability on particular necessities and enforcement mechanisms for its usually strict rules, overseas executives accustomed to operations within the nation have stated.
Though Vietnam’s cybersecurity regulation of 2018 requires all overseas companies incomes revenue from on-line actions in Vietnam to open an area workplace, solely TikTok proprietor ByteDance has up to now complied, regardless that a number of different social media suppliers rely Vietnam as one in all their top-10 international markets.
As Vietnamese officers develop extra assured within the nation’s rising shopper energy, nevertheless, they’ve begun ramping up strain on tech companies to abide by the foundations.
They threatened to close down Fb in 2020 over political content material on the platform, and in 2022 launched new rules requiring that tech companies retailer consumer knowledge domestically and that social media companies take away inside 24 hours what the authorities deem to be false content material.
NETFLIX MEETING
Netflix instructed senior Vietnamese authorities officers it was finding out the opportunity of opening an area consultant workplace throughout a December 2022 assembly with the agency’s Asia enterprise technique vp, in response to a press release posted on the Ministry of Planning and Funding’s web site.
Nguyen Van Doan, a senior official on the ministry, “expressed his want that Netflix quickly set up a authorized entity in Vietnam and contribute to the event of the Vietnamese economic system,” the assertion stated.
Vietnam’s data ministry didn’t reply to a request for remark.
With the quickest rising center class in Southeast Asia, Vietnam has change into a key marketplace for tech giants.
Its digital economic system together with fintech, e-commerce and on-line leisure is on observe to develop to just about $50 billion in complete transactions per yr by 2025, greater than double final yr’s determine, in response to a report by Google, Temasek Holdings and Bain & Firm.
Vietnam’s ruling Communist Occasion maintains tight media censorship and tolerates little dissent, with strict guidelines over on-line content material, whereas the federal government is protecting more and more shut tabs on overseas gamers within the sector.
The authorities introduced final month that that they had collected 1.8 trillion dong ($78 million) in taxes from Google, Meta, Netflix and TikTok in 2022.
The Vietnamese authorities had for years been demanding tax funds by tech giants, together with Netflix, that had been working with out native workplaces, in response to sources accustomed to the matter.
Firms had stated they lacked a correct mechanism to pay tax in Vietnam, though this was addressed final yr with the creation of a web-based portal for that goal.
Social media firms have confronted specific strain over content material, together with pending guidelines over the posting of news-related content material on social media accounts, though Netflix has additionally occasionally been the goal of public orders by the federal government to dam home entry to content material judged “offensive to the Vietnamese individuals”.
This included in 2022 the Hollywood movie “Uncharted”, which referenced Chinese language claims within the South China Sea, and the South Korean drama “Little Ladies”, which contained scenes of the Vietnam Warfare.
Reporting by Fanny Potkin in Singapore and Phuong Nguyen in Hanoi; Enhancing by Edmund Klamann
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