Vietnam used to be the easy answer to "China+1."
It isn't anymore.
Over the last 18 months, I've advised seven Chinese clients on Vietnam projects — consumer electronics, solar modules, cross-border e-commerce — and the same pattern keeps showing up: the playbook from 2022 no longer works. Vietnam is quietly rebuilding the foundation of its foreign investment regime.
Four shifts every cross-border counsel should map:
- Data localization is approaching China-style strictness.
Decree 13/2023/NĐ-CP introduced GDPR-flavored obligations: cross-border data transfer impact assessments filed with the Ministry of Public Security, a designated local data protection officer, and tightened lawful bases. The forthcoming Personal Data Protection Law (expected Jan 2026) goes further. A SaaS client of mine had to relocate user data to a Vietnam-based data center after a near-miss compliance review.
- Global Minimum Tax (Pillar Two) wiped out the headline incentive.
Since 1 January 2024, MNEs with consolidated revenue above EUR 750M face a 15% effective tax floor. The "four-year exemption + nine-year half-rate" sweetener is largely neutralized at the group level. One electronics client's IRR dropped from 18% to 13% after re-modeling.
- Work permits for Chinese technical staff have tightened.
Decree 70/2023 raised qualification thresholds. The "fly in a Chinese engineer for three months" model is fading. I now tell clients to start grooming local deputies 12 months ahead of launch.
- Anti-circumvention scrutiny is real.
US and EU patience for transshipment is gone. Vietnamese customs is auditing solar, batteries, and aluminum aggressively. Push for 35%+ local value-added; keep critical processes onshore; archive origin records for five years.
The Vietnam window is not closed. The "travel light" window is.
If you're scoping a Vietnam project, build compliance into the original CAPEX — not as an afterthought. The clients who allocated 3%+ of investment to legal and tax structuring upfront paid roughly half what the others paid in remediation.
How is your team adjusting the Vietnam thesis for 2026?
#CrossBorderLaw #VietnamInvestment #ChinaOutbound #DataPrivacy #InternationalLawyer
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Mike Wu, China-licensed Attorney · Cross-border practice
4 languages (CN/EN/ES/JA)
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