This article aims to examine policies and legal frameworks governing the digital economy in several representative countries; analyze different regulatory models along with their advantages and limitations; and, on that basis, propose policy recommendations and lessons applicable to Vietnam.

Keywords: digital economy policies and laws in selected countries; policy lessons for Vietnam.

OVERVIEW OF THE DIGITAL ECONOMY AND THE ROLE OF LAW

1. Concept of the digital economy

The digital economy refers to an economic system based on digital technologies and data as core production factors. It encompasses e-commerce, digital services, financial technology (FinTech), digital logistics, and digital platforms.

From a general perspective, the digital economy includes fields such as: e-commerce, financial technology (fintech), information technology services and digital platforms, as well as data and digital assets.

From a more specific analytical perspective, Bukht and Heeks classify the digital economy into three layers: The digital core, including traditional ICT industries such as software, hardware, and network services; The digital platform economy, which includes economic activities that rely on digital technologies as operational infrastructure, such as e-commerce, fintech, artificial intelligence and cloud services; The digitized economy, in which all sectors including education, healthcare, transportation and public administration incorporate digital components and digital transformation.

2. Measuring the digital economy

According to a review study published in PMC Digital Economy, the digital economy accounts for approximately 4.5% to 15.5% of global GDP, depending on the definition and statistical methodology applied.

3. The concept of digital economy law

Digital economy law may be understood as the body of legal norms governing economic relations arising in the digital environment, including both relationships among private entities (such as enterprises and consumers) and relationships between private entities and the State in areas (such as regulation, governance and the protection of rights).

From a more detailed perspective, digital economy law can be categorized into the following groups of legal norms:

- Regulations governing the exchange, purchase, sale, conclusion, and performance of obligations through electronic means.

- Law on data governance and personal data protection: Regulations concerning rights over data, obligations to protect personal information, and control over data sharing and storage.

- Competition law and antitrust regulation in digital markets: Legal provisions aimed at regulating the abuse of dominant positions by digital platforms and controlling economic concentration in the technology sector.

- Tax law in the digital economy: Legal rules determining the tax obligations of cross-border digital businesses that operate without a physical presence in the host country.

- Legal frameworks for regulating innovation: Including regulations related to regulatory sandboxes, fintech, artificial intelligence, blockchain and other emerging technologies.

4. The role of the legal framework

Law plays an essential role as a regulatory instrument to: Ensure fair competition between domestic and foreign enterprises; Protect user privacy and personal data; Promote innovation and attract investment; Establish tax obligations and revenue sources for the state budget.

5. Current status of legal regulations on the digital technology industry in Vietnam

In Vietnam, the digital technology industry has been identified as a new engine of economic growth and has been recognized in numerous policy documents issued by the Party and the State in recent years. Notable examples include: Resolution No. 52-NQ/TW dated 27 September 2019 of the Politburo on a number of guidelines and policies for proactively participating in the Fourth Industrial Revolution; The National Digital Transformation Program to 2025, with a vision to 2030, promulgated under Decision No. 749/QĐ-TTg of the Prime Minister.

During the period 2021-2025, the State has made considerable efforts to develop important legal documents related to the digital technology industry, including: the Law on Electronic Transactions (2023); the Data Law (2024); the Draft Law on Personal Data Protection; the Draft Law on the Digital Technology Industry; as well as regulatory sandbox policies for fintech, blockchain and artificial intelligence. These initiatives represent necessary steps toward gradually completing the legal framework for the sustainable development of the digital technology industry in Vietnam.

However, the legal system governing this field in Vietnam remains at an early stage of development. The legal framework is still fragmented and overlaps across various sectoral laws, such as: the Law on Cybersecurity (2018); the Law on Network Information Security (2015, amended in 2018); the Law on Intellectual Property (2005, amended in 2022); along with implementing decrees and related regulations. This fragmentation creates significant challenges for both regulatory governance and the promotion of digital technology development. Many legal provisions have yet to keep pace with the rapid development of digital technologies, particularly in emerging areas such as artificial intelligence, open data, regulatory sandboxes for technology startups, digital identity systems and digital signatures in civil transactions, thereby creating obstacles to scaling innovation.

Policies supporting technology enterprises also remain incomplete. For instance, tax incentive policies for innovative startups are often administratively complex, while research and development (R&D) funding programs tend to be formalistic and have yet to generate a substantial growth stimulus. At the same time, law enforcement capacity and regulatory oversight at the local level remain limited. Coordination among ministries, sectors, local authorities and businesses in implementing digital technology regulations is still insufficiently effective and many regulatory provisions remain unclear. These legal constraints are currently hindering the development of Vietnam’s digital technology industry.

ANALYSIS OF DIGITAL ECONOMY POLICIES AND LEGAL FRAMEWORKS IN SELECTED COUNTRIES

1. The European Union (EU)

The European Union (EU) is among the leading actors in developing a comprehensive legal framework to regulate and promote the sustainable development of the digital technology industry. Since 2020, the EU has adopted a series of landmark legislative instruments aimed at regulating various aspects of the digital economy, including: (1) The Digital Services Act (DSA) and the Digital Markets Act (DMA), both entering into force in 2023. These regulations impose stringent legal obligations on large digital platforms, commonly referred to as “gatekeepers”, requiring algorithmic transparency, the removal of illegal content, anti-monopoly measures, and enhanced consumer protection. (2) The Data Governance Act (DGA) and the Data Act, which establish mechanisms for cross-border data sharing among businesses, governments, and citizens in a fair, transparent and secure manner. (3) The EU Artificial Intelligence Act (AI Act) adopted in March 2024 representing the world’s first comprehensive legal framework governing artificial intelligence based on a risk-based regulatory approach.

In this context, the EU has placed particular emphasis on data privacy protection and has made significant contributions to shaping global standards in this area. This is reflected in the establishment of the General Data Protection Regulation (GDPR), which entered into force in 2018 and is widely regarded as a global benchmark for personal data protection. GDPR not only sets strict rules on the collection, processing and storage of personal data but also extends its territorial scope to companies outside the EU if they process the data of EU citizens. This regulation has produced a significant global spillover effect often referred to as the “Brussels Effect” encouraging and pressuring other countries to align their legal frameworks with EU standards in order to maintain trade and investment relations with the EU.

Thus, regarding the EU, several key points can be summarized as follows:

1.1. Key legal frameworks

- General Data Protection Regulation (GDPR): One of the world’s most stringent legal frameworks for personal data protection and privacy rights.

- Digital Markets Act (DMA) and Digital Services Act (DSA): Regulations aimed at governing the conduct of large digital platforms, enhancing accountability for online content and preventing platform monopolies.

1.2. Key provisions:Strengthening users’ control over personal data; Restricting monopolistic practices by digital “gatekeepers” such as Apple, Google, and Amazon; Ensuring transparency in algorithms and procedures for removing unlawful content.

1.3. Outcomes and evaluation: The EU has established international standards for the digital economy through: A fair and competitive digital market environment; Strong protection of digital citizens’ rights; However, some businesses have raised concerns regarding the high costs of regulatory compliance.

2. The United States

The United States is one of the world’s pioneers in developing the digital economy, with a relatively comprehensive system of policies and legal instruments aimed at promoting innovation, protecting data privacy, ensuring fair competition, and fostering digital infrastructure development. One of the defining characteristics of the U.S. regulatory framework for the digital economy is the absence of a single comprehensive federal law. Instead, governance is structured through a combination of federal and state laws, each regulating specific sectors or categories of risk arising in the digital environment.

The U.S. legal approach is largely based on the principle of “light-touch regulation” or self-regulatory sandbox approaches, whereby government intervention occurs primarily when markets fail to regulate themselves or when systemic risks emerge. For example, in the field of artificial intelligence, the United States has not yet enacted a specific federal AI law. Instead, governance relies on ethical guidelines issued by institutions such as the National Institute of Standards and Technology (NIST), including the AI Risk Management Framework (2023).

At the same time, individual states have developed their own privacy laws. A prominent example is the California Consumer Privacy Act (CCPA), often described as an “American version of GDPR”. Furthermore, U.S. legislation provides a wide range of tax incentives, research funding and intellectual property protections designed to encourage technological innovation. For instance: The CHIPS and Science Act (2022) allocates more than USD 280 billion to support advanced technology research, semiconductor manufacturing, artificial intelligence and quantum science. The Digital Millennium Copyright Act (DMCA, 1998) protects copyright in the digital environment, providing strong incentives for the development of the software and digital content industries.

In summary, the United States’ policies and legal frameworks related to the digital economy can be characterized by several key aspects:

2.1. Legal model: There is no comprehensive federal law governing data protection; regulation is largely sector-based. Some states such as California have enacted privacy laws like the CCPA, which resemble GDPR. Competition policy focuses on addressing anti-competitive conduct through antitrust law enforcement.

2.2. Regulatory approach: Emphasis on promoting innovation and entrepreneurship with limited administrative intervention; Flexible governance through market mechanisms and judicial enforcement.

2.3. Advantages and limitations

Advantages: A highly favorable environment for startups and technological innovation.

Limitations: The absence of a comprehensive national data protection regime may create risks regarding privacy protection.

3. China

China is also among the leading countries in promoting the development of the digital economy, viewing it as a strategic pillar for transforming its growth model and enhancing national competitiveness. Under the unified leadership of the Communist Party of China and the state, China has developed an increasingly comprehensive policy and legal framework to promote the digital economy, regulate data and strengthen oversight of large technology platforms. China has established a regulatory framework characterized by strong governance combined with proactive promotion of digital technologies, as reflected in laws such as: the Cybersecurity Law (2016); the Personal Information Protection Law (PIPL, 2021).

These laws clearly define rights and obligations in cyberspace. In addition, China introduced the Regulation on the Administration of Algorithmic Recommendation Services (2022) to regulate automated content recommendation systems used by platforms such as TikTok and WeChat. Furthermore, the Chinese government adopted a National AI Development Strategy in 2017, setting the goal of becoming a global AI superpower by 2030.

The Chinese government has also invested tens of billions of dollars in technology development funds, established innovation zones and promoted a model of “data sovereignty”, under which data generated within national territory must be stored and processed domestically. China has also launched a Three-Year Action Plan (2023-2025) to develop the metaverse industry, inviting major corporations such as Huawei, Tencent and Baidu to participate in developing national technical standards for metaverse technologies. As a result, China has achieved remarkable progress in the development of the digital economy. According to the China Digital Economy Development Report 2024, the country’s digital economy reached 53.9 trillion yuan (approximately USD 7.44 trillion), accounting for roughly 10% of national GDP. Key characteristics include:

3.1. Legal frameworks and regulations: Cybersecurity Law; Personal Information Protection Law (PIPL); Cross-border data governance policies. These regulations place strong emphasis on national security and domestic data control.

3.2. Key characteristics: Strict regulatory oversight of domestic digital platforms such as Alibaba and Tencent; Requirements for domestic storage of critical data.

3.3. Analysis: Provides competitive advantages for domestic enterprises; At the same time, it limits market access for foreign companies.

4. Singapore

Singapore is widely regarded as one of the leading countries in establishing a legal framework that facilitates the development of the digital technology industry, with the strategic vision of becoming “Asia’s Smart Digital Hub”. The core focus of Singapore’s strategy lies in data governance, cybersecurity protection, innovation promotion and ethical deployment of artificial intelligence. Singapore enacted the Personal Data Protection Act (PDPA) in 2012 and has continuously amended it to reflect emerging technological trends. Notably, Singapore did not replicate the European GDPR model but instead developed a “tiered consent framework”, designed to balance privacy protection with the promotion of the digital economy (Ho, 2022).

In this approach, Singapore first prioritized the development of infrastructure to strengthen the technological foundation for digital economic growth. Early initiatives included the construction of a national fiber-optic network and the deployment of 4G mobile networks around 2010. These developments created the foundational infrastructure necessary for the expansion of the digital economy and information technology sectors in Singapore.

In addition to investing in digital human capital development, Singapore has actively encouraged universal Internet connectivity by maintaining low-cost access to digital infrastructure. By 2022, fixed broadband subscriptions accounted for approximately 37% of the population. Singapore has demonstrated strong performance in this area, boasting the fastest fixed broadband speeds in the world according to global indicators (World Bank Data, 2024).

At the same time, Singapore has introduced incentives encouraging companies to increase investment in research and development, particularly in 5G technologies, which serve as a platform for creating new business models and advanced applications, thereby stimulating economic growth and innovation in the business sector. One of Singapore’s most important strategic initiatives was the implementation of the Intelligent Nation 2015 Master Plan (iN2015). This program represented a ten-year national strategy designed to strengthen the country’s information technology infrastructure and accelerate the transition toward a digital economy.

ANALYSIS OF DIGITAL ECONOMY POLICIES AND LEGAL FRAMEWORKS IN SELECTED COUNTRIES

1. Comparative policy analysis

- Data protection: The European Union has established the highest standards for data protection through the General Data Protection Regulation (GDPR), which requires transparency, as well as users’ rights to access and erase personal data. In contrast, the United States currently does not have a comprehensive federal law on data protection.

- Platform Competition: The EU clearly defines the responsibilities of digital platforms through the Digital Markets Act (DMA) and the Digital Services Act (DSA). The United States, by contrast, primarily relies on traditional antitrust laws rather than specific regulations governing digital platforms.

- National Data Control: China exercises strict control over data governance, particularly with respect to cross-border data transfers. Meanwhile, the EU and the United States adopt more flexible approaches to cross-border data flows.

2. Policy Lessons

- Ensuring fair competition: It is necessary to enact antitrust regulations for digital platforms to prevent large platforms from crowding out small and medium-sized enterprises.

- Balancing innovation and regulation: Legal frameworks should avoid excessive restrictions while still providing clear and predictable rules.

- Regional harmonization: The development of common regulatory standards within ASEAN could facilitate regional market integration and digital trade connectivity.

POLICY IMPLICATIONS FOR VIETNAM REGARDING DIGITAL ECONOMY GOVERNANCE

In recent years, Vietnam has gradually developed a legal framework to regulate relationships arising in the digital economy through the promulgation and amendment of numerous legal documents across different sectors. Instead of establishing a single comprehensive digital economy law, Vietnam’s legal system currently adopts a multi-layered and sector-based approach, covering areas such as electronic transactions, data governance, consumer protection, e-commerce, taxation and regulatory sandboxes for innovation.

The general legal foundation for the digital economy has been established primarily through the Law on Electronic Transactions (2023), which provides the legal basis for the formation and implementation of transactions in the digital environment.

However, despite these achievements, Vietnam’s legal framework for the digital economy still reveals several shortcomings that affect regulatory effectiveness and adaptability to the rapid and complex evolution of digital economic activities. In addition, mechanisms for protecting the legitimate rights and interests of relevant stakeholders remain insufficiently effective in practice.

Based on the analysis of experiences from several countries and regions including Europe, the United States, China, and Singapore a number of policy implications can be drawn for Vietnam during the period 2023-2030 in order to promote the development of the digital economy. Specifically:

First, Develop a proactive legal framework rather than merely reacting to technological changes. Vietnam should establish a coherent system of specialized laws and decrees instead of fragmented regulations in order to effectively regulate complex digital business models. A comprehensive legal framework should cover areas such as: personal data protection; digital platform governance; digital taxation; cybersecurity and information security.

Second, Integrate the development of legal frameworks with national strategies for the development of the digital technology industry.

Third, Establish flexible regulatory mechanisms, such as regulatory sandboxes, to support the development of the digital technology industry. Encourage investment from all economic sectors and improve the quality of online public services in order to create market demand for the information technology sector. In addition, introduce platform antitrust regulations and strengthen oversight of transfer pricing and unfair competition.

Fourth, Legal frameworks for the development of the digital technology industry should place strong emphasis on data protection and privacy rights. Drawing lessons from the EU, Vietnam should enhance privacy protection, build secure digital platforms and proactively monitor emerging risks. Elements of the GDPR model may be adapted in accordance with Vietnam’s legal and cultural context, including provisions on users’ rights to access, erase and be informed about their data.

Fifth, Legal frameworks should also promote technology ethics and digital trust. Creating a supportive legal environment for startups and attracting investment in digital infrastructure are essential, while ensuring a level playing field for all market participants.

Sixth, Legal policies should emphasize public investment in digital infrastructure and high-performance computing capacity. Tax incentives should be provided for digital startups, alongside innovation support funds and stronger collaboration between universities and enterprises.

Seventh, Strengthen regulatory capacity and international cooperation. This includes upgrading digital platforms for e-government, simplifying administrative procedures and expanding international cooperation on data flows and cybersecurity.

The digital economy represents an irreversible global trend that requires a legal system that is flexible, transparent and internationally integrated. Countries such as the EU, the United States, China and Singapore have adopted different regulatory models based on their respective development objectives. Vietnam should combine international experience with domestic realities in order to develop a legal environment that promotes innovation, protects users and ensures sustainable development.

Dr. Dinh Xuan Tuong

REFERENCES

1. International legal instruments on data protection (GDPR, CCPA).
2. Digital Markets Act and Digital Services Act (EU).
3. Cybersecurity Law and Personal Information Protection Law (China).
4. Digital economy policy reports of OECD and ASEAN.
5. Academic studies on the digital economy and digital taxation.