Trading in Vietnam? Have You Opened a Local Data Center Yet?

Two servers feeding into a larger data center

Posted on Thursday, October 18, 2018

In what appears to be a growing trend, Vietnam has become the latest country to place additional data controls on foreign corporations. Following the lead set by India in August, the Vietnamese government has announced legislation designed to prevent personal data physically leaving the country.

Under the plan, any foreign firm offering services to Vietnamese residents will be required to set up local offices inside the country. Several data types will attract additional protections, such as financial records, biometric data, information on ethnicity, political views, and personal interests. And these protected data types will need to be stored in local data centers; it will be illegal to transport that information outside Vietnam’s borders.

A totalitarian power play

Where India claim their law is to protect citizens’ privacy, Vietnam has been more circumspect. Although increasingly liberal, it is thought that the ruling Communist Party is keen to control citizens’ data as a way to maintain tight media censorship– and to clamp down on potential political dissent.

Facebook and Google have protested the move with Vietnamese officials, but no concessions have been forthcoming. Both companies are concerned that this legal requirement could put a brake on the growing online economy. They also believe that holding data in local data centers makes it much easier for government officials to make seizures.

Building your own Vietnamese storage strategy

For any business planning to penetrate the Vietnamese market, this new rule adds an additional layer of complexity– particularly as it prevents the use of public cloud infrastructure. Instead businesses will need to deploy and operate a traditional on-site data center– and find a way to support and maintain their hardware in-country.

For more help and advice about building and maintaining a localized storage infrastructure (in Vietnam or beyond), please get in touch.

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