Cross-Border E-commerce in Vietnam: A legal perspective, why the current model cannot sustain

Cross-Border E-commerce in Vietnam: A legal perspective, why the current model cannot sustain

In a previous article, we analyzed why cross-border e-commerce in Vietnam faces structural issues from the very beginning, particularly the misalignment between goods flow, cash flow, and legal responsibility. (See: Cross-border e-commerce in Vietnam: Why the structure fails from the start)

In another piece, we proposed a more integrated approach, where customs, logistics, and compliance are designed as a unified system rather than fragmented services. (See: E-commerce customs brokerage in Vietnam: your all-in-one cross-border solution)

However, to fully understand why these issues are not merely operational inefficiencies but structural inevitabilities, it is necessary to examine the legal foundation behind them. Under the Law on Foreign Trade Management 2017, import activities cannot be carried out by an entity without legal standing in Vietnam. Goods must be imported either by a Vietnamese trader or by a foreign trader with a legally established presence in the country. This immediately creates a clear constraint: a foreign seller without a legal entity in Vietnam cannot directly act as the importer.

In practice, this gap is often “resolved” through the use of an Importer of Record (IOR). However, under the Commercial Law 2005, particularly Article 155, an entrusted party does not merely perform technical or administrative functions. It conducts the transaction in its own name. When read together with Article 156, the responsibility toward third parties, including customs authorities, tax authorities, and regulators, rests with that same entity.

This leads to a critical legal reality: the Importer of Record is not just a service layer. It is effectively the legal owner within the import transaction.

This distinction is precisely where many current models fail to align with the legal framework. In our earlier analysis, we pointed out that the current cross-border e-commerce model in Vietnam separates three key elements: economic ownership remains with the foreign seller, operational control lies with platforms and logistics providers, while legal responsibility is assigned to a third party. From a legal standpoint, this separation is not a design choice; it is a direct consequence of how the law is structured.

Once an entity is declared as the importer, it becomes the single point of legal accountability within the system, regardless of who controls the commercial side of the transaction. This explains why, in real-world situations such as cargo being held at ports, incorrect HS code classification, or missing import licenses, authorities always engage with the named importer rather than the foreign seller.

Similarly, in post-clearance audits, all obligations to provide documentation and justification fall on the Importer of Record. If the transaction structure is unclear or lacks a properly defined entrustment agreement, the risks extend beyond administrative penalties to potential tax reassessments or more serious legal consequences. Another layer of constraint comes from Decree 09/2018/ND-CP, which clearly stipulates that foreign investors must obtain the appropriate licenses and establish a commercial presence in Vietnam to exercise trading and distribution rights. This means that even if goods are successfully imported through an IOR, selling those goods directly into the Vietnamese market remains a regulated activity.

This creates a critical legal gap frequently observed in practice: goods are already in the market, but the right to sell them has not been fully licensed. When these elements are considered together, it becomes clear that the concept of “import without an entity” does not exist within the Vietnamese legal system. What is actually happening is a redistribution of roles among different parties, where the legal entity is not eliminated but replaced by another party acting on behalf of the system.

This reinforces the argument made in our earlier article: the challenges of cross-border e-commerce in Vietnam are not rooted in logistics costs or operational capability, but in the fact that legal and operational structures were never designed in alignment from the outset.

As a result, effective solutions cannot rely solely on optimizing logistics or simplifying procedures. They must begin with redesigning the structure itself, ensuring that ownership, control, and legal responsibility are aligned within a coherent system. This is precisely the approach we outlined in our article on integrated cross-border solutions. If you need a deeper understanding of the legal framework or are looking to build a compliant cross-border structure, feel free to reach out to us at info@tronchan.com. We are happy to explore tailored solutions that fit your business model and ensure sustainable operations in Vietnam.