In a continued effort to enhance the regulation of the betting and prize-winning games industry, the Government of Vietnam is drafting a new Decree (“Draft Decree”) that aims to amend and supplement Decree No. 137/2021/ND-CP (“2021 Decree”) on administrative penalties applicable to betting and prize-winning games operations. This move reflects the Government’s commitment to tightening regulatory oversight, addressing legislative gaps, and ensuring public order and national security.
Key Objectives of the Draft Decree
The Draft Decree seeks to:
- Clarify and update ambiguous or incomplete provisions in the 2021 Decree;
- Enhance enforcement mechanisms and increase administrative fines;
- Address unregulated or unnoticed violations in the gaming industry; and
- Bolster national security and maintain public order.
Key Features of the Draft Decree
1. Expansion of Recognized Violations
The Draft Decree introduces several new categories of violations to address previously unregulated conduct, including:
- Operating Time Violations (Article 27a of the Draft Decree):
- Fines of VND 40–50 million for failure to notify authorities about the suspension/resumption of operations or for submitting incomplete reports.
- Fines of VND 180–200 million for conducting business while under temporary suspension by competent authorities.
- Unapproved Game Content (Article 33 of the Draft Decree):
- Fines for distributing or operating prize-winning games or equipment containing content or images not approved for circulation by competent authorities.
- Inadequate Record-Keeping (Article 30 of the Draft Decree):
- Sanctions for failure to record sufficient contextual information or failure to retain records within required timeframes.
- Anti-Money Laundering and National Security Violations (Articles 53–55 of the Draft Decree):
- New provisions addressing failure to monitor, report, or delay transactions linked to money laundering, terrorism, or weapons of mass destruction.
- Requirements for preventive strategies and compliance systems to detect and mitigate these risks.
2. New Penalties Introduced
In response to the broadening scope of violations, the Draft Decree introduces more stringent penalties:
- Mandatory Destruction of Game Materials (Clause 5, Article 33 of the Draft Decree[DFDL1]):
- Violators may be required to destroy in-game currency or equipment used in non-compliant games.
- Temporary Suspension of Business Operations (Clause 3, Article 56 of the Draft Decree):
- Entities found to be in violation of anti-money laundering and national security provisions may face suspension of business operations for 3 to 6 months.
3. Expansion of Enforcement Powers
The Draft Decree also introduces new enforcement powers under its Article 57:
- Heads of departments within Ministries or Ministerial-level agencies will be authorized to:
- Issue warnings and impose fines of up to VND 200 million;
- Confiscate related materials and evidence of violations; and
- Revoke Business Eligibility Certificates.
This marks a notable expansion in the authority of administrative officials compared to the 2021 Decree.
Future Implications
The Draft Decree represents a significant regulatory development for Vietnam’s betting and prize-winning games sector. By closing existing loopholes, introducing new categories of violations, and empowering enforcement authorities, the Decree is poised to enhance regulatory compliance and industry oversight. This will be instrumental in safeguarding national security, promoting transparency, and maintaining public trust in Vietnam’s rapidly growing gaming industry.
Stakeholders are advised to closely monitor the issuance of the final Decree and assess their internal compliance systems accordingly.
The information provided here is for information purposes only and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.
