The United States Trade Representative’s (USTR) 2025 National Trade Estimate (NTE) Report highlights persistent trade barriers and market access concerns in Vietnam.
From regulatory opacity to digital trade restrictions and weak enforcement of intellectual property rights, the report outlines key friction points that will shape future negotiations and trade policy.
More importantly, it has been cited as a basis for the “reciprocal” tariffs announced by the Trump administration at the start of April and therefore is worth a deeper dive.
As such, this article looks at the USTR’s latest findings and what they mean for Vietnam’s trade outlook in 2025.
Tariffs and taxes on U.S. goods in Vietnam
The report notes a number of tariffs and taxes that apply in Vietnam including:
| Category | Details |
| Average MFN tariff rates (2023) | Overall: 9.4% – Agricultural: 17.1% – Non-agricultural: 8.1% |
| WTO commitments | – 100% of tariff lines bound Average bound tariff: 11.7%; – Maintains tariff-rate quotas on salt, eggs, and sugar |
| Recent tariff increases on U.S. goods | Affected products include: – Sweeteners (fructose, glucose) – Confectionery – Shelled walnuts – Ketchup and tomato sauces – Inkjet printers – Soda ash – Stainless steel bars and rods |
| Note: Most of these are also produced domestically in Vietnam | |
| Taxation on imported alcohol | – Law 106/2016/QH13 changed the taxable base from import price to sales price – Resulted in higher tax burden on imports compared to domestic products |
Non-tariff barriers
The USTR also provides a list of non-tariff barriers. These include:
Import bans and restrictions
- Vietnam does not allow the import of some products, including:
- Certain children’s toys
- Used household goods
- Used car and motorbike parts
- Small used engines
- Some encryption software and devices
- Refurbished medical equipment
- Certain cultural items
- Used IT products can only be imported under specific conditions:
- Part of a business relocating to Vietnam
- Needed for a specific production system or software project
- Returning to Vietnam after repairs
- Replacing parts that are no longer made
Customs delays
- U.S. exporters report customs delays in Vietnam, especially when tax amounts are disputed.
- Vietnam signed the WTO Trade Facilitation Agreement and started separating release of goods from final tax amounts in 2022. But delays still happen.
Imported drug regulations
- Foreign drug companies can now set up their own import offices in Vietnam (since 2017).
- But there are still tough requirements for warehousing, licensing, and paperwork.
- Companies can only fix their paperwork three times before their application is rejected.
- If approval is delayed, some drug licenses are allowed to stay valid until the end of 2024.
- Vietnam’s Ministry of Health now publicly lists which drugs are allowed to stay on the market during delays.
Ethanol blending rules
- Vietnam only allows 5% ethanol blends (E5) in just one type of petrol.
- The U.S. wants:
- All petrol types to include ethanol
- Lower tariffs on ethanol
- A move toward E10 (10% ethanol blend) fuel
- Vietnam’s plan to expand ethanol use still hasn’t been put in place.
Technical barriers to trade: Vietnam
Vietnam’s evolving regulations on product labelling, testing, and technical standards have created ongoing challenges for exporters which the USTR breaks down like this:
Goods labelling requirements
Vietnam’s Decree 111/2021/ND-CP requires importers to add detailed labels to all imported goods. The regulation also imposes product-specific labelling standards.
Importers have raised concerns about inconsistent enforcement and confusion over product classifications, which makes compliance difficult. The regulation has been in effect since February 2022, but challenges remain.
In-country testing for ICT products
The Ministry of Information and Communications (MIC) has issued several technical regulations (QCVNs) that no longer recognise international test reports.
Instead, imported telecom and ICT equipment must now undergo testing within Vietnam. U.S. stakeholders have flagged short transition periods, limited domestic lab capacity, and the lack of grandfathering as serious concerns.
This remains an active trade barrier, and U.S. industry has raised the issue with authorities.
SAR standards for mobile phones
A draft regulation (QCVN 134:2024/BTTTT) proposes new Specific Absorption Rate (SAR) standards for mobile phones, requiring in-country testing and introducing local standards that differ from international norms.
Stakeholders have expressed concern about the new testing mandate, the deviation from global benchmarks, and the rapid timeline for implementation.
Following U.S. engagement, Vietnam made some improvements, but discussions are ongoing.
Vietnam sanitary and phytosanitary (SPS) barriers
As Vietnam modernises its food safety and agricultural regulations, foreign exporters continue to face a complex and evolving compliance landscape. Several key barriers the USTR picks up on include:
Genetically engineered crop approvals
Vietnam resumed approvals of genetically engineered (GE) crops in 2024 after several years of inactivity. The renewed Biosafety Committee began reviewing seven applications for biotech corn, soybean, canola, and cotton.
Notably, three corn hybrids were approved in early 2024 after a 10-year wait. U.S. stakeholders have raised concerns about the long timelines and stressed the importance of a reliable approval process for biotech exporters.
The United States continues to engage with Vietnam on pending applications.
Food Safety Law enforcement
Vietnam’s Decree 15/2018/ND-CP, issued under the Food Safety Law, sets procedures for importing food, including labelling, inspection, and self-declaration.
While the decree simplified some import processes, inconsistent interpretation—particularly between the Ministry of Health (MOH) and the Ministry of Agriculture and Rural Development (MARD)—has led to confusion, especially over the definition of “processed products.”
A draft revision to the decree was withdrawn in 2024 for further consultation.
Review of the Food Safety Law
Vietnam is currently conducting a comprehensive review of its Food Safety Law under Decision 426/QD-TTg. The MOH, MARD, and the Ministry of Industry and Trade (MOIT) are jointly reviewing the law from 2023 to 2025.
The process is expected to lead to legal amendments. U.S. stakeholders are monitoring this closely due to the potential for future regulatory disruptions that could impact food and agricultural exports.
Ban on white offal products
Despite lifting its ban on white offal—such as poultry gizzards and beef intestines—Vietnam has not approved any new U.S. export facilities since 2013.
The delay is attributed to the postponement of planned audits, reportedly due to African Swine Fever outbreaks. U.S. officials have raised concerns over the lack of a science-based justification and continue to push for progress.
Facility registration for meat and poultry
In 2024, the approval process for U.S. meat and poultry facilities slowed significantly. Exporters reported increasingly detailed requests for proprietary information, raising concerns of de facto audits.
Following engagement from the U.S. government, Vietnam’s Department of Animal Health approved six U.S. facilities in December 2024.
However, exporters remain cautious about burdensome approval requirements.
Product testing and quarantine rules
Vietnam implemented Circular 4/2024 on May 16, 2024, introducing new quarantine and pathogen testing requirements for animal products.
Stakeholders have raised concerns about the lack of clarity around appeal procedures, retesting processes, and how test results will be handled. The United States is actively tracking the impact of these new rules on trade flows.
Government procurement
Government procurement has also been raised. Specifically, the USTR states that:
| Topic | Details |
| Legal framework | Vietnam’s 2023 Law on Procurement is the main legislation governing how the government makes purchases. |
| Domestic preference | The law favors domestic goods and services in government contracts when available. |
| International agreements | Vietnam is not a member of the WTO Agreement on Government Procurement. |
| WTO observer status | Vietnam has been an observer to the WTO Committee on Government Procurement since December 2012. |
Intellectual Property Protection
Vietnam remains on the USTR’s 2024 Watch List for intellectual property (IP) protection, despite some progress in enforcement. While authorities have increased raids and taken down some piracy sites, concerns persist over online counterfeiting, weak criminal enforcement, and unclear protections for pharmaceutical data. Here’s a breakdown of key IP issues facing Vietnam.
Vietnam intellectual property enforcement status (2024)
| Topic | Details |
| Watch List status | Vietnam remains on the USTR 2024 Special 301 Watch List. |
| Positive developments | More raids and seizures, improved Customs enforcement, and first-ever criminal copyright case. |
| Main concerns | Weak enforcement, online piracy, counterfeits in physical markets like Saigon Square, and legal gaps. |
| Challenges to enforcement | Limited resources, corruption, and poor coordination among enforcement agencies. |
| Online piracy | Still widespread. Some pirate sites were taken down, but enforcement still relies mainly on administrative penalties. |
| Notorious market listing | Saigon Square Shopping Mall listed in the 2024 Notorious Markets List for counterfeiting. |
| Pharma data concerns | Lack of clarity on protection for undisclosed test data in pharmaceutical marketing approvals. |
| US position | The US urges stronger criminal enforcement, not just private negotiations or administrative fines. |
| Monitoring & engagement | The US continues to engage Vietnam on IP reforms and monitor commitments under trade agreements. |
Service barriers
Vietnam imposes several restrictions on foreign service providers, particularly in audiovisual media, finance, and electronic payments. While some sectors remain open to foreign participation, complex local rules and ownership limits create challenges. Here’s an overview of key service-related trade barriers:
| Sector | Key Barrier |
| Audiovisual services | Decree 71/2022 requires OTT media platforms (e.g. Netflix, Disney+) to have a local entity or joint venture. Separate censorship rules apply to films and non-film content. Some U.S. providers have exited the market due to this. |
| Film and content rules | Foreign OTTs can distribute films without a license, but must comply with two sets of content regulations: Circular 05/2023 for films and Circular 06/2023 for non-film programs. |
| Financial services | Foreign equity in joint stock banks is capped at 30 percent (20 percent per strategic investor); joint venture banks capped at 50 percent. Lending is restricted by local capital, not global capital of parent firms. |
| Law on Credit Institutions (2024) | New limits: institutional shareholders max at 10 percent (down from 15); collective ownership with related parties capped at 15 percent (down from 20). |
| Electronic payments | All in-person card transactions must be routed through NAPAS, a state-owned monopoly, even for foreign-branded cards. Online payments are exempt from this requirement. |
Vietnam digital trade and e-commerce barriers
Vietnam has made progress in regulating its digital economy, but several laws and decrees pose barriers for foreign businesses, particularly in the areas of data localisation, content control, cybersecurity, and cross-border electronic transactions.
1. Cybersecurity and data localisation
| Regulation | Issue | Impact |
| Law on Cybersecurity (2018) and Decree 53/2022/ND-CP | Requires Vietnamese user data to be stored locally and offices to be established in Vietnam. | Uncertainty remains over enforcement for international firms. |
| Draft decree on penalties (not yet issued) | Includes fines, bandwidth throttling, and blocking for violations. | Stakeholders worry about vague compliance expectations. |
2. Internet and content services
| Regulation | Issue | Impact |
| Decree 72 (2013) and Decree 27 (2018) | Controlled online content; enforced server localisation. | Replaced by Decree 147/2024, but concerns persist. |
| Decree 147/2024/ND-CP | Expands regulation to cloud services and data centres. | May overlap with existing rules, adding complexity for foreign firms. |
3. Personal data protection
| Regulation | Issue | Impact |
| Decree 13/2023/ND-CP | Lacks clarity on scope and limits cross-border data transfers. | Foreign businesses face compliance risk. |
| Draft Personal Data Protection Law (2024) | Under review, set to replace Decree 13. | Expected by November 2025; final impact TBD. |
| Data Law (Nov 2024) | Regulates cross-border data and aims to protect national interests. | Adds reporting burdens for data transfers abroad. |
4. Electronic transactions and digital signatures
| Law | Issue | Impact |
| Law on Electronic Transactions (2023) | Lacks clarity for cross-border digital platforms and e-signature providers. | Compliance remains ambiguous. |
| Decree 48/2024/ND-CP | MIC does not recognise foreign digital signature providers. | Affects international finance and cross-border services. |
Vietnam investment barriers
Vietnam has made significant efforts to attract foreign investment, but statutory restrictions and sector-specific limits still pose challenges for U.S. and international investors.
1. Restricted sectors for foreign investors
| Type of restriction | Description |
| Fully prohibited sectors | Under Decree 31/2021/ND-CP, 25 business sectors are entirely closed to foreign investment. |
| Conditional access sectors | 58 sectors are open to foreign investors but require compliance with specific conditions such as joint ventures, local partnerships, or ownership limits. These include: • Banking & credit institutions• Aviation• Land & sea transportation• Film production and distribution• Tourism, advertising, logistics |
2. Sectors requiring Prime Minister’s approval
Some foreign investments require direct approval from the Prime Minister, especially for:
- Airports and major seaports
- Casinos
- Oil and gas exploration and refining
- Telecommunications and network infrastructure
- Forestry and publishing
- Projects involving multiple provinces
3. Telecommunications sector barriers
| Policy | Impact |
| Law on Telecommunications (2023) | Limits foreign ownership in traditional telecoms with network infrastructure. |
| Decree 163/2024/ND-CP | Applies to foreign-owned data centres, cloud, and Internet service providers. Requires data localisation, user protection, and security plans. |
| Expanded definitions | The law now includes data centres, cloud computing, and OTT communications under telecom regulations, raising future regulatory risk. |
Stakeholder concerns:
Foreign investors are particularly concerned about the broad and evolving definitions of telecom services, which may allow regulators to impose ownership limits in sectors that were previously unrestricted, such as cloud computing.
Other trade barriers
1. Regulatory transparency and governance
- Ongoing concerns exist over lack of transparency in Vietnam’s regulatory processes.
- U.S. stakeholders cite overlapping mandates across different ministries and inconsistent rulemaking.
- The U.S. continues to encourage reform and improved transparency in Vietnam’s governance systems.
2. Export taxes on natural resource products
- Vietnam levies export taxes ranging from 1 to 40 percent on selected goods.
- These taxes apply mainly to items where natural resources, energy, and minerals make up over 51 percent of product value.
- Products subject to export taxes include:
- Plants and botanical parts
- Ores and coal
- Crude oil and chemicals
- Animal skins and wood
- Charcoal, gems, silver, and gold
- Jewellery and metal products
Vietnam’s export tax system is regulated under Decree 26/2023/ND-CP.
FAQ
1. What are the biggest trade barriers in Vietnam?
The USTR highlights barriers such as high tariffs on U.S. agricultural goods, mandatory data localisation, in-country testing for ICT products, restrictions on digital platforms, and uneven enforcement of intellectual property rights.
2. Why is the 2025 USTR report important for Vietnam?
The report is significant because it outlines ongoing trade frictions that are now being used to justify reciprocal tariffs by the Trump administration, making it a key document shaping future trade negotiations.
3. What types of US goods face higher tariffs in Vietnam?
Products like sweeteners, ketchup, shelled walnuts, stainless steel bars, and inkjet printers face higher tariffs—often because they are also produced domestically in Vietnam.
4. How do Vietnam’s non-tariff barriers affect US businesses?
Non-tariff barriers like strict labelling rules, in-country testing mandates, customs delays, and opaque pharma registration procedures increase costs and limit market access for U.S. exporters.
5. Will addressing these trade barriers lead to lower US tariffs?
Potentially. The Trump administration has indicated that meaningful reform in areas like IP protection, digital trade rules, and investment transparency could influence tariff decisions in Vietnam’s favour.
What’s next?
With growing U.S. scrutiny of Vietnam’s regulatory opacity, data localisation rules, IP enforcement gaps, and unequal treatment of U.S. goods, progress on these fronts has been named as key to any tariff relief.
Notably, negotiations are currently underway, however, any rapid movement on these issues may be difficult to execute. Rather, it will most likely have to hinge on Vietnam being able to demonstrate good-faith efforts to reduce these non-tariff barriers, clarify investment rules, and improve market access for U.S. firms.
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