Expanding electronic transactions: A breakthrough in the reform of the financial sector

	Regulations on electronic transactions in financial operations
	Finish legal basis for implementing electronic tax administration
	Optimization of electronic financial transactions

The State management agencies in the fields of Taxation, Customs, State Treasury, Securities andInsurance can use electronic transactions in a suitable way for each type of transaction and each transaction group. Photo: H.Van.

Raise legal value

In 2005, the Electronic Transaction Law was promulgated, creating a very clear legal corridor for the implementation of electronic transactions. In 2007, the Department of Informatics and Financial Statistics asked the Ministry of Finance to submit to the Government for promulgation Decree 27/2007/ND-CP, with the scope of definingelectronic transactions within financial activities (including between State agencies and the public,between State agencies themselves and between the public).

Not many subjects wereincludedat that time because the technology had not yet been developed. Additionally, legal documents on identification and authenticationwere not in place and other laws had not encouraged electronic transactions.

Decree 27 wasamendedlater and supplemented by Decree No. 156/2016/ND-CPto overcome some limitations arising in the implementation process.However, Decree 156 onlypartially resolved the issuesthat needed to be handled such ascancelling the provision of value-added services in e-transactions with conditional businesses in accordance with the Investment Law2014, but therewere noalternative regulations for this type of service.It is necessary to have a similar type of service to serve the needs of people and enterprises, as well as support and guaranteehigh quality services of financial agencies.

State agencies and enterprises are still confused over the implementation ofelectronic transactions due to the lack of specific regulations and guidelines, leading to a lack of confidence.At the same time, Vietnam's internet connectivity and computer and mobile phone equipment are rated highly in the region.

In recent years, many new legal documents have been issued such as the Law on Public Investment, the Law on Information Security and Safety and the Law on Network Security.As Decree 27 and Decree 156failed to cover all points, the introduction of Decree 165was inevitable.

According to Mr. Nguyen Viet Hung, Deputy Director of the Department of Financial Informatics and Statistics at the Ministry of Finance, Decree 165 maximised the content around electronic transactions, from conditions to ensure the original value to transfer paper documents to electronic documents and vice versa. It also covered the modification of electronic documents; storage; invalidation and destruction. In particular, Decree 165 specified theauthentication methods for electronic documents that are recognised alongside digital signatures.

As a result, the State management agencies in the fields of Taxation, Customs, State Treasury, Securities andInsurancecould apply electronic transactions in a suitable way for each type of transaction and each group of transactions.

For important transactions with high value, high legal requirements, frequent transactions and transactions with enterprises, digital signatures would be applied. Other types of transactions mightusedifferentforms of authentication that are more simple and less costly.

Similarly, enterprises operating in the fields of financial services, insurance, securities, accounting and auditing services could provide their products and services to customers in an electronic form, using authentication methods for the electronic documents suitable for enterprises and customers. Insurance companiesnow need a legal basis to provide insurance products to their customers in electronic form.Decree 165 supports this legal basis forinsurance companiesso that they can implement contract procedures entirely in electronic form.

More than digital documents

Decree 165 inherits the results that were resolved in Decree 156 and continues to unify regulations with the current legal system. These includespecialised fields in financial activities and legislation on administrative procedures, legislation on access to information, storage,sealing,and material evidence and legislation onnetwork information security.

Specifying a number of provisions in the Law on E-Transactions (such as conditions to ensure the original value of electronic documents andintermediary services in financial activities),the new regulations also mention the role of parties involved in electronic transactions in financial activities andspecify the provisions on State management.

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With Decree 165, some forms of authentication other than the digital documents have been allowed with the aim of promoting electronic transactions among organisations, enterprises and individuals. This allowsflexible, proactive and inexpensive authentication methods,thereby reducing costs.

It is necessary todefinewaysto verify information on electronic transactions.At the same time, regulate the inspection, examination and investigation agencies and the administrative procedure-settling agenciesmay only request the agencies, organisations and individualsproduce paper documents converted from electronicdocuments when verification cannot be performed.

"Thus, it can be said that Decree 165/2018/ND-CP created a breakthrough in the reform of administrative procedures in financial activities and a clear legal framework and support for the development of electronic transactions,” Mr. Nguyen Viet Hung said.