Vietnam has recently opened its data center market to foreign investors, allowing them to own 100% of data center projects in the country.

Previously, foreign ownership in data centers was restricted to a maximum of 49%, as reported by Nikkei Asia. However, the new Law on Telecommunications, which came into effect in July 2024, has removed this cap, exempting data centers from the usual market entry constraints.

The former ownership limit had discouraged major tech companies from investing in Vietnam. With increasing demand, the local market has struggled to meet needs.

Additionally, Vietnam’s Cybersecurity Law mandates that companies store their data within the country, raising operational costs and presenting challenges in maintaining international data security and privacy standards, according to Leif D. Schneider, counsel at law firm Luther.

The new Telco law clarifies that while cloud and data providers are not responsible for the content stored on behalf of customers, they must block content as requested by state agencies.

Recently, Vietnamese telecom provider CMC Corporation launched a data center company, CMC AI Digital Infrastructure, focused on hyperscale data centers. Interest from global companies is growing, with Huawei considering a cloud region in Vietnam and STT GDC planning a 60MW data center in Tan Thuan, Ho Chi Minh City. Alibaba Group also announced plans to build a data center in Vietnam.

Currently, Vietnam has 22 data centers across Ho Chi Minh City, Hanoi, and Da Nang, operated by companies including FPT Software, NTT GDC, Telehouse Europe, Global Data Service, VNPT Data, Viettel Group, and CMC Telecom.