Potential risk of online transaction in Vietnam and its consequences

The 4.0 Industrial Revolution has developed significantly, which results in the transformation and breakthrough of all areas of the globe. Besides, the Internet and social network has got more popular and become an indispensable part of modern life. Online business, therefore, is formed and conducted the most frequently on social networking platforms. In the process of doing online business on this platform, many potential risks arise and depending on the situation, the people taking part in the transaction might need to involve the business consultant or risk management consultant to assist proving advice or consultancy service to address the matters.

First and foremost, it is very difficult and complicated to determine the identity of the subjects partaking in the social networking platforms in general and conducting business activities on these platforms in particular. Unlike e-commerce platforms which register operation with authorities, which require the sellers to verify their information before doing business, the social network environment allows anyone to participate in without revealing their true identities exposed. User will have an account that may or may not provide their true information after only a few basic registration procedures. As a result, many people have taken advantage of this feature of social networks to commit illegal acts in business activities. There are instances in Vietnam for fraud to appropriate property on a social network which the offender using an account on a popular social network with a fake name, using other people’s photos as his avatar. Next, he bought a fake ID card and used it to set up some bank accounts to start committing fraud. Although he did not have products for sale, but he still posted ads with pictures of selling products at cheap prices on his social network account. If customers wanted to buy, he asked them to transfer money first and promised to send the products to them by post soon after. However, when receiving the money from the customer, he did not send the goods and temporarily locked his account. Beside fraudulent activities, seller’s information is not checked or confirmed, allowing unscrupulous people to readily impersonate others for profit. It is not unusual for prominent business professionals or influencers to be faked on social networking platforms. This action jeopardizes the honor and reputation of those who are exploited while also affecting a large number of legitimate business people. Thus, the fact that social networks do not require business entities to verify their identities, despite helping conduct business procedures quickly and conveniently, causes many problems mentioned before, directly affecting the right to conduct business, benefit customers and stakeholders.

Secondly, no authorities have the possibility to guarantee absolutely the quality of items traded on social networks. The goods listed for sale are extremely diverse in quantity, type and design. Each business subject can sell hundreds of products per day and there are many business subjects on one social networking platform. Therefore, governmental agencies are unable to oversee and manage the origin and quality of each product and service. Many of goods for sales are prohibited or barred from trading. At the same time, sellers can sell fake goods, counterfeit, provide poor-quality ones or sell unknown-origin ones to customers in order to maximize profits. The most serious consequence of trading in unqualified goods is affecting the health of customers.

Thirdly, although Vietnamlaw imposes taxs on business subjects, it is difficult to collect taxes from organizations and individuals conducting business on social networks. That reduces state revenue and creates an unfavorable competitive climate for other sorts of enterprises. The reason is that business on social networks is based on technology, and it is easy to modify and delete information online, so it creates difficulties in identifying and verifying the number of business people and capturing transactions. This situation can be characterized as unfair competition, which is upsetting and unstable for the economy.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Readmore: https://lawyersindanangvietnam.blogspot.com/2023/08/potential-risk-of-online-transaction-in.html

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Risk of disputes from transactions through social networks in Vietnam

 

Social networks have become popular and become an indispensable part of modern life. Along with the development of the internet, social networking applications are also used by many people as a transaction method to exchange and conclude contracts or business transaction with each other. When a dispute occurs, it is difficult for the parties to prove the transactions and the parties involved. Hence, it is important to conduct background check on the business counterparts from financial, operational aspects instead of blind belief in the exaggerated advertising or discounted offer from them.

In fact, many individuals and organizations have reported that their partners have denied purchase and sale transactions through social networks and caused huge damages. However, the evidence provided is only messages, icons … stored in social networking applications that carry many meanings and are easily confused in interpretation. These are quite common electronic transaction disputes today, but there is no strict legal corridor to protect parties with legitimate interests.

The legal system has not kept up with the strong development of the internet business. As a result, it raises a number of complicated issues, beyond the control of legal regulators and creates many difficulties and challenges when business disputes occur over social networks.

Specifically, many individuals engage in commercial activities but does not have a fixed location and do not register business with any authorities. They might advertise over the internet with buying and selling goods and services without having to be responsible for any consequences for fake products or inadequate delivery of quantity or maybe even scam.

It can be seen that the lack of business registration makes it difficult to determine the truthfulness of the transaction and the competent authorities do not know the information of individuals and organizations transacting on social networks authentication of transaction status on social networks when participating in business.

According to the law, electronic data messages are expressed in the form of electronic data exchange, email and other similar forms according to the provisions of the law on electronic transactions. Electronic is also a source of evidence used as a basis to determine the validity of a transaction. Therefore, it can be seen that in fact transactions via social networks are also a form of electronic transactions with legal value. However, these transactions present a lot of potential risks because it is difficult to prove to the authorities when dispute arise.

Because these accounts can be easily disabled, communications can be deleted or hidden, and the name of the account holder is easy to change. Moreover, when transacting and exchanging via social networks, the parties cannot control whether the person being exchanged is an authorized person or not. The violating party will rely on the above reasons to deny all the content discussed with the partner.

Transactions through social network platform are thriving and are expected to bring value. However, in order to contribute to promoting the sustainable and safe development of this type of business, more legal regulations governing related issues are needed. In addition, in order to limit disputes and risks in these transactions, individuals and businesses need to carefully check the partner information, from authenticity, adverse media, reputation online or engage third party consulting company to verify business registration, search business shareholders information, visit office or operation site for audit, undertake background check, criminal record for protection of interest if the dispute occurs.

Readmore: https://lawyersindanangvietnam.blogspot.com/2023/08/risk-of-disputes-from-transactions.html

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