Consultation on Vietnam Draft Chemicals Law reveals opportunities and concerns for industries
Vietnam’s proposed overhaul of its 2007 Chemical Law aims to cut down on some regulatory burden, introduces green technology but also presents challenges for industry, especially on the ingredient disclosure requirements.
The Vietnam government launched a public consultation in early May on the draft Chemicals Law, which is being considered by the People’s Congress. Seeking to replace the existing 2007 Chemicals law, the draft Law aims modernize the chemical management system in the country and would impact any organizations or companies involved in any and all aspects of the life cycle of the chemicals, especially manufacturers and importers of chemical substances and mixtures.
While the new law provides clarity and has the potential to simplify the chemical management process in Vietnam, the draft law introduces other concerns for industries.
The law is expected to be enacted in the second half of 2025 and to take effect in January 2026. New chemical restriction provisions or those requiring new permits, if any, would commence from 1 June 2026. Companies already received various other authorizations are given a 2 year transition period for their current use or handling of the chemicals prior to the law taking effect, which would begin on 1 January 2028. Products already placed on the market are permitted for use until their expiry dates.
Chemical inventory and notification
A critical change from the existing framework is the introduction of the concept of “new and existing” chemicals as seen in China, the Philippines and the United States. Under the draft law, existing chemicals are those chemicals which are on the country’s chemical inventory, which is being compiled by the Vietnam Chemical Agency (Vinachemia). Chemicals not on the inventory must be notified to Vinachemia prior to importing, manufacturing and using in manufacturing processes. Chemicals used for national defense, national public health emergencies are exempted. Testing labs and testing data to be submitted with the notifications would be required to comply with standards set by the Organization for Economic Co-operation and Development (OCED).
Within the first five years of operations, companies who notified the new chemicals must also provide reports to Vinachemia as well as other competent authorities on the manufacturing, importing and use of the chemicals. The laws permit the chemical agency to also consider chemical inventory listings from other recognized countries or entities but does not specify which listings would qualify.
The national chemical inventory has gone through several consultations but have yet been finalized. Vinachemia has not reveal its completion date but promised that it would be done in time once the Law is enacted.
GHS - classification and labelling
The draft Law requires all chemicals to continue to be classified, labelled and accompanied by a safety data sheet (SDSs) as specified under the Globally Harmonized System of Classification and Labeling of Chemicals (GHS), but does not specify which version of the GHS it would implement. However, Vinachemia has maintained thus far that the agency would accept GHS from revision 2 or later.
Record keeping
Companies must keep information on hazards and risk of any chemicals that they handled on file for at least 3 years. The required data includes chemical names, CAS numbers, hazard classifications and labelling based on GHS, and information relating to emergency response and safe usage.
Information disclosure
One of the more controversial aspects of the law is the duty for companies to provide the concentration of hazardous chemicals in products through various means including on the national chemical database/ website, on the companies’ website or at locations where it distributes the chemicals.
This means that companies may need to disclose concentration of hazardous chemicals in safety data sheets, on labels or via their websites. This type of disclosure has traditionally been challenged by industry for fear of losing trade secrets and business confidential information.
Advertisements must provide information on the hazards and risks in using the chemicals or the products containing chemicals.
Confidential business information
The draft law recognizes confidential business information (CBI) and trade secrets. However, the following would not be considered as CBI: Chemical names, contact information for manufacturers and importers, chemical hazards, chemical impurities, SDSs (and required information in it), and warnings and precautionary information to ensure safe use. Given the emphasis on concentration levels of hazardous chemicals under the disclosure requirement, concentration and threshold is also not likely to be considered as CB or trade secrets.
Chemical restrictions under various agencies
The draft law permits regulatory agency with the allocated authorities to set regulatory restrictions on the use of chemicals. Under the existing framework, various agencies including the Ministry of Environment and Natural Resources (MONRE), Ministry of Health (MOH), and Ministry of Science and Technology (MOST), Ministry of Transportation (MOT), and Ministry of Industry and Technology (MOIT) share the responsibility of regulating chemicals. Industry and other observers had hoped that Vinachemia, an agency under MOIT, would be the only agency to set the policy on chemical restrictions or other requirements to ease the regulatory and compliance burden. However, in various meetings and discussions, other ministries besides MOIT continue to advocate for oversight on the use of chemicals under their existing authorities. Nevertheless, government insiders told Regulatory Reactions that Vinachemia will be the coordinating agency among the others to ensure good governance and to alleviate any unnecessary regulatory burden.
All chemical prohibitions and restrictions under the 2007 laws that have been implemented by MOIT and Vinachemia and any other regulatory agencies are expected to remain in place until being replaced by new regulations that will be issued after the enactment of the Chemicals Law
Environmental Safety and Health (EHS) concerns for Workplace and Storage
Under the draft laws, companies must ensure that storage of chemicals provides sufficient separation to avoid fires, explosions, spillage or other chemical incidents that would threaten physical structures or human health. Manufacturing sites or those using hazardous substances and chemicals must ensure that any disposal is safe for the environment. Companies must have emergency plans in case of emergency and incidents, and provide training to employees on the risk and safety when handling the chemicals throughout its full life cycle. The draft law emphasizes the duties and responsibilities of companies regarding the safety and health of the environment and the public when handling chemicals.
Finally, the draft laws also permit government agencies to impose green initiatives for companies involved in the manufacturing, importing and use of chemicals.
Implications for businesses
The introduction of the new and existing chemical concept would save companies time and efforts when manufacturing and importing existing chemicals. Those seeking to place products with new chemicals will face the additional burden of notifying Vinachemia, which may add to the time and cost when introducing new chemicals to the market unless the organisation could plan accordingly. Based on the language of the draft law, chemicals already on the inventory in the EU, US and other countries are likely to receive faster authorisation since the agency would not be required to conduct new and original assessment.
The concentration disclosure may also be a concern for certain sectors such as the fragrance industry or those who are concerned about providing CBI or trade secrets. Companies operating in Vietnam now have clear duties and responsibilities concerning the manufacture, use, transport, storage and disposal of the chemicals. These companies should evaluate their emergency response plan, disposal processes and training programs to ensure continuing compliance. Companies are strongly encouraged to provide information, comments, suggestions or objections online.
Foreign companies with no operations in Vietnam may be asked to provide more information to their customers who are local to Vietnam in order for these companies to comply with the new law. The relatively short transition period may also be an issue for companies if they do not plan and prepare for these changes.
Despite these concerns, the draft law is still just the first step in the legislative and regulatory process. Once the law is enacted, MOIT and Vinachemia will be required to issue implementing decrees which would further explain and specifies further requirements. Companies will have another opportunity to comment on the specific requirements as issued and implemented by Vinachemia.
More information: access the online consultation and document through the People’s Congress website.
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