Instead of destroying the car as "deterrence" as it had considered earlier, the agency has decided to merely confiscate it and slap fines on all entities involved with importing and displaying it, according to the statement on Monday.

A customs spokesperson said: "Customs will remove and destroy the software which contains maps incorrectly depicting Vietnam’s sovereignty over the sea and islands. We will not destroy the vehicle to avoid waste."

Customs will fine World Auto Co., Ltd., the importer of the car, VND40-60 million ($1,730-$2,600) and suspend its operations for six to nine months.

Volkswagen Vietnam Co., Ltd., the German automaker’s distributor in the country, will be fined VND20-40 million ($850-1,730) for displaying the car.

Last Sunday a visitor to the motor show noticed the map with the nine-dash line in the car’s navigation app.

The vehicle was imported from China for display purposes only and scheduled to be re-exported next February, the Vietnam Register has claimed.

The infamous and controversial nine-dash line is a demarcation that claims 90 percent of the 3.5-million-square-kilometer East Sea, known internationally as South China Sea. The unilateral demarcation has been strongly opposed by the international community. Apart from violating Vietnam’s sovereignty, it overlaps with claims by Brunei, Malaysia, the Philippines, and Taiwan.

Last week the Vietnam Register ordered a Vietnamese dealer of four Chinese cars, including Zotye and Baic, to remove the map from its cars.

Earlier this month Vietnam banned online game Onmyoji developed by Chinese firm NetEase and stopped the screening of Hollywood animation movie "Abominable" for showing the nine-dash line.