According to the report, USTR based Vietnam’s PFC designation on five main concerns: ineffective enforcement against digital copyright infringement; insufficient enforcement against counterfeit and trademark-infringing goods; limitations in border enforcement mechanisms; lack of meaningful enforcement against the use of unlicensed software in businesses; and the absence of adequate criminal provisions addressing signal theft involving cable television and encrypted satellite programming.

This development warrants close monitoring because, depending on the outcome of consultations and assessments by the United States, a formal investigation — if initiated — could be prolonged and may lead to adverse trade measures, including tariffs. In fact, during President Donald Trump’s first term, the United States launched a Section 301 investigation against China in 2017 concerning intellectual property, technology transfer, and innovation practices. The findings later served as the basis for imposing multiple rounds of additional tariffs on Chinese imports, many of which have remained in effect in subsequent years.

However, the issue should also be viewed objectively, balanced, and constructively. In recent years, Vietnam has made significant efforts to improve its legal framework and strengthen IP enforcement, including amendments to the Law on Intellectual Property, enhanced inter-agency coordination in handling violations, and increased inspection and monitoring measures in digital environments and goods circulation. Vietnam’s official response also emphasized the need for the United States to conduct a more objective, comprehensive, and balanced assessment of Vietnam’s efforts in IP protection and enforcement.

In this context, it is important to both proactively manage risks and maintain a cooperative, transparent, and dialogue-based approach. For the business community, this is the time to strengthen compliance reviews related to intellectual property throughout production, business operations, and export activities, especially for enterprises with markets, partners, or supply chains closely linked to the United States.

In the immediate term, businesses should urgently review their internal compliance status, particularly in areas highlighted by USTR in the report. Such reviews should begin with the legality of software used within the enterprise; the use of images, trademarks, packaging, designs, and promotional content; as well as the origin and lawful usage rights of data, designs, technical documents, digital works, and marketing materials. Enterprises should also ensure that internal documentation proving ownership or lawful use rights for relevant IP assets is complete and readily available to minimize risks in the event of disputes or requests for clarification.

For enterprises providing digital platform services, e-commerce, hosting services, data centers, social media platforms, or other intermediary infrastructure, it is necessary to proactively strengthen content control procedures and seller verification mechanisms, improve systems for receiving and handling IP infringement complaints, and promptly remove goods, stores, or content showing clear signs of infringement. In high-risk cases — particularly involving medical products, food, dietary supplements, or websites suspected of distributing copyrighted content on a large scale — businesses should implement early preventive measures and coordinate closely with competent authorities.

For exporters to the United States, in addition to reviewing IP compliance, businesses should continue enhancing transparency, digitizing records, and improving traceability throughout the supply chain. These are not only essential for risk management in the event of unfavorable developments from the United States, but also critical for strengthening competitiveness and meeting increasingly stringent international requirements related to compliance, origin, quality, and product transparency.

Should USTR decide to initiate a formal investigation, affected enterprises and industry associations should proactively participate in information submissions, comments, and practical feedback through appropriate channels. Demonstrating positive developments in compliance practices, legal reforms, and enforcement efforts by Vietnamese authorities will be important in ensuring that the evaluation process more accurately reflects the realities in Vietnam.

More broadly, developments surrounding the 2026 Special 301 Report highlight the growing need for Vietnamese enterprises to view intellectual property not merely as a legal issue, but also as an integral component of modern governance and long-term competitiveness. Investments in compliance, risk management, supply chain digitization, internal process standardization, and market diversification will help businesses better navigate increasingly unpredictable developments in international trade policy in general, and the U.S. market in particular.

VCCI will continue closely monitoring related developments, coordinating with government agencies, associations, and the business community to provide updates, consolidate recommendations, and support enterprises in responding effectively. Alongside the efforts of state agencies in dialogue and policy improvement, the proactive engagement of businesses will play a crucial role in protecting the legitimate interests of the Vietnamese business community, while reinforcing Vietnam’s image as a serious, responsible trading partner with a continually improving legal and business environment.

Reference materials are attached below:

https://trungtamwto.vn/file/24052/260505-special-301-report-vietnam-ban-dich.pdf

https://trungtamwto.vn/file/24051/2026-special-301-report-vietnam-pages-43-47.pdf

https://trungtamwto.vn/file/24050/2026-special-301-report-full.pdf