Vietnam culture ministry blasts foreign ad firms
HANOI - Vietnam's
powerful Culture and Information
Ministry has accused foreign
advertising agencies of using illegal
business practices to dominate the
local market, official media reported
Monday.
The Vietnam Investment Review
(VIR) weekly quoted an internal
ministry report as saying ``heavy
treatment'' should be meted out to
foreign advertisers that broke the law
and local firms should be protected
from the competition.
The tone of the ministry report was
at odds with recent official
statements that Hanoi might soon
relax curbs on foreign ad agencies
and allow joint ventures to operate.
Some 20 foreign advertisers have
offices in Communist-ruled Vietnam,
which bars them from direct business
activities in a country where political
mistrust of consumerism runs deep.
VIR quoted the report as saying
foreign advertisers had illegally
snatched the lion's share of the local
ad market.
``More than 20 global ad companies
have set up their rep offices in
Vietnam and by different methods
they have been conducting illegal
practices here,'' it said.
The report did not give details,
though it accused firms of not paying
tax.
Under current business restrictions,
foreign ad agencies have to sign
contracts and receive payments
offshore and do their media buying
through Vietnamese entities.
It was unclear how authorities would
deal with the foreign ad agencies
accused of breaking the law, and
culture ministry officials were not
available to comment. But the report
said protective walls should be
erected around local ad firms.
The report also demanded a
clampdown on the import of
ready-made props for advertising,
such as films and photographs used
by foreign ad agencies.
The first Vietnamese advertising
agencies were formed in 1989 and
were soon followed by international
firms looking to support their global
clients as they pushed into Vietnam.
Market research firm AC Nielsen
has estimated total ad spending in
Vietnam of $109 million last year,
down from $111 million in 1997. No
estimates for ad spending in 1999
have been released.
Reuters - August 16, 1999.
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