“Unraveling the Closure Crisis: Understanding Why Businesses are Shutting Down”

According to Mr. Duong, during the month of heightened efforts to combat smuggling, commercial fraud, and counterfeit goods, local authorities and functional forces nationwide conducted inspections and controls. Local reports indicate that many shops and businesses along traditional trade streets and markets have closed down. Statistics show that more than 5,500 shops have shut their doors, mostly selling food, dietary supplements, cosmetics, and household goods.

Mr. Duong identified five main reasons for this phenomenon.

Firstly, traditional business models are no longer effective in the face of the rapid growth of e-commerce, resulting in unmet business goals and expectations.

Secondly, there is a sense of apprehension among some traders due to the intense focus on combating commercial fraud and counterfeit goods. These traders may not be able to meet legal requirements regarding procedures and invoices.

Thirdly, tax-related issues have also played a role in the closure of these shops.

Fourthly, a delay in adapting to new business models, such as a lack of focus on e-commerce, service quality improvement, or product diversification, has been noted by functional forces. Additionally, some shops may be temporarily closed for renovation or relocation.

At the press conference, Deputy Minister of Industry and Trade Nguyen Sinh Nhat Tan shared that the recent campaign against counterfeit and infringing goods involved not just the market management force but also other forces. The campaign, which took place from May 15 to June 15, has had a significant impact on restoring consumer confidence, according to the Ministry of Industry and Trade. The Ministry aims to continue fostering trust among consumers and encouraging legitimate producers and traders to offer high-quality products, thereby driving back commercial fraud and counterfeit goods.

Tracing the origin of goods through seller identification

At the press conference, Deputy Director of the Department of E-Commerce and Digital Economy Hoang Ninh affirmed that not all products sold on e-commerce platforms are fake. In the first half of 2025, over 33,000 products and more than 11,000 stalls were removed from e-commerce platforms in collaboration with the Ministry of Industry and Trade for violating intellectual property rights.

According to Mr. Ninh, the new Law on E-Commerce will include provisions to protect consumers, notably by introducing seller identification to facilitate origin tracing. This measure will help identify sellers who repeatedly violate regulations by opening new stores, enabling better consumer protection, product source tracing, and tax collection.

Furthermore, the Ministry of Industry and Trade will implement four solutions to combat counterfeit and infringing goods: improving the legal framework, applying new technologies like AI and blockchain for product tracing and authentication, raising public awareness to identify counterfeit goods online, and strengthening bilateral and multilateral cooperation to address entities without legal entities in Vietnam.

Deputy Minister Nguyen Sinh Nhat Tan added that e-commerce platform owners must promptly coordinate with the market management force when receiving reports of violations. Quick action should be taken, including removing or even expelling the violating stores from the platform to prevent them from re-emerging under new identities.