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AI-Pac is Flint’s digest providing our take on major AI policy and regulatory developments in Asia-Pacific. In a fast-moving environment, this newsletter is designed to help you stay on top of the regulatory agenda and consider what it means for your business. Please see here for our first ten blogs, spanning 2024 and 2025. In each blog, we set out:
In June and July 2025, the global backdrop of intensifying competition between countries to develop AI capabilities and the accompanying deprioritisation of regulation continued to make itself felt in Asia-Pacific. The US AI Action Plan’s strong opposition to stringent AI regulations around the world was quietly noted by APAC policymakers, and most APAC countries will want to avoid regulating AI in a way that attracts US scrutiny. In this digest:
If you would like to discuss how AI policy and regulation in Asia-Pacific will impact your business, please get in touch with Flint’s team here.
On 14 June, Vietnam’s National Assembly passed the Law on the Digital Technology Industry (DTI Law), which provides a comprehensive legal framework for digital technologies including AI. It will be Vietnam’s first legislation focused on AI governance, taking effect in January 2026.
The DTI Law maintained the categorisation of AI systems into three groups based on their risk profile – “high-risk”, “high-impact” and others – as outlined in the draft version in July 2024 (see Flint’s previous AI-Pac blog here). It then assigns distinct responsibilities to developers, providers (known elsewhere as deployers) and users.
Similar to the EU’s AI Act, AI systems deemed “high-risk” and “high-impact” face stricter statutory requirements, including technical specifications, data management, oversight and inspection, transparency for data use and storage, as well as network security. Much of the operational details, including clarity on the designation of “high-risk” and “high-impact” AI, will be developed through forthcoming decrees expected in Q4 2025.
In June 2025, the National Innovation Centre (NIC) (operating under the Ministry of Finance (MoF)) released a report highlighting that AI could add up to $130 billion to Vietnam’s economy by 2040. To unlock AI’s potential in driving economic growth, officials in the Ministry of Science and Technology (MoST) and the MoF want to avoid overregulation. But it remains to be seen whether the government delivers on this ambition. The Ministry of Public Security (MPS) may take a role in vetting non-Vietnamese digital technology providers, and sectoral regulation is also likely to follow for sensitive or regulated sectors like public services, public security, financial services, healthcare, and defence. An emerging patchwork of horizontal and sector-specific regulations could lead to a lack of clarity for businesses over overlapping regulatory provisions.
Businesses will need to closely monitor detailed subordinate regulations for the DTI Law in the coming months and consider their engagement with MoST, MoF, and MPS. As some degree of consultation on the draft decrees and circulars is expected, including through written feedback and stakeholder workshops, there will be an opportunity for businesses to provide feedback.
On 13 June, the Ministry of Digital Economy and Society (DES) affirmed its support for the draft principles of the AI law, following public consultations held by Electronic Transactions Development Agency (ETDA) that concluded on 9 June.
Under the draft principles, primary legislation would empower an enforcement agency to determine lists of prohibited and high-risk AI use cases. Providers of “high-risk” AI would be subject to additional rules for implementing risk management frameworks, appointing local legal representatives and reporting serious incidents. “High-risk” AI deployers will face more targeted requirements, such as ensuring human oversight of AI systems, maintaining operational logs and cooperating with investigations.
Wisit Wisitsora-at, Permanent Secretary of the DES Ministry, has highlighted how Thailand sees guidance around AI governance as critical for providing businesses across the economy with the confidence to adopt AI. Similarly, ETDA officials have said that a focus of legislation would be to remove legal barriers that existing laws cannot address, thereby unlocking broader AI adoption.
ETDA plans to submit its draft principles for Cabinet review shortly. For now, there remains considerable scope for businesses to engage and shape the emerging approach to AI governance, with the government still considering the appropriate balance between hard- and soft-law approaches, as well as between horizontal and sector-specific oversight. Broader political uncertainty – including the suspension and potential dismissal of Prime Minister Paetongtarn Shinawatra and border clashes with Cambodia – are also likely to delay progress on AI legislation.
On 8 July, Minister of Science, Innovation and Technology Dr. Shane Reti unveiled New Zealand’s long-awaited AI strategy to spur private-sector AI use and innovation.
The strategy sends a clear message: New Zealand is prioritising practical uptake of AI over pouring investments into homegrown AI models. It outlines a vision of New Zealand’s businesses building a competitive advantage by becoming “sophisticated adopters” who quickly deploy AI solutions to meet local challenges.
The strategy also reinforces New Zealand’s light-touch, principles-based approach to AI regulation, which was outlined in a Cabinet paper from June 2024. The government will, as needed, update existing, technology-neutral regulatory frameworks (e.g., privacy, consumer protection, human rights) to address AI risks.
Overall, New Zealand’s decision not to prioritise regulation reflects a global shift towards prioritising promoting AI adoption over implementing stringent safeguards. New Zealand will be conscious of the actions of its ‘Five-Eyes’ partners in this area, especially the US’s stated intention in its AI Action Plan to oppose AI regulation around the world and the lack of recent progress towards AI legislation in Australia and the UK.
South Korea elected a new government and president, Lee Jae-Myung, on 3 June. Under President Lee, Korea has doubled down on its pursuit of ‘full-stack’ AI sovereignty, while deprioritising regulation.
Lee has appointed two industry veterans to lead the national AI strategy. He named Ha Jung-woo from Naver his Chief AI Officer (CAIO) and Bae Kyung-hoon from LG as Minister of Science and ICT. In late July, Korea designated Naver Cloud, NHN Cloud, and Kakao Corp to procure 13,000 GPUs to enable domestic AI development. Korea has also launched a competition that selected five teams to develop a government-led LLM. Korea’s goal is to develop a sovereign AI model with “at least 95%” the performance of global models.
However, much uncertainty remains over what the pivot in approach will mean in practice for businesses, particularly in terms of compliance with the AI Basic Act passed under the previous government in December 2024. The new government missed the deadline of 30 June to publish draft enforcement decrees and rules for the AI Basic Act, which is set to take effect in January 2026. The Ministry of Science and ICT (MSIT) is contemplating a grace period on monetary fines for contravention of Articles 31, 36 and 40, which would delay the full enforcement of the bill. In July, the Director General of Ministry of Science and ICT’s (MSIT) AI Policy Bureau suggested that MSIT would hear views on the AI law “with an open mind” and may have to revise its enforcement timeline.
Meanwhile, how Korea should prioritise its resources in the pursuit of AI sovereignty is also the subject of debate. Some Korean AI startups have argued that sovereign LLMs are commercially unviable and that national resources should support vertical AI applications for industries like healthcare. Some startups fear that the appointment of ex-NAVER and LG executives to government roles threatens to tilt the playing field against smaller firms focusing on vertical AI use-cases. How government policy balances the interests of Korea’s largest digital businesses with its dynamic start-up sector will be a key determinant of its policy approach.
Just days after US President, Donald Trump, unveiled the US AI Action Plan, China hosted the World AI Conference (WAIC) in Shanghai from 26 to 28 July. Premier Li Qiang’s keynote emphasised the growing regulatory fragmentation in AI, calling for open-source AI access and a new multilateral body for collective AI governance. Li’s speech was followed by a 13-point Global AI Governance Action Plan proposing an International AI Scientific Panel and a Global AI Governance Dialogue – both under the auspices of the UN.
China is also deepening AI cooperation with its BRICS partners. On 7 July, China and ten other BRICS member states inked a Joint Declaration at the BRICS Summit that, for the first time, called for collective AI governance to mitigate risks and ensure inclusive access.
By championing UN-led multilateral governance, open-source AI access and Global South cooperation, China is promoting an alternative vision of global AI governance to that of the US. However, it remains to be seen how actively China seeks to promote and implement its vision; its previous Global AI Governance Initiative unveiled in October 2023 bore relatively few concrete results.
China’s call for an inclusive approach to AI development and governance may resonate with several emerging economies across Asia-Pacific and globally. Visiting Shanghai for the WAIC, Malaysia’s Digital Minister, Gobind Singh Deo, welcomed China’s Action Plan and secured USD 700 million of investment into Malaysia from Chinese technology firms. Nevertheless, most APAC countries will be cautious to tread a balance between the US and China, both of which are either essential economic or security partners to many countries in the region.
This blog was written by Abigail Chen, Ewan Lusty, and Wong Zhi Xuan, with the input of Flint’s Senior Adviser network based across Asia-Pacific. Abigail, based in Hong Kong, has experience in technology and financial policy from her prior roles in a law firm and think tanks. Ewan and Zhi Xuan are both based in Singapore. Ewan has been supporting Flint clients on a range of digital policy issues for over four years, prior to which he advised UK government ministers on online safety regulation. Zhi Xuan is an Intern at Flint with prior roles in foreign affairs and digital policy research at a think tank. He is a student reading Philosophy, Politics and Economics at the University of Oxford.