Yes, the flag of the former Republic of Vietnam (South Vietnam) was declared a counter-revolutionary symbol and was made illegal for public display. Pro-western political parties/organizations (or pro-democracy organizations) are generally considered illegal in today's Vietnam.

Anyone caught flying or displaying the South Vietnamese flag are arrested. In overseas Vietnamese communities, the flag is commonly used to represent the Vietnamese people, as many members of the Vietnamese diaspora fled following the war. Many American cities have in fact passed resolutions declaring the South Vietnamese flag to be the "official" flag of their overseas Vietnamese communities. Flying the current Vietnamese flag in South Vietnamese enclaves today would be questionable at best and tends to provoke protest.