Vietnam – Intellectual Property Rights – 2015

1. Vietnam - Intellectual Property Rights - 2015
Overview
Since the issuance of the Law on Intellectual Property (IP Law), as amended in 2009, its
accession to the World Trade Organisation (WTO) and joining the WTO’s Agreement on
Trade-Related Aspects of Intellectual Property Rights (TRIPs), Vietnam has significantly
improved its legal framework to comply with international standards. Enforcement is also
improving with many significant cases handled in the last year. However, further
strengthening Intellectual Property Rights protection serves to promote trade, investment and
economic development and at company level, fosters innovation and entrepreneurship. It is
seen as a vital component for the promotion of advanced, high-tech industries. IPR benefits
both foreign players and Vietnamese businesses, honing the latter's competitive edge in
global markets. Moreover, a strong IPR system has significant potential advantages for the
society at large, as it protects consumers from counterfeit products that may not meet the
required health and safety standards. A win-win solution, IPR protection, especially IPR
enforcement, should clearly be the focus for Vietnam in its development.
Online IPRs
Relevant State authorities: Ministry of Science and Technology (MOST), National Office of
Intellectual Property (NOIP), Ministry of Industry and Trade (MOIT), Ministry of Culture,
Sports and Tourism (MCST), Ministry of Information and Communications (MIC)
Issue description
As the number of Internet users continues to grow, infringements in the online environment
are on the rise. Enforcement remains difficult, especially, against illegal trading in
copyrighted work ('online piracy') and infringing goods, Intellectual Property Rights (IPR)
infringements on websites, as well as abusive domain name registration or maintenance
('cybersquatting').
It appears that a greater number of online content providers are now offering licensed
content, to some extentP
3
P. Also, several administrative complaints of copyright infringement
were lodged recently against a number of websites, and a civil action was filed against an
online content providerP
4
P. Generally, the awareness of copyright protection online, of both the
public and the authorities, seems to have increased. Regarding domain name disputes, a case
involving a cybersquatter that could not be located was successfully brought to court - this is
the second civil case relating to domain names to be heard in Vietnam.
There are many areas where the protection and enforcement of IPR could be improved,
however. Online copyright infringements remain widespread and involve all kinds of
content (software, music, movies, books, etc.) whereas administrative fines are still
low. Also, infringing goods are massively available in the online environment. On a
related point, enforcement against intermediary service providers is still limitedP
6
P.

2. Domain name disputes are almost impossible to resolve through administrative
actions, particularly as a recent conflict between competent authorities has currently
deprived right holders from obtaining forcible revocation of domain names by
administrative agencies. In addition, administrative enforcement against registrants
that are not identified or located in Vietnam is unavailable. Civil actions still require
tremendous amounts of time and effort and are uncertain as to outcomes.
Potential gains/concerns for Vietnam
• Online copyright: Promotion of creation and innovation, subsequent increase of tax
revenue.
• Infringing/counterfeit goods: Increased protection of consumers, including against
counterfeits that may pose health risks.
• Domain names: Quicker domain name recovery and response against cybersquatting
acts.
Recommendations
We would like to make the following recommendations:
• Increase the level of administrative fines against individuals committing copyright
infringements (Decree No. 131/2013/ND-CP dated 26 October 2013 on sanctioning
administrative violations of copyright and related rights);
• Strengthen enforcement efforts against infringing websites and implement Joint
Circular No. 07/2012/TTLT-BTTTT-BVHTTDL dated 19 June 2012 ;
• Adopt a Uniform Domain-Name Dispute-Resolution Policy (UDRP)-type system for
resolution of vn’ domain name disputes, or amend the law for administrative agencies
to settle cases more effectively - including against absent registrants; and
• Continue to raise public awareness of online protection of all types of IPRs.
2.4.3 Registration of trademarks in Vietnam
Relevant Ministries: Ministry of Science and Technology (MOST), National Office of
Intellectual Property (NOIP)
Issue description
We recognise the efforts of the National Office of Intellectual Property (NOIP) to improve
the regime of registration of IPR in general and of trademarks in particular in Vietnam. We
especially appreciate the recent efforts to comply with the statutory term for formality
examination of trademark applications. Although the statutory term of the substantive
examination of trademark applications is sometimes not met, significant improvement has
been seen in this regard.

3. Nevertheless, we consider that further efforts are desired in the following areas of registration
of trademarks in Vietnam.
1 Trademark database
We note that despite the achievements in the construction and maintenance of the NOIP’s
online trademark database, the capacity for conducting a trademark search using the
current online trademark database is still very limited. In many cases, only identical
search or limited similarity search is possible.
2 Trademark search
We note that the NOIP currently provides a trademark search service for goods in Classes 5
and 12 for certain purposes only. No search service is available for goods and services
in other classes. The limitation of the database for online searches creates significant
difficulties for businesses in making decisions as to what trademark to adopt and what
register to use.
3 More specific procedures in trademark opposition
We understand that an opposition petition is treated as a reference in the NOIP’s examination
of an opposed trademark application. We, however, consider that more specific
procedures would be desired. Currently, after considering an opposition, the NOIP
sends a letter to the opponent informing the opponent on whether or not the office
agrees with the opposition. This letter in the majority of opposition procedures is the
final correspondence the NOIP sends to the opponent in respect of the opposed
application. In some cases, we understand that the NOIP has informed an opponent
that the office agrees with the opposition; however, the opposed mark was later
registered and the opponent was not informed of this unfavourable outcome.
4 Dishonesty/Bad faith
Currently, 'dishonesty’ (or bad faith] is mentioned briefly in Article 96.3 of the Law on
Intellectual Property (IP Law]. The provision may be intentionally drafted to be in line with
Article 6 of the Paris convention. Its wording may, however, lead to a different interpretation
on whether or not 'dishonesty’ can be an independent ground for invalidation of a trademark
registration and for refusal of a trademark application. The recent meeting between We and
the NOIP has helped to bring confirmation on this issue. Accordingly, 'dishonesty’ can be
considered as an independent ground for invalidation of a trademark registration and for
refusal of a trademark application. The remaining issue may now be what can be considered
as 'dishonesty’. While there is no definition, the European Union (EU) and the US, through
court rulings, seem to have an open approach and rule a broad range of actions to be 'bad
faith/bad intention’. We recommend that the NOIP shall adopt the EU and the US’ approach
for this issue. For ease of reference, the following are among acts that have been considered
bad faith by the EU and US courts:

4. • Knowledge of a third party’s prior right, including business relations with the third
party;
• Intention to misappropriate the reputation of a third party’s prior right;
• Intention to prevent a third party’s entry onto the market;
• Multi-filings of other’s marks, warehousing marks and domain names;
• Intent to circumvent the use requirement (repeat filings);
• Registration primarily to disrupt a competitor’s business;
• Failing to submit a timely response;
• Intent to sell the mark/domain name;
• Intent to divert consumer from the mark owner’s online location to the infringer’s
website;
[9] For the purpose of these searches, the applicant should submit an official letter
requesting for the searches and explaining the purpose of the searches to the NOIP.
The NOIP, in its discretion, will decide if it accepts the request.
• Providing false contact information when applying for the registration.
This list is not exhaustive and will evolve with time due to the complexity of the
infringers’ acts.
5 Inconsistency in examination of trademark applications
Inconsistency still exists in both formality and substantive examinations of trademark
applications. In many cases, identical goods or services may receive different treatment
when they are designated in different applications. It has happened that one item is
accepted in one application but is refused for wrong classification or lack of clarity in
another application. Inconsistency is also observed in substantive examination of
trademark applications. One element may have to be disclaimed in one application when
no disclaimer is required in another application under the same conditions. Similarly, the
NOIP has in the past refused to register a mark based on both descriptiveness of an
element of the mark and others’ prior rights to that element at the same time.
6 Examination of pharmaceutical trademarks
We observe that a significant number of closely similar marks have been registered in
respect of pharmaceutical products. A general impression is that a much more relaxed
degree of similarity is applied in examination of pharmaceutical marks despite the fact
that any confusion in respect of pharmaceutical products may result in serious
consequences to consumers and can directly affect consumers’ health. We recommend
that the same degree of similarity shall be applied for examining pharmaceutical marks.

5. 7 Well-known trademarks
It is not certain to trademark owners and practitioners whether results of market surveys
may be accepted as evidence to prove the well-known status of a mark in Vietnam. As
this practice is often accepted in the EU and many other countries, we recommend that
market surveys should be considered as evidence to prove the reputation of a mark as
well as to prove likelihood of confusion.
Potential gains/concerns for Vietnam
An improved registration regime for trademarks would effectively promote the protection
of trademarks and businesses in Vietnam. With the present limitations of trademark
enforcement capabilities, a comprehensive regime for registration of trademarks would be
viewed as a great help for IPR enforcement authorities and trademark enforcement in the
country. With the increasing awareness of IP rights among the public, especially among
businesses, the need for a full and effective trademark registration system has become
more and more urgent and such a system would in its turn promote business and
investment.
Recommendations
We would recommend the Vietnamese authorities to ensure the following improvements
of the current trademark registration system, which we believe would improve the
protection of trademarks in Vietnam:
• Keep the current database of trademark applications and registrations updated on a
regular basis for public search;
• Grant licences to IP agencies to have access to the NOIP’s comprehensive trademark
database for conducting trademark searches;
• Allow access to the NOIP’s records of trademark opposition, appeal and cancellation
matters, and opposition and cancellation matters;
• Set a procedure in which the outcome of a trademark application is communicated to
the opponent;
• Amend the IP Law to clearly provide for refusal of a trademark application and
cancellation of validity of a trademark registration if the corresponding application
was filed in bad faith;
• Ensure a stricter approach to the examination of pharmaceutical trademarks;
• Issue comprehensive trademark examination manuals to serve as guidelines for
trademark examination;and
• Acknowledge market surveys as a method for proving whether a mark is well-known
and provide detailed guidance for the implementation of this provision.

6. Enforcement of IPR laws and regulations
Relevant Ministries: People's Supreme Courts, Ministry of Science and Technology
(MOST), Min¬istry of Industry and Trade (MOIT), Ministry of Public Security (MPS),
Ministry of Finance (MOF), Ministry of Culture, Sports and Tourism (MCST), Ministry
of Information and Communications (MIC)
Issue description
Progress has recently been observed with Intellectual Property (IP) enforcement agencies,
currently handling many complicated cases such as patent infringement. However, more
is hoped from Vietnam as both the EU-Vietnam Free Trade Agreement (EU-VN FTA)
and the Trans-Pacific Partnership (TPP) are coming close to their conclusion.
We believe Vietnam should gradually increase the role of courts in IP dispute resolution.
At present, although IP infringement is a civil dispute in nature, most infringement cases
in Vietnam are handled by administrative bodies instead of courts. However, given the
high profile of civil actions as well as the unique remedies they allow, such as
compensation for damages, which cannot be awarded by administrative bodies,
international Intellectual Property Rights (IPR) holders prefer to resort to civil action to
better protect their rights. We would recommend Vietnam to follow this tendency and
amend the current legislation, especially on civil actions, to advance the effectiveness of
IP enforcement.
In our opinion, the establishment of an IP court would be a springboard for an
improvement of Vietnam's IP prospects. As far as we understand, the Supreme Court of
Vietnam is working on a project on the possibility of forming such a court. We would
recommend Vietnam to speed up the process of setting the IP court as soon as possible.
For example, in Thailand, foreign investment increased after the country established an IP
court.
We also believe that the authorities (administrative, police and courts) should co-ordinate
better in handling complex cases such as those involving patent infringement, unfair
competition, or overlapping rights.
We think highly of the mechanism available in Vietnam that enables IPR holders to
expediently overcome the defence of invalidation that the offenders could raise. However,
such mechanism does not explicitly exist under civil actions. Accordingly, defendants
could take advantage of this shortcoming to prolong civil actions. We are of the view that
Vietnam should expressly set out such a mechanism to enhance civil actions against IP
infringement, and to decide on issues of invalidity more quickly.
In some cases, the fines imposed are too low [ranging from hundreds to a few thousand
USD) and therefore lack a true deterrent effect to further infringements. As provided by
law, repeat offenders in counterfeit cases should be subject to criminal charges, but, so
far, criminal charges have rarely been applied. Those subject to low fines simply repeat
their infringing activities, viewing the small fine as merely a cost of doing business. In

7. addition, there is no clear regime for enforcement agencies to force infringers to open up
their records to show the sources of counterfeit goods or suppliers, whereas this would
help right holders to locate the manufacturers or wholesalers trading in counterfeit or
infringing goods.
We are of the view that enforcement processes should have even more specific
guidelines. Accurate and complete records should be kept of all administrative fines,
product confiscations, product destructions and other administrative sanctions that are
imposed on infringers of IPR. Further details regarding the infringing activities should
also be disclosed, such as information on the amount and source of products. All the
judgments and decisions that competent authorities render to resolve IP disputes should
be compiled into a database, to which the public can have access.
We do note, however, that enforcement shortcomings are often due to manpower, as in
some cases, the relevant enforcement authorities may lack the technical knowledge and
resources to detect and deal with violations.
We observe that criminal charges against IP infringers have rarely been applied although
criminal penalties are available under the Penal Code. We would recommend the
Vietnamese Government to introduce a regulation providing guidelines for applying the
criminal charges in practice.
Potential gains/concerns for Vietnam
The value of a comprehensive legal framework declines when enforcement is lagging.
More effective implementation of the laws will lead to greater confidence amongst
businesses and consumers in the State’s ability to protect their rights. In addition, it is
likely to lead to the recovery of lost Government revenue (tax revenue and prosecution
income) and discourage repeat offenders, preventing future violations. Proactive and
persistent enforcement against products that present a high health and safety risk is
essential to protect the general public from harmful and hazardous effects of counterfeit
goods.
Recommendations
We would like to make the following recommendations:
• Set up an IP court to deal with all contentious matters relating to IP;
• Provide for a mechanism of civil action that could enable the court to tackle the
invalidation defence raised by defendants;
• Increase enforcement manpower at relevant Government agencies, in all cities;
• Impose larger fines to deter future infringement, and raise the ceiling fine to VND 2
billion for legal persons and VND 1 billion for individuals;
• Increase the financial incentives for enforcement and prosecution;

8. • Amend the laws to impose accomplice liability on market owners who allow repeat
offenders to continue to do business on their premises;
• Keep accurate and complete records of all administrative fines, product confiscations,
product destructions and other administrative sanctions;
• Require infringers to provide detailed information regarding their infringing activities
and make these records publicly accessible via a national database;
• Audit the records in the national database regularly and in detail to determine whether
the level of fines and other sanctions are sufficient; and to determine whether an
infringer is a repeat offender; and
• Issue guidelines on criminal prosecution of IPR crimes.
IP Legislation
Relevant State authorities: People’s Supreme Courts, Ministry of Science and Technology
(MOST), Ministry of Industry and Trade (MOIT), Ministry of Public Security (MPS),
Ministry of Finance (MOF), Ministry of Culture, Sports and Tourism (MCST), Ministry of
Information and Communications (MIC)
Issue description
During the past few years, there have been some instances of subordinate legal documents
that are inconsistent with the prevailing laws. According to statistics of the Government, from
2013 to the beginning of 2014, the Ministry of Justice detected 312 out of 1,574 documents in
conflict with the existing laws and decrees. The conflicting documents account for 19.8% of
the documents that the Ministry of Justice reviewed, signalling an alarming issue in the
legislation, potentially undermining trust in the legal system of Vietnam.
We would like to point out some conflicts and inconsistencies of which we have become
aware in Intellectual Property (IP) legislation as follows:
Under the formerly applicable Decree 97/2010/ND-CP dated 21 September 2010 on
administrative sanctions in the field of industrial property, the Inspectorates of Science and
Technology have the authority to sanction advertising that infringes industrial property rights.
However, as an effect of Decree 99/2013/ND-CP dated 29 August 2013 (Decree 99) and
Decree 158/2013/ND-CP dated 12 November 2013, the Inspectorates of Science and
Technology, which are one of the most active agencies in Intellectual Property Rights (IPR)
infringement suppression, are no longer vested with the authority to sanction advertising that
infringes IPR. This has created true difficulties to IPR holders, practitioners as well as those
authorities dealing with IPR infringement, and is viewed as a backward step in IPR
enforcement regulations. As IPR infringing sale is often coupled with IPR infringing
advertising, we recommend that the Ministry of Science and Technology (MOST)
Inspectorates should be vested with the authority to handle IPR infringing advertising.

9. Recently, we have become aware of the issuance of Decree 71/2014/ND-CP dated 21 July
2014 ('Decree 71’), which sets out the prescribed remedies for competition violations,
including sanctions in antitrust, unfair dealings, and unfair competition cases. While these
measures are a step in the right direction, they potentially conflict with last year's Decree 99,
complicating the enforcement of the latter. Although Decree 71 restates the definitions of the
infringing unfair competition acts mentioned in Decree 99, it sets out different remedies and
proceedings to suppress the infringing acts. Additionally, Decree 71 does not empower the
same authorities as set forth under Decree 99 to sanction the infringing acts. As a
consequence, a conflict arises between the two Decrees, regarding the treatment of remedies,
the proceedings, and the competent authorities.
Decree 71 seems to be a step backwards in the fight against unfair competition acts relating to
industrial property, as it does not provide specific measures to completely address the issues
of cybersquatting and infringing company names. However, given the prevailing regulations
under the 2008 Law on the Promulgation of Legal Documents dated 3 June 2008 and the IP
Law, it seems likely that Decree 71 will take precedence over Decree 99 in rulings on
misconduct governed by both texts. With Decree 71 having taken effect on 15 September,
2014, it is likely that the resolution of cyber-squatting and infringing company names relating
to unfair competition will be complicated from now on.
We think Vietnam should review the causes of contradicting legal provisions and we would
encourage the Vietnamese Government to enhance the cooperation in this regard with the
private sector. IP practitioners in the private sector such as IP lawyers have experience in
enforcing the laws in practice. They know of the loopholes, the shortcomings and any
discrepancies among the legal documents, and are aware of implementation problems that
may arise in practice. Therefore, we would recommend the enhanced cooperation between
practitioners and policy makers when drafting a new legal document.
Other issues such as the lack of cooperation among relevant ministries in law building and
the lack of the court's power in holding legal documents invalid also contribute to the lack of
consistency of the legislation in Vietnam.
Potential gains/concerns for Vietnam
Foreign investors would favour an improved, consistent legal system. Therefore, improving
the IP legislation will definitely bring about benefits for Vietnam, at least in terms of the
confidence of foreign investors in the legal system.
Recommendations
We would like to suggest the following recommendations:
• Improve the cooperation between the law makers and the private sector in law
building;
• Improve the cooperation among relevant ministries and agencies in law building; and

10. • Empower the court to hold invalid legal documents that conflict with other superior
legal documents.
Please contact Oliver Massmann under Uomassmann@duanemorris.comU if you have any
questions.