The Legal 500 & The In-House Lawyer Comparative Legal Guide

Vietnam: Intellectual Property

This country-specific Q&A provides an overview to intellectual property law in Vietnam.

It will cover intellectual property rights, licensing, enforcement, establishing infringement or liability, and challenges to intellectual property.

This Q&A is part of the global guide to Intellectual Property. For a full list of jurisdictional Q&As visit http://www.inhouselawyer.co.uk/index.php/practice-a reas/intellectual-property/

1. What different types of intellectual property rights exist to protect: (a) Inventions (e.g. patents, supplementary protection certificates, rights in trade secrets, confidential information and/or know-how); (b) Brands (e.g. trade marks, cause of action in passing off, rights to prevent unfair competition, association marks, certification marks, hallmarks, designations of origin, geographical indications, traditional speciality guarantees); (c) Other creations, technology and proprietary interests (e.g. copyright, design rights, semiconductor topography rights, plant varieties, database rights, rights in trade secrets, confidential information and/or know-how).

Generally all of the protectable subject matters included in the Agreement on Trade- Related Aspects of Intellectual Property Rights (TRIPs) were transposed into the 2005

Vietnamese IP Law as revised (the “IP Law”), particularly they are categorized as 3 principal branches:

1. Copyright and Related Rights

The subject matters of copyright cover literary, artistic and scientific works as mentioned in the Berne Convention including their derivative works whereas the subject matters of related rights (neighbouring rights) comprise performances, audio and visual fixation (audio-visual recordings), broadcasts and satellite signals carrying coded programmes.

2. Industrial Property Rights: inventions, utility solutions and industrial designs (these three types are the subject of patents), layout designs (also known as topographies or design of semi-conducting closed circuits or semiconductor topography), trade secrets (business secrets), trademarks, trade names, geographical indications, and protection against unfair competition (alike passing off)

(a) Rights to plant varieties and reproductive materials.

2.What is the duration of each of these intellectual property rights? What procedures exist to extend the life of registered rights in appropriate circumstances?

Cinematographic works, photographic works, works of applied art and anonymous works have a term of protection of seventy five years from the date of first publication while other works not specified at the preceding sentence would be protected for the whole life of the author and for fifty years after his/her death.

The rights of performers, producers of recordings (audio and visual fixation) shall be protected for fifty (50) years calculated from the year following the year of formulation [into a fixed form] of a performance, or from the year following the year of publication, or from the year following the year of the making of a broadcast respectively

For patents for inventions, utility solutions: 20 years and 10 years respectively. For

design: 5 years from the granting date and renewable twice each of 5 years or a total of life-span of 15 years. Layout design: 10 years from the filing date or 15 years from the date of creation, whichever date is sooner. For trademark, term of protection is 10 years and renewable with unlimited number of times. Geographical indications, trade secrets, trade names and protection against unfair competition (alike passing off) are potentially permanent as long as their criteria for protection still exist.

Plant variety protection certificates shall be valid from the grant date up until the expiry of a period of twenty-five (25) years for timber trees and vines; and of twenty

(20) years for other plant varieties.

3.Who is the first owner of each of these intellectual property rights and is this different for rights created in the course of employment or under a commission?

For patents, for certificate of trademark registration, certificate of protection of plant variety: the first owner is the individual or organization who are recorded in the national register as patentee or registrant.

Geographical indications: the State is the owner whilst the producers or associations’ producers are those authorised to use or exploit those GIs in commerce.

Copyright: an author is deemed as the first owner of copyright. In case of a work constituted on the commission basis or on the employee-employer relationship, unless otherwise agreed by the parties, the organisation or individual who commissioned or employer shall be the owner of all economic rights plus one of the four moral rights being the right to publish his/her works or to authorise other persons to publish his/her works.

4.Which of the intellectual property rights described above aren registered rights?

Inventions, utility solutions, industrial designs, layout designs, trademarks, geographical indications and plant varieties.

5.Who can apply for registration of these intellectual property rights and, briefly, what is the procedure for registration?

For patents and layout designs, who is entitled to register is individual (author) who have created them by his/her own labour at his/her own expense. Where these creations (subject matters) are generated with other individual or organization’s funds or material facilities, whether in the form of commissioning or job assignment, the aforesaid individual or organization becomes entitled applicant.

For common trademark: who is the producer or service supplier is entitled to register his/her trademark used for his/her product or service. Who is neither manufacturer nor service supplier service trades in or puts on the market any product manufactured by others has the right to register trademark if the manufacturer neither use nor oppose that registration or use of that trademark. For special trademarks like certification mark, collective mark and geographical indication: lawfully established collective organizations of organizations and/or individuals those who are doing business in that location have the right to register.

Procedure: filing application - formality examination within 01 month (15 days for plant variety) – application publication for potential opposition purpose (only 3 months for plant variety whilst others started from publication up prior to the NOIP’s or New Plant Variety Protection Office under the Ministry of Agricultural and Rural Development (PVP Vietnam) issuance of notices of allowance) - substantive examination (not required for layout design) – notice of allowance – grant of patent or certificate of layout design (registered design of semi-conducting closed circuits).

Trademarks and Geographical indications: filing application - formality examination – application publication for potential opposition purpose - substantive examination – notice of allowance – grant of certificates.

6.How long does the registration procedure usually take?

Patent for invention, utility solution: at least 3 years (possible delay of 6-8 months)

Patent for design: 11 months

Layout design: 6-7 months

Trademark: 12-13 months (possible delay of 8-12 months)

Geographical indication: 9-10 months

For plant variety: 7-8 months

7.Do third parties have the right to take part in or comment on the registration process?

Yes. When all of these applications have been published in the IP Gazette or in the specialized magazine on new plant varieties until prior to the issuance of notice of allowance by the NOIP and PVP Vietnam except for layout design (only a period of 3 months allocated for opposition).

8.What (if any) steps can the applicant take if registration is refused?

Where applications are refused as to formality (eg. non-patentable or non-protectable subject matters or other irregularities), the NOIP or PVP Vietnam will issue notices of irregularities and allows the applicant to response or correct in 2 months (1 month for plant variety). In the event that no timely response is made or inappropriate response

or correction is made, decisions on rejection will be released. Similarly, at the substantive examination stage, if applied-for subject matters are deemed unsatisfied with their criteria, the NOIP or PVP Vietnam will issue notices of intention of refusal and the applicant has 3 months to respond or amend. If in the absence of response or the as-filed response is improper, decisions on refusal will be issued. Kindly note that one- only 2-month or 3-month extension regarding the above notices respectively is permissible against official charge). The aforesaid decisions may be subsequently subjects of the possible complaints if they are timely submitted against the NOIP’s General Director in 90 days. If unsatisfied with the complainants by the NOIP’s General Director, the complaints either have right to appeal to the NOIP’s upper body being Minister of Science and Technology or initiate a lawsuit before an administrative court. If still unsatisfied with the settlement by the Minister of Science and Technology, the complainants are able to bring the case to an administrative court.

9.What are the current application and renewal fees for each of these intellectual property rights?

Patents for invention/utility solution:

From application through grant including mandatory 1st year annuity (min.): 2,310,000VND (~105USD)

Maintenance/Annuities: See the table below

Patent for Design:

From application through grant: 1,690,000VND (~77USD)

Maintenance/Annuities: 700,000VND (~32USD) for each of two 5-year renewable times

Certificate of Layout Design

From application through grant: 690,000VND (~31USD)

Maintenance/Annuities: N/A

Certificate of Trademark

From application through grant: 1,380,000VND (roughly 65USD)

Renewal: 1,200,000VND (~55USD)

Certificate of Geographical Indication

From application through grant: 1,890,000VND (~86USD)

Maintenance: N/A

Certificate of protection of plant variety:

From application through grant (exclusive of DUS experiment cost):

2,450,000VND (roughly 111USD)

Annuities: see the table below

10.What are the consequences of a failure to pay any renewal fees and what (if any) steps can be taken to remedy a failure to pay renewal fees?

Failure to pay renewal fee or annuities within a period of 6 months prior to the due date or in a 6-month grace period shall result in the termination by default of validity of patents for invention, utility solution or design and certificate of registration of trademark. No provision on restoration of validity is available in the IP Law as a result of failure to pay renewal fee.

11.What are the requirements to assign ownership of each of the intellectual property rights described above?

For patents, certificate of layout design, certificate of common trademark:

• An original copy/certified copy of assignment contract (Vietnamese translation thereof is required)
• Original copy of patents or certificates subject to proposed assignment
• A written statement signed by all joint owners if the subject of assignment belongs to joint ownership

In addition to the above requirements, for certification mark and collective mark, additional documents needed: (a) Regulations on use of collective marks, Regulations on use of certification marks drafted and provided by the assignee, and (b) documents providing the good standing (entitlement) to register the collective mark or certification mark in the name of assignee. Please bear in mind that in this case both of these regulations and documents providing the good standing shall be re-examined by the NOIP.

Geographical indications are not assignable in any case while assignment of trade name is permitted only where such transfer attaches to the assignment of the entire business undertaking and business activities under such trade name.

For assignment of copyright and related rights: recordal of assignment is not required. However, subjects of copyright and related rights assignable are one or several or all economic rights plus only one assignable moral right (ie. right to publish or permit others to publish a work).

12.What are the requirements to licence a third party to use each of the intellectual property rights described above?

It is not mandatory for licensee and licensor to register a license contract for IP rights regarding patents, trademark, copyright and related rights, and plant variety with the State authorities. However, general principle at Section 148(2) of the IP Law provides for that an industrial property object license contract shall be valid as agreed upon by the parties involved but shall be legally effective as against a third party merely upon registration with the State administrative body for industrial property rights.

13.Is there a requirement to register a licence of any of these intellectual property rights and, if so, what is the consequence of failing to register?

The rights to registered trademark may be lost or invalidated due to the principle indicated at question 13 above. Specifically, even if a registered mark has been legally

used by a licensee or others with the permission of the trademark owner through a unregistered license trademark agreement, the evidence of use of the registered mark by the licensee or that person would not be accepted if such license trademark agreement had not been recorded with the NOIP prior to the date of submission of invalidation request by third party.

14.Are exclusive and non-exclusive licensees given different rights in respect of the enforcement of the licensed IP, and if so, how do those rights differ?

Yes. Under the IP law, no provision preventing exclusive or non-exclusive licensees from enforcing licensor’s IP rights, however, to prove that he/she has good standing to initiate an IP rights claim, the evidence of signed license contract shall be supplied.

15.Are there criminal sanctions for infringement of any intellectual property rights, and if so, what are they and how are they invoked?

Yes. Under the 2015 Penal Code as revised, only infringements of copyright, related rights, trademarks, geographical indications on a commercial scale committed by a natural person in a knowingly manner may be subject to criminal punishments under Section 225 and 226 respectively. For example, 2 types of acts of reproducing works, phonograms or video recordings and distributing the public copies of the same by Section 225(1) shall be imposed a fine of between fifty million and three hundred million dong or subject to non-custodial reform for up to three years if one of the minimum thresholds has been satisfied:

1. on a commercial scale
2. having gained illicit profit of between fifty million dong and below three hundred million dong

3. having caused damage to the right holders from one hundred million dong to below five hundred million dong,
4. infringing commodities valued a range of one hundred million dong to below five hundred million dong

In addition, the fact that Vietnam, as the first time and strikingly, introduced corporation criminal liability into the Penal Code gives rise to the new opportunity for right holders to be able to deter infringement, pirated copyright goods or counterfeit more efficiently when even a legal person (only for-profit company/entity/corporation/corporate) itself may be charged criminally by a fine of between three hundred million dong and one billion dong if the act made by the corporation falls into the circumstances described in Section 225(1) above provided that either of two prerequisites had occurred:

1. Such corporation must have been already administratively sanctioned before; or
2. Such corporation have already been charged for this crime but not yet entitled to criminal record remission and repeat the violation

16.What other enforcement options are available for each of the intellectual property rights described above? For example, civil court proceedings, intellectual property office proceedings, administrative proceedings, alternative dispute resolution.

IP holders can bring an infringement to a court, or request to settle and impose fine by administrative remedy, or submit a request for IP border control with the customs with noting that up to 98% IP cases are handled by administrative measure.

17.What is the length and cost of such procedures?

Typical costs for dealing with a claim of infringement before a court including court’s fee and cost lawyers’ fee and other costs such translation and notarization may be

$10,000-20,000 or more depending on the degree of difficulty and the reputation of the appointed firm. In case of dealing with the infringement by administrative measure which may take about 1-2 months, no official cost is required and in this case cost lawyers’ fee and other costs can be between about $5,000 and below $10,000.

According to the 2015 Civil Procedure Code, the time limit for a court to hear and decide a lawsuit is 2 months counting from the date of acceptance of the case.

However, since this provision does not stipulate the time limit applicable for lawsuit having foreign element, thus the time limit for this type of lawsuit is indefinite. Please bear in mind that in practice, it may take 6 months to 12 months to receive a first instance judgement.

18.Where court action is available, please provide details of which court(s) have jurisdiction, how to start proceedings, the basics of the procedure, the time to trial, the format of the trial, the time to judgment and award of relief and whether any appeal is available.

The fact that Vietnam has not yet established any specialized intellectual property court (IP court) up to now results in the practice that all IP disputes are deemed as civil or commercial ones of which jurisdiction of first instance hearing would belong to district-level courts and provincial courts nationwide. However, where the profit purpose are all aimed by both plaintiff and defendant or the dispute has foreign elements (one of the litigants are foreigner/foreign entity), jurisdiction of first instance hearing shall bestow upon provincial courts, otherwise it belongs to district-level courts. The jurisdiction of court by territories is determined to be the court of the locality of residence or work by defendant (natural person) or the locality of head office of defendant (organisation or legal person). The mode of hearing in Vietnam is still physical one also known as in-person hearing (traditional style) meaning no other means of hearing (eg. in a UDRP case, no in-person hearing is conducted) are available.

Time limit for acceptance of the case: 5 working days.

The time limit for hearing an instance judgment: 2 months counting from the date of acceptance of the case.

In practice, it may take 6 months to 12 months to receive a first instance judgement.

Interim and/or permanent injunctions are available in the IP Law. Interim injunction also known as provisional urgent measures may be awarded by a court upon or after the initiation of a lawsuit and before hearing the counter-opinion by the party that will be affected by such interim injunction if one of the following cases occurs:

1. There is a danger of irreparable damage to such intellectual property right holder;
2. Goods suspected of infringement of intellectual property rights or evidence related to the act of infringement of industrial property rights are likely to be dispersed or destroyed unless they are protected in time.

Upon release of first instance judgement, one of the litigants is entitled, within a period of 15 days from the date of judgment, to appeal against it. In case of appealing against a decision of temporary suspension or suspension of a proceeding made by the court of first instance, the time limit for lodging an appeal shall be 7 days from the date on which the appellant receives the decision.

19.What customs procedures are available to stop the import and/or export of infringing goods?

The border control of intellectual property in Vietnam basically and mainly covers registered trademarks, industrial designs, copyrighted products and geographical indications due to the limited capacity of the Vietnamese customs force. Pursuant to the Law on Customs of 2014, the hub for receiving IPR border control is the Customs Management Supervision Department, an affiliate of the General Department of

Customs (GDoC) under the Ministry of Finance. The requests upon the formality acceptance by GDoC shall be convey its inferior networks of departments of or sub- departments of customs nationwide including the Anti-smuggling Investigation Department

There are two types of requests for IPR border control currently accepted by GDoC:

1. request for application of inspection and supervision to detect IP infringement which is valid in a period of 2 years; and/or

2. request for temporary suspension of customs clearance where imported or exported goods shows possible IP infringement

Under Circular 13/2015/TT-BTC of January 30, 2015, the procedure for request for temporary suspension of customs clearance can be briefed as follows:

1. The customs shall notify right holder, who has been recorded his/her IP rights with GDoC, of the former’s finding any allegedly infringing goods and request right holder/authorised individual or organization to submit relevant documents including tittle of protection of IP rights, a detailed description of genuine goods and infringing goods, guide to recognition of the same and a guarantee certificate of credit institutions equal to 20% of the value of the goods shipment in the contract or at least VND 20 million if the value of the suspected infringing goods shipment is not identified to pay damage compensation and expenses as prescribed which may arise due to wrong request for postponement of customs formalities

2. If the as-filed dossier is found legitimate, within 2 hours, the suspension-conducting customs shall issue its decision of provisional customs clearance that is valid in 10 working days (extendable for another 10 working days subject to a statement of justified reason along with another guarantee certificate)

3. During the time of provisional suspension of customs clear, the suspension- conducting customs shall conduct the followings:

1. To ask the right holder to provide relevant documents such as expert opinon, catalog, conclusion of similar case
2. To have IP infringement expert opinion (infringement appraisal) done regarding the determination of elements of infringement.
3. To extract, archive specimens of the suspected goods
4. To communicate or coordinate with other State IP bodies

4. Upon the expiry of provisional suspension, the suspension conducting customs is liable for performing one of or all of the followings: to issue a decision on accepting the case in accordance with administrative penalty handling, to issue a decision on temporary seizure of IP infringement suspected goods, to prepare and handle infringer by administrative measure, or to release the suspected goods in case of no infringement

20.Are any non-court enforcement options or dispute resolution mechanisms mandatory in respect of intellectual property disputes in any circumstances? If so, please provide details.

In any circumstances, there are no non-court enforcement options or dispute resolution mechanisms mandatory in respect of IP disputes in Vietnam. However, in practice, except for cases of possible criminal liability, in any point of time regarding handling of infringement via administrative measure or court, concerned parties are advised to negotiate or conciliate with each other.

21.What options are available to settle intellectual property disputes?

Parties may settle IP disputes by bringing the case to a court, or demanding a State administrative   authority in charge of IP under Section 200 of IP Law to handle and impose a fine against the violator, or referring to the Vietnamese arbitrations (eg. VIAC) subject to a prior arbitration clause agreement, or out-of-court settlement or co- existence agreement based on the conciliation and compromise by and between them.

22.What is required to establish infringement of each of the intellectual property rights described above? What evidence is necessary in this context?

The general 4-criteria rule for determining the existence of IP infringement: (a) allegedly infringing subject matter falls into the scope of protection, (b) there are infringement elements (factors) subsisted in allegedly infringing subject matter, (c) allegedly infringing person is neither the owner of IPR nor authorized person to use or exploit IPR, and (d) the act of alleged infringement occurring in Vietnam.

The criteria (b) plays most important role. This significant criteria is more clarified or specified in Decree 105/2006/ND-CP as revised subject to alleged infringement subject matters being copyright, related rights, patents or trademarks. For example, alleged infringement act shall be determined as infringement of a patent if a product or part (component) of a product is identical or equivalent to a product or part (component) of a product within the scope of protection as an invention.

To be continued

              ______________________________________________________________

 Bross & Partners, a Vietnamese registered Patent, Design, Trademark and Copyright agent, constantly ranked by Managing Intellectual Property, World Trademark Review, The Legal 500 Asia Pacific, AsiaLaw Profiles and Asian Legal Business. We are providing clients all over the world the reliable, affordable contentious and non-contentious IP services including IP enforcement, anti-counterfeiting, litigation and domain name recovery before courts and arbitrations. For further discussion, please get in touch with us via vinh@bross.vn