SOME IMPORTANT LEGAL CHANGES IN THE INTELLECTUAL PROPERTY LANDSCAPE AFTER THE COMPREHENSIVE AND PROGRESSIVE AGREEMENT FOR TRANS-PACIFIC PARTNERSHIP (CPTPP) CAME INTO EFFECT FOR VIETNAM FROM JANUARY 14, 2019

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CPTPP officially took effect for Vietnam from January 14, 2019

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP or TPP-11) is a free trade agreement among Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. The precursor of the CPTPP was the Trans-Pacific Partnership Agreement (TPP) consisting of 12 member states (the US out of the deal). The CPTPP took effect from December 30, 2018 after the ratification of the sixth country – Australia followed New Zealand, Canada, Japan, Mexico and Singapore. The CPTPP consists of 11 countries with a total GDP value of about $ 10,000 billion, occupying about 13% of global GDP. On November 12, 2018, the Vietnamese National Assembly ratified the CPTPP, making Vietnam the seventh country to ratify CPTPP. Based on Notice No. LGL/CPTPPD/2018-15 by New Zealand, the CPTPP officially took effect for Vietnam from January 14, 2019.

Important legal changes as from Jan 14, 2019

Because Article 6 of the Law on Treaties of Vietnam 2016 stipulates where a legal document and a treaty to which the Socialist Republic of Vietnam is a contracting party have different provisions on the same issue, such treaty shall prevail, except the Constitution [1]. Thus, in the context that Vietnam has not yet amended its current Law on Intellectual Property as well as other related legal documents while some provisions on intellectual property rights in the CPTPP are different from those in the IP Law led to the issuance of notice No. 1926/TB-SHTT dated of February 1, 2019 by the National Office of Intellectual Property of Vietnam (NOIP) [2] guiding how to apply the CPTPP. Below is some brief information and our additional comments for your reference:

1. Suspension of Clause 2, Article 148 [3] of the IP Law provides that a license contract (a contract of transfer of the right to use a trademark) is effective only among the parties but not a third party if it is not registered with the NOIP

Article 18(27) of CPTPP provides that no member state may require recordal of a trademark license agreement for such purposes as: (a) establishing the validity of such license, or (b) making a condition that the use of licensed trademark by the licensee is deemed to have being used by the licensor (the right holder) with respect to the proceedings of establishment, maintenance and enforcement concerning such licensed trademark.

Hence, as a simpler manner since January 14, 2019, Section 148(2) of the IP Law has been automatically suspended, resulting in two legal consequences as below:

(a) A trademark license contract even if it was not registered with the NOIP, it shall be valid for any third parties, and

(b) the use of the licensed trademark in commerce by the licensee is also considered as the one by the licensor in the event a request for 5-year consecutive non-use termination is filed by a third party

2. Disclosure of the invention up to 12 months, whether authorized or unauthorized, before the filing date, still seems to be novel

Kindly note that a 6-month grace period to novelty disclosure is very limitedly accepted by Section 60(3) of the IP Law, provided that the inventions subject to those circumstances must be submitted with the NOIP within 6 months:

a) It was published by another person without permission of the person having the right to registration as provided for in Article 86 of this Law;

b) It was published in the form of a scientific presentation by the person having the right to registration as provided for in Article 86 of this Law;

c) It was exhibited at a national exhibition of Vietnam or at an official or officially recognized international exhibition by the person having the right to registration as provided for in Article 86 of this Law.

However, due to the impact of Article 18(38) of the CPTPP, the above rule has significantly changed, particularly:

1. The invention was publicly disclosed by the applicant or by a person that obtained the information directly or indirectly from the applicant (regardless of how they obtained that invention); and
2. The above indicated disclosure occurred in a period of 12 months prior to the filing date of the aforesaid invention (priority date disregarded).

As a result, the above disclosure shall not be cited as the prior art against the determination of novelty and inventive step of the same invention filed. For example: an invention/utility model A was devised and filed by B on January 14, 2019, probably knowing that such invention was either disclosed publicly on the applicant’s website or exploited before January 14, 2019, whereby the new rule of 12-month grace period shall be kicked off to this case (assuming that the above invention was filed on January 13, 2019, the applicant’s self-disclosure as described is subject to Section 60(3) above).

3. Refusal or cancellation of validity of a Geographical Indication (GI) due to "likelihood of confusion" instead of "will cause confusion" with trademark rights in Vietnam

Pursuant to Section 80(3) of the IP Law, a GI seeking for registration shall be rejected where it is identical with, or similar to, a validly registered trademark, if the use of such GI will cause confusion as to the origin of the products. Whereas Article 18(32)(1)(b) of the CPTPP forces Vietnam to provide that a GI may be rejected because of the opposition made by third party against the protection or recognition of such GI based on that GI may be likely to cause confusion with the validly registered trademark in Vietnam. Therefore, an opposition by third party based on the "will cause confusion" ground must be replaced with "likely to cause confusion”.

The Notice 1926 further explains that how to settle the conflict between an earlier registered trademark and GI will change significantly, ie. the NOIP is obliged to take into account the fact that GIs are often the pre-existing objects (independent from its registration or not) and widely known, even well-known, which are therefore more likely to be "confused" than "cause confusion" with trademarks.

4. Administrative procedures applicable to the protection or recognition of geographical indications in the form of translation or t transliteration must be similarly applied to normal geographical indications.

Article 18(32)(5) of the CPTPP sets out: “If a Party provides protection or recognition of a geographical indication through the procedures referred to in Article 18(31) - Administrative Procedures for the Protection or Recognition of Geographical Indications – in the form of its translation or transliteration, that Party shall make available procedures that are equivalent to, and grounds that are the same as, those referred to in paragraphs 1 and 2 with respect to that translation or transliteration”. Pursuant to this provision, the NOIP instructs that applications for GIs in the form of their translation or transliteration submitted from the effective date of the CPTPP shall be processed the same as usual applications for registration of GIs. 

5. New rule for determining whether a term is the common name of goods in Vietnam, the competent authority is entitled to consider how Vietnamese consumers understand such term

This is an obligation imposed by the CPTPP at Article 18(33), which is in practice further clarifying the provisions on procedures for protection or recognition of GIs stated by Article 18(32)(5) as well as regulations on denial or cancellation of GIs according to Article 18(32)(1)(b) above, which is directly related to GIs if they have become a common name of goods in Vietnam, if correct, it is subject to the exclusion of protection as GI under Section 80(1) of the IP Law. Accordingly, the determination of whether a GI is a common name or not under the CPTPP must be done through a 2-step test:

1. Whether or not that name, indication or term is used to refer to the type of goods in question based on the source of information such as dictionaries, newspapers, market research reports, and relevant websites; and
2. How the goods made reference to in the form of that term, indication or name are marketed in commerce in Vietnam (used in recognized international standards mentioning a sort of, or class of, goods/commodity, ie. import and export tariff...).

Should you have any query, please get in touch with us at vinh@bross.vn or 84-903 287 057

 Bross & Partners, a renowned and qualified Patent, Design, Trademark and Copyright agent of Vietnam, constantly ranked and recommended by the Managing Intellectual Property (MIP), World Trademark Review (WTR), Legal 500 Asia Pacific, AsiaLaw Profiles, Asia IP and Asian Legal Business, is providing clients all over the world with the reliable, affordable contentious and non-contentious IP services including preparing Vietnamese translation of PCT applications and entering the Vietnamese national phase, filing, prosecution, enforcement, anti-counterfeiting, litigation and domain name matters.

[1] Article 6(1) of the Law on Treaties dated of April 9, 2016 that took effect from July 1, 2016.

[2] See Vietnamese original version at: http://www.noip.gov.vn/web/noip/home/vn?proxyUrl=/noip/cms_vn.nsf/vwDisplayContentNews/3E06998AFC1F97254725839F00176FAB?OpenDocumen