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Identification of Rationale of Domain Name Disputes


The phenomenon that a particular individual uses brand names, trademarks or trade names protected by another individual or company to register as his/her domain name then seeks to re-sell such domain name to the genuine brand owner at a price higher tens or hundreds of times than the out-of-pocket expense spent is often called in many different ways, namely appropriation of domain name or abuse of domain name registration policies, which all originate from the commonly used term “cybersquatting”.


Cybersquatting is the main and major cause of disputes over international domain names (gTLDs) or national domain names (ccTLDs), which is ever defined by the ICANN that “cybersquatting is generally bad faith registration of another's trademark in a domain name”[1].


The Vietnam Internet Network Information Center (VNNIC) also points out that "due to the high diversity and competitiveness of the commercial environment, many subjects have pre-registered domain names that, according to their expectations, in future may have been sought to register by the genuine brand stakeholders. Where there is an entity in need of domain name, these subjects will resell it for profit. This phenomenon is called "domain speculation" (domain name speculation) ". Similarly, the VNNIC also said that "there is another type, ie. the subjects pre-empted domain names before the competitors or rivals do so in order to make it difficult for their business and marketing. This phenomenon is commonly known as "domain name appropriation" (domain name cybersquatting)[2].


Cybersquatting could have been seen commonly for the last ten years because domain names are considered a tiny investment industry but profits are huge. For example, Vietnamese large enterprises were bitter about losing their domain names in the hands of cybersquatters, such as the domain name Viettel.com registered in 1997 by an American individual and in 2011 it was offered for sale at $1.5 million price[3]. Before the domain name samsung.vn was resolved by the court, the price that the domain name registrant required Samsung Company to exchange for ownership of two national domain names samsungmobile.com.vn and samsungmobile.vn was 218 million VND[4].  But worst of all Bkav had to spend 2.3 billion VND to buy the domain name bkav.com that a US company quickly registered before 2001[5].


Demerits 4 Measures or Alternatives of Domain Name Dispute Resolution


As national domain name is subject to the Law on Information Technology of 2006, all disputes relating to domain names .VN must be resolved according to Vietnamese law. However, because the Intellectual Property Law also prohibits the act of registering, occupying the right to use, or use of a national domain name that is identical or confusingly similar to a trademark, protected trade name of other person, or geographical indications for which they do not have the right to use are unfair competition acts. Therefore, stakeholders may choose one or more than one or all 4 forms/measures of domain name dispute resolution is as follows:


  1. Through negotiation and mediation 
  2. Through arbitration 
  3. Initiating a lawsuit at a competent court
  4. Handling acts of unfair competition with administrative measures along with imposing the required remedy to force changes in domain names or returning domain names according to Decree 99/2013/ND-CP


Negotiation and mediation are probably the least effective and least viable forms among 4 alternatives of domain name dispute settlement because as mentioned above the domain name dispute mainly comes from the phenomenon of cybersquatting. As a result, domain name registrants often require brand owners to spend large or very large amounts to redeem domain names - a condition that brand owners often refuse to accept because if accepted means promoting or lending a hand to unfair competition, illicit money-making behavior.


The form of arbitration seems to be civilized and almost resembles the UDRP[6] mechanism but in fact, according to our observations, the implementation of this measure is almost zero. In other words, it is almost impossible to resolve a dispute by arbitration for the following three reasons:


  1. No cybersquatter (who are holding right to use domain name based on other people's brand name or trademark) who are attempting to make money from ransom demand of thousands or even tens of thousands of US dollars (although his out-of-pocket expense for registering and maintaining such domain name is only about 35USD or 800,000VND) agrees to sign the arbitration agreement or arbitration clause[7] with the brand owner;
  2. No default provision on establishing arbitration clause or agreement included in the current domain name registration contracts between registrants and registrars accredited by the VNNIC leading to the fact that arbitration cannot almost kick off.
  3. Different from the UDRP mechanism that allows a party to sue an arbitration award regarding its denial, forcible cancellation, or forced transfer of a disputed domain name to a competent court, the domain name .VN dispute resolution through the arbitration (eg. the Vietnam International Arbitration Center - VIAC) is final[8]


Bringing a lawsuit to a court has multiple obstacles and difficulties by reason of several reasons, in particular: (a) long process of handling and trial (it sometimes takes a year, two years or more, ie. the lawsuit relating to the domain name lafarge.com.vn[9]), (b) lawsuits often have to undergo two levels of trial as first instance and appellate, not including civil execution, (c) the court is very reluctant to adjudicate without the presence of defendant (deliberately avoiding, or misrepresenting identity when registering domain names), (d) no mechanism to “freeze” domain names (freeze a domain means that it is forbidden to change domain name information or transfer domain names) resulting in the potential suspension of the lawsuit by the court and then the plaintiff is forced to re-file the same again.


Administrative punishment accompanied by remedy measures of being forced to change domain name information or return domain names according to Decree 99/2013/ND-CP is the administrative measure that run since July 25, 2016 - the date of taking in effect of Joint Circular 14/2015/TTLT-BTTT-BKHCN. This measure is also not easily enforceable in practice for a variety of reasons, such as: (a) only applicable to domain names that are identical or similar, which can cause confusion with the subject of intellectual property being protected and content posted on the website accompanying the domain names violates intellectual property laws (therefore, it is not possible to tackle passive holding or inactive holding of a domain name), (b) no mechanism to “freeze” domain names (freeze a domain means that it is forbidden to change domain name information or transfer domain names) resulting in the potential suspension of the administrative action by IPR enforcement agency and then the petitioner is forced to re-file the case because allegedly infringing subject is no longer existing.




It seems that all four ways of claiming a .VN national domain name reveal different hindrances making the path to recover national domain name .VN held by cybersquatters be really arduous, even if such path is still somewhat shows that it may be more difficult to ask for a national domain name .VN than to claim international domain names. However, you should not be too pessimistic because we have had our own know-how along with reasonable approaches to assist you in taking back domain name in a legal way as no matter what the law can only exist based on fairness and righteousness.


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 enforcement, anti-counterfeiting,  litigation regarding trademark, trade name, industrial design, patent, copyright and domain name.


[6] UDRP stands for the Uniform Domain-Name Dispute-Resolution Policy

[7] Section 5(1) Law on Commercial Arbitration states “a dispute shall be resolved by arbitration if the parties have an arbitration agreement. An arbitration agreement may be made either prior to or after the dispute arises”

[8] Section 4(5) Law on Commercial Arbitration of 2010 stipulates “arbitral award is final”.


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