Vietnam Legislation Development Update:

Safe Harbors Provision and Legal Liability of Intermediate Service Providers in the Draft Amendments of the IP Law to Comply with the EVFTA

Attorney Le Quang Vinh – Bross & Partners

Email: vinh@bross.vn

Background of Article 12.55 of the EVFTA[1]

With respect to indirect copyright infringement, also known as secondary infringement, committed by a user on the platform of an online service provider (OSP) or an intermediate service provider (ISP), the EU legislation has 2 Directives governing the information society service in the EU single market. Firstly, Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market (“Directive on electronic commerce”), and Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC (“Directives on dealing with online copyright infringement”). According to these Directives, Member States shall, among other things, ensure that OSPs whose transmission in a communication network or provision of access to a communication network or shortly referred to as “mere conduit”, if determined in compliance with the statutory conditions, is not liable for the users’ acts of infringing upon copyright, related rights on the internet.

Regardless of the above legal framework, up to now, no harmonization rule in the EU-wide level for holding an intermediate service provider (ISP), or an online service provider (OSP) liable for its user’s copyright infringement occurred on its platforms. Meanwhile, at the EU’s member level, different approaches adopted and adjudicated by the national courts in determining the OSP’s secondary liability has made the practice of handling online IP infringement become inconsistent and unpredictable in the EU single market.

Based on the above legal framework, Article 12.55 EVFTA imposes a mechanism of limitations and exemptions in favor of ISPs in relation to the provision or use of their services, for infringements of copyright or related rights that take place on or through telecommunication networks. Where statutory requirements are met, ISPs are exempted legal liability from the activities of mere conduit, caching and hosting. However, kindly note that Article 12(3), Article 13(2) and Article 14(3)   Directive 2000/31/EC states that those exemptions shall not affect the possibility for a court or administrative authority of requiring ISPs to terminate or prevent an infringement, nor does it affect the possibility for Member State of establishing procedures governing the removal or disabling of access to information.

Some Comments

1.        In terms of formality, Section 198b seems to be long and obscure, and less practical, eg, the legal liability exemptions of ISPs mentioned in points b, c, clause 2 are very lengthy, using too many semicolons.

2.        The Draft Amendments have not yet brought up the ISP’s liability and efforts are to receive and handle the right holder’s complaints accusing the user of posting, trading in, or marketing copyrighted works, and other 3 subject matters under the related rights without the stakeholder’s permission. This complaint mechanism is widely known as the notice and takedown procedure. In essence, Section 198b deals with the secondary copyright infringement (indirect infringement) regarding conditional liability exemption activities of mere conduit, hosting and caching.

3.      The first part of clause 3, Section 198b stating that “an intermediary service provider is not forced to monitor its services or seek evidence of infringement” is not so good because such provision can imply that ISPs are imposed no obligation to monitor, receive and solve the complaints accusing of copyright infringement on their platforms when the copyright holders commence a notice and takedown procedure. Moreover, such provision is likely deemed in contradiction with the e-commerce legislation set out by Article 36 Decree 52/2013/ND.[2]

4.        The legal liability of ISP originates from Joint Circular 07/2012/TTLT-BTTT-BVHTTDL and it would appear first time in the law level at Section 198b. In our opinion, an ISP should be assumed as an infringer, whereby it is likely to become a defendant in a lawsuit.

5.        The provision “failure to perform or incompletely performing the obligations to be exempted from legal liability for an ISP specified in Section 198b of this Law” in clause 8 of Section 28, and clause 11 of Section 35 should be carefully reviewed because “failure to perform” or “incompletely performing” appears to be difficult to apply and not actually accurate.

6.        The applicability scope of Section 198b is narrow since it is only applicable for infringement of copyright, related rights and pirated goods. It is not clear how to deal with the ISP's legal liability if violators take advantage of the ISP's platform to market or offer for sale counterfeit goods, counterfeit intellectual property goods, or goods infringing upon trademarks, geographical indications, patents, industrial designs while infringement of intellectual property rights in Vietnam is currently at an alarming degree as shown by the reports released by the ICC Bascap and USTR’s 2019 Special Report 301.[3]

Bross & Partners, an intellectual property company ranked First (Tier 1) by Legal 500 Asia Pacific, has experience in resolving complicated IP disputes including trademarks, copyrights, patents, plant varieties

Please contact: Vinh@bross.vn; mobile: 0903 287 057; Zalo: +84903287057; Skype: honor.bross; Wechat: Vinhbross2603.