Intellectual PropertyEnforcement Guide:Vietnam

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Vietnam, as a civil law country, enforces the

rules and procedures for IP enforcement through

written laws. By joining the WTO, Vietnam

committed to providing enforcement measures

in accordance with the TRIPS Agreement.

A primary feature of Vietnam's IP protection is

the use of an administrative enforcement

system. Legal complaints are filed to a

government department that inspects,

investigates, and forms a decision on disputes.

Introduction toIP Enforcementin Vietnam

As Vietnam joins the WTO, IP enforcementmeasures under the TRIPS Agreement arecomprised of:

Civil remedies including judicial procedures,evidence rules, injunctions, damages,information to rights holder, and rights ofindemnifications to defendants, as well asprovisional measures (preliminaryinjunctions and search and seizure orders);Customs interceptions of infringements;Criminal remedies, at least for wilful trademark counterfeiting or copyright piracy ona commercial scale;Administrative remedies for handlingadministrative offences

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A primary feature of Vietnam's IP protection isthe use of an administrative enforcementsystem. Legal complaints are filed to agovernment department that inspects,investigates, and forms a decision on disputes. Although administrative proceedings arepopular in Vietnam, we notice that IPR holdersare increasingly using civil litigation to seekpreliminary injunctions, damages, or a publicapology from infringers. Court avenue is alsoincreasingly chosen by trade mark ownersagainst cyber-squatting cases.

Vietnam’s laws and regulations on IPprotection are currently under review andexpected to be amended in accordance withthe EU-Vietnam Free Trade Agreement(EVFTA) of which Vietnam is a signatory. It hasan IP chapter and mandates Vietnam toprovide greater IP protection to right holders Also, given the increasing number of onlineinfringement cases, Vietnam will shift its focustowards developing its legal framework andpractical mechanisms to tackle IP infringementin the contemporary digital environment. Withadditional higher requirements for IPstandards under the CPTPP and EVFTA, thelaws are expected to be further amended.

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AdministrativeEnforcement V

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Authorities with the jurisdiction to conductadministrative enforcement are currently asfollows:

The Police for Corruption, Smuggling andEconomic Crimes under Vietnam People'sPublic Security (Economic Police – “EP”): Inaddition to taking action against criminaloffences, the EP may also handleadministrative enforcement against trademark counterfeits. The EP will onlyundertake serious infringement casesinvolving large quantities of stock or anetwork of infringers, or infringing acts, orproducts that pose a danger to consumers.Given the limitation of specialist IPknowledge amongst officers, the EP oftenhesitates to take on cases involvinginfringing goods that are not clearlycounterfeits. For copyright piracy, the EPwill cooperate with the Ministry of Culture,Sports & Tourism (“MoCST”) andDepartment of Culture, Sports & Tourism(“DoCST”) Inspectorate to carry outactions.

Police Unit for High-Tech CrimePrevention: The Police Unit for High-TechCrime Prevention is responsible forhandling complicated cases of online piracy.

Customs: The key function of the Customs isto control national borders, including theprevention of counterfeit goods imports.

The Market Management Bureau: TheBureau deals with relatively simple casesinvolving counterfeits at the market level,for example, shops of small to medium sizeand retailers. Right holders often opt forMMB for quick action against smallinfringers. The Bureau and EP regularlycollaborate in enforcement actions.

Inspectorate of the Ministry of Science andTechnology (MoST) and Department ofScience and Technology (DoST): The MoSTand DoST Inspectorate tend to handlecomplex cases, i.e. where the infringingmark is alleged to be confusingly similar tothe trade mark, or where the use of thealleged infringing mark is on the infringer’sbusiness materials (websites, documents,product, etc.). Cases of counterfeiting areeffectively handled by the EP and MMB.

Inspectorate of MoCST and DoCST: TheInspectorate of MoCST and DoCST areresponsible for the administrativeenforcement of copyright and related rightsin Vietnam. They cooperate with the EP andMarket Management Bureau for raid andinvestigation actions against infringers.

Inspectorate of the Ministry ofInformation and Communications (MoIC)and Department of Information andCommunications (DoIC): The Inspectorateof MoIC and DoIC are responsible forcooperating with the Inspectorate of DoSTand other relevant agencies in the processof handling domain names that infringe IPrights.

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People’s Committees: The People’sCommittee at city and provincial levelsrarely directly deal with IP infringement.They will step in where the likely sanctionexceeds the authority of the enforcementauthority that is usually responsible fordealing with the matter.

To take administrative actions, IPR holders (ortheir authorised representatives) shall filewritten requests for the handling of theinfringing acts to the competent authorities.The request must be enclosed with evidenceon the IPR holders’ status and evidence todemonstrate the alleged infringement.

During the examination of the writtenrequests from IPR holders, the competentauthorities, within the scope of theirresponsibilities, can carry out the followingactivities:

Request the alleged infringer and partieswith related rights and interests to providethe information, document, evidence,explanations, arguments orcounterarguments;

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Request the IPR holder to providedocuments, evidence, clarification on thecase; confirmation on the counterfeitnature of the infringing goods (in case ofhandling counterfeits), etc.;

Following the handling process, if the IPinfringement is established, competentauthorities shall issue sanction decisionsagainst the infringers. Administrative sanctionsmay include warnings or, together withtermination of the infringing acts. Possiblesupplemental sanctions include confiscation ofthe counterfeits, and raw materials, materialsand means used mainly for production ortrading of such counterfeits, and suspensionfor a definite time of business activities in thearea of infringement.

Conducting administrative actions againstcounterfeits based on IPR holder's requestscan also provide momentum for enforcementauthorities to proactively arrange raids againstcounterfeits without the IPR holders' request(“ex-officio raids”) at a later stage. Thenumber of ex-officio raids has been steadilyincreasing over the years and enforcementauthorities have become the eyes and ears ofIPR holders. Work for IPR holders in ex-officioraids is quite minimal once the EP or MMBseize the suspected counterfeits, as they onlyneed to confirm with the authorities whetherthe seized products are indeed counterfeits.Upon confirmation with the IPR holders aboutthe counterfeit nature of the seized goods, theenforcement authorities will issue a sanctiondecision against infringers, then issue themwith applicable fines and order the destructionof counterfeits.

Civil Enforcement V

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Level of Civil Courts

It’s helpful to know which court level the mostappropriate for IP disputes in Vietnam. Fordisputes related to non-commercial purposes,district-level civil courts have jurisdiction overthem. This is except cases involving foreignfactors, which would be settled under thejurisdiction of Provincial-level Civil Courts.In contrast, disputes that involve commercialpurposes come under the jurisdiction ofProvincial-level Economic Courts.

Preliminary injunctions

When (or after) initiating a lawsuit, the IPRholder is entitled to request that the Court toapply the preliminary injunctions to goodssuspected to be infringing IPRs and raw materials,materials and means for manufacturing andtrading such goods if (i) there is a threat ofirreparable damage suffered by the IPR holders;or (ii) there is a threat of dispersal or destructionof suspected infringing goods and relatedevidence if they are not protected in time.Preliminary injunctions include retention, seizure,sealing, prohibiting any alteration of the originalstate, prohibiting any movement, prohibitingtransfer of ownership of the infringing goods,raw materials, materials and means.

Damages

Damage under the IP Law includes materialdamage and spiritual damage. The level ofdamages is calculated based on the actual lossthat the right holder suffered due to theinfringement.

Once the plaintiff can adduces evidence toprove that the infringement caused him orher material damage, the plaintiff may requestthe Court to decide the damages based on:

Total material damages in money plus theprofit gained by the defendant by theinfringement, if the decrease in profit ofthe plaintiff has not been included in thetotal material damages; orThe licensing price on the assumption thatthe defendant was licensed by the plaintiff touse the IP under a license contract within ascope corresponding to the infringement; orOther ways of calculation right holderproposed in accordance with laws.

Where the damages cannot be calculated basedon the above methods, the Court may decidethe amount of damages based on the extentof the losses, but the amount will not surpassVND500 million (~US$21,600). Once the plaintiffis successful in proving that the infringementhas caused the plaintiff spiritual damages, theplaintiff is entitled to request the Court todetermine the damages depending on theextent of loss, with the range from VND5 millionto VND50 million (~US$216 to US$2,160).

Vietnam’s IP Laws require calculation ofdamages based on trade mark and copyrightinfringement act. In practice, it is difficult forIPR holders to prove actual losses arising fromthe act of IP infringement of the adverse party.In some cases, the IPR holders can still recoverexpenses such as attorney’s fees and relatedfees e.g. fees for seeking expert opinions, etc.from infringers in court decisions.

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CriminalEnforcement V

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The number of criminal IP cases has increasedrecently following enactment of IP violationlaws. For instance, Criminal Code 2015(“Criminal Code”) which officially came intoeffect in 2018, marked the first time corporateinfringers could be subjected to criminalliability. Criminalisation of corporate infringersis the most significant change for both criminalproceedings in general and IP enforcementcases in particular.

Under the Criminal Code, infringers whocommit infringements upon trade marks,geographical indications, copyright and relatedrights can be brought hear charges at criminalproceedings. EP, People’s Procuracies andCourts have the authority to conduct criminalproceedings.

Manufacturing and trading in counterfeits canalso be regarded as criminal infringementagainst trade mark rights. Criminalenforcement authorities usually prioritisecases where counterfeits pose serious harm toconsumers and public health (e.g. fakepharmaceutical products, gasoline, andconsumer goods).

Criminal enforcement has the toughestsanctions with strict penalties againstinfringers, compared to other enforcementactions. For individual infringers, criminalpenalties may include loss of certain civilrights, monetary fines of up to VND1 billion(~US$43,095), and imprisonment for up to 30years. Fines of up to VND5 billion(~US$215,600), business suspension for up totwo years, ban from business activities,operations in certain fields, and evenpermanent termination of business operationsare some of the criminal penalties that may beordered by the court.

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Customs BorderEnforcement V

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Customs measures for protection of IP include:

Suspension of customs procedures forsuspected infringing goods;Inspection and supervision for detectinggoods with signs of IP infringement

Right holders may file customs recordals withGeneral Department of Vietnam Customs.Upon acceptance of customs recordalapplication, when detecting signs of IPinfringement in a consignment, Customs willstop the customs procedures and send anotice on suspected infringing goods to theright holders. Within three working days fromthe date of receipt of the notice on suspectedinfringing goods, the right holders must submita request on the suspension of customs and abond in the form of money or a deed ofguarantee issued by a bank/ credit institution.

The time limit for the suspension is ten (10)working days from the date the suspensiondecision is issued. It can be extended for afurther ten (10) days in case the customs needto consult IP experts’ opinions. Uponexpiration of the suspension period, Customsmust:

Issue a decision to accept the caseaccording to administrative proceduresonce confirmation is done of thesuspended infringing goods;Issue a decision on detention of goods incase there are sufficient grounds todetermine the suspended infringing goods;Impose administrative sanctions andremedies if there are sufficient grounds todetermine the suspended infringing goods.Transfer the case to the EP for investigationand criminal prosecution if the value ofcounterfeits meets the threshold forcriminal prosecution.

Upon expiration of the suspension period, ifthe IPR holders do not initiate a lawsuit orCustoms does not accept the case inaccordance with administrative violationhandling procedures, Customs will resume thecustoms procedures for the consignment.

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WarningLetters V

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IPR holders commonly use warning letters as aself-protection measure. A common strategy isto put the infringer on notice, or to negotiateand settle the case. In practice, sending awarning letter to an infringer is considered aninitial attempt to educate the infringer of theprior rights of the right holders. A warningletter is normally sent out before any officialenforcement action is taken. Warning lettersshould be accompanied by a follow-up toensure that the infringers have understood thecontent of the letter and are cognizant of theprior rights of the right holders. Proof ofsending a warning letter can serve as evidenceof right holders’ attempt to settle the caseamicably, should any official dispute resolutionproceedings begin.

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OnlineEnforcement V

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Given the rapid development of internet inVietnam, IP infringement (e.g. online piracyand counterfeit products) has been risingconsiderably across online trading websitesand e-commerce platforms in recent years.

Decree No. 15/2020/ND-CP on administrativepenalties for violation in postal services,telecommunications, radio frequencies,information technology, and electronictransactions have specified administrativepenalties for IP-specific violations by websites,social networking platforms, and users. Inparticular, IP violations of posting/deliveringjournalistic, literature, artistic works and otheronline publications created without the IPright holder’s consent are subject toadministrative fines ranging from VND10million to VND70 million (~US$426 toUS$2,982) depending on the subject of theviolations. Possible supplemental sanctionsinclude confiscation of means for violation,forcible take-down of infringing content, ortemporary confiscation of the platform’soperation license.

However, it is unclear how the above sanctionswould be practically enforced against foreigncompanies providing cross-border servicesaccessible to Vietnamese users. Given theCybersecurity Law 2018 specifies “acts ofinfringing upon copyright and other IP rights incyberspace” by both domestic and foreignservice providers among cybersecurityviolations, it is expected that the law’supcoming implementation decree will set outsanctions, remedies, and enforcementmeasures imposed on such violations,including those for cross-border serviceproviders.

Under current regulations, online serviceproviders who operate websites, socialnetwork sites and provide online streamingservice are not obliged to remove infringingcontent upon IPR holders’ requests. In casethe providers are unwilling to voluntarily takedown infringing content, IPR holders canconsider proceeding with administrativeactions or civil actions.

As for e-commerce platforms, there are rulesaimed at tackling online infringement of IPrights. However, to date, e-commerceplatforms’ liability has not been established indetail (including whether and how theplatforms must establish notice and take downmechanisms). In practice, IPR holders normallyrely on the take-down mechanisms availableon such platforms instead of any officialadministrative enforcement or civil actions.

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