Business brief 2014: Vietnam

Patents

How do you register or secure patent rights, and is national or international coverage most appropriate?

Vietnam is a state member of the Paris Convention and has acceded to the PCT, so it is at the applicant’s discretion to file a patent protection in Vietnam claiming Convention priority or through PCT route. In view of reduced cost for filing in several countries, the PCT system would be preferable.

Once granted, a patent is valid for a period of 20 years from the filing date.

What are the costs for obtaining a patent, and what are the costs of defending it?

Typically it costs about $2,500 to obtain a patent, filed through Convention or PCT routes, with 30 pages of specification and two independent claims.

Depending on its complexity, costs of a patent infringement lawsuit including attorneys’ fees can be up to $10,000 and are charged according to the work undertaken.

Where can you find information on existing patents in your jurisdiction?

Information on existing patents and published patent applications filed in Vietnam can be found by manual search in the paper version of the Official Gazette of IP archived at NOIP and via the internet, on: http://iplib.noip.gov.vn/WebUI/WLogin.php.

Is there anything unusual about the patent law that companies should be aware of, and what are the most common mistakes businesses make?

Patent applicants, especially in pharmaceutical field, should be aware of the patentability of ‘use format’ claims. As defined by Article 4.12 of the IP Law, an invention is “a technical solution, in form of a product or a process, to resolve a specific problem by utilising laws of nature”. Patent examiners at NOIP may reason that “use” is neither a “product” nor a “process” to reject the claims in the use format.

What are the key threats to patent owners, and what is the best strategy if you suspect someone is infringing your patent?

Key threats include a lack of IP courts in Vietnam and judges’ insufficient knowledge on IP issues. If you suspect someone is infringing your patent, you need to find a reliable local IP law firm to advise you on essential steps to handle the case. A start is to draft and send a cease and desist letter to the infringer.

Trademarks

How do you register or secure trademark rights, and what protection does it grant?

Applicants can use the national registration system by filing an application with NOIP, or through the international registration system (Madrid Agreement and Protocol) to register their marks. Registration of a trademark provides exclusivity to the mark owner to use the mark on the goods or services for which the mark is registered, and to take legal action against trademark infringements.

The trademark is protected for a period of ten years and can be renewed every ten years thereafter.

What are the costs for registering a trademark, and what are the costs of defending it?

The average cost, including attorneys’ fees, for registering a trademark in respect of one class of goods/services covering a maximum of six items is $350, and those for renewal is $110.

What are the key threats to trademark owners, and what is the best strategy for dealing with infringement?

Key threats to trademark owners are counterfeiting and online infringement. The best strategy for dealing with infringement is to apply administrative measures, which may be quick and simple to arrange. Authorities that have the right to apply administrative sanctions include IP inspectors, the Market Management Department, Economic Police, Customs and People’s committees.

The main sanction in the form of monetary fine can be up to VND 500 million ($22,000).

What are the most common mistakes trademark owners make?

The most common mistakes that trademark owners make are: (i) failure to renew a trademark registration, as the mark rights will cease if a mark is not used for a period of five years, whereby any party may use the mark; and (ii) a lack of understanding of the scope of protection, especially in case the mark is registered with disclaimer.

Copyright

What are the key challenges to copyright holders in your jurisdiction?

“The majority of counterfeit goods originate in China and are illegally imported, and carried into Vietnam via the country’s porous, rugged border.”

Key challenges to copyright holders in Vietnam are: (i) unclear and sometime contradictory copyright law and related legislation; (ii) increasingly sophisticated copyright infringement due to the advancement of technology, leading to a rise in the commercial trade of pirated goods; and (iii) copyright infringement on the internet, which has become a global problem. Infringing websites mainly operate abroad and it is very difficult to handle the infringement without international collaboration.

How should people ensure they are protected against copyright infringement?

Copyright protection is governed under the Penal Code (Article 170 Infringing upon copyright and related rights), the IP Law and Government Decree No.47/ND-CP of May 13, 2009 on sanctioning administrative violations of copyrights and related rights. According to these, acts of copyright and related rights infringement may be handled by civil, administrative or criminal measures depending on their nature and severity.

Vietnam has the system of enforcement authorities which include courts, IP inspectors, Market Management Department, Economic Police, Customs and People’s committees for handling IP right infringements.

What is the best way to deal with infringement, and what are the costs associated with it?

The best way to deal with infringement is to use administrative measures, which may be quick and simple to arrange and most helpful in many copyright piracy cases. The costs associated with it vary from hundreds to thousands of US dollars, depending the complexity of the case and quantity of pirated products.

Counterfeiting

How big a problem is counterfeiting in your jurisdiction?

Counterfeiting is a big problem in Vietnam. Nearly all high quality products that have large sale volumes have been counterfeited and competent authorities have difficulty in staunching the rapid growth of the counterfeit trade. The majority of counterfeit goods originate in China and are illegally imported, carried into Vietnam via the country’s porous, rugged border.

Counterfeiters have extended their reach to virtually every kind of product, from pharmaceuticals, cosmetics, medicines, clothes, bags and IT products to music, software and fast moving consumer goods. It is estimated that 90 percent of computer software available in Vietnam is pirated.

What industries are particularly at threat?

Industries which are particularly at threat are clothes, shoes, handbags and household appliances.

What are the best strategies for dealing with the problem?

The best strategies for dealing with counterfeiting may include: (i) authorities, manufacturers/traders and consumers joining hands and increasing communication among them. It has been observed that many counterfeiting cases are not reported to the competent authorities as manufacturers/traders fear consumers will turn away from their products if they publicly address the counterfeiting issues they face; (ii) encouraging consumers to claim compensation when they inadvertently buy fake goods; and (iii) improving legislation to deal with counterfeiting and applying higher penalties on serious infringement.

There have been no any changes to the patent, trademark and copyright laws in the last 12 months.

Pham Vu Khanh Toan is a managing partner at Pham & Associates. He can be contacted at: hanoi@pham.com.vn