Vietnam’s IP Law Amended to comply with CPTPP

During the 7th working session of the 14th National Assembly of Vietnam, on June 14, 2019 the National Assembly discussed and approved seven draft laws: Law on Education (revised), Law on Architecture (revised), Law on Tax Management (revised), Law on Public Investment (revised), Law on Criminal Judgements Enforcement (revised), Law on Alcohol Harm Prevention and Control, and Law on amending and supplementing some articles of Law on Insurance Business and Law on Intellectual Property Rights.

The Draft Law on amending and supplementing the Law on Insurance Business and the Law on Intellectual Property was passed with 428/428 (100%) votes. The primary purpose of this draft law is to bring the existing Law on Intellectual Property in line with the terms of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which came into effect in Vietnam on January 14, 2019.

Below are the amendments and supplements to the Law on Intellectual Property:

(Excerpt from Law amending and  supplementing some articles of the Law on Insurance Business and the Law on Intellectual Property which was approved by the National Assembly of Vietnam on June 14, 2019. Underlined words are content amended or supplemented)

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Below are some key amendments and supplements that are included in IP law 2019

Patents

Regarding novelty of invention and grace period applicable

Amendments to Clause 3 and addition of Clause 4 after Clause 3 of Article 60 as follows:

Article 60. Novelty of inventions

"3.An invention shall not be considered as lacking of novelty if it is directly or indirectly disclosed by the person entitled to registration specified in Article 86 of this Law or by the person who has information about the invention under the condition that the patent application is submitted in Vietnam within 12 months from the date of disclosure.

4. The provisions of Clause 3 of this Article shall also be applied to any invention disclosed in the industrial property application or industrial property protection title published by the state administration authority of industrial property rights  in case the publication  is inconsistent with provisions of laws or the application is submitted by a person ineligible for registration”.

Previously, the grace period for public disclosure was much shorter, just six months from the date of disclosure.

Geographical Indications (GIs)

Regarding generic names [of goods] ineligible for protection as Gis, the amended IP Law 2019 clarifies the condition a term is recognized as generic name. Further, a GI will be considered identical with or similar to a mark having been protected if their use may cause [instead of “will cause” under the previous IP Law] confusion as to the commercial origin of goods.". This extends the protection of a registered trademark. In details:

Amendments to Article 80 as follows:

a) Amendments to Clause 1:

"1. Names and indications that have become common name of goods as per the perception of relevant consumers in Vietnam ";

 b) Amendments to Clause 3:

“3. Geographical indications that are identical with or similar to a trademark being protected or have been filed under a trademark application with an earlier filing date or priority date, if the use of such geographical indication is made may cause confusion about the commercial origin of goods ".

For simplifying the recognition and protection of GIs under international treaties to which Vietnam is a member, the amended IP Law 2019 supplements  Article 120a as the following:

“Article 120a. International proposal and processing of international proposal on geographical indication

1. Proposal for recognition and protection of geographical indications in accordance with international agreement to which the Socialist Republic of Vietnam is negotiating, is called international proposal.

2. The publication of international proposal and handling of opinion of a third person, assessment of the registrability of geographical indication in international proposal shall comply with the relevant provisions specified in this Law for geographical indication in geographical indication application submitted to the state administration authority of industrial property rights.”

Trademarks

In the amended IP Law 2019, Clause 2 of Article 136 is amended to determine clearly that the use of a trademark by a licensee constitutes use of mark by the trademark holder, which, in a certain situation, can be used as a defense against non-use cancellation.

Amendments to Clause 2 of Article 136 as follows:

“2. Trademark owners are obliged to use the trademark continuously. The use of a trademark by a licensee under a trademark licensing contract is also considered as a trademark owner's use. In case the trademark has not been used continuously for five years or more, the registration certificate of such trademark shall be terminated according to the provisions of Article 95 of this Law ".

Effect of licensing contracts

In the amended IP Law 2019, a licensing contract of industrial object without recordal with the NOIP is still valid, but to be effective to a third party it must be recorded with the NOIP, except for trademark license contracts. In details, it is as follow:

To amend and  supplement Article 148 as follows:

"Article 148. Effect of contracts for transfer of industrial property right

1. For the industrial property rights established on the basis of registration as referred to in point 3(a) Article 6 of this Law, a contract for assignment of industrial property right shall only be effective upon registration with the state administration authority of  industrial property rights.

2. For the industrial property rights established on the basis of registration as referred to in point 3(a) Article 6 of this Law, a contract for use of industrial property object shall be effective as agreed by the parties.

3. A contract for the use of industrial property object specified in Clause 2 of this Article, except for a contract for the use of trademark, shall be registered with the state administration authority of industrial property rights to ve valid for third parties.

4. Validity of a contract for use of industrial property object shall be terminated ex- officio upon the termination of licensor’s industrial property rights."

Online filing system

In practice, in addition to paper modality, an online filing system set up by the NOIP, started with trademark applications, followed by patent applications, has been implemented since 2017. However, specific provisions for this have only been added to the amended IP Law 2019 by adding Clause 3 to Article 89. Mode of filing registration applications for the establishment of industrial property rights, as follow:

“3. Applications for registration of industrial property rights shall be submitted in the form of paper documents or electronically under the online filing system to the state administration authority of industrial property rights."

Enforcement of IP rights

Lawyers’ fees

Two new clauses, i.e., Clause 4 and Clause 5 are incorporated into Article 198. Right to protection by oneself to ensure equality in adjudication of intellectual property rights disputes. According to these, the defendant, without the court's conclusion of infringement, has the right to ask the court to force the plaintiff to pay reasonable attorneys' fees. Acts of abusing other people's intellectual property protection procedures causing damages are also dealt with. In details, it reads as follow:

"4. Organizations, individuals who are defendants in lawsuit over intellectual property infringements, if the Court concludes that they do not commit acts of infringement, may request the Court to force the plaintiffs to pay them reasonable fee to hire a lawyer or other expenses in accordance with laws.

5. In case an organization or individual abuses the procedures for intellectual property protection and thus causes damage to another organization or individual, the organization and individual suffering damage may request the Court to force the abuser to pay damages, including reasonable costs of hiring a lawyer. Acts of abusing intellectual property rights protection procedures include acts of intentionally exceeding the scope or objective of this procedure.”

Grounds for determination of damages caused by the infringement

Under the amended IP Law 2019, beside the methods for calculating damages that already set forth in the IP Law 2005, Clause c added to Article 205.1, which writes “c) Material losses calculated in other ways by the intellectual property right holder in accordance with provisions of laws” gives an IP right holder the right to claim damages on any legal basis which he/she is able to prove it eligible. This supplement makes the article in question more inclusive and helpful for choosing proper way for determining damages in practice.

Obligations of customs to provide information on suspected infringing goods

Clause 1 Article 218 is modified to determine the obligation of customs to provide information on suspected infringing goods as follow:

"1. When the requester for suspension of customs procedures has fulfilled the obligations specified in Article 217 of this Law, the customs authority shall issue the decision of suspension. The customs authority shall provide the intellectual property rights holder with information on name and address of shipper; exporter, consignee or importer; description of goods; quantity of goods; origin of goods (as the case may be), within 30 days from the date of issuance of the decision to apply administrative measures to handle trademark counterfeiting and pirated goods specified in Clause 4, Article 216 of this Law.”

Effectiveness

This amended IP Law 2019 takes effect from November 1, 2019 and apply to:

a) An application for registration of an invention, utility solution, industrial design, trademark, layout design or geographical indication shall be submitted to the state management agency of industrial property rights from January 14, 2019.

b) Procedures for canceling the validity of Patents for inventions, Patents for utility solutions, Certificates of registration of geographical indications of the applications filed from January 14, 2019;

c) Procedures for invalidation of trademark registration certificates shall be carried out from January 14, 2019;

d) Procedures for protection of intellectual property rights are required from January 14, 2019./.