Notable new points on IPR enforcement specified in Decree 65/2023/ND-CP

This article summarizes some important new points of Decree 65 regarding the  establishment and enforcement of intellectual property rights.

I. Regarding the Establishment of Industrial Property rights

Decree 65 has introduced a series of new and detailed regulations related to procedures for establishing industrial property (IP) rights such as new Application Forms; amending and supplementing the Application for Registration of establishment of Industrial property rights; Separation and Withdrawal of applications for registration of establishment of industrial property rights; Application for Industrial design registration under the Hague Agreement as well as international application for trademark registration under the Madrid system; Amendments related to the issuance of Protection Titles in paper or in electronic form; amending the Protection Titles and transfer of rights to trademarks as well as regulations related to security control of inventions;  Confidential inventions...

II. Regarding the Enforcement of Industrial Property rights

When dealing with this topics, it is necessary to pay attention to the fact that currently (2023) Vietnam still does not have any agency officialy assigned the responsibility for collecting, synthesizing, compiling and providing statistical indicators on the field of intellectual property. Agencies competent to handle acts of IP infringement such as Courts, Inspectorate, Market Management, Customs, Police and People's Committees at all levels only build their own databases, therefore, it is difficult to have a comprehensive and reliable report on the enforcement of industrial property rights in Vietnam annually as well as in a specific research period.

The rare data that we have is in the Report summarizing 10 years of implementation of the IP Law[5], which showed that in the period from 2006 to 2016, the Market Management Forces across the country have  imposed administrative sanctions on with 179,857 cases related to counterfeit goods and goods infringing IP rights. Meanwhile, in the period 2012-2015, only 177 cases of infringement were resolved by court and 55 cases were brought to trial, including 12 criminal cases, accounting for an insignificant proportion. This reality shows that administrative sanctions still play a key role in IP rights enforcement activities in Vietnam.

As mentioned above, because Decree 65 replaces the entire of Decree No.103 and only partially replaces Decree No.105  on the protection of industrial property rights, rights to plant varieties and state management of intellectual property, but does NOT amend, supplement or replace the provisions of Decree 99/2013/ND-CP[6] (Decree 99 - amended and supplemented by Decree No. 126/2021/ND-CP[7] ) which is the backbone Decree on sanctioning administrative violations in the field of industrial property, so there will basically be the following 2 groups of issues:

- The issues which are systematized, amended and supplemented in Decree 65

- The remaining problems that Decree 65 has not yet resolved.

1. The issues which are systematized, amended and supplemented in Decree 65

1.1. Determine the act, nature and level of infringement (specified from Article 72 to Article 80)

These are regulations that inherit Decree 105 and also supplement violations considered to occur within Vietnamese territory. Accordingly, Article 72.4 of Decree 65 adds that “a violation is also considered to occur in Vietnam if the violation occurs on the Internet and is performed on an electronic information page under a Vietnamese domain name or whose display language is Vietnamese" instead of only “aimed at consumers or information users in Vietnam" as in Decree 105.

1.2. Determination of damage (specified in Articles 82 to 87)

These are regulations that inherit Decree 105, including:

- Principles for determination of damage to industrial property rights and rights to plant varieties;

- Loss in property (decrease in or loss of the in-cash value of the protected IP right subject matters, price of ownership assignment or transfer of use right, value of the business capital contributed in the form of IP rights; etc);

- Spiritual loss (honor, dignity, prestige, reputation...);

- Decrease in income, profits

- Loss of business opportunities; and

- Reasonable expenses for prevention and remedy of damage

1.3. Handling of infringing goods

Unlike previous regulations,  Article 96.4 of Decree 65 provides, in some specific cases, in order to facilitate the application of additional remedial measures (such as forced distribution or putting into non-commercial use or destruction of infringing goods) the IP right owner can request the competent authority to force organizations or individuals producing infringing goods to regain  the infringing goods that have been brought  in their distribution channels. However, representatives of some agencies such as the Economic Police, Market Management... said that it is unrealistic because it is difficult to regainl goods once they have been sold on the market or brought in distribution channel.

1.4. Expertise[8] of industrial property rights and rights to plant varieties (specified from Article 114 to Article 122)

The expertise of industrial property rights and rights to plant varieties is amended and supplemented with the following main contents:

- Determine the scope of protection of industrial property rights and plant variety rights;

- Determine whether the subject under consideration meets the conditions to be considered an element of infringement of industrial property rights or rights to plant varieties;

- Determine whether there is any overlap, similarity, confusion, difficulty in distinguishing or copying between the object under consideration and the protected object;

- Determine the value of industrial property rights and plant variety rights according to the valuation method prescribed in the Law on Prices; determine the value of damage according to the provisions of the IP Law.

2. Issues remain unresolved

As mentioned above, because Decree 65 does NOT amend, supplement or replace the regulations in Decree 99, there are still some regulations in this Decree that conflict with the amended IP Law 2022 as well as other legal documents, some of which are expected to be included in the Draft of amendment and supplement to Decree 99, namely:

2.1 For exported goods, while all the IP Law[9], the Law on Customs[10] and Circular 13/2015/TT-BTC[11] stipulate that the owner of intellectual property rights and the Customs force have the right to request and/or apply measures on inspection, supervision or temporary suspension of customs procedures for the export of goods showing signs of infringement of intellectual property rights, Decree 99[12] merely stipulates the authority of the Customs force in handling infringements in transit and import of goods. As a result, in principle, Customs can handle exported goods that infringe IP rights, but there are no specific regulations on infringing acts, forms of sanctions, fine levels regarding  exported goods in Decree 99 to apply.

2.2 For goods in transit, the regulations on border control measures in the IP Law do not mention the handling of goods in transit; The Law on Customs  does not apply regulations on temporary suspension of customs procedures for goods showing signs of infringing IP rights on transit goods, but Decree 99 has regulations on jurisdiction, infringing acts and fine levels for goods in transit. This also stems from the fact that goods in transit are a very important channel for infringers to swap and smuggle counterfeit and smuggled goods into the Vietnamese market.

2.3 Authorization to request handling of violations

The regulation that "Authorization document requesting handling of violations must be the original" in Clause 3, Article 23 of Decree 99 has caused many difficulties for the enforcement of IP rights in practice because the infringing acts often do not occur only once and in one location. Meanwhile, as it’s required that the POA document needs notarization and consular legalization, which takes a time so the authorizing party usually  issues a general POA and in one copy only.

Therefore, Clause 3, Article 23 of Decree 99 needs to be amended as follows:

“3. The authorization document requesting handling of violations must be the original if the authorization content is related to a specific case. In case of a general POA for many cases, the party requesting handling of violations may submit a copy of the original POA”.

In summary, Decree 65, to a certain extent,  has fulfilled its task of guiding the implementation of a number of new regulations in the Amended IP Law 2022. However, due to some shortcomings and limitations also appear in other contents, which are beyond the scope of this article, the Decree certainly needs further amendment and supplementation by a subsequent Decree.