Frequently Asked Questions about Patents in Vietnam

How is the duration of patent protection determined?

The term of validity for a patent for invention is 20 years, while such a term for a patent for utility solution is 10 years, counted from the filing date.

May a court amend the patent claims during a lawsuit?

During the term of validity of a patent, the patent owner may file a request for modifying the patent by cancellation of one or more claims in the patent. Any third party may file a request for invalidation of a patent if the patent has been granted on unlawful basis. The patent may be terminated if the owner does no longer exist, fails to pay maintenance fee or surrenders his or her patent. During a lawsuit, a court may hold a claim valid or invalid but may not amend the claims in a challenged patent.

Does the patent office provide any mechanism for resolving priority disputes between different applicants for the same invention? What factors determine who has priority?

In accordance with the law, the priority right is to be determined on the basis of ‘first to file’ principle. In fact, under article 90 of the IP Law, where two or more patent applications have been filed by several independent applicants for the same invention, a patent may only be granted to the patent application with the earliest filing date or priority date, where applicable. If more than one patent application has been filed by different applicants for the same invention and with the same priority conditions, namely with the same priority date, the Office shall invite all the applicants to jointly file a single patent application as co-applicants. If the applicants cannot reach such an agreement, all the subject patent applications will be rejected.

Does the patent office provide any mechanism for opposing the grant of a patent?

Article 112 of the current Vietnamese IP Law provides that as from the publication date of a patent application until prior the date of grant, any third party may request rejection of a patent application by submitting arguments together with relevant documents, information with respect to the patent application.

Is it possible to appeal an adverse decision by the patent office in a court of law?

Under the law, if dissatisfied with an adverse decision from the NOIP, an applicant or any third party may file a petition to appeal such decision with the minister of the Ministry of Science and Technology or file an appeal before the competent administrative court.

Must an inventor disclose prior art to the patent office examiner?

Vietnamese IP Law encourages inventors to disclose prior art to the patent office but does not contemplate any sanctions against the inventors who deliberately hide the prior art known to them.

How long does it typically take, and how much does it typically cost, to obtain a patent?

It normally takes three years, from the date of filing or entering into national phase, to obtain a patent. The waiting period may be remarkably shortened if the applicant provides the Office with information concerning the corresponding patent applications in the other countries. On the other hand, the procedure of examination on the merits will be prolonged if the invention concerned belongs to the pharmaceutical  or biotech fields and there has been no examination conducted in the United States, Japan, European countries, etc, for the foreign family patent applications, to which the Vietnamese examiners may refer. It typically costs about US$2,500 to obtain a patent granted to a patent application, filed through Convention or PCT routes, with 30 pages of specification and two independent claims.

Are any mechanisms available to obtain a compulsory license to a patent? How are the terms of such a license determined?

According to article 145 of the IP Law, compulsory licenses or non- voluntary license can be granted for use in the public interest or in the case of non-working or insufficient working of a patent, or based upon the interdependence of patents or a patent is being used contrary to fair business practice.

On a request of any person or organization,  the Ministry of Science and Technology (MoST) or relevant ministries may grant a non-voluntary license if the working of the patented invention is considered necessary to meet the demand of national defense, national security, disease prevention and treatment, nutrition for people or other urgent social needs.

The MoST or other ministries, as per a request of any person or organization, may grant a non-voluntary license if, the patented invention or utility solution has not worked or is insufficiently working in the country; the requesting person can prove his or her ability to work the patented invention or utility solution in the country; and the owner of the patent has received a demand from the requesting person to obtain a contractual license, but the requesting person has been unable to obtain such a license on reasonable terms and within a reasonable time without receiving justified grounds from the owner of the patent.

The MoST, upon the request of the owner of a later patent (or its registered licensee or the beneficiary of a non-voluntary license), may grant a non-voluntary license if: the invention or utility solution claimed in the patent cannot work in the country without infringing a prior patent; and the owner of the earlier patent has received a demand from the requesting person to obtain a contractual license, but the requesting person has been unable to obtain such a license on reasonable terms and within a reasonable time without receiving justified grounds from the owner of the earlier patent.

Any person or organization can seek a decision on grant of a non- voluntary license of a patented invention if the owner of this invention, with the granted monopoly, has undertaken anti-competitive conduct.

The IP law does not provide a specific term for such licenses, leaving it for the MoST’s determination.

Are there any restrictions on the contractual terms by which a patent owner may license a patent?

Article 144 of the IP Law provides that a license contract shall not have provisions unreasonably restricting the right of the licensee, in particular, provisions not deriving from the rights of the licensor, including the following:

- prohibiting the licensee from improving the industrial property object, except trademarks; compelling the licensee to grant a free license or to assign to the licensor the right to industrial property registration or an industrial property right in respect of such improvements;

- directly or indirectly restricting the licensee to export goods produced or services supplied under the industrial property object license contract to the territories where the licensor neither holds the respective industrial property right nor has the exclusive right to import such goods;

- compelling the licensee to buy all or a certain proportion of materials, components or equipment from the licensor or the persons designated by the licensor without aiming at ensuring the quality of goods produced or services supplied by the licensee; and

- prohibiting the licensee from complaining about the validity of the industrial property right or the right to license of the licensor.

Must a patent holder mark its patented products? If so, how must the marking be made? What are the consequences of failure to mark?

No requirement.

What is the time limit for seeking a remedy for patent infringement?

The statute of limitation for initiating a lawsuit against infringement is two years from learning of the infringement.

Are additional remedies available against a deliberate or willful infringer? If so, what is the test or standard to determine whether the infringement is deliberate?

Not available in the cases of deliberate or willful infringement but in cases of repeated infringement, which can be furnished criminally.

Under what conditions can a successful litigant recover costs and attorneys’ fees?

A patentee who gains a final court judgment in its favor may demand litigation costs, including reasonable attorneys’ fees, from the adverse party.

To what extent is it possible to obtain a temporary injunction or a final injunction against future infringement? Is an injunction effective against the infringer’s suppliers or customers?

A temporary injunction (in the form of provisional measures) can be granted by a competent court, which may include seizure, enumeration, sealing, prevention of the transfer or disposal of infringing goods or facilities for producing infringing goods if the patentee or registered licensee can prove that in the absence of corresponding measures, there appears a likelihood of irreparable damages being sustained by IPR holders, due to the infringement; or there is a risk that infringing goods or other material evidence pertaining to such alleged infringement will be destroyed or unable to be traced (Article 206 of the IP Law).

A final injunction (in the form of court judgment) may include removal of the facilities used for the act of infringement, revocation of business license or other measures necessary to prevent infringement in the future.

The injunctions can be effective against the infringer’s suppliers or customers if the facilities are supplied or used exclusively for producing invented products or processes.

What monetary remedies are available against a patent infringer? When do damages start to accrue? Do damage awards tend to be only nominal, provide fair compensation or be punitive in nature?

Article 204 of the IP Law provides the rules of determination of dam- ages, which consists of physical damages and emotional damages caused by the infringement of intellectual property rights.

The burden of proving and calculating physical damages lies with the plaintiff. The amount of physical damages should be actual losses suffered by the intellectual property right holders. If it is unable to establish the rate of compensation, the court shall fix the rate of compensation. Such fixed rate cannot exceed 500 million Vietnamese dong (US$1 is about VND 21,300 in December 2014).

Compensation of emotional damages is available where the plaintiff succeeds in proving that the act of infringement of intellectual property rights has caused emotional damage to him or her. The amount of emotional damages subjected to recovery ranges from 5 million dongs to 50 million VND.

The damages start to accrue from the infringing date and they are fair compensation in nature.

Are there any grounds on which an otherwise valid patent can be deemed unenforceable owing to misconduct by the inventors or the patent owner, or for some other reason?

Under Article 7(2) of the IP Law, ‘the exercise of intellectual property rights shall not infringe upon interests of the state, the public or legitimate rights and interests of other organizations, individuals and shall not violate other applicable provisions of relevant law.’ Therefore, an otherwise valid patent shall be deemed unenforceable if the exercise of the patent right would have infringed the rights and interests of the state or any third party, or violated the laws.

What is the legal standard for determining whether a patent is ‘obvious’ or ‘inventive’ in view of the prior art?

Under Article 61 of the Intellectual Property Law of Vietnam:

An invention shall be considered to involve an inventive step if, based on all technical solutions already disclosed by use or means of a written or oral description or any other form inside or outside the country, prior to the filing date or the priority date, as applicable, of the invention registration application, it constitutes an inventive progress and cannot be easily created by a person with ordinary skill in the art.

Circular 01/2007/TT-BKHCN, providing detailed guidelines for the implementation of Intellectual Property Law, in section 25, item 6, provides that the prior art relevant for the purposes of considering an inventive step shall include all the publications or uses that are publicly available anywhere in the world prior to the filing or the priority date of the patent application under examination. In assessment of an inventive step, the examiner will define whether the essential technical features defining the invention in question have been disclosed in the prior art; and whether the combination of the essential technical features of the invention would have been obvious to a person with ordinary skill in the art. An invention shall be regarded as involving an inventive step if it is a result of an inventive activity and is not common general knowledge in the relevant art.

Is there an ‘absolute novelty’ requirement for patentability, and if so, are there any exceptions?

Under article 60 of the IP Law, the disclosure in any form, including by use, anywhere in the world shall destroy the novelty of the invention seeking protection. In other words, the novelty requirement for patentability is worldwide and absolute. There is, however, a grace period of six months provided for an invention which was disclosed by others without the authorization of the persons having the right to file the patent application; published in the form of a scientific presentation by the persons having the right to file the patent application; or exhibited at a national exhibition of Vietnam or at an official or officially recognized international exhibition by the persons having the right to file the patent application.

How and on what grounds can a patent be invalidated?

In Article 96, the IP Law provides that during the term of validity of a patent, a third party may take an invalidation action against the patent if:

- any of the requirements for patentability were not fulfilled at the time the patent was granted; or

- the person to whom the patent was granted was not entitled to apply for and be granted the patent.

Who owns the patent on an invention made by a company employee, an independent contractor, or multiple inventors? How is patent ownership officially recorded and transferred?

In Article 86, Vietnamese IP Law provides that:

The following organizations and individuals shall have the right to registration of an invention, industrial design and layout-design:

a) The authors who have created the invention, industrial design or layout design by his or her own efforts and expenses; or

b) The organizations or individuals who have invested funds and material facilities to the authors in the form of a job assignment or job hiring unless otherwise agreed by the parties and such agreements are not contrary to paragraph 2 of this Article.

In case more than one organizations or individuals have jointly created or invested in the creation of an invention, industrial design or layout-design, those organizations or individuals shall all have the right to registration and such right shall only be exercised with their consensus.

In line with the above provisions, the ownership of an invention made by a company employee or an independent contractor shall belong to the employer or the person who has invested funds and material facilities in creation of the invention. An invention is recognized as a ‘service invention’ only when the author-employee has taken working time or used the material resources of the company-employer in making such an invention.

If an invention has jointly been created by co-inventors, the ownership of the invention shall belong to all of them.

Patent ownership is recorded by the state by grant of patent. The ownership of a granted patent can be transferred by an assignment agreement in written form (Article 138, Vietnam IP Law).

Can a patent be obtained to cover any type of invention, including software, business methods and medical procedures?

Under Article 4.12 of Vietnamese Intellectual Property Law (IP Law), which took effect from 1 July 2006, an invention is defined as ‘a technical solution, in form of a product or a process, to resolve a specific problem by utilizing laws of nature.’ In accordance with article 59 of the same law, ‘the following subject matter shall not be protected as inventions:

- discoveries, scientific theories; mathematical methods;

- schemes, plans, rules or methods for performing mental acts, training domestic animals, playing games, doing business; computer programs;

- presentations of information;

- solutions of aesthetic characteristics only;

- plant varieties, animal varieties;

- processes of essentially biological nature for the production of plants and animals other than microbiological processes; and

- disease prevention, diagnostic and treatment methods for human or animals.

 It is clear that the law explicitly excludes, inter alia, software, business methods and medical methods from protection. In practice, in order to determine whether a software-related or business method-related invention is patent-eligible, the NOIP applies a two-prong machine-or-transformation test. Normally, a computer program claim is acceptable if it is drafted in the form of ‘a computer-readable medium having a computer program embodied therein’. In respect of method-of-treatment claims, under the old patent law, in certain cases, such claims may survive if converted into the Swiss-type for- mat. However, recently the Office has raised objections to ‘use-type’ claims on the grounds that they relate neither to a process nor a product, and therefore, cannot be regarded as a statutory subject matter. This point of view of the Office has caused a fierce debate among Vietnamese intellectual property professionals, which has not yet come to an end.

To what extent are alternative dispute resolution techniques available to resolve patent disputes?

As an alternative dispute resolution method, meetings with infringers aimed at reconciliation or mediation are used in Vietnam for settlement of IP disputes. Pre-hearing consolidation, where the parties reach an agreement on the matters that must be resolved in the civil case, is also used.

To what extent can enforcement of a patent expose the patent owner to liability for a competition violation, unfair competition, or a business- related tort?