Rewiring intellectual property rules

10:52 | 28/08/2019
On June 14, the Vietnamese National Assembly passed a law amending and supplementing certain articles of the Law on Insurance Business and the  Law on Intellectual Property. The purpose of the move is to make national legislation compatible with the requirements set out in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, of which Vietnam is a signatory. Tran Manh Hung, partner from law firm Baker McKenzie, explained the changes.  
rewiring intellectual property rules
Changes in the new law can further protect IP rights for high technology in Vietnam, Photo: Le Toan

The Law No.42/2019/ QH14 on amendments to the Law on Insurance Business and the Law on Intellectual Property will take effect on November 1, except for certain regulations that have been effective since January 14 when the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) took effect in Vietnam. It will apply to the following cases:

rewiring intellectual property rules
Tran Manh Hung

- Applications for establishment of industrial property rights submitted from January 14, 2019;

- Requests for invalidation of invention patents, utility solution patents, and certificates of geographical indications (GIs) registration granted on the basis of applications for registration of industrial property rights filed from January 14, 2019;

- Requests for cancellation of certificates of trademark registration submitted from January 14 ,2019;

- Lawsuits regarding infringement of intellectual property (IP) rights handled by competent authorities from January 14, 2019 onwards;

- Other requests regarding IP rights protection carried out from January 14.

The amendments and supplements of IP regulations under Law 42 are related to industrial property objects, including trademarks, patents, and geographical indications; electronic filing of applications for registration of industrial property rights; and IP rights enforcement.

Trademarks, patents, and ­indicators

“Article 136.2: The owner of a trademark shall be obliged to use it continuously. The use by a licensee under a trademark license contract is considered as an act of using the owner’s trademark. In case the trademark has not been used for a period of five consecutive years or more, the validity of the trademark registration certificate shall be terminated in accordance with Article 95 of the law.”

Whilst the current IP law is ambiguous in assessing evidence of trademark use by a licensee, the amended IP law has clearly pointed out that the use of a trademark by a licensee will also be considered as usage of the trademark to nullify a non-use cancellation against its registration.

No requirement for trademark licensing recordal

“Article 148.3: A license contract of an industrial property object provided in Clause 2 of this article, except for trademark license agreements, shall be legally effective against a third party only upon its registration with the state administration authority of industrial property rights.”

Under the current IP Law, in order for a trademark license agreement to be effective against a third party, two parties must record such agreement with the Intellectual Property Office of Vietnam (VNIPO). Nevertheless, in accordance with the amended IP law, such a trademark license agreement will be deemed valid without any recordal requirement at the VNIPO.

The amended IP law has expanded exceptions of the novelty of inventions regarding exposers, publication methods, and places as well as extended time for enjoying the exceptions from six to 12 months from the publication date. In particular, Article 60 of the IP law regarding the novelty of inventions is amended and supplemented as follows:

“It is considered that an invention does not lose its novelty if it is directly or indirectly published by the person entitled to registration specified in Article 86 of this law, or by the person who has information about the invention provided that the patent application is submitted in Vietnam within 12 months from the date of publication.”

It continues, “The provisions of Clause 3 of this article shall also be applied to any invention published in the industrial property application or industrial property protection titles announced by industrial property management authority in case the announcement is not conformable with provisions of laws or the application is submitted by a person who does not have the right for registration.”

Regarding the inventive level of inventions, the IP law has supplemented Article 61.2 as follows, “Technical solution, which is an invention disclosed in accordance with Clauses 3 and 4 of Article 60 of this law, shall not be used as a basis for evaluation of the inventive level of invention.”

Objects ineligible for ­protection as GIs

Firstly, there is a new criterion to assess common names of goods that do not qualify for GI protection in Vietnam. In particular, Article 80.1 of the current IP law regulates that “names or indications that have become generic names in Vietnam would not be protected as geographical indications” without any explanation about the definition of “generic”. To clarify this, Article 80.1 under the amended law has further pointed out that the common name of goods will be determined by awareness and/or perception of the relevant consumers in Vietnam.

Secondly, objects ineligible for protection as GIs extend to those that are identical or similar to pending trademarks with earlier filing or priority date while the current IP law only limits to registered trademarks. Particularly, Article 80.3 of the current IP law has been amended as follows:

“Any geographical indication that is identical or similar to a trademark under protection or being submitted under a trademark application with early filing or priority date, the use of which may cause confusion as to commercial origin of goods.”

International protection

Under the amended IP law, the regulation pertaining to the establishment of IP rights of GI is separated from other IP objects in comparison with the current IP law.

In particular, Article 6.3(a) of the IP law has been amended: “Industrial property rights to geographical indications shall be established on the basis of decisions on granting a protection title issued by competent authorities in accordance with registration procedures specified in this law or international agreements to which Vietnam is a contracting party.”

In addition, the amended IP law has added a provision about the recognition and protection of GIs under international agreements, which was not clearly stipulated in the current law. Particularly, Article 120 was supplemented as follows:

“Proposals for recognition and protection of geographical indications in accordance with international agreements, to which Vietnam is negotiating, are called international proposals. The announcement of international proposals and handling of third party opinions, assessment of conditions for protection of geographical indications in international proposals shall comply with the equivalent provisions specified in this law for geographical indications in geographical indication applications submitted to industrial property rights authority.”

Electronic filing of industrial property

Article 89 of the IP law is amended by adding Clause 3 as depicted below to officially affirm the electronic filing system as separate from the paper form for registration applications to establish industrial property rights:

“Applications for establishment of industrial property rights shall be filed, in paper form, with the state authority in charge of industrial property rights or in electronic form via the online filing system.”

Enforcement of IP rights

Under the current IP law, only the plaintiff may claim reasonable attorney’s fees in an IP lawsuit. If the plaintiff does not succeed in its IP infringement claim, the defendant cannot claim any attorney’s fees that have been incurred for the lawsuit. However, under Article 198.4 of the amended IP law, the defendant in an IP lawsuit can now request the court to force the plaintiff to reimburse for their reasonable attorney’s fees if it is concluded to have not committed an IP infringement.

Elsewhere, in line with the CPTPP, the amended IP law has provided a new clause, particularly Article 198.5, in relation to compensation of damages caused by the abuse of IP rights protection procedures. Specifically, any parties suffering from damages caused by the abuse of IP rights protection procedures are entitled to request the court to force such right holder to compensate for the damages and reasonable attorney’s fees.

The said abuse includes deliberate acts beyond the scope or aims of the IP right protection procedures.

In addition to three methods of calculating damages as stated in Article 205.1 of the current IP law, the amended one provides a more flexible approach that allows the plaintiffs to determine their own calculating methods of material damage as long as they are in accordance with the provisions of law.

Finally, Article 218.1 of the current IP law has been supplemented by adding a new regulation in which the customs office is required to furnish the IP right holders with information of suspected infringing goods within 30 days from the issuance date of a decision on suspending customs procedures, namely as follows:

“When an applicant for suspension of customs procedures has fulfilled the obligations stipulated in Article 217 of this law, the customs office shall issue a decision suspending customs procedures with regard to the goods consignment in question. 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 (if known), within 30 days from the date of issuance of the decision to apply administrative measures to handle trademark counterfeiting and smuggled goods specified in Clause 4, Article 216 of this law.”

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