Acts of unfair competition on industrial property rights in Vietnam
I. Unfair Competition on Industrial Property Rights
1.1 What is Unfair Competition?
According to Clause 6, Article 3 of the 2018 Competition Law:
Unfair competition is an act of an enterprise that is contrary to the principles of good faith, honesty, commercial practices, and other standards in business, causing damage or potentially causing damage to the legitimate rights and interests of other enterprises.”
Competition is the driving force behind the development of the economy because it makes producers more dynamic, sensitive to consumer needs, and forces them to offer new economically viable products and strategies.
However, in pursuit of economic benefits, enterprises often engage in dishonest commercial practices to gain competitive advantages and profits for themselves. Such behavior has a negative impact on other businesses, which is known as unfair competition.
1.2 What Are Industrial Property Rights?
According to Clause 4, Article 4 of the Law on Intellectual Property in 2005, as amended and supplemented in 2009 and 2019, industrial property rights refer to the rights of organizations and individuals to their inventions and industrial designs, the layout design of semiconductor integrated circuits, trademarks, trade names, geographical indications, and trade secrets created or owned by them, as well as the right to combat unfair competition.
Meanwhile, according to Clause 2, Article 3 of the Law on Intellectual Property in 2005, as amended and supplemented in 2009 and 2019, the subjects of industrial property rights include inventions, industrial designs, semiconductor integrated circuit layout designs, patents, trade secrets, trademarks, trade names, and geographical indications.
As stated in Clauses 12, 13, 15, 16, 21, 22, 23, Article 4 of the Law on Intellectual Property in 2005, as amended and supplemented in 2009 and 2019:
An invention refers to a technical solution in the form of a product or process that solves a specific problem by applying natural laws.
An industrial design is the external appearance of a product expressed by shapes, lines, colors, or a combination of these elements.
A semiconductor integrated circuit layout design (hereinafter referred to as layout design) refers to the spatial structure of circuit elements and the interconnection of those elements in a semiconductor integrated circuit.
A trade secret is information obtained from financial and intellectual investment activities that has not been disclosed and is capable of being used in business.
A trademark is a sign used to distinguish goods and services of different organizations and individuals.
A trade name is the name of an organization or individual used in business activities to distinguish a business entity bearing that name from other business entities in the same business field and area.
A geographical indication is a sign that refers to a product originating in a particular region, locality, territory, or country.
1.3 What is unfair competition in industrial property rights?
Currently, the law does not provide a specific definition of unfair competition in industrial property rights, but only lists out acts that constitute unfair competition on industrial property rights. Based on the above definitions, it can be understood that acts of unfair competition on industrial property rights refer to competitive behaviors of enterprises in the business process that are contrary to normal standards of business ethics, causing damage or potentially causing damage to the state interests, legitimate rights and interests of other enterprises, or consumers in relation to industrial property rights.
II. Acts of unfair competition in industrial property
According to the provisions of Point d, Clause 3, Article 6 of the Law on Intellectual Property in 2005, amended and supplemented in 2009 and 2019, the right to combat unfair competition is established based on competitive activities in business.
According to Clause 1.8, Article 1, Section 1 of Circular 01/2007/TT-BKHCN dated February 14, 2007, guiding the implementation of Decree No. 103/2006/ND-CP dated September 22, 2006, of the Government detailing and guiding the implementation of some articles of the Intellectual Property Law on industrial property: “The right to combat unfair competition is established based on the reality of competition activities without having to carry out registration procedures at the Department of Intellectual Property. When using the right to fight against unfair competition, the subject must prove their right by evidence showing the object, field, territory, and time of business related to competitive activities.”
Regarding acts of unfair competition, Article 130 of the Law on Intellectual Property 2005, as amended and supplemented in 2009, clearly states the following cases:
“Article 130. Unfair competition behavior
- The following acts are considered unfair competition acts:
- a) Using commercial indications to cause confusion about business entities, business activities, commercial origins of goods or services;
- b) Using commercial indications to cause confusion about the origin, production method, features, quality, quantity or other characteristics of goods or services or on the conditions for providing goods and services;
- c) Using a trademark protected in a country that is a contracting party to an international treaty that prohibits the representative or agent of the mark owner from using such a mark that the Socialist Republic of Vietnam is not authorized to use. Also, a member, if the user is the representative or agent of the trademark owner, and such use is not consented to by the trademark owner and without good cause;
- d) Registering, seizing the right to use or using a domain name identical or confusingly similar to another’s trademark, protected trade name or geographical indication that it does not have the right to use for the purpose of seizing domain names, taking advantage of, or damaging the reputation and reputation of respective trademarks, trade names, or geographical indications.
- Commercial indications specified in Clause 1 of this Article are signs and information intended to guide the trade of goods and services, including trademarks, trade names, business symbols, business slogans, geographical indications, packaging designs of goods, and goods labels.
- Acts of using commercial indications specified in Clause 1 of this Article include attaching such commercial indications to goods, goods packages, means of services, business transaction documents, means of transport, advertising facilities; selling, advertising for sale, stockpiling for sale, or importing goods bearing such trade indications.”
It can be seen that the law on intellectual property clearly stipulates the acts of unfair competition. However, not all acts of unfair competition are governed by intellectual property law; only acts of unfair competition related to industrial property rights are specified in Article 130 of the Law on Intellectual Property in 2005, as amended and supplemented in 2009. Acts of unfair competition that violate the law on intellectual property only became illegal in 2019. On the other hand, acts of unfair competition not related to industrial property rights will only be considered a violation of competition law.
Measures to deal with unfair competition in industrial property rights
The provisions of Clause 3, Article 198 of the Law on Intellectual Property in 2005, as amended and supplemented in 2009 and 2019, allow:
“Organizations and individuals that suffer damage or are likely to suffer damage due to acts of unfair competition have the right to request competent state agencies to apply civil measures specified in Article 202 of this Law and administrative measures in accordance with the law on competition.”
Civil measures: According to the provisions of Article 202 of the Law on Intellectual Property in 2005, as amended and supplemented in 2009 and 2019, civil measures include:
– Forcible termination of infringing acts;
– Forced public apology and correction;
– Forcible performance of a civil obligation;
– Forcible compensation for damage;
– Forcible destruction or forced distribution or use for non-commercial purposes of goods, raw materials, materials, and means used mainly for the production and trading of goods that infringe upon intellectual property rights, provided that it does not affect the ability of the intellectual property right holder to exploit the rights.
Administrative measures according to the competition law: According to the provisions of Decree 75/2019/ND-CP dated September 26, 2019, on the sanctioning of administrative violations in the field of competition, specific measures are to be applied to each violation.
– Competition Law 2018;
– Law on Intellectual Property 2005, amended and supplemented in 2009, 2019;
– Decree 75/2019/ND-CP dated September 26, 2019 on sanctioning of administrative violations in the field of competition;
– Circular 01/2007/TT-BKHCN dated February 14, 2007 guiding the implementation of Decree No. 103/2006/ND-CP of September 22, 2006 detailing and guiding the implementation of a number of Articles of the Intellectual Property Law on industrial property;