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Thursday, August 21, 2014

Vietnam's uncertainty over unfair compeition

One of the problems in the legal environment in Vietnam is the government’s habit of enacting laws over the top of existing ones. This leads to uncertainty over which rule apply, even outright conflicts. A new unfair competition regulation issued in July illustrates this problem. Decree 71 was issued to set out remedies for unfair competition violations.  However a 2013 Decree 99 already covers sanctions for IP violations including unfair competition. 
 
The first problem is the bodies who deal with unfair competition. Decree 71 says it is the Competition Authority at the Ministry of Trade and Industry. Whereas Decree 99 permits a variety of bodies, who normally handle IP cases. Secondly the procedures specified differ, with Decree 71 laying down specific new procedures, while Decree 99 adopts pre-existing ones. A third point is different levels of fines are imposed. For example one offence of passing off has a fine of 200 mn VND in Decree 71 and 500 mn VND in Decree 99. There are increased fines for cybersquatting, trade secret theft and so on, which is good news, but only if you use the new Decree!
 
The general rule is that the later decree should apply, if it is unclear which should be used. This potentially takes a wide range of IP related unfair competition violations out of the hands of existing IP authorities and off to a new department. It is not at all certain that this was intended; authorities are often protective and try to retain jurisdiction so we fully expect the existing authorities to continue to hear cases. We will only know how this will pan out once the decrees start to conflict and decisions get made. It is quite common for parallel jurisdictions to run for years.
 
 

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