Myanmar trademark soft launch to finally start in October

Myanmar’s Ministry of Commerce, which now houses the IP Department, issued notification no. 63/2020 on 28 August 2020 announcing the launch of the soft-opening period for refiling trademarks. At long last the soft-opening period will start on Thursday 1 October 2020. See here for background.

Existing trademark holders who recorded their trademarks under the previous system are required to re-file their marks under the new system in order to preserve their earlier priority date. If not any later new filing will be granted a priority date of the date of filing.

Applications in the soft launch period may not add goods/services over those for which they are already registered under the old system. Any marks that don’t qualify for refiling during the soft opening period will only be able to be filed after the soft opening period, probably in 6 months time.

When the music stops - TikTok's legal dance with a Vietnamese music titan

Major online Vietnamese content platform VNG is suing TikTok in Vietnam. VNG Corporation is a Vietnamese tech platform, founded in 2004, which focuses on digital content, online entertainment, social networking, and e-commerce. One of it’s subsidiary is app and web based a music streaming service, Zing MP3. Zing also owns rights to certain music especially Vietnamese music.

TikTok is huge in SE Asia, a relatively uncontentious region in the current global political environment. Its owner Bytedance counts Vietnam as one of its fastest growing countries. It has avoided political risk there by blocking certain content (it faces a double whammy risk of being big tech and Chinese, both highly sensitive in Vietnam). By steering clear of risk Vietnam is supposedly now among its most profitable markets in Asia.

VNG accuses TikTok of using music owned by Zing  without consent, in a number of its short videos. These are likely user posted videos probably with accompanying Vietnamese music. An analysis report from Zing showed a total of 150 Zing music tracks used in more than 11 million videos on TikTok's website and app. VNG says it sent a cease and desist letter alleging copyright infringement to Tiktok and requested Tiktok to review and remove all the music owned by Zing.

The case was filed in the People’s court of Ho Chi Minh City. The complaint demands removal of the music videos both from the TikTok app and also it’s website, as well as a damages claim for 221 billion VND (over USD9 million).

This is a huge damages claim, probably not likely to be upheld by the court. However copyright cases make up most of the infringement seen in the courts in Vietnam so judges do have some experience of this area. The case could take a year or so if it proceeds to trial. in most countries such ISP cases settle, on the basis that the ISP removes the content. Settlements have happened in other copyright litigation cases in Vietnam.

Talent Shows and copyright infringement in the Philippines

A musical furor is developing in the Philippines arising from the outcome of a local online talent show, The Pop Stage. The copyright infringement complaint relates to the unrelated, but well known musical called “Ang Huling El Bimbo: The Musical” (“AHEB”), which is based on the songs of iconic Filipino pop rock band Eraserheads. The title refers to their most famous 1995 love song which gained global success. The musical director of AHEB, which was first performed in 2018 and subsequently on stage at Resorts World Manila, has claimed that The Pop Stage winner “ripped off” the musical arrangement in one of their entries on the show.

The Pop Stage is an online talent show run by a well known actor Matteo Guidicelli. It is sponsored by the US fried chicken chain, Popeyes. It started several months ago and has been building towards its finale last week. CJ Villavicencio was announced the winner on 2 August 2020.  He won PHP1 million cash price and a one-year management deal with Viva Artists Agency.  His entry was a music video featuring a medley of Pare Ko, Alapaap and Huwag Kang Matakot, which are all popular Eraserheads songs. 

AHEB’s musical director, Myke Salomon, has accused CJ Villavicencio of copyright infringement, specifically for copying without permission the arrangements (the musical treatment and concepts) for those Eraserheads’ songs. He also condemned The Pop Stage judges for allowing such a “ripoff”. Salomon has been supported in his views by many members of the AHEB show’s cast too and other local artists. Now Ely Buendia, formerly lead singer in Eraserheads and composer of the songs used in CJ Villavicencio’s music video, posted “I am appealing to the people, companies and corporations involved in the AHEB plagiarism issue”. He wants them to “set an example” to the music industry. 

Local news agencies have reported that The Pop Stage winner CJ Villavicencio has spoken on the issue and claimed that his performance was a tribute to his favorite artist (Eraserheads) and the musical (AHEB) and that he has no intent to plagiarize. 

The Pop Stage has not yet addressed the complaint and there is a growing popular clamor for this to be corrected. Apart from infringing the rights of the musical director of AHEB it may be unfair to other contestants of the show.  Many ordinary Filipinos have supported this position on social media, that artists’ original IP should be protected. The Philippines has a robust music industry with many performers famous far outside the country. Many forms of copyright piracy plague the industry despite clear provisions in the IP code against it.

Government compulsory licensing in Indonesia

Indonesia has two different rules on compulsory licensing. One relates to third-party compulsory licensing which implements the TRIPS Doha Declaration rules. The second is government licensing. This enables the Indonesian government to implement a patent themselves due to public interest or security and defence reasons. 

Public interest government licensing is directed to 4 categories of public emergency - public health emergencies, agriculture and food resilience requirements, animal health emergencies or environmental or natural disasters.

The government can appoint third-parties to produce the patented product if needed. Such government implementation of a patent does not impair the patent holders exclusive rights. That means they can still implement the patent i.e. make a product themselves, and sue others for infringement. Patent holders are required to pay annual maintenance fees as normal. 

An application procedure is set out. The IP office will review the government application especially to check that what they request comes within the scope of the granted patent. The patent holder will be notified. The DGIP will then set a license fee to be paid.  This Regulation seems designed to support emergency Covid vaccine production if necessary. See the earlier concerns expressed here. 

The other form of government license relates to defense technologies. Security can include technology, encryption and surveillance related subject matter. The government can appoint third-parties to produce the patented technology if needed. The patent holder may not then exercise his own exclusive rights and implement the patent. But conversely, patent annuity fees are reduced to zero. An application procedure is set out. The IP office will review the government application especially to check that what they request comes within the scope of the granted patent. The patent holder will be notified. The DGIP will then set a license fee to be paid. 

The regulation also contains a set of rules relation to weapons technologies that conflict with Indonesia‘s defense and security. In essence it is prohibited to implement patents for these in the country without government approval.

Covid 19 research and IP in SE Asia

As research work on vaccines and treatments worldwide speeds up, SEA is taking part in various trials. See here for previous reports on concerns about access to Covid treatments. 

There are a dozen or so candidates to prevent or treat COVID-19 now in clinical trials. These include preventative vaccine candidates (like Oxford University’s ChAdOxInCoV19 or Pfizer’s BNT162), as well as various existing and new drugs for treating the disease (e.g. Gilead’s Remdesivir or Zhejiang Hisun’s Favipravir), as well as generics like Dexamethasone. 

Nearly 2,000 trials are ongoing worldwide now. Data in late July indicated nearly 30 in SE Asia, with Thailand leading with at 8 trials following by Singapore, Malaysia and Indonesia. Trials are hugely expensive and the majority fail at some point. The key to speed is the global coordination by WHO to avoid duplication of the same work. 

The majority of the work is re-purposing existing drugs.  The challenge with that is where there may be patent protection for these drugs.  A number of the older ones, including Tenofovir (another Gilead drug) have expired in many countries.  Another problem is second medical use patents, which are not consistently treated around the world or in SE Asia. Indonesia has also recently brought in new rules on compulsory licensing (report to follow) aimed to allow medical emergencies to override patents. 

There is no suggestion anyone will use IP to prevent access to Covid treatments. The race is on and it is useful to understand the IP background since the issue will need to be considered at some point. 

Laos Trademark law implementation

Laos is one of the smallest IP markets in SE Asia. The Amended Law on Intellectual Property No. 38/NA was published in May 2018 but many parts did not take effect immediately or needed more guidance. 

In early 2020 Decision No. 2822/MOST took effect to clarify many of the Trademark provisions of the Amended law. Areas covered include:

- Services marks are now allowed
- The detail for how to register 3D marks are set out
- There are more detailed rules on filing through local agents under Powers of Attorney
- Renewal deadlines are shortened. 
- Assignments and licenses must be recorded at the Department of Intellectual Property
- Examination and opposition periods and the registration timeframes are set out
- Cancellation procedures are described
- Appeal procedures are described

In 2018 the number of trademark filed exceeded 5,000 for the first time. Local applicants numbered 249. Applicants can expect filings can become easier. 

Covid vaccines and emerging markets

As the race for a Covid 19 vaccine speeds up, countries, especially developing countries, are starting to express concerns about how it will be created, patented, made and distributed. Indonesia recently asked the  International Coordination Group (ICG), a group of countries working on the COVID-19 pandemic response to seek fair distribution of the vaccine to every country in the world.

The concern appears to be the classic access to medicines one, albeit with a new pandemic driven urgency. Flexibility of intellectual property rules will be needed; that is, patents must not be used to prevent access to a vaccine.  The Covid 19 pandemic would almost certainly fits within the Doha Exception to the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement.

With so many companies in different countries working on procuring a vaccine the need for collaboration in development as well as production will be a test of the world's IP and other cooperation systems. Patent owners will need to decide if they will patent or not. Many will likely need to cooperate to accelerate the quality and efficacy testing process, and governments must fast track regulatory approvals. Then the process for making available and pricing must be considered. Will the TRIPS mechanism be used for governments to authorize themselves, or third parties, to make use of a patent without the permission of the patent owner through compulsory licensing?  Once that is worked out, how will manufacture and distribution potentially to billions of people occur? Even doing that alone will be difficult, before you consider the risk of hoarding and disputes.

Brazil, Indonesia and others are now seeing media discussions about these issues. In May the US rejected wording in a World Health Organization (WHO) resolution that backed the rights of poorer countries to ignore patents to gain access to Covid-19 vaccines and treatments. Trump’s America First policy worries many outside the US. So too does the continued assertion that China is somehow to blame. 

Public health experts and campaigners believe it is vital to pull together to end the pandemic. EU has taken a lead; leaders in Italy, France, Germany and Norway, together with the European Commission and Council, called recently for all innovative tools, therapeutics or vaccines to be shared equally and fairly.

Singapore Indonesia tax treaty and IP royalties

IP royalties paid from Indonesia to Singapore are common for many reasons. One is that Singapore is a base for regional investment so holding companies tend to be located in Singapore, covering SE Asia. Another is that foreign businesses operating in SE Asian countries face other restrictions (ownership limitations, higher corporate tax etc) that might make IP royalties a useful structural tool. A third is that investment vehicles that own IP assets in a robust jurisdiction are easier to attract VC and other financing options, even an outright sale.

Royalties however attract withholding tax when they are paid offshore. There are different rates for different types of IP. The rules are set out under the Singapore-Indonesia Double Tax Treaty; Indonesia and Singapore signed a new tax treaty on 4 February 2020 to replace the 1990 tax treaty between the two countries. Ratification is under way and it should be in effect by the end of 2020; which means its time for businesses to start planning now.  

Under the new treaty withholding tax for royalties will be lowered from 15% to the new rates of either 10% or 8%, depending on the type of royalty:

• 10%, for the copyrights, patent, trade mark, design or models, trade secrets; and
• 8%, for the use of or the right to use, industrial, commercial or scientific equipment, or know how.

So ‘classic’ IP royalties (e.g. licenses of copyright or trade marks) attract 10%. Physical equipment is 8%. Of great interest will be the trade secrets and know how rules, which could create a whole new category of licensable rights, which are currently quite overlooked in transactions.

Both countries apply the credit method for the elimination of double taxation. This means that Singapore should credit the withholding tax paid against the Singapore IP owner’s income tax in Singapore (an already fair 17% corporate tax rate is reduced to an effective 7% then for that IP royalty income).

GIs - the EU v US positions and the SEA battlefield

The EU and US do not see eye to eye on GI protection. Until now the non agreement hasn’t been contentious, but the 2020 USTR Special 301 report just released raises the temperature. It argues that the EU position “significantly undermines the scope of trademarks and other IP rights held by U.S. producers”.

The US does not protect GIs specifically, but allows them in practice as certification marks unless they are generic terms and provides some protection to wines through the American Viticultural Area (AVA). However many terms are generic in the US due to the historic immigrant use from the places in question. For example Italian immigrants widely used ‘Parmesan’ in the US rendering it generic in the US for that type of cheese. Meanwhile the EU has a huge GI industry (estimated at E25 million in value in 2014). There are 2 levels of GI protection – Protected Designation of Origin and Protected Geographical Indication. Above this the TRIPS rules protect GIs, with additional protection for wines and spirits, but allow non confusing uses in certain circumstances. The EU and US don’t agree on what constitutes non confusing use.

In SE Asia most countries now have sui generis GI laws. But as in many other markets, a battle is being played out as the US and EU increasingly negotiate IP protections at a bilateral level. EU FTAs with IP chapters propose extensive GI protection. This sits well in economies with strong agri sectors.

Thailand has rapidly built a national GI portfolio of agricultural and non-agricultural products (i.e. handicrafts) – 118 domestic GIs are now registered. It also has 6 foreign GI products registrations from Thung Kula Rong Hai hom mali rice in the EU to Lamphun brocade Thai silk in Indonesia. A series of other Thai GIs are still at application stage,  from Phetchabun sweet tamarind in Vietnam to Doi Tung coffee in Cambodia. Thailand is committed to developing and promoting more GIs from all of its provinces to generate income for communities. It aims to hit a billion dollars in GI based trade in the next 5 years. 

Vietnam has signed an EU FTA (which is awaiting ratification after which they will automatically protect each other's GIs) and is also known to be keen to develop more GIs.  Indonesia has filed one GI in the EU for Kopi Gaya coffee and is trying to develop more domestic GIs.

Meanwhile the US seeks to insist in its negotiations that GI protection must not override legacy trademark rights. Some GI names are incorporated into US trademarks and their export capability is diminished in third countries if GI protection is too strong. The EU typically conditions an FTA to provide mass reciprocal mutual GI recognition. The EU also requests extensive unfair competition type protection against any misleading uses.  The US goes on to argue there is inconsistency in the EU position (notably some exceptions, where some EU countries use others’ GIs as descriptors).

It is unclear how SE Asian countries should approach this, whether to offer wide and reciprocal protection to the EU (therefore enabling EU market access for their GIs), or whether to carve out exceptions for US brands (e.g. California Champagne). So far few of the US trademarks at issue seem to have reached disputes in the region but that will change over time. Thailand clearly intends to use GIs to support its agri and handicrafts sector, and countries with large agri sectors will presumably do the same; which could create a market access barrier to some US brands.

Fast tracking health related patents in the Philippines

The Philippines government has issued dozens of rules to cope with the Covid 19 crisis and the emergency lockdown that has been in place since 16 March. One example is electronic Supreme Court complaint and information filings. 

The IPO office had already issued a Memorandum Circular No. 2020-009 which extended deadlines for all papers, pleadings, documents, and payments due on any IP allocation due during the lockdown period (initially proposed as 16 March 2020 to 15 May 2020) for 60 calendar days. 

Now the IPO has now issued a second issued a Memorandum that applies specifically to patents, utility models and designs for personal protective equipment , medical/health care equipment/devices, and pharmaceutical products that may be urgently needed for the Covid 19 pandemic. They realized that the extensions of time under their first Memorandum Circular No. 2020-009 could delay IP registrations for this important subject matter, which could hinder access to these technologies during the public health crisis. 

So the second Memorandum Circular No. 2020-010 relates to filing of Third Party Observation and Adverse Information during the lockdown. It basically prevents extension of time for these two events during the application period for IP applications for the covered subject matter. The result should be fewer delays in processing of these applications. 

This is forward thinking and essentially helps fast tracking potentially important technology that supports healthcare.