In today’s rapidly expanding global marketplace, protecting intellectual property rights has become crucial for foreign businesses entering Vietnam’s growing franchise market. This comprehensive guide provides insights into Trademark Protection for International Franchises in Vietnam, covering essential aspects foreign businesses need to know

Introduction

Vietnam’s franchise market has experienced significant growth in recent years, attracting numerous international brands. However, with this opportunity comes the critical need for robust trademark protection strategies.

Current State of International Franchising in Vietnam

The Vietnamese franchise sector has shown remarkable development, with an increasing number of foreign brands establishing their presence. This growth is supported by Vietnam’s improving legal framework for intellectual property protection and its participation in various international trade agreements.

Importance of Trademark Protection for Foreign Franchises

Trademark protection forms the cornerstone of successful franchise operations in Vietnam. It safeguards brand identity, prevents unauthorized use, and maintains a competitive advantage in the market.

Vietnamese Trademark Legal Framework

Relevant Laws and Regulations

Several key legal instruments govern Vietnam’s trademark protection system:

  • Law on Intellectual Property (as amended)
  • Civil Code provisions on intellectual property rights
  • Various implementing decrees and circulars (Decree 65/2023/NĐ-CP, Circular 23/2023/TT-BKHCN)

International Treaties and Agreements

Vietnam is a signatory to multiple international intellectual property agreements:

  • Paris Convention for the Protection of Industrial Property: Ensures priority rights for trademark applications across member countries, promoting fairness and international cooperation.
  • Madrid Protocol for International Trademark Registration: Simplifies international trademark registration, reducing business costs and administrative barriers.
  • TRIPS Agreement under WTO membership: Sets global standards for intellectual property protection, aligning Vietnam’s legal framework with international trade norms.

Registration Process for Foreign Franchises

Step-by-Step Trademark Registration Guide

Preliminary Trademark Search

  • Conduct comprehensive searches in Vietnamese trademark databases
  • Verify availability and potential conflicts

Identifying any existing trademarks that are similar or identical to your proposed trademark is necessary. This includes searching for trademarks that are already registered in Vietnam, as well as those that are in the process of being registered. This process ensures your trademark is unique and avoids having any conflict with others in the future.

Preparation of Application

  • Compile required documentation: You must ensure that your application is complete and meets all the requirements of IP Vietnam. (Article 100.1, 101 and 105 Law on Intellectual Property)
  • Prepare accurate trademark descriptions (Article 72 Law on Intellectual Property)
  • A trademark must be a visible sign or sound represented graphically.
  • It must be able to distinguish its owner’s goods or services from those of others.
  • Classify goods and services according to Nice Classification: Applicants must classify their goods and services following the Nice Classification as published by the state management agency. If the applicant fails to classify or classify incorrectly, the agency will classify the goods and services and charge a classification fee. (Article 105.3 Law on Intellectual Property, Part V, 3.e Decree 65/2023/NĐ-CP)

Filing and Examination (Circular 23/2023/TT-BKHCN)

  • Apply to the National Office of Intellectual Property (NOIP) (Article 89 Law on Intellectual Property)
  • Foreign individuals residing in Vietnam, as well as foreign organizations or individuals with a business presence in Vietnam, may file trademark applications directly or through a legal representative.
  • Foreign individuals or organizations without a physical presence in Vietnam must file trademark applications through a legal representative.
  • Undergo formal and substantive examination (Article 25, 26 Circular 23/2023/TT-BKHCN)
  • Formal examination, publication of trademark registration applications
  • Substantive examination of trademark registration applications

Required Documentation

Essential documents for trademark registration include: (Article 100.1 Law on Intellectual Property):

  • A declaration for registration, made according to a set form (Form No. 08 according to Appendix I, Decree 65/2023/NĐ-CP);
  • Documents, samples, and information identifying the industrial property subject matter registered for protection as specified in Articles 105 of Law on Intellectual Property. Documents, specimens, and information identifying the trademark to be protected in the trademark registration application include:
  • Trademark samples and the list of goods and services bearing the trademark;
  • Regulations on the use of collective trademarks and regulations on the use of certification trademarks
  • Power of attorney, if the application is filed through a representative;
  • Documents evidencing the registration right, if the applicant acquires such right from another person;
  • Documents evidencing the priority right, if such right is claimed;
  • Vouchers of payment of fees, and charges.

Trademark registration process is guided in the National Public Service Portal: The process of Trademark Registration 

Protection Mechanisms

Enforcement Options (Article 199 Law on Intellectual Property)

Vietnam offers various enforcement mechanisms for trademark protection:

  • Administrative actions through market management authorities (Decree 99/2013/ND-CP amended by Decree 46/2024/ND-CP): Corporate legal entities committing acts of trademark infringement shall be fined from VND 20,000,000 to VND 40,000,000. Additionally, the following measures must be taken to remedy the consequences:
  • Compulsory removal and destruction of the trademark;
  • Compulsory destruction of infringing materials and means if the infringing elements cannot be removed, or destruction of infringing goods harmful to human health, livestock, crops, and the environment;
  • Compulsory change of the business name and removal of infringing elements in the business name.
  • Civil litigation in courts (Article 202 Law on Intellectual Property): The court applies the following civil measures to handle organizations and individuals committing acts of intellectual property infringement:
  • Compelling cessation of infringing acts;
  • Compelling apologies and public corrections;
  • Compelling the fulfillment of civil obligations;
  • Compelling compensation for damages;
  • Compelling the destruction, distribution, or non-commercial use of infringing intellectual property goods (without affecting the ability to exploit the rights of the intellectual property rights holder).
  • Criminal prosecution for serious violations: Corporate legal entities infringing industrial property rights (Article 226 Criminal Code), may be sentenced:
  • Fine (500.000.000 – 5.000.000.000 VND)
  • Suspension of operation
  • Prohibition from operating in certain fields;
  • Prohibition from raising capital
  • Fine if no administrative penalties are imposed (100.000.000 – 500.000.000 VND)
  • Customs border control measures:
  • Suspension of customs procedures for goods suspected of trademark infringement: This measure is carried out at the request of the trademark owner to collect information and evidence about the shipment for handling infringement actions.
  • Inspection and monitoring to detect goods showing signs of infringement: Conducted at the request of the trademark owner to gather information to exercise the right to request suspension of customs procedures.

Common Challenges and Solutions

Foreign franchises often face several challenges in Vietnam:

  • Trademark squatting and bad-faith registrations: Individuals may register a foreign franchise’s trademark in bad faith, intending to sell it back at a high price.
  • Solution: Register trademarks early, monitor filings, and take legal action to challenge bad-faith registrations.
  • Counterfeit products and unauthorized use: Counterfeit goods bearing the brand’s name or logo may flood the market, causing brand dilution.
  • Solution: Actively enforce IP rights, conduct market inspections, work with authorities, and monitor online platforms to remove counterfeit listings.
  • Enforcement delays and procedural complexities: Legal and enforcement processes in Vietnam can be slow and complex, hindering swift action.
  • Solution: Hire local legal experts, use alternative dispute resolution methods, and ensure proper documentation to expedite enforcement.

Best Practices for Foreign Franchisors

Pre-entry Trademark Checks

Before entering the Vietnamese market, franchisors should:

  • Conduct thorough trademark availability searches: Ensure the trademark is not already registered in Vietnam to avoid conflicts.
  • Register trademarks in all relevant classes: Protect the brand across multiple sectors by registering in all appropriate classes.
  • Consider registering Vietnamese translations/transliterations: Register local versions of the brand name to prevent local infringement risks.

Ongoing Protection Strategies

Maintain effective trademark protection through:

  • Regular market monitoring: Continuously monitor the market to detect unauthorized use of the trademark.
  • Swift action against infringements: Take immediate legal action if infringement is detected, such as sending cease-and-desist letters or filing complaints.
  • Maintaining proper documentation and records: Keep accurate records of trademarks, licensing agreements, and evidence of use to support enforcement and legal actions.

Conclusion

Protecting trademarks in Vietnam requires a comprehensive understanding of local laws and procedures and proactive management strategies. Foreign franchisors should invest in proper trademark protection measures to ensure successful long-term operations in the Vietnamese market.

Next Steps

For foreign businesses looking to protect their franchise trademarks in Vietnam:

  • Consult with experienced IP attorneys familiar with Vietnamese law: Foreign businesses should seek legal counsel from local IP experts to navigate Vietnam’s trademark registration and enforcement system effectively. This ensures compliance with local regulations and reduces the risk of legal issues.
  • Begin the trademark registration process early: Trademark registration should be initiated before entering the market to avoid issues such as trademark squatting or bad-faith registrations. Early registration helps secure IP rights and reduces risks in the long term.
  • Develop a comprehensive protection strategy: A robust strategy should include not only registration but also ongoing monitoring, enforcement actions, and legal measures to defend against infringements. It’s important to address potential issues proactively.
  • Maintain regular monitoring and enforcement measures: Ongoing vigilance in monitoring the market and swift enforcement actions are crucial for detecting and addressing trademark infringements. This includes legal actions, cease-and-desist orders, and collaboration with authorities.

By following these guidelines and working with qualified local professionals, foreign franchises can establish and maintain effective trademark protection in Vietnam’s growing market.

Harley Miller Law Firm ”HMLF”

Head office: 14th floor, HM Tower Building, 421 Nguyen Thi Minh Khai, Ward 05, District 3, Ho Chi Minh City.

Phone number: +84 937215585

Email : [email protected]

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