Handling of Infringements by Administrative, Criminal and Customs Measures

Disputes between individuals and organizations with the purpose of profit are business and commercial disputes under the jurisdiction of the people's court.

The jurisdiction of the Civil Court and the Economic Court in the people's court system to adjudicate disputes over intellectual property rights as well as the jurisdiction of district and provincial people's courts are divided according to the provisions of the Law on Organization of People's Courts and the Civil Procedure Code.

According to the Law on Intellectual Property, civil remedies that the court can apply to handle acts of intellectual property infringement include:

Maybe you are interested!

- Force to stop the infringement;

- Forced to apologize and make public correction;

- Forced to perform civil obligations;

- Forced to compensate for damages;

- Compulsory destruction, distribution or non-commercial use of goods, raw materials, materials and means used primarily for the production and trading of goods that infringe intellectual property rights, provided that this does not affect the ability of the intellectual property right holder to exploit the rights.

Notably, the provisions on principles and bases for determining damages and compensation for damages caused by intellectual property rights infringement in cases of handling violations by civil measures. Specifically, the damages determined include both material damages and spiritual damages (Article 204 of the Law on Intellectual Property). Material damages include property losses, reductions in income, profits, losses in business opportunities, and reasonable costs to prevent and remedy damages. Spiritual damages include losses in honor, dignity, prestige, and reputation. The extent of damages is determined on the basis of actual losses suffered by the intellectual property right holder due to acts of intellectual property rights infringement.

Material damages are determined based on the determination of actual losses. If they cannot be determined, the level of compensation for damages will be determined by the court, but not exceeding VND 500 million. Mental damages can be compensated from VND 5 million to VND 50 million (Article 205 of the Law on Intellectual Property).

Regarding the issue of compensation for damages, Joint Circular 02/2008/TTLT-TANDTC-VKSNDTC-BVHTTDL-BKHCN-BTP dated April 3, 2008 of the Court

The Supreme People's Procuracy, the Ministry of Culture, Sports and Tourism, the Ministry of Science and Technology and the Ministry of Justice ("Joint Circular 02") have issued specific regulations guiding the compensation for material and spiritual damages caused by acts of infringement of intellectual property rights, the basis for determining the level of compensation for damages in section BI

The Law also stipulates that the right holder has the right to request the court to apply temporary emergency measures in the following cases: there is a risk of irreparable damage to the right holder; the infringing goods or related evidence is at risk of being dispersed or destroyed if not protected in time. The intellectual property right holder has the right to request the court to apply temporary emergency measures when initiating a lawsuit or after initiating a civil lawsuit on intellectual property rights. Temporary emergency measures are implemented in the following forms: seizure of goods and evidence; attachment; sealing, prohibition of changing the scene; prohibition of transferring ownership. The person requesting the application of temporary emergency measures must be obliged to compensate for damages if the defendant does not infringe the rights, and must pay a security deposit (equal to 20% of the value of the goods requiring temporary emergency measures). If the value of the goods requiring temporary emergency measures cannot be determined (all necessary measures such as: value estimation, price appraisal, valuation... have been applied but the value of the goods cannot be determined), the Court shall decide that the minimum security deposit to be paid is twenty million VND. Joint Circular 02 has provided specific guidance on temporary emergency measures in Section B.II.

The judgment of the court of first instance may be appealed, protested and reviewed by the appellate court according to the order and procedure of civil proceedings.

The provisions on handling intellectual property rights infringement by civil measures in the Intellectual Property Law have enhanced the role of the judicial system, reduced the intervention of state administrative agencies in civil matters, and avoided the administrativeization of civil relations.

However, we currently do not have specialized courts to adjudicate cases of intellectual property disputes and infringements in Vietnam. In practice, intellectual property lawsuits are often handled and adjudicated by provincial and municipal courts according to common procedures. In cases involving foreign elements, the competent court will be the People's Court of Ho Chi Minh City or the People's Court of Hanoi, according to the plaintiff's wishes. Therefore, strengthening the position and role of the people's court in the enforcement of intellectual property rights protection is an objective necessity, especially after Vietnam became an official member of the World Trade Organization (WTO).

Currently, the percentage of people who have the right to choose to resolve disputes related to intellectual property rights in court is still very low. The main reasons leading to this situation are:

- The time to resolve a case at the Court is still long. In reality, it usually takes from 06 months to 01 year for the Court to accept and resolve a dispute about the Department of Industry at a trial level;

- The cost of resolving disputes through court is much more expensive than resolving them by administrative measures;

With the aim of preventing and stopping infringements and compensating and restoring damages suffered by the owner or legitimate user, the protection of industrial property rights to geographical indications according to

The civil law mechanism is a practical and effective legal protection mechanism for the subjects having the right to use geographical indications as well as the owners of geographical indications. Therefore, we need to actively implement the judicial reform strategy, including the issue of specialization in the adjudication of cases related to intellectual property rights of the People's Court.

2.5.2. Handling of infringements by administrative, criminal and customs measures

2.5.2.1. Handling of infringement by administrative measures

Administrative measures are applied to handle infringements falling into one of the cases specified in Article 211 of the Law on Intellectual Property, at the request of the intellectual property right holder, organization or individual suffering damage caused by the infringement, the organization or individual discovering the infringement, or proactively detected by a competent authority.

Regarding the handling of intellectual property infringement by administrative measures, the Law on Intellectual Property and the Law on Amendments and Supplements to a Number of Articles of the Law on Intellectual Property have clearly defined which intellectual property infringement acts will be subject to administrative sanctions in Article 211. The Law on Intellectual Property has differentiated the intellectual property infringement acts that are subject to administrative sanctions compared to the previous Law on Intellectual Property. Specifically, the following intellectual property infringement acts are subject to administrative sanctions:

- Infringement of intellectual property rights causing damage to authors, owners, consumers or society;

- Producing, importing, transporting, trading in counterfeit intellectual property goods or assigning others to do so;

- Production, import, transportation, trading, storage of stamps, labels or other items bearing trademarks or geographical indications identical or similar to

level of confusion with counterfeit trademarks or geographical indications or assigning others to do so.

When there is an act of infringement of industrial property rights, the industrial property right holder only needs to submit a request to the competent authorities to request handling of the violation by administrative measures without having to obtain a conclusion of infringement from the Intellectual Property Office.

Under previous regulations, except in cases where the violation is obvious, the industrial property right holder must submit a request to the Intellectual Property Office for assessment and official written conclusion on the violation. In practice, the conclusion of the violation by the Intellectual Property Office is a prerequisite for the competent administrative sanctioning authorities to begin considering the case.

Under current law, the competent authorities authorized to implement administrative sanctions for violations in the field of intellectual property include:

- Intellectual property inspectors of the Ministry of Science and Technology and the Departments of Science, Technology and Environment of the Provinces and Cities,

- Market Management Department under the Ministry of Trade, its Sub-Departments and Market Management Teams,

- Central and local economic police,

- General Department of Customs and Customs at border gates nationwide,

- People's Committees at provincial and district levels.

Forms of administrative sanctions include warnings; fines; additional penalties such as: confiscation of counterfeit goods and evidence, temporary suspension of business activities of infringing products/services; remedial measures such as: forced destruction or non-commercial use of counterfeit goods and related evidence, forced removal of counterfeit goods and evidence.

infringement, forced re-export of counterfeit goods or infringement of intellectual property rights.

In general, the provisions of current law on administrative sanctions are not much different from previous legal provisions (specifically Decree No. 12/1999/ND-CP dated March 6, 1999 on administrative sanctions in the field of industrial property).

An important point in the content of handling intellectual property rights infringement by administrative measures in the Intellectual Property Law is the regulation on the level of fines for acts of intellectual property rights infringement. Clause 4, Article 214 of the Intellectual Property Law stipulates the level of fines based on the value of the infringing goods, which is set at least equal to the value of the discovered infringing goods and not exceeding five times the value of those goods. This regulation has overcome a limitation that often occurs in handling administrative violations, which is that the law sets a general fine level for a certain type of violation, but in many cases, administrative violations of this type bring profits to the violator or cause damage and losses to the state and society many times greater than the prescribed fine level, leading to the purpose of handling administrative violations not being effective. However, this provision is inconsistent with the provisions of the Ordinance on Handling of Administrative Violations on the authority to sanction administrative violations and the level of fines for violations in the field of intellectual property. To overcome this shortcoming, the Law amending and supplementing a number of articles of the Law on Intellectual Property has been amended to "The level of fines and the authority to sanction administrative violations for acts of infringement of intellectual property rights shall be implemented in accordance with the provisions of the law on handling of administrative violations" (maximum of 500 million VND). This amendment will make the handling of violations of intellectual property rights in general and industrial property rights for geographical indications by administrative measures feasible and consistent.

The Law also stipulates measures to prevent and ensure sanctions. Intellectual property rights holders have the right to request the application of measures to prevent and ensure administrative sanctions in the following cases: the infringement is at risk of causing serious damage to consumers or society; the exhibits are at risk of being dispersed; in order to ensure the enforcement of the sanction decision. Preventive measures are prescribed in four forms: temporary detention of people; temporary detention of goods and exhibits; search of people, search of the scene; other preventive measures.

Thus, according to the provisions of the Law on Intellectual Property, the Law amending and supplementing a number of articles of the Law on Intellectual Property and guiding documents, the scope of application of administrative compensation has been limited and shifted towards civil compensation, administrative procedures have been further improved, the principle of administrative sanctions exceeding the benefits gained from the violation has been established, the functions of enforcement agencies have been more clearly defined to avoid overlapping procedures. The combination of administrative procedures and sanctions with compensation under civil procedures has a deterrent effect as stipulated in Article 41 of the TRIPS Agreement.

To date, administrative action has proven to be the most effective in dealing with intellectual property violations compared to other measures such as litigation in court. This measure is relatively quick, simple, inexpensive and generally allows for the application of some civil sanctions as provided for in the laws of other countries.

However, administrative measures have also revealed some disadvantages:

- The issue of compensation for damages is not resolved. Currently, compensation for damages is only carried out according to civil procedures;

- Sanctions are not strong enough to prevent further violations; and

- Limited knowledge and resources of administrative sanctioning authorities.

Currently, the application of administrative measures to handle acts of infringement of industrial property rights in the world is increasingly limited, instead civil and criminal measures are strongly applied.

2.5.2.2. Handling of infringement by criminal measures

Article 212 of the Law on Intellectual Property stipulates: Individuals who commit acts of intellectual property infringement that constitute a crime shall be prosecuted for criminal liability according to the provisions of criminal law.

According to current regulations, criminal handling of acts of infringement of industrial property rights to geographical indications is applied to the following crimes: crime of producing and trading in counterfeit goods (Article 156 of the Penal Code), crime of producing and trading in counterfeit goods that are food, foodstuffs, medicines, and preventive medicines (Article 157 of the Penal Code), crime of infringement of industrial property rights (Article 171 of the Penal Code), crime of deceiving customers (Article 162 of the Penal Code). Depending on the nature and severity of the violation, a person who commits the crime of infringing industrial property rights to geographical indications, producing and trading in counterfeit goods may be subject to one of the following criminal sanctions: fine, non-custodial reform, prohibition from holding a position, prohibition from practicing a profession or doing certain jobs, fixed-term imprisonment, life imprisonment or death penalty.

The Law amending and supplementing a number of articles of the Penal Code has made a number of amendments to the crime of infringement of industrial property rights, specifically:

Regarding the basic elements of the crime, the element "having been disciplined or administratively sanctioned for this act but still violating causing serious consequences" is removed, replaced by the elements "intentionally" and "on a commercial scale". The acts only include infringement of rights to trademarks and geographical indications, not including infringement of rights to other industrial property objects (Clause 1, Article 170);

Comment