Legal Provisions on Protection of Industrial Property Rights by Criminal Measures

for acts of infringement of intellectual property rights when the infringing entity has been notified but continues to commit acts of infringement of intellectual property rights.

With the above provisions, it can be seen that the fight to protect intellectual property rights in general and industrial property rights in particular is not only determined and considered a task belonging to state agencies, but this responsibility must first belong to the owners and legal users of industrial property rights because they are the subjects of infringement and have the conditions to detect these infringements when they occur. Thereby contributing to raising the awareness of owners and legal users of industrial property rights in protecting their own rights. Moreover, such provisions also aim to share the burden on law enforcement agencies in the fight to protect intellectual property rights. Because in the market economy that Vietnam has officially participated in, it is certain that intellectual property rights infringements will not only be more sophisticated but will occur more frequently.

The Law on Intellectual Property clearly defines acts of intellectual property infringement in the production, import, transportation and trading of counterfeit intellectual property goods compared to other acts of production, trading and circulation of counterfeit goods.

It can be seen that in the past, when handling administrative violations in the field of intellectual property, our authorities often encountered many difficulties in identifying counterfeit goods and goods that infringe intellectual property rights in order to be able to make an accurate penalty decision in accordance with the provisions of the law as presented above. This has been determined in the Law on Intellectual Property and has provided a concept, indicating quite clearly and specifically counterfeit goods in terms of intellectual property as stipulated in Point c, Clause 1, Article 211 of the Law on Intellectual Property.

Certainly, the Law on Intellectual Property's provisions on counterfeit goods in intellectual property will reduce the burden and facilitate the authorities when handling administrative violations in the field of intellectual property.

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The Law on Intellectual Property also separates acts of intellectual property rights infringement in the field of unfair competition that are handled by administrative measures and transfers them to the Law on Competition for handling.

Previously, acts of infringement of intellectual property rights in the field of unfair competition seemed to be left unchecked and when there was a request to handle infringement of intellectual property rights in the field of unfair competition, it seemed that the authorities could only request the infringing party to temporarily stop the infringement because there were no specific sanctions for administrative sanctions. However, after the State promulgated the Competition Law (effective from July 1, 2005) and the Law on Intellectual Property, the above issue had a legal basis for handling when the authorities discovered the infringement or when there was a request for administrative handling. However, despite the provisions, the Law on Intellectual Property does not directly regulate and handle acts of infringement of intellectual property rights in the field of unfair competition, but this issue will be handled according to the provisions of the Law on Competition. Specifically, according to the provisions of Clause 3, Article 211 of the Law on Intellectual Property, organizations and individuals who commit acts of unfair competition in intellectual property shall be subject to administrative sanctions according to the provisions of the law on competition. This means that if there is a request from the owner or legal user of intellectual property rights or when the competent authorities discover acts of infringement of intellectual property rights and such violations are accompanied by other violations related to unfair competition such as misleading instructions; infringement of business secrets; coercion in business; defamation of other enterprises; disruption of business activities of other enterprises; advertising for unfair competition; promotion for unfair competition; discrimination by associations... then the competent authorities will have to apply the provisions of the law on competition to handle the case, not handle it according to the provisions of the law on intellectual property. It can be said that this regulation is very reasonable and it will ensure the principle that an administrative violation is only punished once in accordance with the spirit of the Ordinance on Handling Administrative Violations.

Through the analysis of some of the above provisions of the Law on Intellectual Property in determining acts of infringement of intellectual property rights by administrative measures, we clearly see that

This is one of the significant advances of the Law on Intellectual Property. With such positive changes, it will certainly help owners, legitimate users of intellectual property rights and competent authorities to better protect intellectual property rights and hopefully these regulations will contribute to making Vietnam's intellectual property environment cleaner.

2.2. LEGAL PROVISIONS ON PROTECTING INDUSTRIAL PROPERTY RIGHTS BY CRIMINAL MEASURES

Along with the development of the economy, criminal acts also increase, including crimes in the field of intellectual property. However, the problem lies in the fact that while the violations of intellectual property rights are increasing, civil and administrative sanctions are always being amended to suit the reality, while criminal sanctions remain the same. Is it because Vietnamese criminal law is still lax in this field or are criminal sanctions not strict enough?

Criminal acts in the field of intellectual property in general and industrial property in particular are crimes that have arisen along with the development of the socio-economy. The 1999 Penal Code (1999 Penal Code) regulates acts of infringement of industrial property rights in the Chapter “Crimes of infringement of economic management order”. Previously, in the 1985 Penal Code, called “Economic crimes”, including 21 articles, there was only one article regulating acts of infringement of industrial property rights stipulated in Article 167 “Crime of counterfeiting, crime of trading in counterfeit goods”.

During the implementation of the Penal Code, our National Assembly has amended and supplemented this Code five times in 1989, 1990, 1992, 1997, 1999, in which economic crimes were always adjusted to adapt to the continuous development of economic and social life, actively contributing to the innovation of the legal system in accordance with changes in the economy. In the 1999 Penal Code, Chapter XVI "Crimes against economic management order" replaced Chapter "Economic crimes" with 28 articles, of which 05 articles are related to industrial property rights, namely:

Article 156 - Crime of manufacturing and trading in counterfeit goods

“Anyone who produces or trades in counterfeit goods equivalent to the quantity of genuine goods with a value of from 30 million VND to under 150 million VND or under 30 million VND but causing serious consequences or has been administratively sanctioned for the acts specified in this Article or in one of Articles 153, 154, 155, 157, 158, 159, 161 of this Code or has been convicted of one of these crimes, has not had his/her criminal record expunged and continues to commit the violation, shall be sentenced to imprisonment from 6 months to 5 years, or shall be sentenced to imprisonment from 3 years to 10 years in the case of organized crime or professional crime, recidivism, abuse of position, power, abuse of the name of an organization, counterfeit goods with a value of from 150 million VND to 500 million VND, large illegal profits, acts causing very serious consequences”.

Article 157 - Crime of manufacturing and trading in counterfeit food, foodstuffs, medicines and disease prevention medicines

In the laws related to intellectual property, Clause 4 of this Article stipulates the heaviest penalty - applying the death penalty - for the act of producing and trading in counterfeit food and medicine for disease prevention and treatment, causing particularly serious consequences. These regulations are necessary to protect the health and nutrition of the people, and are consistent with the principles set forth in Article 8.1 of the TRIPS Agreement.

Article 158 - Crime of manufacturing and trading in counterfeit goods such as animal feed, fertilizers, veterinary medicines, pesticides, and plant and animal varieties

(Previously, the 1985 Penal Code combined these three articles into "Crime of making counterfeit goods, crime of trading in counterfeit goods (Article 167).

Article 170 - Crime of violating regulations on granting certificates of protection of industrial property rights

Regulations on violations by competent persons in granting industrial property protection certificates causing serious consequences.

Article 171 - Crime of infringing industrial property rights

Regulations on acts of appropriation and illegal use of inventions, utility solutions, industrial designs, trademarks, names, origins of goods or other industrial property objects protected in Vietnam.

We know that the basis for criminal prosecution of IP infringement is that the IP subject matter being infringed must be protected under the provisions of law. According to Mr. Tran Viet Hung, Director of the Department of Intellectual Property, before the renovation period (before 1990), each year only a few hundred enterprises registered trademarks at the Department of Inventions (now the Department of Intellectual Property). During the period of 1999-2000, each year about 4,000 enterprises registered trademarks and from 2001 to present, each year about 10,000 trademarks applied for registration, the growth rate is 20-25%/year. In 2004, there were more than 4,200 patents, 7,600 industrial design patents, and in 2005 alone, 22,000 trademarks were registered at the National Office of Intellectual Property, 50% of which were Vietnamese enterprises, the rest were from more than 100 different countries around the world. This demonstrates the progress in the awareness of intellectual property protection of domestic enterprises. By 2006, this number had increased to 27,500 applications, equal to some countries in the region such as Thailand and the Philippines [47].

Along with the development of the market economy and the increasingly deep international economic integration of Vietnam, the situation of violations of intellectual property rights in general and violations of industrial property rights in particular is increasing rapidly. From a criminal perspective, it can be seen that the situation of this type of crime is increasingly increasing rapidly and Vietnam is still considered a country with a high rate of intellectual property rights violations in the world. Here are some illustrative figures, in 2005 the number of cases did not decrease compared to 2004, there were up to 3,000 cases handled administratively, of which more than 100 cases were handled criminally (mainly for counterfeiting), but out of those thousands of cases, only 10 cases were accepted by civil courts[44].

Hot spots are violations of industrial design, copyright, and counterfeiting, which have become so common that whatever item sells well on the market, there are immediately counterfeits. Among them:

The amount of counterfeit goods imported from abroad is increasing. If we only consider the field of violations of intellectual property rights in industrial design and trademark, there are still countless subjects violating intellectual property rights that are still openly circulating in the market today. All of the above violations directly infringe on intellectual property objects protected by criminal law. Its consequences will be handled according to the prescribed criminal sanctions, but the more serious consequence it leaves is the loss of consumer confidence in businesses and manufacturers, causing damage to businesses, giving rise to a wave of mixed genuine and counterfeit goods, causing instability in the market.

In general, the legal framework for protection, prevention of infringement of intellectual property rights and prevention of counterfeit production and trade in our country is relatively complete, basically ensuring the legal corridor and meeting the requirements of the WTO TRIPS Agreement. The mechanism for handling violations is also flexible because we have regulations on handling violations in many different laws: the Civil Code, the Customs Law, the Ordinance on Handling Administrative Violations, and the Penal Code. However, from the perspective of handling violations by criminal sanctions, the penalty is still too light and there is a lack of specific regulations related to intellectual property violations.

With the provisions on handling violations by administrative measures, its advantages are quick procedures, avoiding cumbersome and reducing many steps. The advantage of resolving civil disputes is that the parties can agree and negotiate with each other. But the limitation of these measures is that after handling and paying administrative fines, everything goes back to the way it was, the fines keep being fined, the violations continue to be violated. Compensation for civil damages is often inadequate and takes a long time. Therefore, to limit the above cases, it is necessary to apply criminal sanctions to deter and educate subjects in respecting intellectual property rights. Perhaps a more severe penalty framework should be prescribed for this type of crime to thoroughly handle acts of infringement of intellectual property rights.

The criminal laws on intellectual property of some countries have very severe penalties for this type of crime. In the US and Western Europe, when a judgment has come into effect and the convicted person fails to comply, he will be charged with a criminal offense and will be fined or imprisoned regardless of whether the judgment is later reviewed or not. According to German law, even if a judgment has been annulled, the person who fails to comply with the judgment will still be subject to a fine and imprisonment, because their crime here is failure to comply with the judgment.

In addition to applying the highest penalty prescribed by current law for crimes of infringement of intellectual property rights, it is also necessary to add sanctions for acts of non-compliance with penalties or effective judgments, decisions of courts or administrative decisions of competent state agencies. The 1999 Penal Code already has a provision on the crime of non-compliance with judgments (Article 304), but the sanctions are still light (reform without detention for up to 03 years or imprisonment from 06 months to 03 years). Reality shows that it is not necessary to have many legal documents, which will easily cause overlap and complexity in implementation. The problem is to have clear, reasonable regulations and ensure strict implementation in practice, avoiding the situation where laws exist but are difficult to implement or are implemented ineffectively.

Compared with the monetary penalty in current criminal law, we see that the law stipulates that the fine is still too low, as in Clause 3, Article 171, which stipulates that "Offenders may also be fined from 10 million to 100 million VND". Is this a cause of criminals being indifferent to the law, paying fines but still violating because the profits are huge?

The 1999 Penal Code has 344 articles but only 06 articles regulate intellectual property rights, including 05 crimes regulating intellectual property rights as mentioned above and 01 crime regulating copyright. It would be a shortcoming if Vietnamese criminal law did not have more specific and detailed regulations on crimes of infringement of intellectual property rights in general and intellectual property rights in particular. In fact, between the 1999 Penal Code

and the Law on Intellectual Property has a relatively large difference in both time distance and socio-economic conditions, so it is difficult to avoid the "skewed" points of the Law.

The protection of intellectual property rights must satisfy the interests of four subjects, namely consumers (to avoid confusion), trademark owners (to protect product reputation), other manufacturers (to compete equally) and the state (to ensure a fair and effective legal system). This will have two effects: It will be a tool to protect businesses from the current problem of counterfeit goods and reduce intellectual property rights violations, and then strengthen consumer confidence and promote fair competition. However, to do this requires judges to equip themselves not only with professional knowledge but also with specialized knowledge of intellectual property.

The settlement of disputes over violations of intellectual property rights should not stop at handling them by administrative and civil measures, but should include separate crimes so that the provisions on the composition of crimes are specific and clear. For example, "Crime of infringement of trademarks; Crime of infringement of industrial designs; Crime of infringement of utility solutions, illegal use of inventions". In particular, there should be specific provisions on combating unfair competition related to intellectual property rights because the 1999 Penal Code has incomplete and unclear provisions on this issue. (Article 171: "Anyone who, for business purposes, illegally appropriates or uses inventions, utility solutions, industrial designs, trademarks, names of origin of goods or other industrial property objects ".

Intellectual property is ultimately a form of property, so the act of infringing intellectual property rights in general and industrial property rights in particular is an infringement of the property rights of organizations and individuals that are protected by law. The fact that the 1999 Penal Code stipulates crimes of infringing intellectual property rights in the Chapter “Crimes of violating economic management order” is unreasonable from the beginning, this crime should be stipulated in the Chapter “Crimes of violating ownership” which is more reasonable and more consistent with the nature of the problem of infringing intellectual property rights.

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