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In today’s globalized economy, protecting intellectual property rights plays a crucial role in the sustainable development of businesses. In Vietnam, as the market continues to expand and competition intensifies, proactively registering trademarks has become one of the key strategies to safeguard a company’s intangible assets.
Vietnam trademark registration not only helps businesses establish legal ownership of their trademarks but also prevents unauthorized copying and use by competitors. This is a necessary step to ensure that the efforts put into building brand reputation and market presence are comprehensively protected, creating a solid foundation for future growth and expansion.
Conflicts Over Trademark Rights
In the Vietnamese market, there have been numerous cases where an organization or individual uses a trademark for their products and services for years without officially registering the trademark for protection, leading to various risks and challenges in business operations.
For example, after a period of time, when their brand becomes well-known and garners significant attention and credibility, another organization or individual takes advantage of the situation by registering and obtaining protection for the same trademark, even though they have not used it or have no plans to utilize it.
When the party that has been using the trademark but did not register it realizes that the trademark associated with their brand name has been protected under someone else’s name who is not actually using it in commerce, they may seek to reclaim the rights to their trademark.
This type of conflict and dispute is quite common in Vietnam, where many individuals and organizations operate businesses spontaneously, often on a small scale, and do not fully appreciate the importance of trademark protection. It is only when disputes arise that they realize the trademark that should belong to them has been registered, owned, and even used by others to conduct business based on the reputation they have built over the years, leading them to take legal action.
However, most of these actions are too late. The damage to their brand, whether minor or significant, has already occurred. Therefore, to fully protect their interests, businesses operating in Vietnam should consider registering their trademarks early to avoid unnecessary conflicts, maintain their brand image, and, in turn, foster growth.
The next article will analyze the measures that the trademark user can take to protect and reclaim their trademark rights in cases where another party registers the trademark before the actual user does.
Grounds for Challenging Registration or Ownership of the Current Trademark Holder
Vietnam follows a First to File system. Therefore, the notion that a trademark user only needs to collect evidence of their long-term use of the trademark in commerce to request the cancellation of the trademark registered by the current trademark owner is insufficient, though it remains an important factor.
Priority of use, demonstrated by clear and convincing evidence that the trademark has been used in the past and has gained widespread consumer recognition, would be essential only if the parties were disputing in a country that follows the First to Use system.
In Vietnam, from a legal perspective, there are two arguments that the trademark user can make to reclaim ownership of their trademark registration in Vietnam, based on Vietnam’s adherence to the First to File system.
Filing a Trademark Application with Bad Faith
According to Article 96, Clause 1, Point a of the 2022 Intellectual Property Law No. 07/2022/QH15 (“2022 Intellectual Property Law“), a trademark certificate may be entirely invalidated if the applicant filed the trademark application with bad faith.
Thus, the party using the trademark in commerce can request the invalidation of the trademark certificate on the grounds that the trademark owner initially filed the application with bad faith.
Clause 4 of Article 96 of the 2022 Intellectual Property Law stipulates that the statute of limitations for organizations and individuals to exercise their right to request the invalidation of a trademark certificate is the entire protection period, except in cases where the request for invalidation is based on the grounds that the applicant did not have the right to file the application, which will be further analyzed below.
Therefore, if this ground is used to request the invalidation of a trademark that has already been granted a trademark certificate, the statute of limitations for making such a request would be the entire protection period of the trademark in Vietnam, which is 10 years from the filing date according to the current intellectual property laws.
However, proving that the current trademark owner filed the application with bad faith can be challenging for the party using the trademark in commerce. They will have the burden of providing convincing evidence and arguments; otherwise, the process of invalidating the trademark certificate could be prolonged, or the trademark owner may counterclaim against the user (plaintiff), arguing that the lawsuit has adversely affected their business operations.
Additionally, the trademark owner might have anticipated the risk of being sued for bad faith filing and could have established a system to use the trademark in commerce, even if on a much smaller scale than the initial user. In such cases, it becomes even more difficult for the user to prove that the current trademark owner acted in bad faith or engaged in unfair competition.
Therefore, collecting evidence and structuring arguments will depend on the specifics of each case. The user must identify when the bad faith of the owner began and whether this bad faith was driven by immediate benefits, such as trademark squatting, where the owner may have demanded compensation from other parties in exchange for the transfer of ownership, or whether it was part of a broader plan targeting the user due to previous conflicts.
If the user detects the bad faith filing earlier, during the examination stage of the application or while awaiting the issuance of the trademark certificate, the user can file an opposition to the grant of the trademark certificate according to Point c, Clause 1, Article 112a of the 2022 Intellectual Property Law. The time limit for submitting this request is 5 months from the date of publication of the trademark application.
If the Vietnam Intellectual Property Office finds the user’s opposition legitimate, reasonable, and well-founded, it will issue a notice of refusal to grant the trademark certificate for the trademark based on the grounds stipulated in Point b, Clause 1, Article 117 of the 2022 Intellectual Property Law.
Additionally, it is essential to note that the critical basis for the authorities to consider the user’s request lies in the fact that they have used the trademark in commerce. This means that before making any of the above requests, the user must prove that they have used the trademark in commerce before the party that registered or currently owns the trademark certificate.
According to Clause 5, Article 124 of the 2022 Intellectual Property Law, the use of a trademark in Vietnam includes affixing the protected trademark on goods, packaging, business means, service means, and transaction documents in business activities; selling, offering for sale, advertising for sale, displaying for sale, storing for sale, or transporting goods bearing the protected trademark; and importing goods or services bearing the protected trademark.
If the user cannot prove prior use of the trademark in commerce, the subsequent requests will not be considered. However, in practice, proving the origin and usage history of their trademark can be very challenging, especially if the user has not proactively retained evidence throughout their business operations. If sufficient evidence is not available, under the First to File principle applied in Vietnam, the current trademark owner will retain ownership of the trademark.
The Applicant Does Not Have the Right to Register the Trademark
Another less common argument that the trademark user can use is that the current trademark owner listed on the Trademark Registration Certificate does not have the right to register that trademark.
According to Clauses 1 and 2, Article 87 of the 2022 Intellectual Property Law, organizations and individuals have the right to register a trademark for goods they produce or services they provide. Additionally, organizations and individuals conducting lawful commercial activities have the right to register a trademark for products they bring to market, even if those products are manufactured by another party, provided that the manufacturer does not use the trademark for the product and does not oppose the registration.
The second case is relatively common in the current international market economy, where Western companies often use the manufacturing services of Eastern companies with lower costs and labor expenses.
In these cases, the manufacturing companies do not affix the trademark on the products they produce in their factories. Instead, the products are shipped back to Western countries, where they are labeled with a trademark and sold at a higher price in the market.
Therefore, if the current owner of the trademark certificate does not have products they produce or services they provide, and they have no connection with any other party that manufactures the products and authorizes them to register the trademark, they do not have the right to register the disputed trademark.
In this scenario, the trademark certificate may be wholly or partially invalidated if it does not meet the requirements for registration rights as stipulated in Point a, Clause 2, Article 96 of the 2022 Intellectual Property Law.
However, it should be noted that if the trademark user decides to use this argument to reclaim ownership of the trademark, they need to pay special attention to the statute of limitations for exercising the right to request, as stipulated in Clause 4, Article 96 of the 2022 Intellectual Property Law.
Specifically, the statute of limitations for requesting the invalidation of a trademark certificate on the grounds that the applicant did not have the right to register the trademark is 5 years from the date of issuance of the trademark certificate or from the date the international trademark registration takes effect in Vietnam.
With this argument, the trademark user does not need to focus heavily on proving prior use of the trademark in commerce, as if their request is accepted, they can proceed to register and be granted the trademark certificate through the usual procedures.
However, to avoid such situations, trademark users, whether they have been using the trademark for a long time or have only recently started using it, should proactively register the trademark early to obtain protection for the goods or services they provide. It is important to note that failure to do so may result in them having to change their trademark to avoid being sued by a later user who registered first, for infringing their trademark rights.
ASL Law is a leading full-service and independent Vietnamese law firm made up of experienced and talented lawyers. ASL Law is ranked as the top tier Law Firm in Vietnam by Legal500, Asia Law, WTR, and Asia Business Law Journal. Based in both Hanoi and Ho Chi Minh City in Vietnam, the firm’s main purpose is to provide the most practical, efficient and lawful advice to its domestic and international clients. If we can be of assistance, please email to [email protected].
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