Vietnam made the biggest improvement among Asian nations in its intellectual property protection score, according to the 2020 Global Innovation Policy Center (GIPC) annual report by the US Chamber of Commerce. The country garnered an overall score of 36.62 percent, an increase of 5.93 percent from its score of 30.69 percent in 2019.

Asian leader Japan scored 87.73 percent last year and 90.40 percent this year – an increase of 2.67 percent.

Source: 2020 U.S. Chamber International IP Index.

Despite the huge jump in its scores, Vietnam’s performance in IP protection is still relatively low. At 42nd spot among 53 countries, Vietnam trails Japan, Singapore, South Korea, China, Australia, New Zealand, Taiwan, Brunei, Malaysia, India and the Philippines among Asia-Pacific markets.

The report states that the country’s participation in different international treaties such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the increase in damages awards and penalties for IP infringement beefed up its protection capabilities.

Thomas J. Treutler, partner and managing director of Tilleke & Gibbins’ Vietnam practice in Ho Chi Minh City, attributes Vietnam’s increase in scoring to a change in mindset among the country’s leaders. “We believe that changes in Vietnamese leaders’ mindsets have made a great contribution. In recent years, they have clearly acknowledged the importance of the development of science and technology in Vietnam, which has an impact on IP,” he explains.

Treutler enumerates other reasons for the significant increase in the country’s IP protection scores: faster handling and processing of IP applications by the IP Office of Vietnam, stronger outreach and training activities, improved knowledge dissemination to localities and better handling of infringement cases.

“The handling of IP infringements, especially by administrative measures, has seen a lower number of cases but a significant increase in the amount of fines,” says Treutler. “This shows an aggressive approach by the competent authorities in handling IP infringement by administrative measures.”

On the other hand, the weak spots in the country’s fabric of IP protection lie in the following: patent protection in the life sciences sector; copyright protection, including for the online space; the prevalent practice of physical counterfeiting and online infringement; and a generally weak enforcement system.

To close these gaps and further boost Vietnam’s IP protection score, Treutler suggests the following:

• Shorten the timeline for examination of applications to meet prescribed regulations;
• Limit the use of administrative tools, promote application of civil and criminal measures to settle disputes;
• State management agencies should work more closely with other related organizations and individuals;
• A more effective use of IP monitoring and governance tools;
• Greater application of modern technologies in professional operations;
• Knowledge and skills upgrading of human resources especially for IP disputes, appeals and enforcement; and
• Faster and more drastic action by the authorities to actualize the ideal guidance of the Communist Party of Vietnam and the government by issuing strict rules.

As of press time, the Vietnam-EU Free Trade Agreement has not yet been ratified by Vietnam’s National Assembly, though ratification is expected soon; the European Parliament approved the FTA and an agreement on investment protection in February. Treutler and Nguyen Tuan Hung, a senior associate and patent division manager at Aliat Legal in Hanoi, both told Asia IP that they believe the FTA will strengthen Vietnam’s IP protection capabilities.

“When Vietnam integrates deeply into the EU economy, it means Vietnam has to abide by EU standards and EU rules of the game. In such context, Vietnam has given to expanding external economic relations, diversifying markets and taking advantage of resources, managerial experience, and scientific and technological advancement for national industrialization and modernization,” says Nguyen.

“The EU possesses one of the most developed IP protection systems in the world,” Treutler explains. “Due to Vietnam’s commitment to strictly follow rules in EVFTA, there is an opportunity for Vietnam to shrink the gap in the level of development of IP protection; to harmonize the significant differences between the two parties as well as close the loopholes in Vietnam’s IP law.”

The agreement, says Treutler, provides clearer definitions of many concepts in IP law. It simplifies the registration process for right holders and grants authorities, such as customs, the right to actively assess suspected IP infringement and inform the rights holders.

To determine the IP protection scores of the 53 countries, 50 indicators were used including five new ones. The new indicators were: plant variety protection, term of protection (under Category 1: Patents, Related Rights, and Limitations); IP-intensive industries, national economic impact analysis (under Category 8: Systemic efficiency); and three indicators covering five treaties (under Category 9: Membership and Ratification of International Treaties). These treaties are the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks; Patent Cooperation Treaty; Membership of the International Convention for the Protection of New Varieties of Plants, Act of 1991; Membership of the Convention on Cybercrime, 2001; and the Hague Agreement Concerning the International Registration of Industrial Designs (Hague Agreement and Geneva Act).

Espie Angelica A. de Leon