Vietnam’s phenomenal economic growth in recent years resulted in a larger base for consumer and business products. While the economic growth has spurred the development and commercialization of intellectual property rights, Vietnam has also witnessed steady increases in intellectual property infringement and counterfeiting. Competitive labour cost and a large population pool creates an ideal environment for counterfeiters to use Vietnam as a manufacturing base.
The Enforcement Regime
The responsibility of anti-counterfeiting falls mainly on the Market Management Board and the Economic Police. Both government agencies are given the powers to conduct raids against suppliers of counterfeit products. While there is overlapping authority, the Economic Police generally targets their actions against large counterfeiters while the Market Management Board focuses on retail counterfeiting.
The Vietnam Customs also play a pivotal role in preventing the entry of counterfeit products into the country. Counterfeit products are commonly smuggled into Vietnam from the China-Vietnam border as well as key ports like Hai Phong and Da Nang. In 2007 and 2008, the Vietnam Customs have successful stopped the entry of counterfeit Nokia accessories into the country. The Customs’ powers to conduct raids and seizures exceeds beyond the port area. Unlike some countries in Southeast Asia, where the Customs jurisdiction is generally limited to detention of products in the ports, the Vietnam Customs is empowered to conduct investigations against import related offences. Hence, their powers include conducting raids against distributors in key cities if the matter arises from a Customs investigation.
The penalties for counterfeiting include fines and imprisonment. However, in practice, fines are much more common. Such fines range from a few hundred US dollars for retail counterfeiters to a few thousand for larger distributors and manufacturers.
The Role of the IPR Owners
Most IPR owners with endemic counterfeiting problems in Vietnam usually have an anti-counterfeiting programme. Such programmes usually entail aggressive anticounterfeiting raids against manufacturers, importers and key distributors. IPR owners would engage legal counsels and investigators, which would work in cooperation with the Economic Police and Market Management Board to ensure the successful prosecution of counterfeiters.