Penalty Measures Against Administrative Violations In Industrial Property Under New Regulations


Under the new regulations of Circular No. 11/2015/TT-BKHCN, apart from the main sanction measures, additional penalties and remedial measures shall also be imposed on enterprises depending on the nature and severity of the violations they committed.

Commencing from August 11th 2015, the provisions of Circular No. 11/2015/TT-BKHCN (hereinafter referred to as “Circular 11), in which a number of regulations on additional penalties and remedial measures are detailed, shall be put into effect. 

The regulations specified in Circular 11 are of Decree No. 99/2013/ND-CP (hereinafter referred to as “Decree 99), which stipulates penalty measures against administrative violations in the field of industrial property.

1. Additional penalties

Decree 99 prescribes that additional penalties consist of:

  • Confiscation of material evidence and means of infringement;
  • Deprivation of right to use industrial property representation service practice certificates, assessor cards, and certificates of qualified assessment organization;   
  • Suspension of production and trading activities of infringing products and services.

As stated in Circular 11, the additional penalty being confiscation of material evidence and means of violation shall only be imposed on willful violation in the following events: the violators of the infringed goods are unidentified; and it is necessary to prevent possible subsequent violations or material evidence from being destroyed or dispersed.   

2. Remedial measures

The following variety of remedial measures applied to violations of industrial property are clearly specified in Circular 11:   

Measure of forced removal of infringing elements

  • Forced removal of infringing elements is enacted in cases where the material evidence and means of violation are products, goods, expressions, business means, or transaction documents that are attached with signs of infringement of industrial property rights or misleading commercial indications.

Enterprises may proceed to elimination by using different methods of removing, cutting, erasing, etc.;

  • Forced adjustment of domain information or return of domain name is applicable in the following cases:
  • The party requesting for violation handling (“the requesting party”) and the party receiving such request (“the requested party”) fail to come to an agreement after the petition is accepted. 
  • The requested party refuses to stop the acts of registration of, possession of right to use, or use of the infringing domain name.
  • Forced alteration of enterprise name and removal of infringing elements in enterprise name shall be applied where the violating party continues to use an enterprise name illegally, or fails to carry out procedures to change the infringing enterprise name in compliance with the business registration office’s notification or the parties’ agreement.

Measure of destruction of commodities, material evidence and means shall be taken in the following circumstances: goods bearing counterfeit marks or geographical indications;  materials and means used mainly for the production or trading of goods bearing counterfeit marks or geographical indications; labels and items bearing counterfeit marks or geographical indications; infringing stamps, labels, and items; invalid goods; merchandise harmful to human health, animals, plants, and the environment; indestructible infringing goods, or destruction without guaranteed prevention of violations, or lack of other applicable measures.    

Measure of forced repayment of illegal profits earned from committing acts of violation applies to cases where invoices and vouchers related to such acts and infringing goods have been discovered by the time of assessment and examination. Such profits shall be remitted to the State Treasury of Vietnam.     

In addition, Circular 11 stipulates that competent authorities should consult subjects of industrial property rights and requesters of violation handling, as well as the individuals and organizations involved. Enterprises committing acts of violation must bear all expenses incurred during the implementation of remedial actions as provided for by regulations on the handling of administrative violations.

PLF Law Firm 

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