Criminal Code 2017: New developments in the fight against intellectual property crimes
As of January 1st, 2018, the 2017 Criminal Code (“new Criminal Code”) will take effect, replacing the current 2009 Criminal Code which was adopted by the National Assembly in 1999 and amended in 2009 (“old Criminal Code”). Of note, the new Criminal Code was adopted on November 27th, 2015, but for some reasons, its effective date was delayed to allow the National Assembly to admend it on June 20th, 2017. The Criminal Code 2015, as amended in 2017, will take effect from the first day of 2018.
The new Criminal Code is considered as an important step in the development of Vietnam’s Criminal Code, especially because criminal liability with respect to legal entities is recognized for the first time and can be prosecuted. This is indeed what IPR owners in Vietnam have been waiting for a long time: While most of IPR infringing acts on commercial scale are committed by legal entities, until present it is impossible to prosecute legal entities for their IPR infringement.
With respect to crimes relating to intellectual property, the new Criminal Code has the following changes compared with the old Criminal Code:
- Infringement of copyrights and related rights
Regarding infringement of copyrights and related rights, Article 225 of the new Criminal Code will replace Article 170a of the old Criminal Code. According to it, as before, willful act of copying and distributing copies of work on a commercial scale without permission of the IPR owner shall be subject to criminal proceedings. However, the new point of the new Criminal Code is to directly include the term “wilful” into Article 225 and provides for details on what may be considered as “commercial scale”, while under the old Criminal Code, such contents were not found in Article 170a, but in its implementing instruments.
In details, according to the new provisions of Article 225, depending on the scale of infringement, namely the level of illicit earning, loss suffered by the IPR owner, or value of infringing goods, the penalties are stated as follows:
a) In case of illicit earning of from VND*50 million to under VND300 million; or value of infringing goods or loss suffered by IPR owner of from VND100 million to under VND500 million, infringer is subject to (i) a fine of from VND50 million to VND300 million, or a penalty of up to 03 years’ community sentence, if the infringer is an individual; or (ii) a fine of from VND300 million to VND 1 billion if the infringer is an entity;
b) If infringement falls under one of the following cases: (i) The offence is committed by an organized group; or (ii) The offence has been committed more than once; or (iii) Illegal earning is over VND300 million; or (iv) Loss suffered by the IPR owner is over VND500 million; or (v) Infringing goods are assessed at over VND500 million, infringer is subject to (i) a fine of from VND300 million to VND1 billion, or a penalty of 06 months- 03 years’ imprisonment, if infringer is an individual; or (ii) a fine of from VND1 billion to VND3 billion or suspension of operation for 06 – 24 months, if infringer is an entity.
c) In addtion, an individual infringer can also beliable to a fine of from VND20 million to VND200 million, prohibited from holding certain positions or doing certain works for 01 – 05 years; an entity can be liable to a fine of from VND100 million to VND300 million, be banned from operating in certain fields or raising capital for 01 – 03 years.
- Infringement of industrial property rights
Regarding infringement of industrial property rights, Article 226 of the new Criminal Code will replace Article 171 of the old Criminal Code. According to it, as before, willful act of infringement of industrial property rights with objects being products bearing counterfeit trademark or geographical indication on commercial scale shall be liable to criminal procedure. However, the new point of the new Criminal Code is to state clearly in Article 226 that only infringement with “objects being products bearing counterfeit trademark or geographical indication” shall be liable to criminal proceedings, and provides for details in Article 226 on what can be considered as “commercial scale”, while under the old Criminal Code, such contents are not found directly in Article 170a but in its implementing instruments.
In details, according to the new provision of Article 226, depending on infringing scale, namely level of illicit earning, loss suffered by the IPR owner, or value of infringing goods, the penalties are stated as follows:
a) In case of illicit earning from VND200 million to under VND300 million; or loss suffered by the IPR owner or value of infringing goods from VND100 million to under VND500 million, infringer is subject to (i) a fine of from VND50 million to VND 500 million, or a penalty of up to 03 years’ community sentence, if the infringer is an individual; or (ii) a fine of from VND500 million to VND2 billion, if the infringer is an entity;
b) If infringement falls under one of the following cases: (i) The offence is committed by an organized group; or (ii) The offence has been committed more than once; or (iii) Illegal earning is over VND300 million; or (iv) Loss suffered by the IPR owner is over VND500 million; or (v) Infringing goods are assessed at over VND500 million, infringer shall be subject to (i) a fine of from VND500 million to VND1 billion or a penalty of 06 months- 03 years’ imprisonment, if the infringer is an individual; (ii) a fine of from VND2 billion to VND5 billion or suspension of operation for 06 – 24 months.
c) In addition, an individual infringer can also beliable to a fine of from VND20 million to VND200 million, prohibited from holding certain positions or doing certain works for 01 – 05 years; a legal entity can also be liable to a fine of from VND100 million to VND 300 million, be banned from operating in certain fields or raising capital for 01 – 03 years.
- Criminal lialibility for violation of regulations on grant of certificates of registration of industrial property rights abolished
Under Article 170 of the old Criminal Code, violation of regulations on grant of certificates of registration of industrial property rights is subject to criminal penalties including community sentence or 06 months- 07 years’ imprisonment, as well as prohibition from holding certain positions in a certain period of time. This Article has been abolished by the new Criminal Code.
* USD 1 = about VND 23,000