Vietnamese businesses will have the opportunity to penetrate into potential markets and access new sources of high technology and machinery, thereby forming a new value chain. However, they will also have to cope with huge competitive pressure.
The EVFTA is considered to be a new-generation free trade agreement (FTA), in which the IP regulations will have direct impacts on Vietnam’s law institution and enforcement. As Europe is a region exporting IP products, it requires the increased protection of IP rights and also has special protection regimes for geographical indications. In contrast, Vietnam currently possesses only a small number of IP products compared to its European partners, so there needs to be space for businesses, organisations and individuals to access IP products at the lowest costs in service of socio-economic development.
Director of the Ministry of Industry and Trade’s Multilateral Trade Policy Department Luong Hoang Thai said that from the moment the EVFTA comes into effect, Vietnam commits to join the agreement on copyright and the World Intellectual Property Organisation (WIPO) Performances and Phonograms Treaty within three years, with a protection term of at least 50 years. In addition, the country will establish a public electronic database about trademark registration records and permit the revocation of registered trademarks which have been unused for at least five years, alongside acceding to the Hague Agreement on the international registration of industrial designs within two years from the EVFTA taking effect and protecting industrial designs for at least 15 years.
Vietnam has committed to protect over 169 European geographical indications with a high level of protection, mainly wine and food. In contrast, the European side has also committed to protect 39 geographical indications of Vietnam related to famous agricultural and food products with high export potential, such as Moc Chau tea and Buon Ma Thuot coffee. This will create conditions for a number of typical Vietnamese products to build and assert their brands in the European market.
However, commitments on IP also bring certain challenges to Vietnamese organisations and individuals as the fight against IP rights infringement will be stricter, which may burden enterprises with the control procedures, especially if they are involved in disputes and litigation. According to Deputy Director of the Ministry of Science and Technology’s IP Department Le Ngoc Lam, the high level of protection will lead to more limited access to protected intellectual products. The strict protection regime also raises the prices on products and technology, affecting the competitiveness of enterprises. In addition, with strict enforcement mechanisms, enterprises will be burdened with the control procedures unless they are aware of their rights and obligations
According to the MST, specific commitments on the level of protection and enforcement of intellectual property rights in the EVFTA aim to ensure the two sides’ businesses enjoy the highest protection. This will help facilitate their investment and business activities, thus creating a driving force to boost the transfer of high technology in agriculture and the agro-product processing and production industry, as well as in renewable energy technology, pharmaceuticals and machinery, from Europe into Vietnam.
MST Minister Chu Ngoc Anh said that in the time ahead, when the IP-related commitments in the EVFTA have come into effect, the implementation of obligations will enable businesses to establish and protect the outcomes of their investments in creative activities. This will have many positive effects on Vietnam’s foreign investment attraction and trade. In addition, under the drastic direction of the Government, the business environment is improving, with foreign partners’ increasing trust in the protection of intellectual assets in Vietnam, allowing the country to attract high-quality FDI capital sources with advanced technology. This is a very good chance for Vietnamese firms to receive the transfer of advanced technologies from Europe, thereby contributing to enhancing the productivity, quality and competitiveness of each business. In addition, the EVFTA will open up numerous opportunities to access the markets of European countries. However, in order to exploit such a large market, enterprises should master and meet the EU’s regulations on IP rights protection, exploitation and enforcement, as well as the bloc’s regulations on technical barriers in trade. This requires Vietnamese businesses to focus on increasing their awareness of the field of IP, while constantly innovating and improving internal technology capacity and their ability to absorb new and advanced technologies to improve quality of their products.
On August 22, 2019, the Prime Minister approved the IP Strategy until 2030, which suggests many solutions towards bringing Vietnam into the group of ASEAN-leading countries in terms of IP rights creation, protection and exploitation by 2030. All will work to create conditions for new businesses to stand firm when stepping out into the world and joining the global common “game”.