Vietnam – Implications Of The New Draft Amendment Of Internet Decree.

In this article we cover the new draft amendment and the implications on domain name dispute and resolution practice.
 

The Ministry of Information and Communications (“MIC”) has published the draft decree amending decree No. 72/2013/ND-CP with respect to the management, provision and use of Internet services and online information (“Draft Decree”) for public consultations.
 

If you are interested in amendments proposed by Draft Decree in the areas of cybersecurity, online IP protection, and regulate cloud computing services, please refer to our article Vietnam: New Draft Amendment of Internet Decree.

 

Summary
 

• The Draft Decree proposed that the subjects of domain name dispute resolution would also cover the domain names which are identical or confusingly similar to personal names of the complainant and protected geographical indications and trade names.

• The Draft Decree also clarified the standard of proof as to the registrant’s bad faith and brought the domain name freezing mechanism from Circular 24/2015/TT-BTTTT (“Circular 24”) dated 18 August 2015.

 

Expanding scope of domain name dispute and clarifying proof of bad faith
 

 Draft Decree requires right holders to present in their complaints all of the grounds as follows: (1) The disputed domain name is identical or confusingly similar to the complainant’s name/ trade mark / geographical indication / trade name; (2) The respondent has no right or interest in the domain name; and (3) The respondent has used the domain name with bad faith.[1]

 

While current Decree 72/2013/ND-CP has limited the scope of domain name dispute to infringement of trade mark right, Draft Decree further allows right holders of personal names, geographical indications and trade names to file a lawsuit.  With regards to the bad faith of the respondent, Draft Decree resolves the ambiguity of current Decree 72/2013/ND-CP, explicitly providing that such intent can be proven if one, not all, of the following is satisfied:
 

• The respondent leases out or transfers the domain name to the complainant or to a competitor of the complainant for self-seeking purposes or for illicit profit;

• The respondent appropriates, prevents the complainant from registering the domain name with the purpose of unfair competition;

• The respondent uses the domain name to damage the complainant’s reputation, hamper the complainant’s business operation or cause public’s misunderstanding and distrust as to the name, trade mark, trade name, geographical indication of the complainant with the purpose of unfair competition.[2]

 

Solidifying the domain name freezing mechanism

 

 Under Circular 24, maintaining the domain name status serves as a provisional measure applied in court/ arbitration/ mediation proceedings to prevent a registrant from bypassing enforcement actions. The circular allows the disputing parties to ask VNNIC to freeze the domain name in dispute.[3] However, in practice, VNNIC usually ask parties to bring the dispute to courts and it would freeze the domain name in dispute if the courts issued a preliminary injunction.

 

Draft Decree proposed to bring the domain name freezing mechanism from Circular 24 into Decree 72, aiming to solidify the process in a decree[4]. In particular, the MIC may only freeze a domain name in dispute upon receiving a request from the courts or arbitration panels. The Draft Decree did not mention the paralyzed rights of the disputing parties to directly ask VNNIC to freeze of a domain name.[5] We expect a growing shift to deal with domain name disputes by civil litigation (as opposed to administrative measures) because of the clearer freezing mechanism.

 

Remaining issues
 

Draft Decree kept the term “for the purpose of unfair competition” in mentioning the acts of bad faith. The term is vague and should be further elaborated as both Law on Competition and Law on Intellectual Property overlapped in defining the term. For example, it is still unclear whether the act of passive holding would constitute a finding of bad faith in light of the Draft Decree. In addition, VNNIC’s responsibility in implementing a court’s order on domain name dispute is still not regulated in the Draft Decree.
 

Draft Decree suggest notable amendments and supplementations but have not streamlined the domain name enforcement procedure and fully addressed concerns of the right holders. Therefore, the right holder should make use of the consultation period to voice their thoughts before the drafts are passed[6].

 

Authors: Yen Vu, Huy Nguyen, Ha Do and Khanh Nguyen
 

 

[1] Article 1.12 of Draft Decree on proposal to amend Article 16.2 of Decree 72/2013/ND-CP

[2] Article 1.12 of Draft Decree on proposal to amend Article 16.2.c of Decree 72/2013/ND-CP

[3] Article 16.2 of Circular 24/2015/TT-BTTTT

[4] Circulars are legal instruments issued by ministerial level authorities and at a lower ranking than decrees (that is issued by the Vietnam Government) in term of legal effect.

[5] Article 1.12 of Draft Decree on proposal to amend Article 16.4 of Decree 72/2013/ND-CP

[6] The Draft Decree is now under public consultation with the phase looking to complete by 5 September 2021.