DOMAIN DISPUTE SETTLEMENT UNDER VIETNAMESE LAWS: AN OVERVIEW OF CONFLICTS

Domain name is the name used to identify the Internet address of the server composed of sequences of characters separated by a period ".". In particular, Vietnam national domain name is a collection of domain names at all levels below the top-level Vietnamese national domain name ".vn" and domain names below other top-level domain names under the management of Vietnamese authorities. As general principles in the world as well as the approach of Vietnamese laws in the field of information technology, domain names will be granted based on the following two basic principles:
  • Each domain name registered is unique; and
  • "First come first serve" - the domain name shall be granted for the person who registers first.
The national domain name ".vn" is a subject of the Law on Information Technology 2006, all disputes related to the national domain name ".vn" thus must be resolved in accordance with Vietnamese law. According to Article 76 of such legislation and Article 16 of Decree 72/2013/ND-CP, disputes over the registration and use of “.vn" domain names shall be settled through:
  • egotiation and conciliation;
  • arbitration;
  • lawsuits.
From the experiences of Apolat Legal in advising on similar cases, disputing parties in most cases did not agreed on the arbitration dispute resolution. Therefore, this dispute settlement method is unlikely optimal in Vietnam (although this is one of the most effective method for resolving domain name disputes under international practices). The method of negotiation and conciliation is also hard to achieve expected results since the party who is currently owning or using the domain name often requires a huge amount of money in exchange of the domain. Although some major companies will be willing to compromise and pay the required amount to protect their brand and reputation, it is not the case for all violated parties, especially SMEs.
Case Study:

-  Domain name “Viettel.com” (Viettel corporation is one of the Vietnamese biggest communication corporations) was purchased by an American in the year of 1997 and then was listed for sale at the price of 1,5 million US dollar in 2011; or

- The two domain, namely samsungmobile.com.vn and samsungmobile.vn, were repurchased by Samsung Inc. at the price of 218 million Vietnam dongs; or

- BKAV corporation (A major Vietnamese cybersecurity corporation) had to spend 2,3 billion Vietnam dongs to repurchase the domain “bkav.com” from an American company.

 

Therefore, the violated party may bring the case to competent courts. For this purpose, the violated party must prove following basis for his claim:[1]

a) The domain name under dispute is identical or similar to the domain name of the plaintiff; identical or similar to a trademark or brand name

b) The defendant has no lawful right or interest related to the domain name;

c) The defendant leases out or transfer the domain name to the plaintiff who owns the brand name or trademark that is identical or confusingly similar to the domain name; leases out or transfer the domain name to the competitor of the plaintiff for self-seeking purposes or for illicit profits.

d) The defendant appropriates the domain or prevents the plaintiff who owns the brand name or trademark that from registering the corresponding domain name for unhealthy competition;

dd) The defendant uses the domain name to tarnish the reputation of the plaintiff, obstruct the business of the plaintiff, or cause confusion and destroy the trust of the public in the brand name or trademark of the plaintiff for unhealthy competition.

e) Other cases in which the defendant is proved that his or her using the domain name violates lawful rights and interests of the plaintiff.

In most cases, if disputing parties cannot reach a mutual agreement to settle the dispute, competent administrative authority that is in charge of granting and managing national domain names only recalls the disputing domain on the request of a valid judgement or arbitrational award.

It is worth noting that the domain name is not one of the intellectual properties like trade mark or trade name. Nonetheless, the intellectual property legal framework still governs some aspects in registering and using domain name, especially domain uses which may violate intellectual property rights, namely trademark or tradename uses. Accordingly, point d, section 1 of Article 130 Vietnamese Law on Intellectual property 2005 amended on 2009 clearly states that Registering or possessing the right to use or using domain names identical with, or confusingly similar to, protected trade names or marks of others, or geographical indications without having the right to use, for the purpose of possessing such domain name, benefiting from or prejudicing the reputation and popularity of the respective mark, trade name or geographical indication shall be deemed to be an act of unfair competition. Respect to this, current laws of Vietnam already provides parties with remedies for unfair competition acts on industrial property area. Pursuant to the Article 14 of the Decree 99/2013/ND-CP, a person registering or appropriating the right to use or using domain names identical or confusingly similar to protected marks, geographical indications or trade names of other parties in order to appropriate domain names, taking advantage of or harming reputation of those marks, trade names or geographical indications may be fined from VND 5,000,000 and 20,000,000. Further, a violated party may require state authorities to enforce the remedies as changing the registrant of the disputing domain and transfer the disputing domain to the violated party.

The party requesting handling of the act of registering, appropriating domain name use right or using a domain name regarded as an act of unfair competition in industrial property must prove that he has used the mark, geographical indication or trade name in a public and stable manner and has its reputation as an industrial property rights holder and goods or services bearing such mark, geographical indication or trade name (possibly information on advertising, marketing, exhibition; sale turnover; number of products sold; system of distribution agents, joint ventures and associated parties; investment scale; appraisal by state agencies, the mass media, selection by consumers, and other information showing the reputation of the business entity; goods or services bearing such mark, geographical indication or trade name) known to consumers in Vietnam.
[2]

For the act of using a domain name regarded as an act of unfair competition in industrial property, the requesting party shall prove that the party requested to be handled has used the domain name on the Internet for advertising or introducing products, offering for sale identical, similar or related goods or services, causing damage to the reputation of or material damage to the owner of the protected mark, trade name or geographical indication; and the party requested to be handled continues to use the misleading mark, trade name or geographical indication through such domain name after being requested by the mark, trade name or geographical indication owner to stop using it.[3]

For the act of registering or appropriating the domain name use right regarded as an act of unfair competition in industrial property: The requesting party shall prove that the party requested to be handled has registered but has not used the domain containing characters identical to a mark, trade name or geographical indication widely used and reputable in Vietnam; and there are grounds to believe that the party requested to be handled registers or appropriates the domain name use right only for resale to earn profits or to prevent the owner of the protected mark, trade name or geographical indication from registering a domain name.[4] In practice, requiring to prove “the party requested to be handled registers or appropriates the domain name use right only for resale to earn profits or to prevent the owner of the protected mark, trade name or geographical indication from registering a domain name” is complicated task. Hence, in the cases of registered domain names that have not been used, process to recalling the domain name tends to be lasted for a long period.

Besides, the plaintiff also needs to convince that the defendant has no lawful rights to and interests from protected marks, geographical indications and trade names of the rights holder.
Case study:

On 24/07/2019, the Court of Ha Noi city ruled the judgment no 28/2019/KDTM-ST on recalling national domain names, namely Osram.com.vn and Osram.vn, violated to trademark right of Osram corporation. Osram corporation is a German reputable brand on lighting systems and equipments. From the year of 1996 to 2002, Osram had registered trademarks for their products. However, Osram had not registered relevant national domain name under “.com.vn” and “.vn”. In this context, an individual registered and was granted the two domain names at Osram.com.vn and Osram.vn. Then, Osram claimed that domain registration and use of that such individual had constituted an act of unfair competition under Article 130 of the Law on Intellectual property 2005 amended on 2009.

- Plaintiff’s request:

+ Requesting the court to withdraw 2 domain names osram.com.vn and osram.vn so as to prioritize the right to register these 2 domain names for the plaintiff

+ Forcing the defendant to pay compensation for property damage, loss of income and profits as well as business opportunities, specifically requesting the court to force the defendant to pay VND 500,000,000 as a result of unfair competition acts. caused by the defendant

+ Forcing the defendant to pay the attorney fee of VND 200,000,000

+ Requesting a public apology on the mass media

- The first instance judgment: Accept the plaintiff's request for action to:

+ Recalling national domain names osram.com.vn and osram.vn

+ Priority is given to the plaintiff who is allowed to register to register the above two national domain names within 15 days from the time the judgment takes effect.

+ Forcing the defendant to pay the plaintiff a total of VND 203,960,000

+ Forcing the defendant to post a public apology

With the incredible growth of the Internet and the scale of online economy, the demand to own a domain name that is support a company’s brand identity as well as suitable for online marketing strategies of the business is increasingly important. In this context, the value of a domain name is no longer limited to an "online address" of a business, instead of, it is now playing the role as the "identification" of an enterprise. For reasons, conflicts over domain names are also increasing in both aspects of its value and complexity. As a new and technical subject, the legal systems governing domain name in generally and domain name dispute resolution are still in the process of being improved to meet the practical needs, in both information technology and intellectual property field. Nonetheless, the experience of Apolat Legal in consulting and representing our clients shows that the enforcement of these regulations in fact is still very ineffective. Perhaps, there till is a very long path to until domain name disputes can be effectively resolved and enforced in Vietnam.

[1] Section 2 Article 16 of the Decree 72/2013/ND-CP
[2] Point c Section 2 Article 19 of the Circular 11/2015/TT-BKHCN
[3] Point c Section 2 Article 19 of the Circular 11/2015/TT-BKHCN
[4] Point c Section 2 Article 19 of the Circular 11/2015/TT-BKHCN

 
tran chua hoai hanTRAN CHAU HOAI HAN
[m] +84988787285
[e] han.tran@apolatlegal.com