2020 is a year of full turmoil; the SARS-CoV-2 pandemic commenced around November 2019 at Wuhan City, China, and its quick spread altered the method of communication of social on over the world from direct to online, from connecting to social-distancing, etc. However, the pandemic also created chances for enterprises with vigorous transformations to apply high technology in business activities, turn the digital environment into tools for business benefits. Social media such as Facebook, Instagram, Twitter, etc., gradually become the primary means of communication, providing information among individuals and indispensable tools in business activities.
Thanks to the rapid distribution of information and easy access and advertising products/services in large areas, online business activities have become more familiar with business entities and consumers. Social media, therefore, has become a potential market for unfair competition. However, not all enterprises, traders understand methods thoroughly to protect their business operation when doing online business, or being infringed, un-fair competed by other entities on social networking sites. This article only expresses, analyses, evaluates solutions to some popular unfair competitions on social media of businesses while doing business and commerce based on Vietnamese law regulations.
Release “dirty” information, untrue about business activities of other enterprises
Due to its enormous amount of users, rapid spreadability, and users usually do not check the preciseness of information, social media becomes the place “dirty” and untrue information is posted. The story about the unclear quality of dairies material of Vietnam Milk Joint Stock Company (Vinamilk) at the end of 2019 is one of the typical examples of the effect of “dirty” information on businesses. Rivals only release vague information about material’s quality or information which lacks ground about products’ ingredients, rely on the dizzy speed of information sharing and transmission and the scope of the digital environment, Vinamilk had to face the risk of losing billions of VND of market capitalization in the security market. Or the information spread on Facebook about color trails at the tail of toothpaste would show the ingredients of such products, which were from natural materials or chemicals, also confuses public opinion and consumer’s psychology, affects the sales of the big toothpaste manufacturers as P/S, Colgate.
Currently, handling behavior of posting untrue information on social media is prescribed specifically by the Government in the Decree 15/2020/ND-CP on penalties for administrative violations against regulations on postal services, telecommunications, radio frequencies, information technology and electronic transactions, in which:
Acts taking advantage of social media to:
- Provide, share fake, untrue information, deform, vilify, offend prestige of agencies, organizations, honor, and dignity of individuals;
- Provide, share pure fabrication, cause confusion among people, create violence, crime, social evils, gambling or serving gambling activities;
It may be sanctioned from VND 10,000,000 to VND 20,000,000 as prescribed at Article 101, the Decree 15/2020/ND-CP, or depend on the level and behaviors of posting fake information, organizations/individuals putting news may be sanctioned if they offer untrue information about other enterprises per Clause 1,2 Article 18 the Decree 75/2019/ND-CP, the fine shall be in range VND 100,000,000 to VND 300,000,000. Affected organizations, individuals due to acts of posing fake information, can request police or people’s committee to handle these above acts.
Violating intellectual ownership rights on social media
Besides posting false information cause influences to business activities of enterprises, establishing social media account having coinciding or similar signs, symbols to trademarks, tradenames, identification marks of other enterprises without agreement from the owner of those trademarks, trade names, signs is also a popular infringement nowadays.
These behaviors may be considered as violations of industrial property right registered for protection at competent agencies or unfair competition according to as specified at the Law on Intellectual Property, includes:
“Article 130. Acts of unfair competition
1. The following acts shall be deemed to be acts of unfair competition:
- Using commercial indications to confuse as to business entities, business activities or commercial origin of goods or services;
- Using commercial indications to confuse as to the origin, production method, utilities, quality, quantity or other characteristics of goods or services; or as to the conditions for the provision of goods or services.
2. Commercial indications at clause 1 of this article are signs, information serving guidelines to the trading of goods or services including marks, trade names, business symbols, business slogans, geographical indications, designs of packages and/or labels of goods.
3. Acts of using commercial indications stipulated in clause 1 of this article include acts of affixing such commercial indications on goods, goods packages, means of service provision, business transaction documents or advertising means; and selling, advertising for sale, stocking for sale and importing goods affixed with such commercial indications”.
When finding out infringements on intellectual property rights on social media, enterprises can report such violations on intellectual property rights to social media managers and ask them to remove violating contents or block infringing accounts. In addition, violated organizations/individuals may also request authorized agencies such as police, people’s committee to handle and settle infringements on intellectual property rights and/or unfair competition concerning the intellectual property rights according to the laws, with the applicable penalty can be up to VND 20,000,000 as stipulated at the Decree 99/2013/ND-CP on sanctioning of administrative violations in industrial property.
These above mentioned acts only two among many unfair competition methods in practice, and each act, depending on the type and level of such violation, the subject being violated, will be handled according to different regulations. In business, competition is unavoidable, however, enterprises need to identify which acts are unfair competition to avoid and how to resolve unfair competition to cut down damage for themselves.
If you have any questions or require any additional information, please contact Apolat Legal – An International Law Firm in Viet Nam.
This article is for general information only and is not a substitute for legal advice.
