Vietnam: What are the trade secrets eligible for protection? What are the penalties imposed on entities arbitrarily using trade secrets of others?
What are the trade secrets eligible for protection in Vietnam?
Under Clause 23, Article 4 of the Law on Intellectual Property 2005 amended by Clause 2, Article 1 of the Law on Amendments to Law on Intellectual Property 2009, supplemented by Points a, b, d, Clause 1, Article 1 of the Law on Amendments to Law on Intellectual Property 2022:
Interpretation of terms
In this Law, the following terms shall be construed as follows:
1. Intellectual property rights means the rights of organizations and individuals to intellectual assets, including copyright and copyright-related rights, industrial properly rights and rights to plant varieties.
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4. Industrial property rights means rights of organizations and individuals to inventions, industrial designs, layout-designs of semiconductor integrated circuits, trade secrets, marks, trade names, geographical indications and trade secrets they have created or own, and the right to repression of unfair competition.
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23. Trade secret means information obtained from financial or intellectual investment activities, which has not yet been disclosed and can be used in business.
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Thus, trade secrets are under industrial property rights, which are information obtained from financial or intellectual investment activities, which has not yet been disclosed and can be used in business.
According to the provisions of Article 84 of the Law on Intellectual Property 2005, the general conditions for trade secrets to be eligible for protection are as follows:
General conditions for trade secrets to be eligible for protection
A trade secret shall be eligible for protection when it satisfies the following conditions:
1. It is neither common knowledge nor easily obtainable.
2. When used in business activities, the trade secret will create for its holder advantages over those who do not hold or use it.
3. The owner of the trade secret maintains its secrecy by necessary means so that the secret will not be disclosed nor be easily accessible.
Thus, to be eligible for protection, a trade secret must satisfy the following conditions:
- It is neither common knowledge nor easily obtainable.
- The owner of the trade secret maintains its secrecy by necessary means so that the secret will not be disclosed nor be easily accessible.
- When used in business activities, the trade secret will create for its holder advantages over those who do not hold or use it.
What is confidential information ineligible for protection as trade secrets in Vietnam?
Under Article 85 of the Law on Intellectual Property 2005 on objects ineligible for protection as trade secrets:
Objects ineligible for protection as trade secrets
The following confidential information shall be ineligible for protection as trade secrets:
1. Personal identification secrets.
2. State management secrets.
3. National defence and security secrets.
4. Other confidential information unrelated to business.
Under the above regulations, confidential information ineligible for protection as trade secrets in Vietnam includes state management secrets; personal identification secrets; national defense and security secrets; and other confidential information unrelated to business.
Thus, not all confidential information is eligible for protection as trade secrets in Vietnam.
What are the penalties imposed on entities arbitrarily using trade secrets of others in Vietnam?
Under the provisions of Article 127 of the Law on Intellectual Property 2005 on infringements of the right to trade secrets:
Infringements of the right to trade secrets
1. The following acts shall be deemed infringements of the right to trade secrets:
(a) Accessing or acquiring information pertaining to a trade secret by taking acts against secrecy- keeping measures applied by lawful controllers of such trade secret;
(b) Disclosing or using information pertaining to a trade secret without the permission of the owner of such trade secret;
(c) Breaching secrecy-keeping contracts or deceiving, inducing, buying off, forcing, seducing or abusing the trust of persons in charge of secrecy-keeping in order to access, acquire or disclose a trade secret;
(d) Accessing or acquiring information pertaining to the trade secret of an applicant for a licence for trading in or circulating products by taking acts against secrecy-keeping measures applied by competent bodies;
(dd) Using or disclosing trade secrets, while knowing or having the obligation to know that they have been acquired by others engaged in one of the acts stipulated in sub-clauses (a), (b), (c) or (d) of this clause;
(e) Failing to perform the secrecy-keeping obligation stipulated in article 128 of this Law.
2. Lawful controllers of trade secrets defined in clause 1 of this Article include owners of trade secrets, their lawful licensees and managers of trade secrets
Thus, accessing, acquiring, disclosing, and using trade secrets are acts of infringement of the right to protected trade secrets. Therefore, arbitrarily using trade secrets of others is an act of infringement of trade secrets. Entities committing this act may face penalties according to the provisions of law.
Under the provisions of Article 16 of Decree 75/2019/ND-CP on infringement of trade secrets:
Infringement of trade secrets
1. A fine ranging from VND 200,000,000 to VND 300,000,000 shall be imposed for committing one of the following violations:
a) Accessing or obtaining trade secrets by taking actions against security measures adopted by the older of such trade secrets;
b) Disclosing or using trade secrets without the permission of the holder of such trade secrets.
2. Additional penalties:
a) The exhibits and instrumentalities for committing the administrative violation shall be confiscated;
b) Profits illegally obtained from the administrative violation shall be confiscated.
Thus, persons arbitrarily using the protected trade secrets of others - an act of infringement of trade secrets may be administratively fined from VND 200,000,000 to VND 300,000,000.
In addition, persons committing acts of infringement of trade secrets shall have exhibits and instrumentalities for committing the administrative violation on competition and profits illegally obtained from such administrative violation confiscated.
Note: The above maximum fine will be imposed for acts of infringement of trade secrets by organizations. For individuals who commit the same administrative violations on competition, the maximum fine equals half of the maximum fine imposed on organizations (Clause 7, Article 4 of Decree 75/2019/ND-CP).
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