Penalties for violations of regulations on obligations of plant variety protection certificate holders in Vietnam

Penalties for violations of regulations on obligations of plant variety protection certificate holders in Vietnam (Internet image)

Obligations of plant variety protection certificate holders in Vietnam

According to Clauses 5 and 24, Article 4 of the Law on Intellectual Property 2022, which regulates plant varieties and rights to plant varieties, then:

- Rights to plant varieties means rights of an organization or individual to new plant varieties which such organization or individual has selected and created, discovered and developed, or which they own.

- Plant variety means a plant grouping within a single botanical taxon of the lowest known rank, which is morphologically uniform and suitable for being propagated unchanged, and can be defined by the expression of phenotypes resulting from a genotype or a combination of given genotypes, and distinguished from any other plant grouping by the expression of at least one inheritable phenotype.

Pursuant to Article 191 of the Law on Intellectual Property 2022, obligations of plant variety protection certificate holders include:

- Except in the cases specified in Clause 2 of Article 191 of the Law on Intellectual Property 2022, the plant variety protection certificate holder shall pay remuneration to the plant variety breeder under agreement. In case there is no agreement, the remuneration shall be determined as follows:

= 10% of pre-tax profit earned by the plant variety protection certificate holder from the use of the protected plant variety for production or business;

= 15% the total amount received by the plant variety protection certificate holder in each payment for licensing of the plant variety before tax is paid;

= 35% the total amount received by the plant variety protection certificate holder from licensing of the plant variety for the first time before tax is paid, in which case the breeder will not receive remuneration for subsequent licensing and the remuneration specified in Point a and Point b of Clause 1 of Article 191 of the Law on Intellectual Property 2022

- If the plant variety is the result of a science and technology mission funded by state budget, the plant variety protection certificate holder shall pay remunerations to the breeder as follows:

= 10% - 15% of pre-tax profit earned by the plant variety protection certificate holder from the use of the protected plant variety for production or business;

= 15% - 20% the total amount received by the plant variety protection certificate holder in each payment for licensing of the plant variety before tax is paid;

= 20% - 35% the total amount received by the plant variety protection certificate holder from licensing of the plant variety for the first time before tax is paid, in which case the breeder will not receive remuneration for subsequent licensing and the remuneration specified in Point a and Point b of Clause 2 of Article 191 of the Law on Intellectual Property 2022.

- In case where the plant variety has co-breeders, the remuneration provided for in Clause 1 and Clause 2 of Article 191 of the Law on Intellectual Property 2022 shall be applicable to the co-breeders. The co-breeders shall reach an agreement on the division of the remuneration paid by the plant variety protection certificate holder.

- The obligation to pay remuneration exists throughout the term of protection of the plant variety.

- The fee for maintenance of the plant variety protection certificate shall be paid to the plant variety protection authority within 3 months after the date of issuance of the plant variety protection certificate for the first year and within the first month of the subsequent years.

- Preserve the protected plant variety; provide information, reproductive materials of the protected plant variety at the request of the plant variety protection authority; maintain the stability of the protected plant variety according to the traits described when the plant variety protection certificate is granted.

Penalties for violations of regulations on obligations of plant variety protection certificate holders in Vietnam

According to Article 18 of Decree 31/2023/ND-CP (effective as of July 28, 2023) stipulating fines for acts of violating rregulations on obligations of plant variety protection certificate holders in Vietnam as follows:

- A fine ranging from VND 15,000,000 to VND 25,000,000 shall be imposed for one of the following acts:

+ The plant variety protection certificate holder fails to transfer the right to use the protected plant variety under the decision on compulsory transfer of the competent authority;

+ The plant variety protection certificate holder does not pay remuneration to the plant variety breeder according to regulations;

+ The protection certificate holder fails to satisfy the conditions of distinctiveness, uniformity, and stability of the protected plant variety as at the time of grant of the plant variety protection certificate while still exploiting and using propagating materials;

+ The breeder of the plant variety fails to properly perform the obligation to help the protection certificate holder maintain the propagating materials of the protected plant variety.

- A fine ranging from VND 20,000,000 to VND 30,000,000 shall be imposed for using an expired, suspended, or canceled plant variety protection certificate to exercise rights to a plant variety.

Besides, according to Clause 3, Article 18 of Decree 31/2023/ND-CP (effective as of July 28, 2023), remedial measures for acts of violating regulations on the obligations of plant variety protection certificate holders include:

- Forcible return of illegal profits obtained from performing the acts specified at Point c, Clause 1 and Clause 2, Article 18 of Decree 31/2023/ND-CP (effective as of July 28, 2023);

- Forcible return of the plant variety protection certificate to the issuing authority or person for the acts specified at Point c, Clause 1, Article 18 of Decree 31/2023/ND-CP (effective as of July 28, 2023);

Thus, violations of the obligations of protection certificate owners and breeders can result in fines of up to VND 30,000,000 for individuals and VND 60,000,000 for organizations.

In addition, when falling into the case specified in Clause 3, Article 18 of Decree 31/2023/ND-CP (effective as of July 28, 2023), organizations and individuals that commit acts of violating regulations on obligations of plant variety protection certificate holders are forced to take remedial measures in accordance with law.

Nguyen Pham Nhut Tan

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