New regulations on “Bad faith” in Circular 23/2023/TT-BKHCN

1. Circular 23/2023/TT-BKHCN provides a detailed basis and definition of “bad intention/bad faith”.

It is noted as the first time that Vietnamese intellectual property law has specific regulations on clarifying the interpretation of the concept.

Article 34, Clauses 2 and 3, provide guidance on grounds for determining trademark registration with bad intentions/bad faith, specifically:

“- The trademark protection certificate is invalidated because the applicant registered the trademark with bad intentions as prescribed in Point a, Clause 1, Article 96 of the Law on Intellectual Property in the following cases:

  • There is a basis to believe that, at the time of filing the application, the applicant knew or had a basis to know that the mark he was registering was identical or similar to the point of being difficult to distinguish from a mark that is widely used in Vietnam or other well-known trademarks in other countries for identical or similar goods or services; and
  • This registration is intended to take advantage of the reputation and prestige of that mark to gain profit; or primarily for the purpose of reselling, licensing or transferring registration rights to the holder of the trademarks mentioned in Point a of this Clause; or aims to prevent the ability of persons with trademarks mentioned in Point a of this Clause to enter the market to limit competition; or other acts contrary to fair trade practices.

– The provisions of Clauses 1 and 2 of this Article also apply during the processing of patent and trademark applications.”

Previously, there is insufficient ground for identifying the term “bad faith/bad intention”, as well as for handling applications registered in the above basis.

Circular 23/2023 now defines the concept of “bad faith”, which is important in determining whether a trademark application is considered to have bad faith. Evidently, it is more favorable for the right owners of granted certificates who want to ensure their legal rights against acts of trademark speculation and illegal profit from intellectual property.

2. Bad intention becomes a direct legal basis regulated in Law on Intellectual Property 2022

Notably, the Intellectual Property Law 2022 has stipulated “bad faith” as a direct legal basis for the following specific cases:

– Grounds to entirely invalidate the protection titles (Point a, Clause 1, Article 96)

– Grounds for refusing to grant a protection title when there is a basis to assert that the applicant does not have the right to register an industrial property object or register a trademark with malicious intent (Point b, Clause 1, Article 117)

– Grounds for suspending the examination process of application in case of receiving a copy of the notice of acceptance of the case from the competent Court about a third party filing a lawsuit related to the right to register an industrial property object or a trademark which was registered with bad intention (Point c, Clause 3, Article 117)

– The basis for determining unfair competition is if you possess or use a domain name that is identical or confusingly similar to another person’s protected trademark, trade name or geographical indication that do not have the right to use with bad intentions, take advantage of the prestige and reputation of the corresponding trademark, trade name, or geographical indication to gain illegal profits (Point d, Clause 1, Article 130).

It can be seen that the current regulations allow the term “bad faith” to become a legal basis for cases of refusal to grant protection documents; invalidate protection titles and unfair competition. With the above-mentioned regulations related to the term “bad intention/ bad faith” set out in Law on Intellectual Property 2022 and the new enacted Circular 23/2023, the right holder has sufficient basis to rely on legal grounds to protect the legitimate rights, which is considered a positive amendment, creating many advantages in practical terms of intellectual property law.

Vu Le Vy

Enforcement Department