Vietnam – Inventions owned by the State

CategoriesHighlights, Legal News, Trends and IP Practice in Vietnam

The Government has submitted a draft of amendments to the Law on Intellectual Property (IP) to the National Assembly of Vietnam. It is scheduled that the National Assembly will discuss the draft in October 2021 and proceed with the approval procedure in May 2022. The draft may be amended before approval.

An interested issue is provisions on inventions owned by the State in the draft.

Article 86 – The right to file such a patent application

Under current law, overall an entity who invests to create an invention will have the right to file a patent application for the invention, and then, when the patent is granted, the entity will be the patent owner. When the State invests, the entity will be a respective State body. In fact, such State bodies (patent owners) have not commercially exploited such inventions effectively.

Amendments to Article 86 were introduced in the draft to create a measure that the State will invest with an appropriate entity to create an invention, then the entity will have the right to file a patent application as well as will be the patent owner when the application is patented. The entity is not necessarily a State body, but is an entity assumed to effectively exploit the invention. After that, the State benefits because the State is still the owner of the invention. In addition, for such inventions relating to national defense and security, the right to file the applications will still belong to the respective State body irrespective of who has created the inventions.

Article 133a – The rights of the State with respect to State-invested inventions

To ensure that such inventions would be commercially exploited effectively, Article 133a was added to the draft.

Accordingly, in case (i) when the invention is created, the entity who creates the invention does not inform the State of the same, (ii) the entity fails to exercise the right to file the patent application, or (iii) the entity informs the respective State body that they have no a need to file the patent application; the State will publicly notify a possibility of assignment of the right to file the application, and as a result, any organizations and individuals who desire to exploit the same can seek the right to file the patent application.

Within 90 days from the notification date, if the right to file the patent application is not assigned, the State will publish the invention for public use.

Further, the State will permit other organizations and individuals to use the inventions, without the consent of the patent owner and without compensation if (i) the patent owner has not taken, or is presumed not to take, within a reasonable period of time, effective measures to exploit the patent or (ii) the use of the invention is purposed for the public interest, national security, national nutrition, health or other public demands.

Our comments: There are some issues to be clarified here:

– A time-line for the State to publicly notify the possibility of assignment,

– How the other organizations and individuals can obtain the right to file the application, and

– With regards to the use of inventions without the consent of the patent owner and without compensation, there is no definition of the so-called “reasonable period of time”.

It is assumed that the Government will specify for these when the amended IP law takes effect.

Article 136a – Obligations of entities creates State-invested inventions

To further ensure that such inventions would be commercially exploited effectively, Article 136a was added in the draft to control.

Accordingly, within 30 days from the date that the invention is created, such an entity is obliged to report on the same to the respective State body. Then, the entity must file the patent application within six months from the report date.

In case the patent is granted, the patent owner must exercise the patent rights, such as exploitation of the invention, and take measures to enforce the patent rights. The patent owner (the entity) is also obliged to report on the exploitation of the invention and the enforcement of the patent right.

Article 139 – Assignments of such patent applications/granted patents

For a normal invention, an entity investing to create the invention will be the patent owner when the application is patented. For a State-invested invention, the State invests to create the invention, but will not be the patent owner, the invested entity will be the patent owner. For dealing with this particular case, amendments to Article 139 were introduced in the draft.

Accordingly, the patent owner may exploit the invention in the granted patent but cannot assign the patent without permission of the State. In case the State permits to assign the patent, an assignee is necessarily obliged to exercise the patent rights as the same as the former patent owner does.

OUTLOOK

The number of domestic patent applications has significantly increased in the recent years. The above proposed amendments to the IP law are to effectively use the budget of the State in creating inventions, and then, are expected to make a boom of inventions in Vietnam.

By Nguyen Thi Le Na

Patent Department – INVESTIP IP LAW FIRM