Trademark exhaustion and proposals for an improvement of vietnamese trademark law

LUND UNIVERSITY HANOI LAW UNIVERSITY NGƯYEN NHƯ QƯYNH TRADEMARK EXHAƯSTION AND PROPOSALS FOR AN IMPROVEMENT OF VIETNAMESE TRADEMARK LAW SUPERVISORS: PROF DR KATARINA OLSSON ASSOCIATE PROF DR BUI DANG HIEU 2011 ABSTRACT IPR exhaustion not only signals the end o f an IPR ONvners’ distribution rights regarding a particular product but also serves as the basis for solving many trade-related matters, particularly parallel imports, repairs (and recycling or reconstruction) o f IPR-protected goods, and anti-competitive practices involving IPRs The settlement o f IPR exhaustionrelated issues requires the intervention o f policies, intem ational conventions and national laws, and many areas o f law, including at least intellectual property, competition and contract law Still, the utility o f the exhaustion doctrine and m easures for the exploitation of that utility are not always fully recognized, particularly by developing and least developed countries This thesis íịcuses on trademark exhaustion and provides a comparison between V ietnam ’s trademark exhaustion rules both in law and in practice and those of the TRIPS Agreem ent, the s and EU N otw ithstanding this delimitation, its solutions should be usefiil for developing countries other than Vietnam Its goals are to help those countries to design their trademark lavvs (and to some extent, their relevant policies) with a view to complying with the TRIPS Agreem ent, íitting their socioeconomic contexts, and íịstering economic growth and social welfare Keywords: IPR exhaustion, trademark exhaustion, the TRIPS Agreem ent, u s law on trademark exhaustion, EU law on trademark exhaustion, Vietnam ese law on trademark exhaustion, conditions triggering trademark exhaustion, legal consequences o f trademark exhaustion, parallel imports o f trademarked goods, repairs o f tradem arked goods, and trademark-related contractual restrictions PREFACE The exhaustion o f IPRs has not so far been the subject o f significant legislation at the intemational level It is still “one o f the most heatedly debated IP-related topics” and “[p]erhaps one o f the most trade-related issues in the íìeld o f intellectual property.”2 The issue has attracted the attention o f researchers in both law and economics Trademark exhaustion, like IPR exhaustion in general, is an exception to the scope o f IPRs Recognition o f IPR exhaustion serves to balance the conílict between the interests o f IPR holders and those o f consumers and maintains reasonable equality betvveen IPR protection and the circulation o f goods and Service as well as healthy competition The applicability of the ứademark exhaustion principle has undeniably been valuable Nonetheless, both developed and developing countries have faced diíĩiculties in designing laws dealing with ữademark exhaustion-related matters Many issues relating to the exhaustion doctrine and to trademark exhaustion in particular are still controversial, especially where the economic aspects are concemed Those are my reasons to embark upon this research I hope it will serve a reference point for readers who are interested in the trade-related aspects o f IPRs, particularly in the exhaustion doctrine and trademark exhaustion, the conditions triggering trademark exhaustion, the legal consequences o f trademark exhaustion, the exhaustion regime for trademark and parallel imports o f trademarked goods, trademark exhaustion in cases o f repair o f ừademarked goods, and trademark exhaustion in cases o f contractual restrictions In addition, it contains advice for law and policy makers, especially those o f Vietnam, in tailoring policy and law on the issues Looking back after alm ost fiv e hardyears o f research, I w ould like to record the invaluable help o f the kindpeople enveloping me and m y passions and endeavors This dissertation w ould not have been possible without their support and I would like to express m y deepest gratitude to all who have ever helped me First and íịremost, I would like to offer my vvholehearted thanks to my wonderful supervisors, Professor Katarina Olsson and Associate Professor Bui Dang Hieu, for their insightíul conversations during the developm ent o f the ideas in this thesis and for helpful comments on the text My supervisors have shared their immense knovvledge, experiences, and precious time w ith me whilst allowed me room to work in my own way I leamed from their academic, stem but íriendly attitude to students as this encouraged me to put more effort into the research M y supervisors were happy w ith my preliminary results and were willing to give me their help at any time in dealing with difficulties which arose I am very fortunate to have them to go with me on the rough road during the past years It is a pleasure to express my special gratitude to the project Strengthen Legal Education in Vietnam (íunded by the Svvedish International D evelopm ent Cooperation Agency) and the Faculty o f Law, Lund University These organizations have given me the opportunity Ganea, Peter, Exhaustion o f ỈP Rights: ReJlections from E om ic Theory, Institute o f Innovation Research-Hitotsubashi U niversity, Japan, 2006 S ee also G allego, Beatriz Conde, The p rin cip le o f exhaustion o f rights a n d its im plication s f o r com petition law, International Revievv o f Intellectual and Competition Law, IIC 0 , 34 (5 ), pp 473-502 This is Thomas Cottier’s observation, cited by Sheckhtman, Ekaterina and Sesitsky, Evgeniy, Exhauslion an d P a lle l Im portation in the F ieỉd o f T radem arks, 0 , < http://www.turin-ip.com /researchpapers/papers-2008/Shekhtm an-Sesitsky.FINA L.pdP> to be im the Joint Doctoral Training Program and realize my dreams o f engaging in such study n have beneíited from the magnifícent library and advanced Computer system o f the Faculty' of Law which greatly enrich my dissertation My most fruitful and intensive researclh time has been in this cordial refuge, I would like to thank the proíessors, librariams, and other staff o f the Faculty In the course o f my years o f research, I also have had the privilege and pleasure of receiviiag precious support from and spending fruitful time at a number o f excellent educational and research centers, national and intemational organizations, and govemmental oíĩices These are: Suffolk University Law School (Boston, US), WIPO, WTO, Max Planck Institute (Munich, Germany), the European Patent Office and, in Vietnam, the Inspectorate o f the Ministry o f Science and Technology (MOST) the National Office o f Intellectual Property (NOIP) o f MOST, the Competition Administration Department (VCAD) o f the Ministry o f Industry and Trade (MOIT), the Exports and Imports Administration Department o f MOIT, the Drug Administration Department o f the M inistry o f Health, the General Department o f Customs o f the Ministry of Finance, and the People’s Supreme Court I greatly benìted when the Japanese Patent Offíce published my íirst English article on the Vietnamese law on IPR exhaustion in the magazine of the IP Community (in 2007) After its publication, I received many valuable comments which have been useful in the subsequent development o f my dissertation I vvould like to thank WIPO for inviting me to retum to Geneva in 2010 to carry out a research on the use by WIPO M ember States o f exhaustion-related intellectual property provisions to address anti-competitive practices within the Project on Intellectual Property and Competition Policy The arguments below, particularly those on competition-related trademark exhaustion have been strengthened by my work with the WIPO project Also, I express my sincere gratitude to the Vietnamese Ministry o f Science and Technology for permitting me to vvrite some parts o f the Circular guiding the Decree No 97/2010/ND-CP of the Government on sanctioning administrative violations in the domain of industrial property, also in 2010 Such parts (they are on parallel imports; reuse, recycling, and repaữ o f industrial property right-protected goods; and production and marketing o f industrial property right-protected Products in excess o f the rights granted to industrial property right owners) closely link to my dissertation Through discussions with the draíting group, my ideas on these issues vvere improved More importantly, my ideas for improving Vietnamese law on them have been used in a legal normative document I would like to grateíully acknowledge the invaluable support o f Hanoi Law University My university granted me the best conditions for completing this dissertation My special thanks go to the Board o f Rectors, the Department o f íoreign relations, the Personnel Oíĩice, and the Faculty o f Civil Law I am aware and íiilly appreciate that my colleagues in the Center o f Intellectual Property Law and the Division o f Civil Law have been burdened with additional teaching hours due to my írequent, lengthy absences On an individual level, many have given their time, knowledge, and experience in assisting my research I have received Professor Christina M ốell’s warm guidance and eíĩective help in both study-related and practical matters, especially in the fírst three years o f the project when I was a very immature PhD candidate I have also been supported in many ways throughout the process o f vvriting up my research by Assistant Professor Bengt Lundell who is one o f the people most involved in the whole program His seasoned experience and knovvledge o f intemational issues mixed with his understanding o f Vietnamese have helped me out in many puzzles I convey a special acknowledgem ent to his signiíicant contribution in smoothing my research schedules both at home and abroad I would love to em phasize my thanks to Professor Hans H enrik Lidgard W hen I fírst asked him about parallel im ports, I knew nothing m ore than the term s “parallel imports” and “IPR exhaustion.” I w as interested in them but vvorried by their novelty, and I was very hesitant to select the subjects for the proposal for PhD research Professor Lidgard erased m y hesitancy and triggered my passion for doing research on trademark exhaustion Furtherm ore, he has given me continuous encouragem ent and been a constructive voice during sem inars even w hen he w as not a m em ber o f the Examination Panels The encouragem ent o f Professor L ars-G ốran M alm berg and his sincere regards have íostered my study since the tim e I was a m aster student at Lund University I fully appreciate the opinions on com parative m ethod o f Professor Michael Bogdan Those opinions m ade me more coníìdent in using such a method and devoting a whole chapter o f m y dissertation to com parison It is a pleasure to pay tribute also to Professor Birgitta N ystrốm, Professor Hans-Heinrich Vogel, Assistant Professor Eva Lindell-Frant, and Dr Tran Le Hong for their constructive criticism and useful íeedback during and after the seminar I gratefully acknowledge their important contribution to improving my dissertation I thank Dr Nuno Pires de Carvalho for his tireless help in the vvhole process o f my doing research I grateíully thank Dr Christopher Heath, Dr Carsten Fink, Dr Peter Ganea Proíessor M argaret Chon, Associate Professor Jessica Silbey, A ssociate Professor Stephen M MacJohn, Assistant Proíessor U lf M aunbach, Associate Professor Pham Duy Nghia, Dr Pham Dinh Chuong, Dr Pham Hong Quat, and Mrs Tu Viet Lan for acting as patient intervievvees in many discussions carried out over long-distance via e-mails In particular, many thanks go to Dr Pham Hong Quat, Mrs Le Hong Van, and Mr Nguyên Thanh Hong for helping me overcome the difficulties in selecting and accessing the official documents o f the tradem ark exhaustion-related cases in Vietnam Thank to these cases, my writing on tradem ark exhaustion in law and practice o f V ietnam becomes more convincing I record here the help o f Proíessor Stephen Hicks in arranging and following up my discussions with scholars o f intellectual property law when I was in Boston in the u s and afterward Also, many thanks go to Philip Horowitz for his care and patience in reviewing my English This dissertation would not have been existed vvithout my long-suffering family From the bottom o f my heart, I thank my parents, Niet Nguyen and Hue Tran, for teaching me and my younger sister about the importance o f study, giving us the privilege o f being able to study, and raising us with their gentle love and care This dissertation is one o f my eíĩorts to keep them happy with the achievements o f their two daughters I owe much to my parents-in-law and my parents for their support o f my extensive study and their considerate care for my daughter vvhen I was abroad Words fail me in expressing my indebtedness to the sacriíìce o f my small family Luu Dinh, I fully understand how much difficulty he has experienced when I have been far away from our home His love and other contributions given vvithout complaint have supported me through all the stress o f every step o f the joum ey Devotion to Titti Quynh Trang, my little daughter, has been a motivation for me to complete this dissertation In addition, many thanks are due to my friendly and cheerful group o f fellow students We have wholeheartedly shared challenges and pleasures during the years o f our research I hope to keep up our collaboration in the future Finally, I would like to apologize to all who contributed to the realization o f this dissertation but were not mentioned personally The law is stated in this dissertation as in force on 15 April 2011 Nguyen N hu Q uynh V ABBREVIATIONS AG Advocate General AIPPI The International Association the Protection o f Intellectual Property ASEAN Association o f South East Asian Nations CFI Court o f First Instance (European Court o f Justice) CUTS Consum er Unity and Trust Society (India) EC European Community ECJ European Court o f Justice EEA European Economic Area EEC European Economic Community EFPIA European Federation o f Pharmaceutical Association (US) EFTA European Free Trade Association EU European Union FDA Food and Drug Adm inistration (the US) GATS General Agreement on Trade in Services GATT General Agreem ent on TariíTs and Trade ICTSD International Centre for Trade and Sustainable Development (UNCTAD) IPR M atthew s, Duncan and M unoz-Tellez, Viviana, Parallel Trade: A U ser's Guide (In A K rattiger, RT M ahoney, L Nelson, and Davis (eds.) 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UNIVERSITY HANOI LAW UNIVERSITY NGƯYEN NHƯ QƯYNH TRADEMARK EXHAƯSTION AND PROPOSALS FOR AN IMPROVEMENT OF VIETNAMESE TRADEMARK LAW SUPERVISORS: PROF DR KATARINA OLSSON ASSOCIATE PROF DR BUI DANG HIEU... EU, and Vietnam, the consistency betvveen Vietnamese lavv on trademark exhaustion and the TRIPS Agreement, and differences and similarities betvveen Vietnamese law and practice relating to trademark. .. discussion of the theoretical aspects o f IPR exhaustion, trademark exhaustion, and trademark exhaustion- related speciíic matter and the analyses and comparisons o f the trademark exhaustion