The implementation of the law governing commercial anvertisement, reality an recommendations (luận văn thạc sĩ luật học)

MINISTRY OF EDUCATION AND TRAINING HO CHI MINH CITY UNIVERSITY OF LAW FALCULTY OF COMMERCIAL LAW o0o HAP THI NHU NGUYET THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: REALITY AND RECOMMENDATIONS BACHELOR THESIS SPECIALTITY OF COMMERCIAL LAW HCMC – 2011 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 HO CHI MINH CITY UNIVERSITY OF LAW FALCULTY OF COMMERCIAL LAW BACHELOR THESIS THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: REALITY AND RECOMMENDATIONS STUDENT: HAP THI NHU NGUYET COUSE: 32 STUDENT CODES: 3220133 SUPERVISOR: DR HA THI THANH BINH HCMC - 2011 Page THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 COMMITMENT During the time of studying at Ho Chi Minh city University of Law, the topics related to the field of Commercial law have always attracted the interest of the author Therefore, the author has chosen the topic: “The implementation of current law governing commercial advertisement: Reality and recommendations” to study and present in bachelor thesis Despite of the limited time and reference material, the thesis was done with the high concentration of the author on both its form and content The author protests that this thesis is the research results of the author, with the guidance of supervisor The information other than my idea presented in this thesis is also fully cited I would bear full responsibility for my protest Ho Chi Minh City, 07/2011 Hap Thi Nhu Nguyet Page THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 ACKNOWLEDGEMENTS This thesis would not have been accomplished without the contribution of several individuals, to whom I would like to express my deepest appreciation First and foremost, I would like to thank my supervisor, Ms Ha Thi Thanh Binh, for her invaluable guidance and advice from the very first to the final steps of this thesis This thesis is dedicated to my parents, my elder brother and all of family members for always supporting and encouraging me in the time of studying at Ho Chi Minh city University of Law A very special thank to my mother who always believes in me and makes me believing in myself It is her desire making me decide to study at Ho Chi Minh city University of Law and it is her love giving me the strength to face all the difficulties of my student life Finally, an honorable mention goes to my special friends for their lovely support and understandings Thanks to my dear best friend, Nguyen Thi Ha for always being by my side every time I need Thanks to my dear brothers and sisters in Ho Chi Minh City University of Law, especially Tran Quang Huy, Nguyen Thi Duyen, who helped me improve my English writing skill Without their helping, perhaps I would not have completed this thesis as well as it is now Thank you all for all the help you have given me This thesis would have not been possible without you Page THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 TABLE OF CONTENTS CHAPTER CURRENT LAW GOVERNING COMMERCIAL ADVERTISEMENT: SOME SIGNIFICANT REMARKS Error! Bookmark not defined Error! Bookmark not defined 1.1 Overviews of commercial advertisement 1.1.1 Definitions and main characteristics of commercial advertisement Error! Bookmark not defined 1.1.2 Parties to advertising business 1.1.3 Advertising products and advertising media Error! Bookmark not defined 1.1.4 1.1.5 Natures of commercial advertisement Roles of commercial advertisement Error! Bookmark not defined Error! Bookmark not defined 1.2 Overviews of the law governing commercial advertisement in Vietnam Error! Bookmark not defined 1.2.1 Development of advertising activities in Vietnam Error! Bookmark not defined 1.2.2 Development of the law governing commercial advertisement Error! Bookmark not defined 1.2.3 Relationships between the law governing commercial advertisement and some related legislations Error! Bookmark not defined 1.3 Analyses of some important provisions of current law governing commercial advertisement Error! Bookmark not defined Page THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 Error! Bookmark not defined 1.3.1 State management on advertising activities Error! Bookmark not defined 1.3.2 Provisions governing prohibited advertising activities Error! Bookmark not defined 1.3.3 1.3.4 Provisions governing advertising licenses Error! Bookmark not defined Restrictions on advertising activities Error! Bookmark not defined 1.3.5 Provisions governing sanctions for violations on advertising activities Error! Bookmark not defined CHAPTER SOME SHORTCOMINGS IN THE IMPLEMENTATION OF THE LAW GOVENING COMMERCIAL ADVERTISEMENT AND RECOMMENDATIONS FOR IMPROVEMENT 2.1 Shortcomings in implementation of current law governing commercial advertisement Error! Bookmark not defined 2.1.1 Implementation of current law governing commercial advertisement at local level 2.1.2 Shortcomings in implementation of State management on advertising Error! Bookmark not defined 2.1.3 Shortcomings in implementation of provisions on advertising licenses Error! Bookmark not defined 2.1.4 Implementation of provisions governing restrictions on advertising activities Error! Bookmark not defined 2.1.5 Handling of violations on advertising activities defined Page Error! Bookmark not THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 2.2 Recommendations for improvement of commercial advertising law .Error! Bookmark not defined 2.2.1 Recommendations for improvement of some specific provisions .Error! Bookmark not defined 2.2.2 Recommendations for improvement of State management on advertising activities Error! Bookmark not defined I INTRODUCTION Reasons why the topic is worth consideration The market mechanism has opened a new development trend for our economy Businesses in Vietnam have confirmed their position in the world marketplace through their strong brands Contributing partially to this success is the role of advertising activities It is considered that advertising activity is one of indispensable activities on business promotion of companies In addition, consumers also consider it as a channel providing information about the price and quality of products In Vietnam, the importance of advertising activities was highly appreciated recent years Along the line, the law on advertising also has being improved gradually However, because of the rapid change of advertising activities, current law governing commercial advertisement has exposed some shortcomings and needs to be improved Page THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 The shortcomings of current law governing commercial advertisement are also the research contents of some authors such as Dao Huu Dung, Phan Huy Hong, Truong Hong Quang, Nguyen Ba Dien etc Most of them carried out their researches on some aspects of advertising activities, for example Dao Huu Dung with television advertising; Phan Huy Hong, Truong Hong Quang with comparative advertising These authors have clarified many important issues of advertising activities However, beside these issues, in the law governing advertising activities, there are also some other shortcomings must be improved This requirement becomes more necessary when Vietnam is about to build and issue Advertising law in the coming time Because of this reality, the author has chosen the topic: “The implementation of the law governing commercial advertisement: Reality and Recommendations” to study and present on Bachelor thesis at Ho Chi Minh city University of Law The purposes of the thesis This thesis is conducted to serve the demand of the improvement of current law governing commercial advertisement This thesis addresses the necessity of the improvement of current law governing commercial advertisement Basing on analyses of the effectiveness of current law governing commercial advertisement, the research’s results of some authors, legislative experiences of some countries in the world, this thesis also brings out some recommendations for the improvement of current law governing commercial advertisement in future - Methodology Social methods (Analysis, Comparison, Demonstration); Legal methods (Analysis and Review of legislative activities) Limitation on the research’s scope Page THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 This thesis points out the contents and implementation of current law governing commercial advertisement in Vietnam Basing on these results, the thesis is intended to bring out recommendations for the improvement of current law governing commercial advertisement The objects of this thesis are provisions of current law governing commercial advertisement, other related legislations of Vietnam and some countries in the world (Germany, China ) The structure of the thesis The content of the thesis includes chapters - Chapter 1: “The current law governing commercial advertisement: Some significant remarks” In this chapter, the author presents some following contents: Overview of commercial advertisement; Overview of the law governing commercial advertisement; Analyses of some significant provisions of current law governing commercial advertisement - Chapter 2: “Some shortcomings in the implementation of the law governing commercial advertisement and recommendations for improvement” In this chapter, the author presents following contents: The shortcomings in the implementation of some significant provisions of current law governing commercial advertisement; Recommendations for the improvement of some regulations on the law governing commercial advertisement; Recommendations for the improvement of the State management on advertising Page THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 of Association of Consumers on representing for consumer on initiation of lawsuits in order to protect the common benefits without the proxy of consumers because there are many false advertisements of companies affect badly the interests of millions of consumers at present, they must be handled and compensated for damages d) Investing in the quality and quantity of State agencies’ staff In order to perform the centralized, unified management functions on advertising, management agencies should be strengthened first on human resources following by financial ability etc In addition, the State agencies’ staff must also be trained methodically and there must have necessary facilities and equipments for these agencies to meet the requirement of handling with the seriousness and sophistication of violations at present Some countries such as France, USA, Japan, Canada with their good experiences on the State management always reflect their legal opening thoughts on the 73 implementation of the law During the execution, their laws always give the State agencies the right to analyze the natures of each particular case to decide the specific sanctions for violations The details of the law and the flexible functions of the State agencies are the important bases which make their legal system suitable to the constantly changing of the market This is a worth experience for the improvement of our legal system in this aspect e) Hastening the building of advertising plan and scheme for advertisements As mentioned above, the demands on advertising plan and scheme for advertisement are very necessary for the effectiveness of the State management on 73 http://vietnamese-lawconsultancy.com/vietnamese/content/browse.php?action=shownews&category=&id=37&topicid=831 Page 54 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 advertising activities They are not only bases of the inspection and handling violations but also create the consistency and professionalism of advertising activities Currently, one of the causes of the turmoil on advertising activities is the ineffectiveness of the State management Because some localities did not publish the plan for advertisements so companies have carried out their advertising activities spontaneously in many years ago We need hasten the building of advertising plan and scheme for advertisements in all provinces/cities The approval of the scheme for outdoor advertisements should have specialist’s reviews of experts in the fields of construction, architectural planning, natural resources, environment, culture, sports and tourism of each locality With these supports, businesses will be more active on carrying out their advertising activities f) Increasing current sanctions to reduce violations on advertising activities Administrative sanctions: the author is of the opinion that Administrative penalties now are not strict enough to prevent companies from violations The current maximum fine under the provisions of Decree 56/2006/ND-CP, 06/06/2006 is only 30.000.000 VND Such penalty is not a troublesome for those businesses with good financial ability To increase the admonition of administrative sanctions, the author proposes a number of recommendations as below: (i) We should increase the fines in line with the current situation of the economic The penalties must ensure that the penalties will affect the economic benefit of violators If it is ensured, these penalties will have the admonition on reality and prevent new violations (ii) These penalties must have clear classifications A penalty cannot be applied to all violations because in fact each activity has different nature and danger Page 55 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 (iii) It is possible to apply some forms of sanction as name the violated business names on public mass media to make other businesses aware of negative consequences resulting from illegal behaviors Criminal sanctions Criminal law 1999 (amended in 2009) has only a provision regulating violations on advertising (Article 168 "False advertisement") Actually, there are many violations have sufficiently constituent elements of criminal violations such as: advertisements aim to denigrate the honor of other businesses, advertising aimed at unfair competition so in the coming time, we should add some new criminal provisions to deal with some serious violations on advertising The summary of Chapter II In chapter I, the author has analyzed a number of important provisions of the current law governing commercial advertisement, such as: The State management on advertising, prohibited advertising activities, restrictions on advertising, handling of violations on advertising… Based on these provisions, in chapter II, the author has presented the following basic contents: - Identify and analyze the implementation of some important provisions of current law - Identify and analyze the shortcomings and some undesirable outcomes generating from the implementation of these provisions, their impacts to the economy and society Issue some recommendations for the improvement of the law in future - Through these contents, the author has described the reality of advertising activities in Vietnam under the control of the law governing commercial advertisement Because of the quickly change of advertisement and limited legislative ability, the implementation of current law has some shortcomings It is considered that shortcomings on the law are the main reason of the weakness of advertising activities at present To develop advertising sector, we must improve quickly the law both in its Page 56 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 provision and its implementation in practice The author hopes that some recommendation presented above can contribute partially to the improvement of the law governing commercial advertisement III CONCLUSION In the market economy, commercial advertisement plays an important role in development of a business brand Being an effective linkage between consumers and manufacturers, commercial advertisement has been highly paid attention by companies It is also acknowledged that commercial advertisement is a complex sector However, if commercial advertisement is controlled and oriented to develop suitably, soundly by the law, it will still maintain its important roles for the development of the economy and companies From the legal’s point of view, this thesis has studied provisions of current law governing commercial advertisement and the actual effects of these provisions on controlling advertising activities This thesis also has studied and analyzed provisions of Vietnam law relating to the management of advertising and compared to some concerned provisions of the other countries To be concluded, the author is of the view that: In the field of commercial advertisement, although the law of Vietnam has shown some exertions on promulgating provisions controlling advertising activities and exploiting the benefits of commercial advertisement effectively, however, these Page 57 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 provisions still have some shortcomings Since these provisions are general, as such the implementation of them is ineffective in fact By studying and analysis of the implementation of current law governing commercial advertisement in Vietnam, the thesis has proposed some legal recommendations for improving the law governing commercial advertisement of Vietnam in future The most significant ones include the improvement of some specific provisions as: comparative advertisement, prohibited advertising activities, licensing procedures on advertising activities etc; Recommendations for improving State management on advertising, handling of violations on advertising activities The author believes that the improvement of the law governing commercial advertisement must be carried out step by step, firstly, on the State policies on advertising following by legislative procedures In addition, the improvement of the law on advertising, Vietnam must also improve the regulations regarding responsibilities binding the parties thereto on implementing the law in order to achieve the main goal of effective implementation of the law In spite of the said shortcomings, the author hopes that this thesis can give a backdrop of the fact of the law governing commercial advertisement and contribute to the improvement of the law in the future The author wishes to receive comments from teachers and readers for this thesis Page 58 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 BILIOGRAPHY A REFERENCE MATERIALS Christoper Vollmea(2008), Future of advertising and marketing, Age Publishing house Dao Huu Dung(2004), Television advertisement in the market economy: analysis and evaluation, National university publishing house Nguyen Thi Dung (2005), The definition of advertisement on Vietnam law and its impacts on improving the law on advertising, "Journal of State and Law, (12) Nguyen Ba Dien(1997), The law on dishonesty advertising in Vietnam and some countries in the world, State and Law Journal, Social Science Institute of Vietnam, (No 10/1997) Bui Huy – Quach Dau(2009), Business and advertising, HCM city, People's Army Publishing House Page 59 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 Dr Bui Nguyen Khanh(2010), Current methods on settling disputes between consumers and traders in Vietnam - reality and prospect, State and Law Journal, Social - labor publisher, No.11(271) Ngo Quoc Linh (2005), "Proceeding to implement the Framework Convention on controlling tobacco of the World Health Organization in Vietnam" Journal of Jurisprudence (02) Truong Hong Quang(2009), The law governing comparative advertising of European Union and Vietnam - researching under the comparison on Law, Bachelor thesis of law, Hanoi University of Law Nguyen Thi Tam(2010,) The law governing commercial advertising activities on newspapers, current application and directions for improvement, Masters of Law thesis, HCM city university of law 10 Ngo Cong Thanh(1997), International Advertising, HCM City Economics University Publishing house 11 Ha Thu Trang(2004), The law on advertising in Vietnam - Theoretical and practical issues, Master thesis of Law, Hanoi University of Law 12 Dao Thuy Vinh(2000), Competition on commercial activities under Vietnam Commercial law, HCM City University of Law, Bachelor thesis of law B LAWS: Commercial Law No 58/L-CTN, 10/05/1997 Criminal law 2005 (amended in 2009) No.37/2009/QH12 (Criminal Law 2005) Competition Law No 27/2004/QH11, 03/12/2004 (Competition Law 2004) Commercial Law No.36/ 2005/QH10, 14/06/2005 Page 60 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 (Commercial Law 2005) Enterprise Law No.60/2005/QH10, 29/11/2005 Ordinance No 39/2001/PL - UNVQH10, 16/01/2001 on advertising (The Ordinance on Advertising) Consumer Protection Law No 29/2010/QH12, 17/10/2010 (Consumer Protection Law 2010) Corporate Incomes Tax Law No 14/2008/QH12, 03/06/2008 (Corporate Incomes Tax Law 2008) C DECREES Decree No 24/2003/ND- CP, 13/03/2003 detailing the implementation of the Ordinance on advertising Decree 56/2006/ND-CP, 06/06/2006 governing the handling of administrative violations on cultural, informative activities Decree No.185/2007/ND-CP governing the functions, responsibilities, authorities and structure of Ministry of Culture – Sport- Tourism Decree No.187/2007/ND-CP governing the functions, responsibilities, authorities and structure of Ministry of Information – Communication Decree No.189/2007/ND-CP governing the functions, responsibilities, authorities and structure of Ministry of Industry - Commerce Decree No 103/2009/ND – CP, 06/11/2009 on cultural activities and business of public cultural services Decree No 11/2010 ND-CP, 24/02/2010 on controlling and protecting the structure of road traffic Decree No 38/2010/ND – CP, 07/04/2010 on controlling of urban space, architecture and landscape Page 61 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 D CIRCULARS Circular No 43/2003/TT-BVHTT, 16.07.2003 guiding the implementation of Decree No 24/2003/ND – CP, 03/13/2003 detailing the implementation of Ordinance on Advertising Joint Circular No 1/2004/TTLT - BVHTT – BYT, 12/1/2004 guiding the advertising activities in the health sector Circular 79/2005/TT-BVHTT, 12/08/2005 amending and supplementing some provisions of Circular No 43/2003/TT-BVHTT, 07/16/2003 guiding the implementation of Decree No 24/2003/ND-CP, 13/03/2003 detailing the implementation of the Ordinance on Advertising Joint Circular No 85/2008/TTLT - BVHTTDL – BTTTT, 18/12/2008 guiding the licensing activity, advertising on press, computer information networks, publications and the inspection, testing, handling of violations Circular No 13/2009/TT- BYT, 01/09/2009 of the Ministry of Health guiding the informative operation on medicine advertising Circular No 154/2009/TT- BTC, 30/07/2009 governing the collection, management and use of licensing fees for advertising E DECISIONS Decision 108/2002/QD-UB, 25/09/2002 of HCMC People’s Committee Decision 75/2004/QD-UB, 31/02/2004 of HCMC People’s Committee Decision 101/2006/QD-UB, 06/11/2006 of Da Nang People’s Committee Decision 205/2006/QD-UBND, 24/11/2006 of Ha Noi People’s Committee Decision 39/2009/QD-UBND, 05/06/2009 of HCMC People’s Committee Decision No 94/2009/NDUBND, 24/08/2009 of Hanoi People's Committee Page 62 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: REALITY AND RECOMMENDATIONS2011 F WEBSITES http://marketing-branding.vn http://en.wikipedia.org http://simple.wikipedia.org http://ecvin.net http://congthuong.com.vn http://www.lantabrand.com http://vietbao.vn http://dantri.com.vn http://nganhangonline.com 10 http://www.tapchicongnghiep.vn 11 http://www.baomoi.com 12 http://daibieunhandan.vn 13 http://www.phapluatvn.vn 14 http://www.doanhnhan.net 15 http://www.thesaigontimes.vn 16 http://www.tvad.com.vn 17 http://tintuc.xalo.vn/ 18 http://www.cand.com.vn/ 19 http://www.vietnambranding.com/ 20 http://www.cpv.org.vn 21 http://caicachhanhchinh.gov.vn/ 22 http://www.tapchicongnghiep.vn 23 http://www.luatvietnam.vn 24 www.phapluatquangcao.com 25 www.vnbiz.info Page 63 2012 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: REALITY AND RECOMMENDATIONS2011 26 www.doanhnhan360.com.vn 27 www.dddn.com.vn 28 www.sgtt.com.vn 29 www.iab.vn 30 www.case.org.sg/index.html 31 www.qlct.gov.vn Chart 1.1.4 Page 64 2012 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 Source: http://www.slideshare.net/opinionwatch/online-personal-recommendationspersonal-opinions-influence-nielsen-global-survey-july09 Page 65 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 Chart 1.1.5 (1) Effectiveness of advertisement for producers Small producers Big producers 40% Directive letter 70% 28% Events 67% 47% Printed matters 68% 38% Television 47% 27% PR 36% 21% Radio 30% 17% 17% Outdoor advertising 33% Online advertisements 58% 28% Website of certain products Social network Mobile equipments YouTube 47% 6% 21% 3% 18% 3% 12% (Percentages of producers agree) Source: Bui Huy – Quach Dau(2009), Business and advertising, HCM city, People's Army Publishing House Page 66 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2011 Chart 1.1.5 (2) Effectiveness of advertisement for consumers Car 98% Telecom 80% Technique 100% Retail 88% Professtion services 80% Production 78% Health 92% Financal services 94% Consumer goods 89% Average 90% (Percentages of consumers agree) Source: Bui Huy – Quach Dau(2009), Business and advertising, HCM city, People's Army Publishing House Page 67 THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: REALITY AND RECOMMENDATIONS2011 Page 68 2012 .. .THE IMPLEMENTATION OF THE LAW GOVERNING COMMERCIAL ADVERTISEMENT: 2012 REALITY AND RECOMMENDATIONS2 011 HO CHI MINH CITY UNIVERSITY OF LAW FALCULTY OF COMMERCIAL LAW BACHELOR THESIS THE IMPLEMENTATION. .. of Commercial law have always attracted the interest of the author Therefore, the author has chosen the topic: ? 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