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Cite as:  Frederick P. Vimeux, Vietnamese Copyright Laws:  Foreign Copyright Owners Beware!  A Comparative Analysis of its Evolution and Shortcomings, 3 Gonz. J. Int’l L. (1999-2000), available at http://www.gonzagajil.org/.

 Vietnamese Copyright Laws: Foreign Copyright Owners Beware!

A Comparative Analysis of its Evolution and Shortcomings.

by Frederic P. Vimeux, J.D. FNa

I.  Introduction

Vietnam’s New Copyright Laws: An Attempt to Reassure Investors

Birth of Copyright Protection in Vietnam

In 1986, Vietnam took the first step to offer copyright protection to its nationals and foreign owners.25 However, the treaty did not recognize the increasing use of computer software.26 In December of 1994 the Standing Committee of the National Assembly passed an Ordinance on Copyright, this new Ordinance included protection for computer software, translations, maps, and plans. 27

The 1994 Ordinance brought some major improvements to the copyright laws of Vietnam. For example, it provided detailed protection for performance artists, composers, conductors, radio and television broadcasting agencies that performed these neighboring rights.28 Furthermore, the Ordinance offered, for the first time, remedies for copyright infringement.29 Under the Ordinance, an author could demand that the infringer stop using copyrighted material and pay compensation for any damages suffered by the illegal use of the work. An author could request the Department of Copyrights,30 or other relevant state authorities, to intervene in order to stop the infringer and bring the case directly before the local People’s Court.31 Although a major improvement compared to previous legislation, the Ordinance did not survive due to major unresolved loopholes in its enforcement.

In order to obtain protection under this Ordinance, foreign works had to be published within 30 days of their first publication elsewhere, unless protected by an international Agreement to which Vietnam is a signatory.32 Since at the time Vietnam was not signatory to any Agreements or treaty de facto no protection was afforded to foreign work, and Hanoi became rapidly the "photocopy-city" of Asia where any pirated copy of a book or movie could be found. The reader will note that the Vietnamese authorities, although attempting to reach international standards, persist in keeping the 30-day rule as evidenced by its continued implementation in the new Civil Code; which, naturally, creates barriers to the development of credibility in the country’s commitment to ensure protection of foreign works. Finally, the Ordinance did not rise to the level of law because in Vietnam, in order for an ordinance to become law, a subsequent enactment implementing the regulation must be passed.33 The government never took the additional step of passing subsequent necessary mandates and therefore the Ordinance died. Nevertheless, in yet another effort to comply with international standards the Vietnamese Assembly went back to the drawing board to develop what would become the New Civil Code, which took effect in July 1, 1996. 34

The New Civil Code Provisions of 1995: a. General Overview

The 1995 Civil Code35 has offered, in theory, a dramatic improvement for the protection of copyrights. In compliance with the Berne Convention 36, the Civil Code now protects authors of copyrightable material the economic as well as moral rights in their creation. Article 751 of the new Code defines Economic Rights as the right to receive remuneration for the publication, republication, performance, modification, translation and broadcasting of a work.37 Moral rights are those which protect the honor and integrity of a work against mutilation, the right to claim or declare authorship of a work, the right to name, and the right to have one’s name mentioned in connection with the public use of the work.38  Authors who adapt, edit, rewrite, or transform works enjoy economic and moral rights, but must pay remuneration and obtain permission from the author or owner of the modified work.39 Authors who translate works may enjoy economic and moral rights except for the right to name the work.40

The new Civil Code has a number of long overdue improvements. First, the Civil Code is now in conformance with recognized international standards, it now protects an "author" who directly creates the entirety or part of a literary, artistic, or scientific work." Compared to the Civil Code, the language of the Ordinance on Copyrights was vague and unclear regarding the degree of protection afforded to authors who directly create "scientific and technical works or parts thereof."41 However, the Ordinance does not define these terms.42

Chapter I, Part VI of the Civil Code 43 defines Vietnam’s new copyright law. Although the Ordinance barely mentions that an author owns his or her works, the Code finally defines the owner of a work as following: An author can be one who translates, rewrites, adapts, transforms, edits, or annotates from one language or medium to another. As a result of the new definition an increased number of works are now protected including written works, photographic works, scientific projects, computer software, and artistic performances, radio, and television broadcasts.44

Article 746 of the Civil Code defines copyright ownership to authors of work, co-authors of a work, the heirs or devices of a deceased author.45 Indeed, the provisions of article 746 resemble in its range and application to the work made for hire doctrine as presented in section 101 of the United States Copyright Act. 46

Section 101 of the United States Copyright Act defines work made for hire as a work prepared by an employee within the scope of his or her employment, or one of nine enumerated categories of works when the author and a sponsor agree in writing that a work is a work made for hire.47 The nine categories are: (1) a contribution to a collective work, (2) a part of a motion picture or other audio-visual work (3) a translations, (4) a supplementary work, (5) a compilation, (6) an instructional text, (7) a test, (8) answer materials for a test, (9) an atlas. 48

Under the Act the owner of the copyright is the person for whom the work was prepared, or, in other words, the employer rather than the individual who actually created the work.49   Per comparison, Article 746 states that an authority or an organization that delegates to an author shall be the owner of the entirety or part of the work created by the author under a duty delegated by the authority in the organization. 50

However, Article 752 appears to give rights to authors who do not own their creation through the existence of a work for hire doctrine in the Civil Code. Article 746, furthermore, finds that an individual or organization, which enters into a contract with another to create a work, shall be deemed the owner of the work.51 Although these provisions seem to indicate the presence of a "work for hire" doctrine, Article 746 is not clear as to whether it means the same as that in section 101 of the United States Copyright Act. The United States Supreme Court held that if a person is doing the work within the scope of the common law agency principle, then the work is a work for hire and the employee is the initial owner of the copyright, rather than the conceiving employee.52 This lack of clarification may potentially hurt Vietnam’s trade since investors and authors may wonder what protection they may be afforded under Vietnamese copyright law. 53

Before the 1995 Civil Code, the 1986 Decree on Copyright only protected the author’s rights for the author’s life plus 30 years.54 The 1986 Copyright Decree of the Berne Convention requires probation for fifty years and the Civil Code now reflects an attempt to abide by that international standard.55 The new Civil Code also protects economic rights until four years after the death of the last surviving author. In addition, the Civil Code now protects moral rights indefinitely.56 Furthermore, the Code prohibits authors from selling their moral rights. Thereby representing an effort to protect authors in developing countries, where abuses of bargaining power would be a substantial and significant blow to creativity.57

Article 766(5) demonstrates a resurgence of the conflict the Vietnamese government faces with the notion of the privacy of authors’ rights where the authors’ identity is uncertain or anonymous. The Civil Code states that the state obtains automatic ownership over copyright, 58 however, note that the Civil Code softens this extreme measure by stating that if the identity of an author can be determined within 50 years of publication, the exception of Article 766(5) is established and the author’s rights revert to Article 766 (1-4).59

Finally, inheritance of a copyright is a fully established principle.60 However, moral rights do not survive the author’s life. As a comparison, the Copyright Act s. 106A provides that moral rights last as long as economic rights do.61 Although there is no limit in international standards, one wonders why the Vietnam’s authorities deny moral rights protection beyond the author’s life, even though the economic rights last longer by contract.

The new Civil Code correctly requires a written contract authorizing the use of a copyrighted work.62 However, the Code, once again, imposes a severe limitation to the freedom of the contract. For example, Article 770 of the code unfairly favors people who contract to use the work to the detriment of the author or the copyright owner.63 The code provides more rights for the person who contracts than the author or owner of the copyright.64 The author or copyright owner’s rights to rescind are also seriously limited, while fully accepted for the person who contracted to use the work.65 Contrary to the notion of contract, it is troublesome to find such limitations in a country trying to revamp its economy. Similarly, one wonders about the negative impact that such provisions will have on licensing. This may hold back the increase of foreign licenses being established in Vietnam. Indeed, a foreign author and copyright owner may well question the strength and security of its rights in Vietnam.

In addition, the Civil Code expressly grants rights to persons and organizations involved in the entertainment industry.66 The Code specifies that in order to produce audio tapes, compact discs, videotapes, and laser discs, organizations must enter into a contract with the authors and owners of copyrighted materials and further acknowledge them by name, ensure the integrity of the work, and pay royalties or other remuneration due.67 The reader will note that unlike the Copyright Act, which offers a definition of "phonorecords" and motion pictures, the Civil Code does not define or differentiate between works fixed in an audio or visual medium.68

As demonstrated by the recent "Titanic" sweep in Vietnam,69 although the Vietnamese authorities show goodwill in passing these new provisions, a lack of consistent and thorough enforcement will not curtail the rampant and widespread manufacture and sale of illegal material. The Vietnamese government must take the proper steps for it does not want, nor can it afford, for the doi moi renovation to stumble and fail.

b) Loopholes Remaining in The New Civil Code:  The Censorship Provision

Article 749 of the Civil Code70 is one of the most troublesome provisos left in the newly passed legislation. It rejects full and complete protection to any work that could be interpreted as contrary to the interest of the Socialist Republic of Vietnam. This proviso alone is a major blow to copyright protection. Under the cover of censorship and state interest, protection of one’s copyright could be denied. Therefore, broad discretion is left to the court or the appropriate administration to determine whether or not an item, software product or TV show may be protected or not depending on the interpretation given to the product. It is interesting to note that the subsequent implementation ordinance71 offering guidance on how to interpret such eventualities did not reveal the scope of interpretation the censorship clause should be given. Consequently, foreign copyright owners may remain insecure about exporting their products into Vietnam’s developing market and society. In addition, the Code denies protection to any work containing materials that "disseminates social vices, superstition, or undermines traditions and customs" of the country.72 Taking those restrictions into account many work of arts, movies, religious items or references can thus be found contrary to the ideology of the Vietnamese government and therefore deny protection on a very subjective and politically motivated basis. In effect, thereby placing a political shadow of insecurity over potential foreign investors and importers. Finally, the Civil Code denies total protection to works attacking the achievements of the present communist regime, the communist revolution, works challenging the reputation of a government organization, or works offending the honor of distinguished persons or national heroes.73

The Fair Use Doctrine.

Article 76174 starts out in complete accordance with the Berne Convention and the United States Copyright Act.75 Under the Civil Code theory of fair use, one can use a copyrighted work without paying remuneration or even getting permission so long as the use is beneficial to the public, and does not undermine the author or copyright owner’s normal exploitation rights of the work.76 The Civil Code expressly approves a certain number of fair uses, not limited to critique, comment, news reporting, and education.77 The following three requirements must be met in Article 760 of the Civil Code in order for the fair use doctrine to apply:

• The user must provide the name of the original author and citation on the work.78
• The user cannot have or exploit the author’s interest in the copyrighted work.79
• The work must be used within the fair use definition provided by Article 760.80

Contrary to Section 107 of the United States Copyright Act, the Code does not provide any element on how to interpret these requirements. The doctrine of Fair Use allows courts to avoid rigid application of copyright laws when such application would be unfair or would stifle creativity and the dissemination of useful works to the public—the very activity copyright laws are meant to foster; however, this case by case analysis may be troublesome in a society where the legal system is being renovated and jurists are untrained in copyright matters. On the other hand, section 107 of the U.S. Copyright Act provides four elements that must be considered when determining whether a particular defendant’s use is considered "fair use" of the copyrighted work.81

• The purpose of the use and the character, including whether the use is of a commercial nature or is for non-profit educational purposes.  
• The nature of the copyrighted work. The Supreme Court found in the Harper decision that the published or unpublished status of the plaintiff’s work was very important. Unauthorized pre-publication use has often been viewed as unfair because it undercuts the author’s importance in determining the timing of the publication and being able to first publish the work.82
• The amount and substance of the portion used in relation to the copyrighted work as a whole: as the Harper decision demonstrates, a defendant who takes substantively important expressions that express the heart of the copyrighted work may be denied a fair use defense..83
•  Finally, the effect of the use upon the potential market or value of the copyrighted work. The Harper court indicated that mere copying, under the "fair use" doctrine, when properly applied, "does not materially impair the marketability of the work [that] is copied.".84 However, proof of actual harm to the plaintiff’s market is particularly persuasive to the court.

However, proof of actual harm to the plaintiff’s market is particularly persuasive to the court.

Although the Supreme Court stressed that no single section 107 factor should be deemed abusive, courts have received much needed guidance in interpreting the fair use doctrine. In a developing legal system such as Vietnam, it may be wise for the Civil Code, and its subsequent legislation, to provide specific guidance to the judges that will review these fact-oriented cases.

Article 761(g) of the Civil Code raises a more problematic question. Indeed, Article 761(g) departs dramatically from the Berne Convention and the United States Copyright Act by allowing unlimited use of theatrical works or other types of "artistic performances," without provisions or remuneration, as long as the use occurs during a cultural entertainment event or a public political campaign.85 Further the Civil Code does not define these terms.86

Similarly to Article 749, Article 761(g) represents a major blow to the development of foreign investment in Vietnam. Article 761(g) leaves the Vietnamese government, its courts, and the public with a lot of discretion to freely exploit copyrighted works under the guise of an entertainment event or a political campaign. Could a movie theater in Hanoi screen "Titanic" from pirated videos in celebration of the movie’s victorious performance at the Oscars? Article 761(g) could possibly offer a favorable response to this highly possible scenario of copyright violation. 87

The problem resides in the fact that the possibilities for a fair use defense seem to be unlimited and unreliably subjective. Article 761(g) and Article 760 of the Civil Code contradict one another. Indeed, Article 760 requires that a fair use of a work not harm the copyright owner or author’s interest in the work88 while Article 761(g) can, without any doubt, deny an author’s or copyright owner’s rights by turning to the expansive fair use analysis afforded by the Civil Code. Once again this provision is uncharacteristically against the international standards imposed by the Berne Convention.

30-day Rule for Registration of Foreign Copyright

Is the 30-day Rule for Registration of Foreign Copyright Still Alive? This is a very daunting question for foreign investors and traders. When the new Civil Code came into place, many were hopeful that the Vietnamese legislators would do away with the ordinance requirement that foreign works be first published in Vietnam within 30 days of the publication in another country. Removal of that provision would have been a prudent step toward meeting international standards and reassure the world trade community that copyrights are safe in Vietnam.89 However, the Civil Code remains silent on the issue and hopes were completely shattered when the decree implementing the provision in Article 2890 did not address the question of foreign works.91 Even more aggravating, is the fact Vietnam persists in deviating from international standards by denying the same measure of copyright protection to foreign authors while recognizing Vietnamese authors.92 In contrast, Vietnamese law protects Vietnamese authors regardless of where they first publish.93 Finally, the government gave the "coup-de-grace" to any possible membership to the Berne Convention when in 1997 they surprisingly implemented a new decree in the Civil Code provisions which restricted copyright protection to works of foreign authors or owners who had their works published in Vietnam first.94 This new provision is a significant backlash since foreign copyright owners do not benefit of any more than 30 days to publish in the country. However, the 1997 Decree states that any bilateral Agreement or international convention shall suspend the provision.95

The 1997 Decree may be an attempt to suppress concerns and reassure foreigners. However, it is rendered worthless for most companies doing business with Vietnam since it is not a member of any international conventions. Only U.S. companies are protected to the full extent of the US-Vietnam Agreement.96 It is difficult to justify a reason why the Vietnamese government would keep a rule that so blatantly contradicts the national treatment requirement imposed by the Berne Convention. In effect, the Vietnamese government is statutorily denying copyright protection to foreign authors who cannot comply with the rule.97

Removing this clause from copyright legislation seems to be the only alternative for Vietnam in order to avoid delays in active trading from western countries. One must wonder if the Vietnamese government honestly has a desire to fight piracy, or, as it is often reported, if it is trying to deter copyright protection for foreign products in a move to favor government sponsored piracy. Indeed, a Minister of Culture and Instruction, the Minister in charge of copyright protection in the country, owns companies that produce pirated books and films.98 Since these operations have been a significant source of revenue, Vietnam’s central government has been reluctant to crack down on piracy. This might indeed explain the choice to offer minimum protection to foreign works.

Another reason for this arguable choice is that Vietnam seems to be following Taiwan’s lead in restricting protection for foreign copyrights.99 Like Vietnam, Taiwan is not a member of the Berne Convention, and has obtained a poor reputation for copyright protection.100 In addition, similarly to Vietnam’s rule, foreign authors are only granted protection in Taiwan if they publish there first or within thirty days of first publishing in a foreign country as long as the foreigner’s home country accords similar protection to Taiwanese natives.101 Currently, reciprocity is only available to individuals in the United States, the United Kingdom, Hong Kong, and Switzerland.102 It would therefore not be surprising that Vietnam continue following that lead and prefer to deal with this issue on a country by country basis, as in the recent Agreement with the United States.103

In conclusion, Vietnam should, despite the recent Agreement with the United States, clearly abandon this rule. Since GATT embraces the Berne Convention’s principle of national treatment, conformity with international standards would undoubtedly facilitate Vietnam’s entry to the Berne Convention.104 Not to mention, it would facilitate Vietnam’s participation in GATT. Permanently eliminating such a rule would unequivocally signify that Vietnam has entered the world of global commerce and is now willing to request the copyrights of foreign authors and owners of copyrights, and it would transform Vietnam’s current dubious political reputation to that of a genuine and respected world player. By doing away with this contradictory rule, Vietnam would see an increase in the trade of copyrighted materials, which, in turn, would ensure the success of doi moi.

Enforcement of the New Civil Code: A Dream or a Reality?

Although Vietnam has shown some slow improvement in the protection of copyright, at least for its own nationals, and that of foreigners who come from countries with whom Vietnam has established bilateral Agreements,105  the real test to the country’s commitment to protecting authors and owners of copyright will be in fighting piracy with efficiency and determination. Vietnam’s legislation governing copyright laws is relatively well developed by Vietnam’s increasing exposure to foreign products, it is this degree of increased exposure that makes enforcement such a serious problem.106 Because elements of the government are involved in the violation of copyright and other intellectual property rights bribes are often required before local authorities will take action against counterfeiters.107 Since much of Vietnam’s government and society is just now learning the intricacies and importance of a legal system, implementing and interpreting laws is proving problematic and hectic.

A Need for Trained Jurists

In order to enforce the laws there is a need for professionally trained lawyers who understand specifics of intellectual property practice.108 In Vietnam, on one side there is a government that does little to fight piracy, and on the other side there are very few Vietnamese lawyers in piracy practice. In addition, many of the old generation of lawyers, not to mention the most influential and well connected lawyers of the country, were trained in French law and the French language.109 As a result, their understanding of the new system is quite limited. The copyright laws are relatively recent, and many litigation lawyers were more focused on criminal defense and providing state prosecuted defendant representation.110 However, the role asked of these lawyers in copyright protection is quite different. Indeed, these lawyers must present themselves in the role of prosecutors and bring actions in court on copyright infringement.

In fact, many foreign lawyers have opened shop in either Hanoi or Ho Chi Minh City.111 In 1996 the Minister of Justice presented the first round of lawyers’ firms from countries like France, the United Kingdom Australia, or the United States.112 The lawyers are not allowed to appear before the Courts even though they are welcome to practice as legal consultants since 1995.113 Foreign lawyers provide a beneficial service by giving foreign investors and local lawyers an understanding of copyright laws and requirements. However, there is an urgent need to train local lawyers about the intricacies of copyright law. The U.S.-Vietnam Agreement provides cooperation in training and addressing the infringement of copyrights.114 Accordingly, properly training judges and lawyers in copyright law should be a priority. In fact, even the Prime Minister of Vietnam recognizes this need in his commentary regarding the "transparency" and lack of security within their legal system.115

A Case of Intellectual Property Confusion: The Walt Disney Episode

The difficulties encountered by the Walt Disney company in protecting its copyrights provide an example why training should be offered to Vietnamese authorities, judges and lawyers.116 In 1996 in an effort to protect its copyrights, the Walt Disney Company launched a newspaper advertising campaign against copyright violations, threatening prosecution of all offenders who did not stop using the company’s world-famous cartoon characters without proper licensing.117 The response the company executives obtained demonstrated that work must be done to get the authorities to enforce their intellectual property legislation, and to train experts in the field. The vice-president of Vietnam’s Department of Copyright, at the time, asserted that Disneys’ rights could not be protected in Vietnam for they had not registered their trademarks with Vietnam authorities.118 That is either a case of convenient misinformation or a worrisome degree of confusion because under the Civil Code there is no requirement to register one’s trademark in order to get copyright protection.119 Indeed, Article 762 provides that registration shall be an option left to the author or owner of the rights.120 Needless to say, because of the lack of national treatment afforded to foreign entities, this option is highly recommended for foreign authors and owners who seek to secure protection of their rights.121 However, authors and owners of copyright should be protected by the fact Vietnam is a member of the Madrid Agreement for International Registration of Marks, which is intended to establish international registration and protection of marks based on centralized registration.122 Therefore, according to this Agreement, trademarks are deemed registered in all member countries.123 Thus, Vietnam cannot require extra steps be taken by foreign companies to register their trademarks because that would be a direct violation of the Madrid Agreement, as well as the Berne Convention national treatment standard.124 Clarification and training must be a priority given by the Vietnamese government as well as foreign parties entering this country’s market.

Unachieved Requirements Imposed by International Treaties125

This section will survey two of the most important international conventions affecting any copyright issues in today’s global world. The Berne Convention, the single most significant international treaty on the protection of works of authorship, ensures that all authors of works published in member states are treated the same way as nationals would be in their own countries. The second international treaty imposes requirements on members is the Uruguay Round of The General Agreement on Tariffs and Trade (GATT), from which copyright issues were raised to a worldwide arena by the signing of the Trade Related Aspects of Intellectual Property Rights (TRIPS.)

The Berne Convention for the Protection of Literary and Artistic Works.126

The Berne Convention covers "literary and artistic domain whatever may be the mode or form of its expression.127" It focuses on protecting the rights of authors in their literary and artistic creations.128 The distinctive concept established by the Berne Convention is national treatment.129 Thus, foreign authors are guaranteed the same level of protection as domestic authors among Berne Members countries.130 In addition, countries seeking to join the Berne Convention must provide for a minimum of protection for the period of life plus 50 years pursuant to Article 7(1).131 In fact, to adhere to the convention, in 1988, the United States amended the Copyright Act to reflect the 50 years requirement imposed by the Berne Convention.132

Although Vietnam has increased its protective time to the required time through the enactment of Article 766(2) of the new Civil Code, the country has yet to join the Berne Convention. Membership to the Berne Convention is vital, and even more so since the TRIPS provision of the GATT went into effect on January 1, 1996.133 Membership in the Berne Convention draws political and business credibility for member countries. This is especially true for developing countries which seek investment from developed nations in order to improve their economies and to sustain development of their arts, sciences and creativity.134

Trade credibility is so important in negotiations that even a country like the United States which has had adequate copyright protection for more than two centuries was more or less forced to join the Berne Convention in 1988 for fear of being left out by the international community. Since membership countries have a pro-active role in determining international copyright policies, it is primordial for aspiring world trade players to be part of the decision making that will eventually effect them. Further, the Berne Convention has a positive impact on trade since its two most important benefits pertain to providing stability and security in world trade.135 Country members also increase copyright protection domestically and internationally.136 Most countries have to perfect national laws to meet the minimum standards required by the Convention, thus providing better copyright protection for their nationals. By enforcing international standards, member countries can rely on a pre-determined protection, which likely causes member countries to favor one another in trade and commerce.137

Article 16 of the Berne Convention provides for enforcement of copyrights.

It requires all member countries to seize illegally copied material and to enact applicable remedies available pursuant under laws of the member state where copyright infringement occurs.138 Article 759 of the Civil Code does not meet the minimum standard of the Berne Convention.139 Article 759 provides only for public apology, public retraction, and/or monetary compensation.140 Since Vietnam has not joined the Berne Convention yet, and its copyright protection has been largely inefficient in stopping the increased piracy, authors have very little, if any, protection.141 The lack of enforcement is so dramatic that in 1996 and 1997, the International Intellectual Property Alliance142 made special recommendations regarding Vietnam. They estimated that piracy of motion pictures, sound recordings, and musical compositions was at 100 percent.143 A mere apology or financial compensation is insufficient punishment to curb down piracy of pirated goods. Although the newly signed United States-Vietnam Agreement provides for preliminary relief, permanent injunctions, seizures, and destruction of pirated goods and enforcement at the borders, Vietnam must joint the Berne Convention in order to truly insure adequate protection for foreign authors. Joining the Berne Convention would also help the success of the do moi renovation by becoming a player in the global market instead of the newest copyright "Ugly Duckling."

Vietnam’s Benefits in Joining the Berne Convention

Vietnam’s ascension to the Berne Convention has become vital for the country to out of third world status and into usurping its place in the global economic panorama as the next Asian tiger. However, in the midst of Asia’s economic turmoil, foreign investors are now looking much more carefully at prospective countries where to invest. Since Vietnam opened up its economy to foreign investment and trade in 1986, the protection of intellectual property rights remains a pivotal concern to foreign investors.144 In a world where economies battle to survive, joining the Berne Convention and complying with its requirements could ensure the country’s economic prosperity through increased foreign trade and investment, which, studies show, has been steadily declining recently.145 Clearly, strong copyright protection in Vietnam would not only enhance local innovation, it would inject the economy with foreign investors and goods.146 In other words, feeble protection of copyright threatens the country’s economic development; on the other hand, in a region on the abyss of economic turmoil, simply abiding by the current international copyright standards would provide Vietnam with the credibility to fill the regional void in economic and political leadership.

Harsh Reality of Trade Related Aspects of Intellectual

Property Rights (TRIPS Agreement)

One of the most interesting recent developments with respect to international intellectual property came out of the Uruguay Round of the General Agreement on Tariffs and Trade (GATT).147 Intellectual property rights gained their worldwide recognition as a factor world trade development in 1986 when the GATT members provided basic principles and standards of international intellectual property rights for all countries signatory to the GATT. Thus, the so-called Trade Related Aspects of Intellectual Property Rights (TRIPS) were attached to the Uruguay Round negotiations and on January 1, 1996 the TRIPS Agreement was ratified by the members of the newly created World Trade Organization (WTO).148 The TRIPS Agreement reaffirms universal copyright law.149

However, the moral rights so distinctive the Berne Convention are stripped out of the TRIPS Agreement. The main reason for their absence is the key role the United States played during the TRIPS Agreement negotiations. The United States was the strongest advocate for increased intellectual property protection as an element for the Uruguay Round, and since the United states Copyright Act does not expressly grant moral rights to authors, it is not surprising that the language in TRIPS closely mirrors that of U.S. Copyright Laws.150 Vietnam has applied to become a member of the WTO but it is still negotiating the steps it must take before being allowed to join this organization. This membership is far from being guaranteed because there are many questions regarding the country’s commitment to reforming its economy.151 Although the Vietnamese authorities claim that the country is committed to changing to meet international standards, many WTO members have become openly critical of the Vietnamese government’s lack of flexibility and silence on how it will bring its system into compliance.152 In any event, WTO membership seems to be postponed to a later date, which, as a result, will leave foreign authors and copyright owners with a high risk factor to account for when assessing whether or not to proceed with trade and investment in Vietnam. However, under the TRIPS Agreement, Vietnam must undertake the following action if they want to join:

Vietnam Must Enact Laws That Entitle Owners of Infringed Copyright to Judicial Injunction to Halt an Infringer’s Illegal Activity

The TRIPS Agreement requires member nations to enact laws providing relief for copyright infringement.153 Further, the provisions go beyond requesting the infringer to reveal the names of any persons involved.154 Under the TRIPS provision, victims of copyright infringement must have the possibility to be awarded compensatory damages, but also to have all illegal copies of the work destroyed to deter further piracy.155 The Civil Code itself does not provide for these extreme measures to be taken in retaliation for violation of copyright. Indeed, Article 759 only requires the guilty party to apologize and/or make a financial compensation.156

In a 1997 trial in Ho Chi Minh City, a local composer successfully sued a Saigon Music Company for thirteen hundred dollars ($1,300US) in damages for the unauthorized use of songs from his album. This was the first successful copyright prosecution in Vietnam courts. 157 Industry analysts, however, estimate that Vietnam currently endures a 99 percent piracy rate. Foreign consumer goods manufacturers report they are loosing the battle to cheaper pirated goods. In that sort of commercial environment, destruction of all infringing goods must be one means of restitution offered to protect authors and copyright holders, and, in the process, serve as a deterrent and potentially decrease the flow of pirated goods entering the Vietnamese market.158 Neither large nor small corporations are immune from the impact of pirated goods, Proctor and Gamble reports that it has lost approximately 25 percent of its business in Vietnam to counterfeiters and smugglers.159

TRIPS Requires Vietnam to Enforce Copyright Protection at its Borders.

Under the Agreement, copyright owners who suspect individuals of importing materials violating copyright laws can request the local custom service to hold the goods for inspection.160 The customs officials must inspect the goods and order for their destruction if they find the goods infringe upon the claimant’s rights.161 Once again the Civil Code is completely silent regarding such provisions. Indeed, the first sign that the Vietnamese authorities may comply at sometime is expressed in the U.S. Vietnam Agreement signed last June. Article 6(1) provides that each party shall make available effective enforcement at the border, including the seizure and destruction of infringing goods bound for import or export.162 Although U.S. laws are adequate to safeguard against pirated goods entering north American markets,163 Vietnam has a long way to go to achieve the goals set by either the TRIPS Agreement or the recent Agreement with the U.S..

The Titanic164 anecdote is the latest of an overwhelming trend of poor copyright protection in Vietnam. Indeed, there are increasing accounts about pirated goods coming across the China-Vietnam border.165 The International Intellectual Property Alliance (IIPA), a coalition of associations representing U.S. copyright-based industries who work to open up foreign markets with piracy problems, estimate that 100 percent of U.S. motion pictures available in Vietnam are pirated.166 Piracy levels for musical recordings and computer programs is slightly better, with 99 percent of all goods in these areas being pirated.167 Despite the requirements imposed by the TRIPS Agreement, the U.S. Vietnam Agreement, and in particular, Article 6, which requires stricter border enforcement, much of these pirated goods could cost up to $48 million dollars in the Vietnamese market alone.168 Despite all the hopes that came with the signature of the U.S. Vietnam Agreement on copyright protection, Vietnam’s unwillingness to take enforcement measures has left the authors and copyright owners without a true safety net for their works.

The 1997 U.S.-Vietnam Bilateral Copyright Treaty Compared With the U.S.-China Experience

The 1997 U.S.-Vietnam Bilateral Copyright Treaty brought hope that U.S. copyright owners will finally enjoy full protection. It took two years of on-again off-again negotiations between the U.S. and Vietnam to reach this bilateral treaty.169 Signed on June 27, 1997,170 the Agreement has been enforceable since December of 1997; however, Vietnam is still not a member of the Berne Convention for protection of literary and artistic works.171

Although given little press in the media, the Copyright Agreement was perhaps the most important event to take place for the Vietnam-U.S. relations. While the scope of protection conferred by the Agreement is broad, the test of its effectiveness will be in the area of implementation and enforcement. Indeed, the copyright provisions of the Civil Code have not yet been implemented by either the Vietnamese government or the Ministry of Culture and Information, the agency responsible for administering copyright in the country.172 Under this Agreement, the U.S. must be prepared to render technical assistance to local authorities.173 Most likely this assistance will focus on the upgrading of technology necessary to distinguish genuine and infringing products, as well as information tracking device to track the marketing and distribution of infringing products. According to the U.S. law firm of Baker & McKenzie, cited by the Vietnamese newspaper Tuoi Tre, a few days before the Agreement became reality, the film, The Bridges of Madison County, was widely distributed throughout Vietnam without any authorization from the producer.174 The main criticism aired in Vietnam is that with this new treaty, the Vietnamese population will lose access to many goods that would other wise remain available for the mainstream consumer. Since royalties will now have to be paid, many cultural items will fall outside of the grasp of most consumers. In a society where art was a property of the state, it may be difficult to accept such a dramatic change. It is probably one reason the new Civil Code reflects the intent to keep the display of artwork out of the copyright protection umbrella afforded by the Civil Code. 175

The Agreement Discards the 30-day Rule for Registration of Foreign Works.

The Agreement secures national treatment protection for both signatory countries.176 Article 2 spells out that copyright protection can be no less favorable than what each country accords its own nationals.177 This has a tremendous impact on providing U.S. companies and authors protection. The daunting insecurity left by the 30-day rule is now an issue of the past. U.S. copyrights owners now have access to rights similar to those offered to Vietnamese nationals.178 However, under the actual Civil Code provision, a foreign work must initially be published in Vietnam to be protected, or within thirty days if published elsewhere. This requirement alone, as a practical matter, denies protection to all foreign works with the exception of works by United States nationals.

The Internet Becomes a Copyrightable Work

Article 1 defines works as including works in electronic forms.179 This is an interesting move for the U.S., forcing Vietnam to protect the development of Internet-related work and other electronic commerce (e-commerce). However, this will require the Vietnamese authorities to amend the Civil Code to reflect that electronically produced work must be covered by Article 747.180 Yet, one can foresee that a conflict will emerge when the Vietnamese consumer is jumps onto the World Wide Web and is exposed to the information super highway. In regards to Article 749, will the Vietnamese government deny copyright protection to works that offend the Vietnamese authorities or people.181 For example, would an essay on the Vietnam War published by a U.S. veteran over the Internet be protected under the extensive exceptions offered to interpretation by Article 749, even if mentioned under the U.S.-Vietnam accord? The answer is uncertain. One could easily argue that if it were offensive in any way to the Vietnamese people it would not be protected. The U.S.-Vietnam Agreement remained very unclear on the subject, and, for purposes of avoiding confusion, the issue should receive attention in an upcoming amendment.182 The same reasoning must be made as to Article 761, which allows for the non-enforcement of copyright privileges when done in the interests of protection for cultural events, entertainment events, propagation and campaign activities.183 Could government sponsored websites offering American literature samples be "public places" under this Article 761?184 Quite possibly.

In conclusion, the U.S.-Vietnam Agreement has in theory offered some major improvements for prospective copyright owners entering the Vietnamese market. National treatment has been formerly asserted, and the 30-day rule has been unmistakably rejected. However, this Agreement lacks ambition when it comes to enforceability. Foreign investors often criticize Vietnam’s inaccessible legal system, and a somewhat capricious court system.185 The Agreement should have attempted to provide for a stricter enforcement schedule by the Vietnamese authorities. The bilateral Agreement offers a legal basis for enforcement against piracy of U.S. materials; however, the Vietnamese authorities in copyright enforcement do not seem ready to face the task of preventing piracy.186

The current Agreement would have better served U.S. copyright owners by providing for the creation of an enforcement task force modeled on the China example (discussed below) to start cracking down on piracy of U.S. goods.187 Further, the Agreement should have expressly denied the Minister of Culture and Information and its branches from importing, copying, and distributing pirated videos, as has been the case for the past few years.188 Finally, the Agreement should have requested clarification of the Civil Code provision regarding ownership of foreign works with respect to criminal, civil, and border enforcement rights, in accordance with Article 6 of the Bilateral Agreement.189

Creating incentives to enforce more than terms of the Agreement itself will be key to the success of the newly re-established commercial relations between the United States and Vietnam. However, the U.S. may want to apply the same rigor it imposed on China in order to enhance a healthy relation.

The 1995 U.S.-China Agreement on Intellectual Property Protection: An Agreement With a Bite

First China and now Vietnam have been singled out by the USTR as nations that undeniably fail to enforce and protect copyright.190 Based on the China experience, it is clear that without the needed changes in the legal system, and intensive professional formation for lawyers and bureaucrats designed to fight infringement, one cannot expect that Vietnam’s government will enforce radically the terms of this Agreement. In the year following the China-U.S. Agreement, the United States lost an estimated $800 million to piracy in China.191 After the May 15, 1996, Special 301 threat to impose unprecedented trade sanctions on China in the amount of two billion dollars, China made the necessary efforts to enforce and comply with the Agreement signed a year earlier.192 Forced by the extent of the threat on its developing economy, China reversed the trend by improving border enforcement of copyrights, and now is finally cracking down on piracy.193 Furthermore, China agreed to improve its fight against copyright infringement in very specific areas beneficial to U.S. industry.194 Promoting contracts between U.S. companies and Chinese publishing houses dramatically eased market access for U.S. computer software and movies.195 While the U.S.-China Agreement is quite similar to the one signed with Vietnam, the Agreement with China includes provisions for enforcing copyrights at the local level, at border crossings, and, more importantly, at the judicial level.196 In addition, the Agreement calls for establishment of a long-term enforcement structure throughout the country, even in the most remote regions of mainland China.197

The similarities with the Vietnam Agreement stop here. The U.S.-Vietnam bilateral accord is quite broad in its wording while the China Agreement goes deeper into details, imposing more requirements upon China. In light of the increasing piracy level, this lack of sensitive provisions may turn out to be harmful to the success of the Agreement signed with Vietnam.

The China Agreement requires the country to create special task forces designed to perform copyright-related searches, seizures, and arrests.198 Based on the Singapore model, these task forces can revoke production permits, destroy all illegally reproduced goods and impose fines.199 The U.S.-Vietnam accord is silent in the light of recent alarming reports on increasing copyright violations hurting U.S. companies.200 The China Agreement imposes also a total renovation of the country’s custom system and, as suggested, preferably modeled on the United States.201

The U.S.-China Agreement required that the Chinese government create specialized intellectual property courts for hearing claims of infringement.202 These courts improve the prospects for a copyright owner to stop infringers.203 The provisions above gave the United States a stronger ability to secure intellectual property rights in China. Although it took a threat of trade war, the China Agreement has drastically improved the fate of foreign copyright owners. The Chinese authorities did indeed establish eighteen courts to hear intellectual property claims,204 opened hotlines for fighting piracy;205 as a result, millions of pirated compact discs and thousands of pirated videos and books were seized and destroyed.206

In conclusion, strict provisions in the U.S.-China Agreement, coupled with compliance by the parties involved, has dramatically improved China’s level of trade and credibility. Because the U.S.-Vietnam Agreement lacks the level of strict enforcement, as is present in the U.S.-China Agreement, China’s compact disc pirates see Vietnam as fertile ground for expansion of their copyrights infringement business.207 In reaction, the U.S.-Vietnam Agreement should be amended to contain those same restrictions imposed upon China. The amendment should make it clear to the Vietnamese government that its political success in increasing trade with Western nations, and for that matter its economic prosperity, will only become reality when its copyright protection measures become effective. Vietnam’s hope lies in following strict adherence to copyright enforcement beyond the limited terms of the Agreement signed by the U.S.

Conclusion

At a time when President Clinton just granted the Jackson-Vanik waiver, opening the path to MFN status, 208 Vietnam seems to be closer than ever to succeeding in its implementation of the doi moi, its economic plan to both attract foreign trade and investment, and reform its society. However, this success could be easily shattered by the Vietnamese government’s inability to clearly define its copyright laws. To ensure success there must be an efficient and consistent law enforcement apparatus that is committed to diminish the impact of piracy in the economy. One of the most important changes Vietnam could implement would be to revoke the 30-day rule, that silly rule that denies foreign authors copyright protection if their works are first published anywhere other than on Vietnamese territory. Despite the recent U.S.-Vietnam Agreement the 30-day rule will continue to bar Vietnam from acceding the Berne Convention since it contradicts directly with the principle of national treatment. Furthermore, the Vietnamese government must pass legislation clarifying registration of copyright. Without more precise procedures and guidelines foreign investors will not feel secure about how well their copyrighted works will be protected. Finally, regarding enforcement of copyrights, the Vietnamese authorities should, at a minimum, incorporate the enforcement of the TRIPS provisions. Enforcement provisions should include improved law enforcement at the Vietnamese borders, grant injunctive relief to victims of piracy, and create the right for government to destroy pirated works entering the country.

Amendment of copyright laws and defined procedures for enforcement go hand in hand. Lawyers and judges must be given appropriate training. The international community could provide assistance in training the judiciary and advocates. The corresponding segments of the court system could be modeled after China’s special courts, where only intellectual property rights claims may be heard. This action would demonstrate a credible effort and commitment to protect foreign individuals and companies in their enterprise with Vietnam. In addition, task forces must be created to stop