Landmark decision clarifies trademark use standards in Vietnam

On June 6 2025, the Superior People’s Court in Hanoi overturned a non-use cancellation decision by the Intellectual Property Office of Vietnam (the IP Office), a rare and impactful occurrence. In a ruling that may help clarify the enforcement of Vietnam’s Intellectual Property Law, the court held that valid trademark use can be established through commercial arrangements where the brand owner maintains actual control over the use of the mark, and is not confined to relationships governed by a so-called formal licence agreement.

A Singapore company owns a well-known brand of consumer products that has gained recognition across Southeast Asia. In recent years, the brand has been targeted by several unauthorised trademark filings in Vietnam. In one such instance, a local Vietnamese trading company – previously linked to the production and exportation of counterfeit goods to neighbouring countries – filed a non-use cancellation against the Singapore company’s mark and sought to register it under its own name. If the cancellation had been upheld, it would have enabled a complete hijacking of the brand.

The IP holder operates in Vietnam through a structured cross-border supply chain. Under an agreement between two related foreign entities, one of which managed regional operations, production orders were placed through a designated Vietnamese company. While the Vietnamese manufacturer was not a party to the agreement, its role in using the mark was recognised and governed by internal and commercial documentation.

The Vietnamese manufacturer lawfully obtained the necessary permits, regulatory approvals, and customs clearances for producing the goods in Vietnam. These activities were supported by banking records and internal communications, evidencing active, continuous use of the mark in Vietnam.

However, the IP Office concluded that this use did not meet the statutory criteria because the Vietnamese manufacturer did not have a direct licence agreement with the brand owner, as outlined in provisions on trademark licensing under Vietnam’s Intellectual Property Law.

In Vietnam, it is rare for IP agencies to challenge the IP Office in court. The norm is to pursue administrative appeals, a process that can drag on for years, with uncertain outcomes. Given the urgency and the risk of losing the mark to bad-faith actors, the Singapore company made the bold decision to have its IP agency file an administrative lawsuit against the IP Office’s decision on cancellation, requesting it to be overturned.

The first-instance court sided with the IP Office, as is often the case in such disputes. The Singapore company then appealed to the Superior People’s Court, presenting a comprehensive and well-reasoned argument that challenged the IP Office’s narrow interpretation of trademark use and licensing.

The appeal emphasised several critical points:

• Authorisation beyond formal licence agreements – trademark use can be authorised through various forms, including distribution agreements or even implied licences, as long as the brand owner maintains control over the mark’s use.

• International practice – under global standards, the substance of the relationship and actual control over the mark are more important than the formality of the agreement.

• Business realities – the IP Office’s position would impose unnecessary burdens on businesses, forcing them to execute redundant licence agreements in addition to distribution, supply, or manufacturing contracts.

• Purpose of licensing – the primary purpose of a licence agreement is commercialisation, not merely to serve as evidence of authorisation.

• Economic and social impact – the IP holder’s authorised company had made significant contributions to state revenue and employment. In addition, Vietnam could face reputational risk if it were seen as a haven for counterfeit production.

The Superior People’s Court fully accepted the arguments, overturned the IP Office’s decision, and reinstated the mark. The judgment is final, with no further appeals possible.

Notably, this was a rare IP case in Vietnam where the litigation process lasted almost a full day, far longer than the typical few hours, reflecting the complexity and importance of the issues at stake.

This ruling brings welcome clarity to how trademark use may be established in Vietnam. It underscores that valid use can arise from commercial practice and brand control – even where formal licensing registration is absent.

T&G Law Firm LLC (TGVN) acted for the IP holder and is proud to have contributed to this important clarification of legal standards, which strengthens the protection of IP rights in Vietnam and promotes greater certainty for businesses operating in complex supply chains.