One morning, a California-based company mapping its Southeast Asia rollout opened an unexpected cease-and-desist letter from a Vietnamese intellectual property (IP) firm. To the company’s surprise, the letter asserted that a local client already owned the company’s brand in Vietnam and threatened legal action. This is not an isolated incident. In another recent matter, a squatter demanded at least $48,000 from a company in the sports industry to resolve a similar conflict.
For brands entering Vietnam or expanding distribution there, these tactics can create acute risk at precisely the point at which market momentum is building. Vietnam’s rapid economic growth and deepening integration into global trade have made it an increasingly attractive destination for multinational brands. Those same dynamics have intensified a long-standing issue: trademark squatting.
Vietnam has modernised its IP framework over the past decade, but its strict first-to-file trademark system continues to incentivise opportunistic filings by parties with no legitimate interest in a mark. As more foreign brands build their reputation abroad before turning to Vietnam, squatters remain alert to timing gaps and enforcement frictions.
The first-to-file system: advantages and vulnerabilities
Vietnam adheres closely to the first-to-file principle under its Law on Intellectual Property. In practice, exclusive trademark rights belong to whoever submits the earliest valid application to the Intellectual Property Office of Vietnam, regardless of prior use in Vietnam. This approach offers administrative clarity and reduces evidentiary burdens compared with use-based jurisdictions; however, it also creates fertile conditions for squatting.
Bad-faith actors regularly monitor foreign markets, identify brands gaining traction, and move quickly to register those marks domestically, often long before the genuine owner enters the market or prioritises local filings. By the time the true brand seeks protection, the squatter’s application (or registration) stands as a legal obstacle, pushing businesses towards costly oppositions, cancellations, or uncomfortable negotiations to buy back their own mark.
Despite periodic improvements to Vietnam’s IP regime, including greater recognition of bad faith in the 2022 amendments to the Intellectual Property Law, the burden of proof remains heavy for legitimate owners. Demonstrating bad faith requires evidence that the applicant lacked legitimate intentions to use the mark or acted with unfair motives. That proof can be hard to marshal on short notice, particularly when the squatter has had the foresight to stage a ‘minimal use’ narrative.
Practical hurdles flow directly from this system. Proceedings can be lengthy and costly, with contested registrations often remaining in force as oppositions or cancellations play out, while unregistered rights receive limited weight unless a mark can be established as well known – itself a difficult and unpredictable process in Vietnam – and commercial urgency can pressure brand owners towards settlement even when legal principles disfavour rewarding bad-faith actors. These dynamics amplify the need for early filing, vigilant monitoring, and a disciplined evidence strategy.
Common trademark squatting tactics in Vietnam
Trademark squatters in Vietnam deploy a broad spectrum of strategies, from crude to highly sophisticated. They pre-emptively register foreign marks, both famous and emerging, or file small variations that aid registrability while preserving bargaining value. They target visual assets that rights holders sometimes overlook, including stylised logos, trade dress, and distinctive packaging.
Many assemble a facade of commercial activity by registering a matching domain, setting up a local company, executing superficial licence or distribution agreements, launching basic websites, issuing sample invoices, or showcasing products online. Increasingly, they augment these materials with AI-generated images to fabricate purported ‘use in commerce’.
In other instances, local distributors, resellers, or manufacturing agents attempt to register their principal’s mark in their own name as leverage in negotiations or to retain control when relationships sour.
Enforcement posture: zero tolerance v commercial settlement
In the authors’ experience, brand owners often face a strategic fork.
Some adopt a zero-tolerance approach and fight back, challenging the filing on bad-faith grounds, pursuing administrative or civil actions, and coordinating market and customs measures. With a flexible and evidence-driven strategy, companies can successfully navigate these risks, neutralising squatters and restoring brand control without capitulating to ransom demands.
Others opt to settle, particularly where time-to-market is critical, product launches are imminent, or supply chains are already in motion. In these situations, a commercial resolution, however unpalatable, can be the least costly path to certainty.
The right choice turns on concrete business priorities, litigation risk appetite, evidentiary posture, and the availability of parallel pressure points. Legal avenues to combat bad-faith registrations exist but can be time-consuming and uncertain.
The most reliable defence is to be proactive:
File early and broadly;
Monitor diligently;
Preserve evidence of reputation and use; and
Deploy targeted bad-faith and unfair-competition arguments in a coordinated enforcement plan.
A disciplined decision framework, grounded in early filing and robust monitoring, preserves options and bargaining power, whichever path is chosen, and is the surest route to protecting equity and sustaining momentum in Vietnam.
