UNFAIR TRADE PRACTICES
IN VIETNAM
Ho Chi Minh City, Vietnam – 12 Sept 2012
What constitute an Unfair Trade
Practice?





Paris Convention for the Protection of Industrial
Property – Art. 10 bis
Black’s Law Dictionary
Cornell University’s Legal Information Institute (2010)
World Bank and OECD (1998)
Vietnam – Art 3(4) of the Competition Law 2004:
“An act of unfair competition is the competitive act of
enterprises in the business process that is against the
common standards of business ethics and can cause damage
or harm to benefits of the State, the rights and legitimate
interests of other enterprises or consumers.”
What specific UTPs are prohibited in
Vietnam?
Misleading instructions;
 Infringement of business secrets;
 Coercion in business;
 Defamation of another enterprise;
 Causing disruption to business activities of another
enterprise;
 Advertisement aimed at unfair competition;
 Promotions aimed at unfair competition;
 Discrimination by associations; and
 Illegal multi-level marketing.
(Art. 40 – Art. 49 of the Competition Law 2004 of Vietnam)

The differences between UTPs and
other anticompetitive practices?

Criteria for defining whether a competitive practice is
unfair or not:
Going against the common standards of business ethics
 Having caused damages or having the potential of causing
damages to other businesses or the consumer


Criteria for determining an anticompetive practice
(restricting competition):
Relevant market
 Large market share or the ability to substantially restrict
competition in the market (market power)
 Specific conducts (fixing prices, dividing markets, predatory
pricing, anticompetitive M&As, etc)

What other laws and regulations in
Vietnam say about UTPs?








Article 4 of the Civil Code 2005
Article 11(2) of the Commercial Law 2005
Article 10 & Article 124 of the Law on Insurance Business
2001
Article 7(9) of the Electricity Law 2005
Article 8(7) of the Ordinance on Hygiene and Food Safety
2003
Article 5(6) of the Ordinance on Advertising 2002
Article 9 of the Securities Law of 2006
Most recently, the Law on Protection of Consumer Interests
2010 provides for prohibition of various unfair and
unconscionable business practices against consumers (Art.
10). Unfair contracts against consumers would be
automatically void (Art. 16).
Institutional arrangements

Investigating and handling unfair competition cases in
Vietnam is the sole responsibility of the Vietnam Competition
Administration Department (VCAD) – Ministry of Industry &
Trade.






Preliminary investigation
Official investigation
Decision by the DG of the VCA: warning, sanctions and remedies
Appeal on the VCAD’s decisions over UTP cases go to the
Minister of Industry and Trade, then to the Administrative
Court
Apart from those cases related to IPRs, any other violation of
the regulations on unfair competition in any sector shall be
handled by the VCAD
The VCAD is also responsible for implementing the Law on
Protection of Consumer Interests 2010.
Law enforcement records
Perception Survey
So what people think?




Most business and consumers interviewed consider
misleading advertisement, predatory pricing, coercive
dealing, the imposing of unreasonably high prices and
infringement of IPRs to be UTPs
More than 80% of all businesses and consumers
interviewed said that UTPs negatively affect their
interests
Discrepancy in bargaining power, asymmetric
information, monopoly power, absence of relevant
laws and institutions, and ineffective law enforcement
are thought to be the cause
Existing rules, regulations or laws are believed to
have not done an adequate job
Our recommendations





Clarifying the concept of UTPs which remains open till
date
Building up a clear and comprehensive legal framework
on the issue, including implementation regulations,
guidelines, in order to create a firm legal basis, and to
avoid jurisdictional overlaps and conflict of laws
Involving the court and considering the issue of
compensation
Capacity & institutional development for the VCA
More awareness raising and legal education on UTPs
for the business and the consumer
Thank you for your attention!
For further information, please visit our website at
http://utp.cuts-hrc.org/ & join our e-discussion forum
on UTPs.