DECREE

ON UTILITY SOLUTION
(Promulgated by the Government Decree No. 200-HDBT of December 28, 1988 as amended by Government Decree No. 84-HDBT of March 20, 1990 of the Council of Minister)

Chapter I

GENERAL PROVISIONS

Section 1:

Extent of Application

(1) This Ordinance applies to every persons or legal entity to encourage the making, the quick application on a large scale of utility solution to production so as to contribute to the promotion of the economic, social development.

(2) Foreign persons and legal entities enjoy the rights provided for in this Ordinance on the principle of reciprocity pursuant to the legislation of the Socialist Republic of Vietnam and international treaties to which Vietnam is a party.

Section 2:

Criteria of patent ability of Utility Solution

(1) "Utility solution" means technical solution which is new in comparison with the available technology in Vietnam, and practically applicable under the prevailing economic, technical conditions.

(2) A solution shall be considered new, if prior to the priority date of the application for protection (as provided in Section 6), it has been neither publicly used in Vietnam, nor disclosed to the public in Vietnam in any form (printed matters, audio or video magnetic tapes, exhibition, etc.) in such a manner that the realization thereof could be made nor identical with any of solution described in applications for protection of utility solution or invention, filed with the National Office on Inventions of The State Committee for Science and Technology, having an earlier priority date.

The novelty or a solution shall not be considered destroyed if the solution has been disclosed by other person, without the authorization of the person to whom it belonged, within a period of six months preceding the filing date of the application for protection of utility solution.

(3) The subject matter of a utility solution may be a device,a process or substance.

Section 3:

Exclusion from Protection of Utility Solutions

The following technical solutions shall not be considered as utility solution:

a- a solution which may be easily made by a person skilled in the art which it pertains;

b- solutions which are unlawful or contrary to the socialist morality.

Section 4:

Exclusion of Subject Matters from Protection

The following subject matters be excluded from the protection provided for in this Ordinance:

a- methods and systems for economic management, administration (e.g. planning, financing, supplying, statistics, etc.);

b- ideas, scientific principles and discoveries computer programs, mathematical models, graphics and the like;

c- linguistic systems (e.g. grammatical systems, artificial languages, cipher, writing, pronunciation, etc.), information systems, classification systems, documentation compiling systems;

d- methods and systems for education, training, nutrition;

e- training methods for domestic animals;

f- designs and schemes for planning of constructions, projects for regional planning (population area, cultivating lands, parks, etc.)

g- symbols (traffic signs, itineraries, etc.), rules (rules for playing games, traffic rules, etc.) and regulations;

h- solutions concerning only the shape of articles, bearing no technical character;

i- microorganisms, plant varieties, animal breads;

j- methods for the prevention, diagnosis, treatment of diseases in human beings.

Section 5:

Conversion of Patent Application into Application for Protection of Utility Solution

Any patent application filed with the National Office on Inventions of the State Committee for Science and Technology may be converted into an application for protection of utility solution.

Section 6:

Right of Priority

The right of priority of an application for protection of utility solution (hereafter referred to as priority right) shall be determined by the priority date of the application.

The priority date may be:

a- the date of the filing of the application with the National Office on Inventions; or

b- the filing date of the earliest application filed in any country-party to the Paris Convention for the Protection in Industrial Property if the application is filed with the National Office on Inventions of the State Committee for Science and Technology within Article 1 period of twelve months counted from that date; or

c- the date of the display of the solution on an official international exhibition held on the territory of any country-party to the Paris Convention for the Protection in Industrial Property if the application if filed with the National Office on Inventions of the State Committee for Science and Technology within a period of six months counted from that date; or

d- the priority date of the patent application if application converted therefore as provided in Section 5.

Section 7:

Right to File Application for Protection of Utility Solution

(1) The right to file application for protection of the utility solution shall belong to the person(s) who has made the utility solution by his creative work (hereinafter referred to as author) or to his successor in title.

(2) Where a person has made, in execution of a commission within the filed of activity, or with the material, manpower assistance of the employing organization, unit.

The right to file the application, however, shall belong to the author if, within a period of two months following the author's report on the fact that the solution could be protectable as a utility solution, the organization, unit has not filed the application.

(3) When a utility solution has been made in execution of a scientific, technical-research development contract, the right to file the application shall belong to the party which has commissioned the work, if the contract has not provided otherwise.

(4) When a utility solution has been made in an organization, unit applying employment contract, the right to file the application shall belong, to the employing organization, unit, if the contract has not provided otherwise.

Section 8:

Protection of Utility Solution Abroad

In case a utility solution has been made in Vietnam except the case referred to in Section 28 of this Ordinance, the filing of the application for protection abroad may only be authorized after the application for protection of that solution has been filed in Vietnam and the applicant has received the notification of acceptance of the application issued by the National Office on Inventions.

Section 9:

Responsibility of Authority Granting Title of Protection

(1) The National Office on Inventions of the State Committee for Science and Technology is the authority responsible for the receipt and examination of applications, for the grant of titles of protection of utility solution and for the supervision on the protection within the term of validity of titles or protection according to the provision of this Ordinance.

(2) Examiners, co-examiners and other persons, among the staff of the National Office on Inventions, who deal with the applications for protection of utility solutions shall the obligation to keep the content of the applications secret until the publication of the utility solutions in the Gazette issued by the National Office on Inventions of the State Committee for Science and Technology. Matters which are published neither in the Gazette nor in descriptions of utility solutions shall be kept in top secret.

Any infringement of regulations for keeping secret shall be proceeded against by the employing organization, unit pursuant to administrative regulations. Grave infringements will be sued by law.

Section 10:

Organization, Management, Development of Activities Relating to Utility Solutions

(1) The general provisions laid down by the State in respect of the organization, management and development of industrial property activities shall apply to activities relating to utility solutions.

(2) The provisions in force for encouragement of innovators, investors shall apply by analogy to authors of utility solutions, their assistants and persons engaged in the first application of utility solutions.

Chapter II

PROTECTION OF RIGHTS TO UTILITY SOLUTION

Part A. RIGHTS AND OBLIGATIONS RELATING TO UTILITY SOLUTIONS

Section 11:

Establishment of Right

(1) The legal protection of the utility solution shall take effect from the date of the grant of the patent for utility solution by the State.

(2) The patent for utility solution shall establish the exclusive right to work utility solution to the patentee (hereinafter referred to as owner title) and the right of the author.

(3) The term of validity of a patent for utility solution shall be six years counted from the priority date of the application.

(4) The scope of the protection of utility solution shall be determined by claims.

Section 12:

Exclusive Right to Work Utility Solution

(1) Exclusive right to work utility solution means the right to perform exclusively acts relating to the utility solution for productive, commercial purposes.

(2) The owner of title may assign the right to work utility solution, the ownership right of the utility solution to other person or organization, unit.

The assignment of the right to work utility solution (license contract) or the ownership right of the utility solution in respect of the protected utility solution shall be registered with the National

Office on Inventions under the State Committee for Science and Technology and shall be published in the Gazette issued by the National Office on Inventions under the State Committee for Science and Technology.

Section 13:

Rights of Author

(1) The author of the utility solution shall be named as such in the patent for utility solution and in other documents relating to that utility solution.

(2) Within term of validity of the patent for utility solution, the author shall have the right to a payment of royalty due by the owner of title, which shall not be less than eight percent of the profit derived the working of the utility solution. In case of the assignment of the right to work utility solution, the amount obtained by the sale of the license deducted by relating expenses shall be considered as profit.

The amount of royalty due to the author shall be paid within two months following the end of application year or the date of receiving the payment due to the sale of the license.

(3) In case of a utility solution of great economic, technical value, the author may be awarded the honor title and National Scientific - Technical Prize by the State.

Section 14:

Obligation for Application to Production

The owner of title and the assignee of the right to work utility solution shall have the obligation to apply the utility solution to production in Vietnam.

Section 15:

Non-Voluntary License

In case the owner of title refuses, without justified grounds, the assignment of the right to work utility solution, the Chairman of the State Committee for Science and Technology may grant the authorization to work utility solution (non-voluntary license):

(a) to the person who, or organization, unit which made such request if, within a period of three years following the grant of the patent for utility solution, the utility solution has not been applied to production on the territory of Vietnam or has been applied insufficiently for the social needs.

(b) to the organization, unit proposed by the head of ministerial rank organizations, people's committees of provinces or cities subordinated to the Central Government in accordance with the government sectoral and Provincial plans for the application of results of research projects in case the utility solution has been made in execution of scientific, technical research projects financed by the State.

(c) to the organization, unit proposed by the Minister concerned in case the utility solution has a special use for national defense, security or public health or foodstuff services.

(2) The request for the grant of the non-voluntary license must contain the proof of the fact that the requesting party has capability conditions to apply the utility solution and that the owner of title

has refused to assign the right to work utility solution.

(3) The beneficiary of the non-voluntary license shall not be authorized to assign the right to work utility solution to other person or organization, unit and shall have the obligation to pay the owner of title a reasonable amount on the basis of agreement with the later. In case no agreement could be reached, the parties concerned may apply to the court for the settlement of the matter.

Section 16:

Acts Deemed Not To Be Infringements of Exclusive Right to Work Utility Solution

The following acts shall not be deemed to be infringements of the exclusive right to work utility solution of the owner of title:

(a) using or selling a product relating to the utility solution where the product has been put on the market by the owner of title or the assignee of the right to work utility solution or the beneficiary of

the non-voluntary license;

(b) continuing to use, without enlarging the extent of application, Article 1 solution identical with the utility solution claimed in the application filed by other person or organization, unit if, prior to the priority date of the application, that solution has been worked or the serious preparation for working it has been made;

(c) using the utility solution merely for the purpose of scientific research;

(d) using the utility solution on foreign transportation means which, in transit or temporarily, are on the territory of the Socialist Republic of Vietnam provided that the utility solution is used only for maintaining the operation of the said means;

(e) using the utility solution for personal needs, not for commercial purposes.

Section 17:

Maintenance of Validity, lapse of Patent for Utility Solution

(1) For the purpose of maintaining the validity of the patent for utility solution, the owner of title shall have the obligation to pay the prescribed annual fee.

(2) A patent for utility solution shall lapse before the expiration of the term of validity:

- the owner of title does not pay the annual maintenance fee within the allowed period as prescribed in regulations for paying fees;

- the owner of tile submits the declaration for the surrender of the legal protection.

Part B. PROTECTION OF RIGHTS RELATING TO UTILITY SOLUTIONS

Section 18:

Proceeding for Infringement Relating to Exclusive Right to Work Utility Solution

(1) Any of the following acts except the cases referred to in Section 16 if performed, without the authorization of the owner of title, shall be deemed to be the infringement of the exclusive right to work utility solution of the owner of title;

(a) producing, offering for sale, selling, using, importing a product as subject matter of the protected utility solution or warehousing the said product for sale or use;

(b) using a protected process for manufacturing, producing product or offering for use of said process on the territory of Vietnam;

(c) offering for sale, selling, using, importing products obtained directly by the protected process or warehousing the said products for sale or use.

(2) Any infringement of the right to work utility solution of the owner of title shall be proceeded against. The infringing person shall have the obligation to discontinue the infringing acts and to indemnify the owner of title for damages, to bear other penalty provided by law according to the extent of infringements.

Section 19:

Settlement of Appeal Against Payment of Royalty

In case the owner of the patent for utility solution does not the royalty due to the author as provided in Section 13 of this Ordinance, the author or his successor in title shall have the right to appeal to the court of competent jurisdiction.

Chapter III

PROCEDURES OF FILING APPLICATIONS, EXAMINATION, GRANT, PUBLICATION OF UTILITY SOLUTIONS AND RELATED APPEALS, OPPOSITIONS

Section 20:

Filing Applications for Protection of Utility Solution

(1) The application for a patent for utility solution shall be fined with the National Office on Inventions of the State Committee for Science and Technology.

(2) The formal and substantive requirements of the applications for patent for utility solution shall be laid down by the implementation regulations to this Ordinance.

(3) In respect of the conversion of a patent application into an application for patent for utility solution according to Section 5, the application shall be filed;

(a) together with the patent application for requesting the conversion due after the latter's substantive examination if the requirements for granting the patent are found not to be fulfilled;

(b) within a period of two months from the date at which the applicant has received the notification of the refusal of the grant of patent.

(4) The applicant of patent for utility solution shall pay the prescribed application fee.

Section 21:

Formal Examination

(1) Within a period of three months following the receipt of the application for patent for utility solution, the National Office on Inventions of the State Committee for Science and Technology shall accomplish the formal examination of the application. The acceptance of the acceptable application shall be recorded in the Registry of Applications for Patent for Utility Solution and shall be notified to the applicant. The unacceptable application shall be rejected or subjected to amendment, completion.

(2) The application shall be deemed not having been filed if, within a period of one month from the receipt of the notification requesting its amendment, complement the applicant has not sent the amendment, complement as requested.

Section 22:

Substantive Examination, Grant of Patent for Utility Solution

(1) Within a period of nine months from the receipt of the application for patent for utility solution, the National Office on Inventions shall accomplish the substantive examination of the solution claimed in the application and, on the basis of the examination report, the Director of the National Office on Inventions shall make the decision on the grant of the patent for utility solution to the applicant. If the National Office on Inventions the requirements for the grant of the patent for utility solution are not fulfilled shall have the obligation to notify the applicant of the reasons of refusal to grant the patent for utility solution.

(2) Time limit for effecting the substantive examination shall be respectively twenty months from the filing date of the patent application resulted therefrom and is filed in accordance with Paragraph 20 (3) (a), two months from the date of the acceptance of the application if the conversion has requested in accordance with Paragraph 20 (3) (b).

(3) During the substantive examination, the National Office on Inventions shall have the right to request organizations, units in charge of research, designing, production and experts in the fields concerned to participate in the evaluation of solutions described in applications.

(4) The patented utility solution shall be recorded in the National Register of Patent for Utility Solution.

Section 23:

Complement of Documents During Substantive Examination

(1) The National Office on Inventions shall have the right to request the applicant to furnish the complementary documents for clarifying the essence of the solution claimed in the application.

(2) The application shall be deemed not having been filed if, within a period of one month from the receipt of the notification requesting the complement of documents, the applicant has not completed the file or has not justified the reasons for the delay in completing the file. When accepting the reasons for delaying the complement of file, the National Office on Inventions may prolong the time limit for substantive examination for the time delayed.

(3) Where the complementary documents change the essence of the solution claimed in the application, the application for utility solution shall be refused to be patented.

Section 24:

Publication of Utility Solutions

(1) The patented utility solution shall be published in the Gazette issued by the National Office on Inventions.

(2) The description of the patented utility solution shall be laid open in the Central Library of Inventions subordinated to the National Office on Inventions.

(3) For the purpose of the protection of national interest, in case of necessity the utility solution may be deferred or renounced to be published.

Section 25:

Appeal by Applicant Relating to Grant of Patent for Utility Solution

(1) The applicant when disagreeing with the reasons for rejecting the application for patent for utility solution or restricting the scope of protection claimed in the restricting the scope of protection claimed in the application shall have the right, within two months from the receipt of the notification thereof, to appeal to the National Office on Inventions against such decision.

(2) The applicant when disagreeing with the decision made by the National Office on Inventions relating to the settlement of his appeal against the refusal of the grant patent or the restriction of the scope of protection shall have the right to appeal to the State Committee for Science and Technology.

(3) The decision of the Director of the National Office on Inventions in respect of an appeal against the reject of an application, the decision of the Chairman of the State Committee for Science and Technology in respect of an appeal referred to in Subsection (2) above shall be final.

(4) Time limit for the settlement of an appeal at each level shall be three months from the receipt thereof. The applicant shall be notified of the decision made on the matter.

Section 26:

Opposition Relating to the grant of Patent for Utility Solution

(1) Within the term of validity of the patent for utility solution, any person or organization, unit may be file with the National Office on Inventions the request opposing the grant of patent for utility solution when revealed that:

(a) the person who is named in the patent for utility solution as author is not the person who has made the utility solution or the latter is not named as author in the patent for utility solution;

(b) the person who is named in the patent for utility solution as the owner of title had no right to file the application as provided in Section 7;

(c) the utility solution for which the patent for utility solution has been granted has not complied with the requirements for the protection of utility solution.

(2) The request for opposition shall clarify the grounds upon which the opposition bases and the person who files it shall pay the prescribed fee.

(3) The National Office on Inventions shall have the obligation to settle the opposition within a period of three months from the receipt of the request.

(4) In case of disagreement with the settlement made by the National Office on Inventions, the parties concerned may:

(a) file the request for opposition with the State Committee for Science and Technology if the reason for opposition relates to Subsection (1) (c) above. Within a period of three months from the receipt of the request for opposition, the State Committee for Science and Technology shall have the obligation to settle it, the decision of the Chairman of the State Committee for Science and Technology shall be final in this respect;

(b) file the request for opposition with the people's court of competent jurisdiction if the reason for opposition relates to Subsections (1)(a), (1)(b) above.

(5) The decision relating to the invalidation of the patent for utility solution and the re-establishment of the right of the author shall be notified to the owner of title and the author and shall be published in the Gazette issued by the National Office on Inventions.

Section 27:

Agent

(1) Any person or legal entity may effect the procedure of the protection of utility solution in Vietnam through a lawful agent (authorized by the competent authorities for functioning and approved by the National Office on Inventions of the State Committee for Science and Technology).

(2) Any person who, or legal entity which, has neither domicile nor productive, commercial establishment nor agency in Vietnam shall effect the procedure of the protection of utility solution in Vietnam through an agent.

Section 28:

Protection of Secret Utility Solution

(1) Utility solution relating to national defense, security and utility solution being found to be kept in secret for protecting national economic interests shall be considered secret utility solutions.

(2) The regulations laid down jointly by the State Committee for Science and Technology, the Ministry of Defense, the Ministry of Interior in respect of the protection of secret inventions shall apply to the protection of secret utility solutions.

Chapter IV

IMPLEMENTATION PROVISIONS

Section 29:

Transitional

(1) In respect of a patent application where the sought patent has been refused to be granted pursuant to the provisions of Ordinance on Innovations to Effect Technical Improvement and Rationalization in Production and on Inventions promulgated by Government Decree No 31-CP of January 1, 1981, the applicant shall have the right to file, within a period of twelve months from the date of the promulgation of this Ordinance, the application for the protection of the solution as an utility solution.

(2) Any person or legal entity shall have the right to continue to work, without enlarging the extent and volume of application or assigning the right to work, a solution identical with the solution in respect of which the patent for utility solution has been granted according to Subsection (1) above if, prior to the filing date of the application for the protection of the utility solution, that person or legal entity has worked the solution or made serious preparation for working it.

Section 30:

Organization of Implementation

(1) The State Committee for Science and Technology shall be entrusted with the promulgation of the implementation instructions for the application of this Ordinance and the regulation for paying fees relating to the protection of utility solutions.

(2) Ministers, Chairmen of State Committee, head of organization subordinated to the Council of Ministers, Chairmen of People's Committees of provinces, cities special regions subordinated to the Central Government shall be in charge of the dissemination and application of this Ordinance.