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In the realm of intellectual property (IP) protection in Vietnam, businesses have two primary avenues to safeguard their innovations: trade secrets and patents. Each offers distinct advantages and is governed by specific legal frameworks. A comprehensive understanding of these mechanisms is essential for making informed decisions about protecting proprietary information.
Trade Secrets: Definition and Legal Framework
Under Vietnamese law, a trade secret is defined as information obtained from financial and intellectual investments, which has not been disclosed and is capable of being used in business. To qualify for protection, the information must meet the following criteria:
- Secrecy: The information is not common knowledge and is not easily obtainable by others.
- Commercial Value: When utilized in business, it provides the holder with an advantage over those who do not possess or use it.
- Protection Measures: The owner has implemented necessary measures to ensure the information remains undisclosed and inaccessible.
These provisions are outlined in Article 84 of the Law on Intellectual Property (IP Law) 2005, amended and supplemented in 2022.
Patents: Definition and Legal Framework
A patent in Vietnam protects an invention, which is defined as a technical solution in the form of a product or a process intended to solve a problem by applying natural laws. To be patentable, an invention must satisfy the following conditions:
- Novelty: The invention is new and has not been publicly disclosed.
- Inventive Step: It involves an inventive step that is not obvious to someone with ordinary skill in the relevant field.
- Industrial Applicability: The invention can be applied in industry.
These criteria are specified in Articles 58 and 60 of the IP Law.
Key Differences between Trade Secrets and Patents
- Disclosure:
- Trade Secrets: Protection is contingent upon maintaining confidentiality. Public disclosure can nullify protection.
- Patents: Require full public disclosure of the invention’s details as part of the application process.
- Duration of Protection:
- Trade Secrets: Protection can last indefinitely, provided the information remains confidential.
- Patents: Offer protection for 20 years from the filing date, after which the invention enters the public domain.
- Legal Protection and Enforcement:
- Trade Secrets: Owners must actively protect their secrets. Legal recourse is available against misappropriation, but enforcement can be challenging, especially in proving unauthorized acquisition or use.
- Patents: Provide exclusive rights enforceable by law, allowing patent holders to prevent others from making, using, or selling the invention without permission.
- Risk of Reverse Engineering:
- Trade Secrets: Vulnerable to reverse engineering, which is legally permissible in Vietnam. Competitors can lawfully analyze products to discover underlying secrets.
- Patents: Once granted, the disclosed information is protected, and reverse engineering would constitute infringement during the patent’s term.
Practical Considerations in Choosing Between Trade Secret and Patent Protection
When deciding between trade secret and patent protection, consider the following factors:
- Nature of the Information: If the innovation can be easily reverse-engineered or independently developed, patent protection may be more appropriate.
- Duration of Commercial Value: For innovations with long-term value exceeding 20 years, trade secret protection might be preferable.
- Resources for Protection: Patents involve significant costs for application and maintenance, whereas trade secrets require ongoing investment in security measures to maintain confidentiality.
- Strategic Business Considerations: Evaluate whether public disclosure through patenting could benefit the business by deterring competitors or if maintaining secrecy aligns better with business objectives.
