How to Set up Foreign Owned Company in IT and Computer Related Service?

Information technology and computer related service have played an extremely important role in life as well as in business activities on global scale.  The industrial revolution 4.0 has comprised of many technologies and IT and computer service take a big part of such.  The laws of Vietnam and the international commitments to which Vietnam is a party have no restrictions on foreign investors in terms of both the form of investment and the proportion of capital contribution in business in this field. Further, Vietnam prioritizes and encourages development in the field of IT and computer services which is considered attracting high level of intelligence and green business. The investors have grown confidence in Vietnam’s increasingly improved legal systems to protect the Intellectual Property rights in trademark and copyright to protect the company and individuals to exploit economic benefits in IT and computer related service areas.

IT is the core foundation of smart city, intelligent transport system, intelligent education.  Computer services and related services include: consulting services related to computer hardware installation, software implementation services, data processing services, database services, services maintenance and maintenance of office machinery and equipment, including computers and other computer services.

Under Vietnam’s WTO commitments, foreign investors are allowed to set up 100% foreign-invested enterprises to conduct business in IT and computer services and related services. At the same time, it is allowed for computer service business enterprises to set up branches when there is a need to generate additional business activities at locations outside the head office of the enterprise.

To establish an enterprise with 100% foreign invested capital, investors need to apply for an Investment Registration Certificate in accordance with the Law on Investment 2014 and an Enterprise Registration Certificate in accordance with the Law on Enterprise 2014.

A dossier of application for an Investment Registration Certificate comprises: a written request for implementation of an investment project; copy of identity card, citizen identity card or passport for individual investor and copy of establishment certificate or equivalent document certifying legal status for institutional investor; investment project proposal; copies of the latest 2-year financial statements or commitment of financial support of the parent company or financial institution or guarantee of investor’s financial capacity or documents explaining the financial capacity of the house invest; a copy of the location lease agreement or other documents certifying that the investor has the right to use the project location. If the project uses technologies on the list of technologies restricted from transfer, the explanation of the use of technologies must be submitted. Within 15 days from the date of receiving the complete and valid file, the Department of Planning and Investment will issue the Investment Registration Certificate to the foreign investor.

An Enterprise Registration Certificate dossier comprises: an application for enterprise registration; enterprise’s regulations; a list of members of a limited liability company with two or more members or a list of general partners; a notarized copy of identity card or valid passport of individual member; a notarized copy of the Enterprise Registration Certificate of the organization’s member; a notarized copy of valid identity card or passport of the organization’s legal representative; copy of Investment Registration Certificate. After 03 working days from the date of receiving a complete and valid dossier, the Department of Planning and Investment will issue an Enterprise Registration Certificate.

For the establishment of a branch, a dependent unit of the enterprise, tasked to perform all or a part of the functions of the enterprise, including an authorized representative function, business lines of a branch must be consistent with the business line of the enterprise. When registering a branch operation, the enterprise must send a notice of setting up the branch to the Business Registration Office where the branch is located. A dossier of establishment of a branch comprises of a notice of establishment of a branch; branch establishment decisions; decisions to appoint branch heads; minutes of meeting of establishment of branch; copy of the Business Registration Certificate; copy of identity card or Passport of the head of branch. Within 3 working days after receiving a valid dossier, the Enterprise Registration Office shall grant a branch operation registration certificate.

The investors should pay attention to legal compliance since incorporation and during the operation in accordance with the law.  ANT Lawyers with offices in Hanoi, HCMC and Da Nang will be helping the clients to ensure the efficient operation from legal perspective.

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How do I protect intellectual property for my software?

First, you must protect the code. You must have agreements with the developers, confirming that any code they will develop working on your project is your sole property. This is a must. You might want an attorney to draft the agreement. Copyright will protect the code once it is created, you might get an official protection. However, you will have to publish the source code, in this case.

Software Compliance Lawyer in Vietnam

Second, you must protect the trademark (this can wait if you are low on cash). It has to be protected, otherwise someone else can monetize on your success, nonetheless, you can protect it once your software starts selling. However, I do recommend checking if the name is available prior to naming your software, it might be painful to change the name when the software is published.

Third, you can protect some features of your software with patents. Patents are the main reason why Microsoft is flourishing.

Source: Quora

If you are looking for an IP attorney, but are concerned about the typical costs associated with the traditional legal search, you should visit ANT Lawyers where we work to trim those costs. We will match you with an experienced IP attorney in Vietnam for a free, no obligation consultation. Hope this helps.

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Sanctioning for violations of computer software copyright

According to Article 2 (viii) of the Stockholm Convention on 14 July 1967 on the establishment of the World Intellectual Property Organization, intellectual property is defined as the rights related to: Literary works, art and science works, performance of performers, sound recording, video recording, inventions in all areas of human endeavor, Scientific Invention, Industrial Designs, Trademarks (goods), service marks, trade names and indications , logos, Rights (protection) against unfair competition and all other rights are the result of Intellectual activities in industry / engineering, science, literature or arts.

The Berne Convention gives authors a lifetime of copyright and a minimum of 50 years thereafter. However, countries that comply with the convention are allowed to extend the term of copyright.

Software Compliance Law Firm in Vietnam

Depending on the laws of each country, works may be regulated and may have different protections. Copyright infringement of a work can be understood as an act of verbatim copying of part or the whole of a pre-existing work but without the permission of the copyrighted person or unauthorized transmission of part or the whole of a work which is not under his copyright. More specifically, the text is not copied verbatim, but the whole idea as well as the order of presentation of a work are copied. This type of infringement is harder to spot but can still be considered a form of copyright infringement if there is evidence that a "copy" is imitating the prototype. It can be seen that the examples in the master thesis do not specify the source and the main author. The text is not copied in its original form but translated with creative ideas (in other languages ​​or in other formats) is also considered copyright infringement.

Under the 2005 Intellectual Property Law, computer programs or computer software are protected by copyright as protection of a literary work whether expressed in source code or machine code. Therefore, copyright in computer software is also fully protected with personal rights and related rights. The protection of laws on intellectual property products is the basis to encourage individuals and organizations to create useful products. But with the current situation of infringement of intellectual property rights, especially for computer programs and software, the copyright infringement is up to 80%. Most of the computer software programs, if individuals want to use it, have to pay royalties to manufacturers. Normally, this fee is calculated annually, but many individuals and organizations use this reason to use pirated software without copyright.

So how will violators be penalized? Depending on the seriousness, violators may be administratively sanctioned or examined for criminal prosecution. Specifically:

Firstly, regarding administrative handling: Organizations and individuals will be fined from VND 15,000,000 to VND 35,000,000 / 1 software product, if they commit acts of copying computer programs without permission of the copyright owner. At the same time, these organizations and individuals will be forced to remove infringing copies on the digital and cyber environment or destroy the material evidence. According to Article 18 of Decree No. 131/2013 / ND-CP (amended and supplemented by Decree No. 28/2017 / ND-CP), specifically:

A fine of from VND 15,000,000 to VND 35,000,000 shall be imposed for copying a work without permission of the copyright owner. At the same time, the application of remedial measures is to force the removal of copies of infringing works in electronic form, on digital and network environment or forcible destruction of infringing material evidences.

Secondly, on criminal prosecution:

Article 225 of the Criminal Code 2015 (amended in 2017) provides for the Crime of infringement of copyright and related rights as follows:

"Those who are not allowed by the copyright or related right owner to intentionally commit one of the following acts, infringe the copyright and related rights being protected in Vietnam on a commercial scale or gain illicit profits of between VND 50,000,000 and under VND 300,000,000 or cause damage to copyright or related rights owner from VND 100,000,000 to under VND 500,000,000 or infringing goods valued at from VND 100,000 .000 VND to less than VND 500,000,000 will be imposed a fine of from VND 50,000,000 to VND 300,000,000 or face non-custodial reform for up to 03 years:

a) Copying works, sound records, video records;

b) Distribute to the public a copy of the work, a copy of the sound recording, a copy of the video recording. "

In cases of aggravating factors, a fine of between VND 300,000,000 and VND 1,000,000,000 will be imposed or a prison term of between 6 months and 3 years. If a commercial entity commits an offense, the fine level will be higher for an individual, possibly liable to a fine of from VND 500,000,000 to VND 5,000,000,000, suspended from operation for between 06 months and 02 years or banned business, banned activities in certain fields or raising capital from 01 year to 03 years. The applicable penalty will depend on the seriousness of the violation.

If you're looking for an affordable IP attorneys in Vietnam, check out ANTLawyers.vn. ANTLawyers.vn was established to meet these needs by providing fast, effective and economical solutions. Hope that clears things up a bit. Feel free to message me directly to chat further about any other IP questions that you face.

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Why is software copyrighted?

Copyright is the answer to a major problem: how do you protect something creative that took a lot of work to create, but very little to copy? That protection is important, because few people will, or even can, create something that other people want to enjoy, unless they have some reward at the end. This is especially true for software, where making an absolutely perfect copy is easy

Software Compliance Law Firm in Vietnam

Writing software is as creative as writing a book or movie. A lot of decisions and tradeoffs have to be made, and today software takes millions, even billions, of dollars to put together. As a society, we want to incentivize that work. Copyright provides the solution.

Example: Company A develops some new software. An engineer of company A makes a copy of the software and starts a new company selling the same software. Most people would consider such an action illegal.

Software is copyrighted because it represents the intellectual property of its creator, so it needs to be protected from being copied.

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Measures to Prevent and Ensure Administrative Sanctions of Software Piracy

Vietnam is among countries with the highest rate of software piracy in the world, although the rate has reduced from 92% in 2004, to 81% in 2011, 78% in 2015 according to the report of BSA, The Software Alliance that promote legal software use and advocates for public policies that foster technology innovation and drive growth in the digital economy.

Copyright Enforcement Law Firm in Vietnam

Computer software is protected as literary works, one of types of works eligible for copyright protection in accordance with Article 14 of Vietnam law on intellectual property 2005, amended and supplemented in 2009. Unlicensed software is unauthorized use or distribution of copyrighted software.  Copyright infringements include publishing, distributing, copying, using, leasing out, duplicating, importing, exporting a work without permission from the author or copyright holder according to Article 28 of Vietnam law on intellectual property 2005, amended and supplemented in 2009.

The government of Vietnam has been striving to coordinate between ministries to increase awareness and encourage the software license compliance. Further, Ministry of Culture, Sports and Tourism has coordinated with Ministry of Public Security to increase frequency of inspecting the software license compliance in Vietnam as part of intellectual property right enforcement effort.

According to the provisions of Article 215 of the 2005 Intellectual Property Law, there are measures under the law of Vietnam to prevent and secure administrative sanctions.

In the following cases, organizations and individuals may request Vietnam competent agencies to apply preventive measures and ensure administrative sanction as provided for in Clause 2, Article 215 of the 2005 Intellectual Property Law:

-An act of infringement of intellectual property rights is likely to cause serious loss and damage to consumers or society;

-Material evidence of the infringement is likely to be dispersed or there are indications that the offender will evade responsibility;

In order to secure enforcement of a decision imposing an administrative penalty, preventive measures and/or measures to secure enforcement of administrative penalties which may be applied in accordance with administrative procedures to acts of infringement of intellectual property rights shall comprise:

-Temporary detention of persons;

-Temporary custody of infringing goods, material evidence and facilities;

-Body searches;

-Searches of means of transport and objects; searches of places where infringing goods, material evidence and facilities are hidden;

-Other administrative preventive measures in accordance with the law on dealing with administrative breaches

How ANT Lawyers Could Help Your Business?

To learn more about ANT Lawyers IP Practice or contact our Intellectual Property Lawyers in Vietnam for advice via email ant@antlawyers.vn or call our office at (+84) 24 32 23 27 71

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