Vietnam Piracy History

II. The Prioriry actions requested in 2012: IIPA had hoped that the 2005 passage of the IP Code in Vietnam, revisions to the Criminal Code in 2009, an administrative enforcement Decree (No. 47) also in 2009, and a nationwide judicial reformprocess would lead to steady improvements in copyright protection, allowing a legitimate creative marketplace to emerge in Vietnam. Unfortunately, online and mobile piracy has gotten significantly worse in Vietnam, and end-user piracy of business software remains largely unchecked, among other piracy problems.

Increased Internet and mobile penetration and more widely available broadband capacity have led to a severe increase in the trade of illegal copyright files online. Technological advances in Vietnam have outpaced the government’s response to copyright issues, notwithstanding that the Vietnamese have long recognized that piracy in the country is increasingly “sophisticated” and involves violations of “most of the objects of the rights”.

The Vietnamese Government has taken very few enforcement actions over the years, and no criminal case has ever been brought to address copyright piracy. Because of that, IIPA has launched the priority actions requested in 2012 to reduce the piracy situation in Vietnam: Enforcement: * Devote greater resources and Ministry of Culture, Sports and Tourism (MCST) Inspectorate and Economic Police manpower to running raids and bringing cases under the Criminal Code through targeted criminal actions,e. . , against online piracy, retail and source piracy,.. * Take effective enforcement measures against notorious infringing sites whose business models are based on providing access to infringing content, including in particular those sites such as Socbay. com, Bamboo. com,… * Enforce Ordinance No. 4 and Decree No. 47 on administrative remedies for copyright infringement, imposing maximum penalties. * Reduce pirated imports from China. Reduce signal theft by removing illegal content from local cable operators and stopping retransmission of signals from neighboring countries without license. Legislation and Market Access * Issue implementing guidance for the revised Criminal Code so that prosecutions can commence, in line with Vietnam’s BTA obligation, including by confirming that the Code applies to online distributions, and providing detailed interpretations of “commercial scale” infringements that include those undertaken without a profit motive. Make necessary changes to IP Code and implementing decrees to ensure Vietnam is in full compliance with its BTA and other international obligations, and otherwise facilitate the free exercise of rights by copyright owners. * Expedite the drafting process for, and provide public consultation as to, amendments to the Internet Decree (or circular) on ISP liability that clarifies the secondary liability of ISPs and requires ISPs to take responsibility and cooperate with right holders to combat online infringements both in the hosted and the non-hosted environment. Afford U. S. right holders greater access to the Vietnamese market, by eliminating foreign investment restrictions and other entry barriers with respect to production, importation and distribution of copyright materials whether in the physical or online/mobile marketplaces. * Extend the term of protection for sound recordings to the BTA-compatible term (75 years or more) and otherwise extend copyright term in line with the international trend (life of the author plus 70 years). * Pass optical disc licensing regulation. III.

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The actual out come of the 2011 decisions (the result in 2012 after applying priority actions requested in 2012) IIPA hopes the issuance and entry into force in 2012 of the Ministry of Information and Communications (MIC) and Ministry of Culture, Sports, and Tourism (MCST) Joint Circular on Stipulations on the Responsibilities for Intermediary Service Providers in the Protection of Copyright and Related Rights on the Internet and Telecommunications Networks will lead to significant reductions in online and mobile piracy in the country, including closures of notorious websites and services built on copyright infringement.

The IP Code, Criminal Code, administrative enforcement Ordinances and Decrees, and judicial reform, must all be brought to bear to significantly reduce all forms of piracy, including online and mobile piracy, enterprise end-user piracy of software, physical piracy, and book piracy which remain largely unchecked in Vietnam. And the results after applying priority actions requested in 2012, Piracy Situation and enforcement challenges in Viet Nam are summarized as follows: 1.

Internet and Mobile Piracy Causing Severe Damage to Copyright Owners: Increased Internet and mobile penetration and more widely available broadband capacity have led to a severe increase in the trade of illegal copyright files online. Internet penetration continued on an upward path, with reportedly 31. 1 million Internet users according to the Ministry of Information and Communications (MIC) of Vietnam, with 3G mobile Internet users reaching 16 million (18% of the country’s population).

Vietnam ranks 18th in the world, 8th in Asia, and 3rd in Southeast Asia in the total number of Internet users. According to MIC, there are 19 Internet service providers, some 1,064 licensed websites, and 335 social networks operating in Vietnam. Unfortunately, the vast majority of websites dealing in copyright content remain unlicensed, although there are now a few operators of online services providing licensed music (representing, however, only 1% of online music services).

The rest are streaming and download sites (50%), forums (21%), video websites (17%), search engines (8%), deeplinking, cyberlocker, and social network sites all being employed to deliver unlicensed copyright content, including music, movies, entertainment and software, and published materials. Not only the repertoire of VietNam but international and other Asian repertoire such as Chinese, Japanese and Korean music can also be found on these sites. And University networks are increasingly being used for dissemination of infringing content.

Specific example for this case is Zing. vn. Zing. vn is one notorious website which was identified by IIPA in its annual notorious markets filing with the U. S. Trade Representative, and USTR placed Zing. vn on its “Notorious Markets” list. Zing. vn is an online portal service operated by VNG Corporation (previously called VinaGame) in Vietnam. Zing. vn provides various services including an online music portal, social networking, a search engine, instant messaging, movies, karaoke, video and photos. Zing. n, well documented in last year’s IIPA Special 301 report, was proposed by IIPA as a “notoriousmarket” in its Special 301 out-of-cycle review submission in September 2012, and USTR agreed in its December 2012 announcement. USTR noted in its announcement, “In addition to being a social media site, Vietnam-based Zing. vn also includes an infringing deeplinking music portal, which reportedly attracts large numbers of users to the site. ” They also indicated, “We understand that VNG, Zing’s parent company is currently in talks with rights holders to obtain the necessary licenses to transition

Zing into an authorized digital music platform. ” With rapid increases in mobile phone subscribers in Vietnam, there has also been an increase in mobile piracy over the year. Right holders now face two major challenges in the mobile space: 1) the loading by mobile device vendors of illegal copyright content onto devices at the point of sale; and 2) illegal music channels or “apps” set up to be accessed on mobile platforms, without any intervention from the authorities to cease such activities.

As an example of this phenomenon, sites like Socbay. com offer illegal downloads of ringtones to mobile phones, but Socbay has now developed a mobile “app” called Socbay iMedia which provides a variety of unauthorized entertainment content, including, inter alia, music files. This second phenomenon will, if allowed unchecked, threaten the entire online/mobile market for music and other copyright materials into the future and must be addressed. 2.

Enterprise End-User Piracy of Software Harms the Software Industry and Stunts the Growth of the IT Sector: The software industry reports a continued high level of software piracy in Vietnam. In 2011, the software piracy rate in Vietnam was 81% (among the highest in the world), representing a commercial value of unlicensed software of US$395 million. 13 This includes widespread unlicensed software use by enterprises in Vietnam, retail piracy, and hard disk loading of unlicensed software. Most leading cities, such as Hanoi, Ho Chi Minh City, Da N? ng, and H? Phong are still key software piracy hotspots. The industry also notes the desperate need for legalization of software usage within the Vietnamese government. It has been recognized by some within the Vietnamese government that use of unlicensed commercial software is occurring within government ministries. Some initial discussions on government legalization have commenced between BSA and the Ministry of Information and Communications (MIC), with a focus on legalization procedures and the government avoiding any mandates orpreferences for the purchase of specific types of software. . Physical Piracy Remains Rampant, Including Pirate Imports, Pirate Burned Content, Factory Production, and “Media Box” Piracy: Evidence of physical piracy, including virtually 100% piracy of home video entertainment, can still be found everywhere in Vietnam, especially in urban areas like Ha Noi, HCM City,… It remains very easy to buy almost imported discs (from China mainly),burned discs or factory discs of any kind of content, and pirated software is readily available at shops on the socalled “PC streets” or other “CD-DVD” shops.

Vietnamese-sourced pirate products flood the domestic markets and have been found in other markets in recent years in Asia, North America, and even Eastern Europe. For the music industry, with piracy levels still extremely high, financial returns for recorded music sales have dropped so deeply that the companies involved are unable to invest in new albums and artists, choosing to recoup investment through ring tones, ring-back tones, ancillary revenues for personality rights, and music channel licensing. 4. Book and Journal Piracy Severely Harms Publishers:

Book and journal publishers continue to suffer from rampant piracy in Vietnam, in the form of illegal reprints and unauthorized photocopies. Bookshops, roadside vendors and copy shops all sell unauthorized copies of bestselling trade books, travel books and academic textbooks, and unlicensed print overruns continue to harm foreign publishers. Unauthorized translations produced by university lecturers or professors have been detected, in which the lecturers or professors append their name to the translated textbook.

State-sector publishers also have an interest in making sure their licenses (such as those of the Ministry of Youth and the General Publishing House of Ho Chi Minh City) are not misused. 5. Signal Piracy/Pay TV Piracy: Vietnam's Pay-TV sector is one of the fastest developing markets in the Asia Pacific, and is set to rank fourth in the region in growth over the next four years. With 4. 2 million overall connections, and digital systems taking hold (including through Vietnamese Government infusion of capital), signal piracy in Vietnam still holds back the legitimate Pay-TV market, and causes major damages to right holders. Overspill” is also a problem in Vietnam as cable operators capture signals from neighboring countries’ satellite systems. These are endemic problems which the government should address. A relatively new and dangerous problem in Vietnam involves the operation of websites which steal pay-TV signals and stream them onto the Internet. Several sites have been identified as streaming premium content channels without authorization, mainly focusing on motion pictures or sports content.

In general, after applying the above policy, the piracy situation in Vietnam has not improved. One of the reasons for this situation is enforcement challenges. Enforcement updates in Vi? t Nam: Failure to Address Internet and Mobile Device Piracy: Despite notifying the Vietnamese government ofsites involved in piracy of music, movies, software, games, and published works (with reports of growing electronic piracy of textbooks and dictionaries, among other published products), the government has been mainly inactive and disinterested. Notorious piracy site zing. n has been brought to the attention of administrative authorities in Vietnam, but there has been no response. The problem is further compounded by existing administrative enforcement remedies being rendered ineffective by: * The lack of an effective procedure to deal with online piracy administrative complaints. * A heavy burden on right holders for production of evidence and proof of actual damages. * Continued rudimentary issues related to ability to identify and effectively deal with online infringement cases. * Lack of compliance with administrative orders

Court Reform Efforts Lacking: The inactivity of the courts in dealing with copyright infringement issues is a major disappointment. There have to date been relatively few civil court actions involving copyright infringement in Vietnam. The main reasons for this are complicated procedures, delays, and a lack of certainty as to the expected outcome. Building IP expertise must be a part of the overall judicial reform effort. Training should be provided to police and prosecutors as they play a very important role in bringing a criminal offense case to the courts.

End-User Piracy Enforcement: One relatively bright spot in enforcement seems to be in the area of addressing software piracy. In 2012, more raids were taken with participation of both MCST and the MPS Anti-High Tech Crime Police. Administrative fines remain relatively low, generally, VND50 million (around US$2,400), never reaching the maximum applicable rate of VND500 million (US$24,000). The industry also reports stronger support given to both enforcement and educational campaigns to sensitize the public to the need to use legal software.

The presence of the High Tech Police is now seen as essential for the success of raids as they possess technical knowledge which is helpful to achieving effective raids. In addition, there are training courts covered the overview of copyright laws and the value of IP and innovation. There remain no implementing guidelines for the revised Criminal Code, so no software piracy cases have ever been brought to Criminal Court. Very Little Enforcement Against Hard Goods Piracy:

Though MCST has indicated its recognition of the hard goods piracy problem, it has devoted very few resources to deal with physical piracy across Vietnam. Only a ‘zero tolerance’ campaign, including actions against open and blatant piracy activities of all kinds, with deterrent administrative fines meted out to their maximums, license revocations, shop closures, seizures of pirate imports and pirated product destined for export by Customs, and criminal penalties can result in a significant reduction in piracy in Vietnam.

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