In addition to its intellectual property laws, the Patent Law in particular, Vietnam has introduced regulations specifically designed to encourage innovation. It also encourages innovation in other ways.
The country's economy, one of the fastest growing economies in the world, was, until recently, based largely on either foreign investment or the exploitation of natural resources. Innovation regulations were introduced to encourage the development of local industry, particularly in the field of science and technology.
Certain intellectual property provisions were introduced in Vietnam as early as 1981 (Decree 31/CP/1981). In 2005, in preparation for the negotiation to Vietnam to become an official member of the World Trade Organisation, a specific Intellectual Propery Law was enacted. In 2012, Decree No. 31/CP was replaced with Decree No. 13/2012/ND-CP, which introduced specific provisions designed to encourage innovation.
Article 3 of Decree 13/2012/NĐ-CP provides that an ‘innovation’ is a technical, managerial, or operational solution that is novel, and has been applied with practical benefit, within the relevant establishment. The relevant establishment will usually be the employer of the innovator or the person or entity to whom rights in the innovation have been transferred.
For an innovation to be recognized under the Regulation, the author must submit a written request to the employer, or other relevant entity, setting out certain specified details including details of the innovation and an evaluation of its benefits. Within one month, the recipient must examine the request and notify the innovator of its acceptance or rejection or, if modifications are required, allow a further month for those modifications to be made. Where a request is accepted, it must be considered within three months. If the innovation is recognised, a certificate will be granted and the author will be entitled to remuneration for a period of four years from the date of the certificate. The level of remuneration will be as agreed with the relevant establishment owner, or, failing agreement, as specified in the regulation.
The Decree also contains a number of additional provisions designed to promote innovation activities, including a provision that every entity must establish a science and technology development fund and allocate up to 10% of its gross revenue to the fund each year. The specific percentage will depend on the type of enterprise.
Innovation encouragement in Vietnam is not restricted to the introduction of legislation. Every year, many State and private science and technology organizations hold competitions and reward innovation. Successful candidates receive a financial prize and a certificate of merit.