New Amendment on the “2023 Law on IP” in Lao PDR

On March 1, 2024, the Lao Official Gazette published the newly amended Law on Intellectual Property No. 50/NA, dated November 20, 2023 (the “2023 Law on IP”). This amendment introduces significant updates to Laos’ intellectual property framework, aiming to enhance IP protection and align with international standards.

To help you understand these important changes, we have prepared a comprehensive Q&A covering the key takeaways you should be aware of. This guide addresses the most critical updates in the 2023 Law on IP and their potential impact on businesses and IP owners operating in Laos.

Stay informed and make sure your IP strategy is aligned with the latest legal developments. Below are the key insights from the updated law:

What are the key differences between the 2023 Law on IP and previous amendments in 2017 and 2011, particularly in terms of trademark protection and enforcement?

Term of protection

The terms of trademark protection set out by the 2011 Law on IP provided that the term protection of trademarks shall be 10 years from the date of registration whilst the terms of trademark protection set out by the newly amended Law on Intellectual Property No. 50/NA, dated November 20, 2023 (the “2023 Law on IP”) is 10 years from the date of filing application for registration as same as the 2017 Law on IP.

Trade Name

Under the 2017 Law on Intellectual Property, registering a trade name, such as the name of a legal entity registered with the Ministry of Industry and Commerce (MOIC), was not mandatory for it to receive protection. However, the 2023 amendments introduce a new requirement: trade names must now be registered in order to secure protection against infringement by third parties.

Cancellation

The 2023 Law on Intellectual Property (IP) introduces two distinct procedures for the cancellation of IP assets. As with the 2017 Law on IP, third parties may file a request for cancellation with the Ministry of Industry and Commerce (MOIC) within five years of the registration’s publication in the official intellectual property gazette. Additionally, the new amendment explicitly allows for the cancellation of trademark, industrial design, or geographical indication registrations if they are deemed “incorrect” or made in “bad faith.” However, the MOIC assumes this authority without clearly defining these terms.

Regarding bad faith, both before and after the 2023 Law on IP, examiners have assessed the good faith of applications prior to registration, even though the legislation did not specifically authorize this. Now, under the 2023 Law, authorities are expressly empowered to evaluate bad faith after registration. This authority appears to rest with the Department of Intellectual Property, aiming to prevent Laos from becoming a haven for bad-faith applicants.

Well-Known Marks

The 2023 Law on Intellectual Property (IP) seems to reduce the burden of proof required to establish a mark as well-known. Under the 2017 Law on IP, several criteria were outlined for recognizing a trademark as well-known, which afforded protection in Laos even if the mark was not registered. One key criterion was that the goods or services associated with the mark had to be widely circulated “within the territory.” However, the term “within the territory” was not clearly defined, leading to ambiguity and potentially restricting a trademark’s ability to qualify as well-known, thereby limiting its protection within Laos.

Another criterion was that consumers in the country had to widely recognize and acknowledge the trademark’s reputation, but again, the phrase “within the country” was left open to interpretation.

The 2023 Law on IP removes the phrases “territory” and “country,” eliminating the uncertainty of whether the criteria applied exclusively to the Lao market. Now, evidence of widespread circulation, even globally, can be used to establish a trademark as well-known. Furthermore, examiners may consider additional criteria, though the 2023 law does not specify whether all criteria must be met or if only some are sufficient.

Infringement

The 2017 Law on IP provided the concepts and/or principles of an infringements of IP rights and the act of taking legal actions by introduced you to the Forms of Dispute Resolution: 1. Reconciliation; 2. Mediation; 3. Administrative remedies; 4. Remedy through Economic Dispute Resolution Committee; 5. Judicial actions to People’s Courts; 6. International dispute settlement. Under the newly amended Law on Intellectual Property No. 50/NA, dated November 20, 2023 (the “2023 Law on IP”) is still provides concepts and/or principles of an infringements of IP rights but it does not set out the principle for IP dispute resolution itself. However, there is the act of taking legal actions under the Ministerial Decision on Administrative remedies for Industrial Property and New Variety No. 0441/IC, March 30, 2023 (The “2023 Ministerial Decision Administrative remedies for Industrial Property and New Variety”). The 2023 Ministerial Decision Administrative remedies for Industrial Property and New Variety provided you the procedure for resolving the request regarding opposition, rejection, cancellation or elimination of the registration of industrial property and new plant varieties by the administrative dispute resolution committee.

Exhaustion of Rights

The 2023 Law on Intellectual Property (IP) introduces the concept of exhaustion of rights, marking a significant addition to Laos’ IP legal framework. The law indicates that once a product bearing a trademark is sold, the trademark owner’s rights are exhausted. This means the owner can no longer restrict the use or resale of the product, aligning with the international exhaustion of rights doctrine.

This addition may shed light on how local authorities view parallel imports. In the past, Laos has taken a lenient approach to parallel imports, although the legality of such imports has been ambiguous. Certain products, such as pharmaceuticals, vehicles, and medicines, which require a specific license from a licensor to a designated licensee, have seen more explicit legal frameworks. However, the overall legality of parallel imports has remained unclear.

How does the introduction of the exhaustion of rights concept in the 2023 Law on IP impact the legality of parallel imports in Laos, and what are the potential implications for local businesses and foreign investors?

In the past, Laos has allowed the parallel import and not been overly strict in prohibiting or regulating the practice of parallel importing, but their legality has been ambiguous. The 2023 Law on IP clarifies this by implementing the exhaustion of rights doctrine, which suggests that once a product is sold, the trademark owner loses control over its resale or further distribution. This aligns with international principles of “first sale doctrine” where the sale of a product exhausts the IP rights in that product. Consequently, parallel imports, particularly those involving genuine products that have been sold in another market, may now be legally permissible in Laos without the IP owner’s consent.

However, the law has not amended certain provisions that allow trademark owners to prevent third parties from using, selling, importing, or exporting goods bearing identical or similar marks. This creates a potential conflict with the exhaustion of rights concept, leaving some room for interpretation. For specific goods, such as pharmaceuticals or products requiring a licensor’s authorization, the legality of parallel imports remains uncertain due to these unamended provisions.

Local businesses that rely on importing branded goods for resale may benefit from the exhaustion of rights concept. They could potentially source products at lower costs from international markets without needing permission from the IP owners. This can improve competitiveness, offer price advantages, and increase product availability in the domestic market.

For foreign investors, particularly IP owners, the exhaustion of rights doctrine could pose challenges. It diminishes their ability to control the distribution channels and pricing of their products once they enter the market. This can undermine exclusive distribution agreements, disrupt brand strategy, and potentially harm brand reputation if imported goods do not meet the same quality standards as those sold through authorized channels.

The 2023 Law on IP now mandates the registration of trade names for legal protection. How will this change affect existing

businesses that have not yet registered their trade names, and what steps should they take to comply?

Businesses that have not registered their trade names may lose their ability to prevent others from using similar or identical trade names. Competitors or other parties could register similar trade names, potentially limiting a business’s ability to operate under its original name. Businesses should file for registration of their trade name with the Ministry of Industry and Commerce (MOIC) to secure legal protection.

With the 2023 Law on IP expanding copyright protection to include electronic works and extending the protection term for applied art, what challenges or opportunities do you foresee for artists and creators in Laos?

The 2023 Law on IP expanding copyright protection to include electronic works and extend the protection term for applied art from 25 to 30 years. This allows creators to enjoy their exclusive right for a longer period. They will more time to monetize their creations through licensing, sales, and royalties and other forms of commercialization.

With the expansion of copyright protection to electronic works, enforcement of rights could become more complex. Monitoring unauthorized use of digital works online may pose significant challenges for creators without adequate legal or technological resources.

How do the new provisions regarding bad faith applications in trademark and industrial design registrations address concerns about trademark squatting, and what further clarifications might be needed to ensure fair enforcement?

In 2023, the Ministry of Industry and Commerce provided the Ministerial Decision on Administrative remedies for Industrial Property and New Variety No. 0441/IC, March 30, 2023 (The “2023 Ministerial Decision Administrative remedies for Industrial Property and New Variety”).

In order to take legal action against the bad faith application, the applicant shall file the application requesting for consideration on opposition, rejection, cancellation or elimination of the registration of industrial property. The application will be considered and conducted by the administrative dispute resolution committee.

The applicant shall file the application against the bad faith trademark applications and industrial design registration at Department of Industry and Commerce of the Provincials and Vientiane Capital. Besides, the applicant can also file the application requesting for resolution on dispute of the industrial design registrations at Department of intellectual Property

The officer takes approximately 103 Days to proceed the case, after the consideration, if any parties do not agree with the result, they can the file application for appeal within 30 days from the date of issuance the Notice. If the authority found that the evidence is sufficient and reasonable, they will proceed to reconsider the application within 5 days.

By granting the MOIC the authority to cancel registrations after assessing bad faith post-registration, the law allows authorities to take corrective actions even after a trademark or industrial design has been registered. This is essential in combating trademark squatting, as many bad-faith registrations may not be immediately apparent during the application process. It provides a mechanism to invalidate squatted trademarks after they have been granted.

However, while the new amendment explicitly provides the possibility of cancelling trademark, industrial design, or geographical indication registrations that are deemed either “not correct” or made in bad faith, but fails to define these terms. Clarification may be needed to establish clear guidelines on what constitutes a “not correct” registration.

About Us

ILAW LAOS recently recognized as Tier 1 firm in Trademark Area of Lao PDR by AsiaIP Magazine; We will certainly keep you apprised of any future developments in its regard. Should you need further information on protecting trademarks in Laos both under the current practice and the new Law, please drop us a line at IP@ilawasia.com