Why Vietnamese brands are caught napping in overseas markets

ST25, the Vietnamese variety that won the World’s Best Rice contest in 2019, is in danger.

The name is set to be trademarked in the U.S. by an American company which seeks to profit from the brand’s prestige.

Ho Quang Cua, the farmer-scientist who led the research and development of this rice variety, which is grown in southern Vietnam, said that he hadn’t trademarked it in the U.S. earlier, because he did not foresee that it would be exported there and did not thoroughly understand international regulations.

This is the latest in a list of cases of Vietnamese individuals and companies who have lost their brands to foreign companies because of their reluctance in to patent their trademarks and products worldwide.

In 2000, the famous Vietnamese coffee brand Trung Nguyen was registered by U.S. company Rice Field with the World Intellectual Property Organization.

The Trung Nguyen Group had to go through two years of difficult negotiations to reclaim its own brand in the U.S. and ended up making Rice Field a distributor there.

The group then registered its brand in 60 countries and territories, seeking to prevent a similar mishap.

Another coffee grower, Buon Ma Thuot, saw its brand being registered in international markets by a Chinese company for 10 years starting 2011.

Fish sauce brand Phu Quoc of the Association of Phu Quoc Fish Sauce Producers in southern Vietnam, was once trademarked by Viet Huong Fishsauce in the U.S, the E.U., China and Australia.

It took six years for these producers to prove the origin of their products to the E.U., opening at path for them to enter an $18-trillion GDP market.

Experts say these cases happen because Vietnamese businesses lack knowledge of international laws and have limited financial capability to trademark their brands and products.

Many companies are reluctant because they hear that the process is time consuming and complicated, said Ngo Van Hiep, director of the Hiep & Associates law firm.

But they lose more than gain when they do not register their brands early as it will take even more money and time to reclaim the brand from other companies later, he added.

Branding expert Nguyen Thanh Son, chairman of Media Ventures Vietnam, said that a company has a responsibility to protect its own brand, which is a valuable and invisible asset.

Letting other companies step up and take the initiative in registering the brand shows that the company does not appreciate its own brand and its value, he said.

Unless this attitude changes, "similar unfortunate situations like the ST25 brand will continue," he added.

Trademarking is purely an initiative and the responsibility of businesses, not the government, said Lai Van Manh, director of branding company Mibrand. "No one can take over this task for them."

Government’s limitations

However, other experts proposed more assistance from the government in helping Vietnamese individuals and companies with patenting their products.

Vo Tong Xuan, principal of the Nam Can Tho University in southern Vietnam, said that many Vietnamese farmer-scientists only have knowledge and expertise in their field. They have very limited resources and are therefore unable to protect their brands internationally.

He proposed that the ST25 rice be made a national brand with the assistance of the Ministry of Natural Resources and Environment and the Ministry of Industry and Trade, which will provide a stronger legal base for the product to compete internationally.

However, Vu Ba Phu, head of the trade promotion agency under the trade ministry, said that existing regulations do not allow any ministry to register trademarks for a company.

Such action could be a violation of the World Trade Organization (WTO) provisions on protectionism, he said.

But his ministry will propose to the government a mechanism to assist Vietnamese brands patent their products and brands in key markets in line with WTO regulations, he added.

The ST25 rice is the result of 25 years of work by farmer-scientist Cua and his colleagues who cross-bred the premium fragrant rice varieties in Mekong Delta province of Soc Trang. It has been described as having a sweet taste and a hint of pineapple flavor.

In 2019, the ST25 rice was named the winner of the World's Best Rice Contest in the Philippines, marking the first time a Vietnamese rice variety had won the title in the contest’s 11-year history.