TIKTOK V. VNG: CONCERN ABOUT JURISDICTION ON DISPUTE SETTLEMENT

Recently, VNG - A leading technology company in Vietnam has sued TikTok for infringement of intellectual property rights causing their severe damage of more than VND 221 billion. Specifically, VNG accused TikTok of using recordings owned by Zing - a subsidiary of VNG, without VNG’s copyright consent. In this accusation, Zing also said that a total of 150 recordings which they own exploitation rights are currently illegally used by Tiktok in more than 11 million videos on their app and site.

By the above-mentioned, VNG believes in TikTok’s infringement on their intellectual property rights causing heavy damage to them. VNG filed a lawsuit in the People's Court of Ho Chi Minh City, “requirement for TikTok  elimination of all the Zing musics from the TikTok app and site along with a compensation of more than VND 221 billion ($ 9.5 million)” (according to the content of the petition). The case is being accepted by the People's Court of Ho Chi Minh City.

Above is a typical case of a dispute on intellectual property rights involving foreign elements. For protection of the legitimate rights and interests in such cases, which competent authority should the claimant file the lawsuit in? In this paper, DTD will clearly analyze jurisdiction on dispute settlement relating to intellectual property rights involving foreign elements in the VNG v. Tik Tok case.

The dispute involving foreign elements

Under Section 464(2) of the 2015 Code of Civil Procedure on the principles of application:

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“2. A civil case involving foreign elements means a civil case falling in any of the following cases:

a) At least one party is a foreign individual/agency/organization;

b) All parties are Vietnamese citizens/agencies/organizations but the relationship is established, changed, developed or broken up in a foreign country;

c) All parties are Vietnamese citizens, agencies and organizations but the object of such civil relationship is overseas.

In this dispute, the Defendant - TikTok Inc. - is a legal entity with  foreign nationality (TikTok Inc.'s mother company is ByteDance, located in China). Therefore, we can conclude that this is a civil case involving foreign elements as one of the parties is a foreign legal entity.

Settlement of disputes involving foreign elements will be implemented by the Court or the Commercial Arbitration, which follows the agreement of the involved parties. According to Section 30(2) of the 2015 Code of Civil Procedure on Business and/or trade disputes falling under the courts' jurisdiction provides: “Disputes on intellectual property rights or technology transfers among individuals or organizations, which are all for the purposes of profits”. Therefore, both sides have the right to choose the Court accepting and resolving their case.

Is Vietnamese or Chinese the Competent Court to accept this case?

Section 18(1)(6) of the Treaty on Judicial Assistance in Civil and Criminal issues between Socialist Republic of Vietnam and People's Republic of China provides:

“Article 18. Jurisdiction

1. For implementation of this Treaty, the Court of either Parties considered as a Competent Court if:

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6. In case liabilities come up out of the upon-agreed contract, the damaging acts or its consequences took place in the territory of that Party”

Besides, under Section 469(1)(đ) of the 2015 Code of Civil Procedure:

“Article 469. Common jurisdiction of Vietnamese Courts to resolve civil cases involving foreign elements:

1. Vietnamese Courts shall have the jurisdiction to resolve civil cases involving foreign elements in the following cases:

dd) Civil cases related to civil relations which are established, changed or terminated in Vietnam, objects of which are properties in the territory of Vietnam or acts performed in the territory of Vietnam.”

VNG - Vietnamese legal entity accused TikTok Inc.- a Chinese legal entity of using the copyrighted song records owned by Zing without the copyright consent. Thus, the object of this dispute is Zing’s intellectual property right, considered as "properties in the territory of Vietnam". Therefore, the dispute on the records owned by Zing is accepted by the Vietnamese Court.

Under Section 37(1) of the 2015 Code of Civil Procedure on the jurisdiction of People’s Courts of provinces:

“Article 37. Jurisdiction of People’s Courts of provinces

1. People's Courts of provinces shall have the jurisdiction to settle according to first-instance procedures the following disputes:

a) Civil, marriage and family, business, trade and labor disputes provided in Articles 26, 28, 30 and 32 of this Code, except for disputes falling under the jurisdiction of the district-level People's Courts as provided in Clause 1 and Clause 4, Article 35 of this Code.”

The Parties, specially Defendant in this case of “intellectual property right dispute” - TikTok is a foreign entity. Ho Chi Minh City People's Court's acceptance of the VNG’s petition is in compliance with the law.

In conclusion, it is important to determine which national Court is the Competent Court to a civil case involving foreign elements, which is also the first step to ensure that the case is favorably resolved. The next stages of the lawsuit will be continuously updated and assessed objectively based on legal aspects by DTD in the coming papers.