On April 27, the Market Surveillance Department, in collaboration with the Economic Police in Vietnam, conducted a surprise inspection of five warehouses in Thanh Hoa - Vietnam. The warehouses are under the ownership of Mrs. Truong Thi Lien (born in 1971). The inspection team discovered tens of thousands of suspected counterfeits offered for sale through live streaming on the Facebook platform.

The shop owner uses one main warehouse as a business premises. Meanwhile, the other warehouses are scattered not far from the main premises. Each warehouse has an area of 80-100 square meters, located deep in a residential area, and difficult to access. All warehouses are equipped with sturdy shelves to display goods. Goods are divided into categories and placed in separate zones for the convenience of live streaming and sales, such as cosmetic products, and a fashion garments zone. After 10 hours of initial sorting and counting of goods, the inspection team recorded over 12,000 violation products, most of which were products with signs of counterfeiting many famous brands, such as Channel, Kenzo, Gucci... The owner failed to provide documents proving the origin of the above goods. In addition, there are still a large number of goods that have not been classified and counted, which means that there are still many infringing goods in the warehouse which have not been recorded.

According to the statistics of the inspection team, this business establishment sells thousands of orders per day, and has sales of up to VND billions per month, delivering huge profits to the owner. At the time of inspection, hundreds of orders were in preparation for shipping to consumers. The customer base of the business is wide, stretching across all of Vietnam.

Recently, live streaming is highly popular in Vietnam, growing to be one of the most popular sales channels, thanks to coverage provided by the Internet. Using this channel makes reaching consumers very easy for counterfeit sellers. The key advantage of selling online is that this approach connects with a wide range of customers, without having the drawbacks of a physical store, and it is also difficult to be detected by the authorities. To date, most of the seizures involve business entities using an offline business channel. There are still very few seizures at online-only business entities like the one above. However, statistics show that online businesses have a significantly large amount of goods, many times larger than that of brick-and-mortar stores.

The rapid growth of the e-commerce has posed new challenges for the protection of consumers' rights, while the provisions of Vietnamese law on this issue have not yet been adjusted accordingly. Therefore, competent authorities are expanding the process of monitoring and inspecting online businesses for timely detection of violations.

By

Hai Dinh - IP Consultant, S&O IP Vietnam

Linh Bui – Paralegal, S&O IP Vietnam