IP in Exclusive Distribution Agreements in Vietnam: Trademark Usage Rights and Post-Termination Handling. FLAT regularly handles this issue when foreign investors deal with IP in exclusive distribution agreements and post-termination handling in Vietnam: one wrong step can trigger administrative fines, loss of asset rights or prolonged disputes. This article follows a lawyer’s review sequence: the legal basis in force as of October 2026, how it applies to a concrete file, the procedure to follow and the risks to settle before signing anything.
Core legal basis — IP in exclusive distribution agreements and post-termination handling
When a brand lets an exclusive distributor use its trademark, the relationship contains a trademark licence inside the distribution agreement whether or not the parties call it that. The legal consequences follow the IP Law framework: use must be confined to the agreed mark, goods and territory, and the distributor’s rights end with the distribution agreement unless stock and transition clauses say otherwise. The owner keeps quality control rights and the right to bar the distributor from registering the brand’s marks in its own name.
Applying the rules to your situation
The classic bad scenario in Vietnam is the distributor filing the brand’s mark before the brand does, then using that registration to block genuine goods when the relationship breaks. Prevention has two layers: the registration layer — the brand must file in Vietnam before or alongside appointing the distributor — and the contract layer — a ban on the distributor filing any identical or similar marks, with an unconditional duty to assign back any wrongfully filed registrations.
Procedure and documents to prepare
- Step 1: check and complete the brand’s trademark filings in Vietnam before signing exclusivity; search whether the distributor or its affiliates have already filed anything.
- Step 2: draft the IP clauses in the distribution agreement: scope of mark use, display and service quality standards, a filing ban, and handover duties on termination.
- Step 3: record the licence (where structured separately) with the Intellectual Property Office for third-party effect under Article 148 of the IP Law.
- Step 4: on termination, trigger post-termination clauses immediately: stop mark use, run stock through the agreed sell-off window, and recover marketing materials, domains and pages the distributor created.
Risks to anticipate
The first risk is the distributor already owning a registration of the brand’s mark: the brand must run an opposition within the publication window or an invalidation under Article 96 of the IP Law for bad-faith filing, which takes years. The second is contract silence on post-termination stock, turning sell-off into counterfeit and infringement disputes. The third is the distributor keeping digital channels (domains, marketplace stores, fan pages) after termination, free-riding on the mark and confusing origin.
Answers to client questions
What clauses are needed when an exclusive distributor uses the brand’s mark?
At minimum: identify the mark and the scope of use (goods, territory, sales channels); quality and presentation standards for mark use; a ban on the distributor filing identical or similar marks in its own name; the brand’s inspection rights; and post-termination duties on ceasing use, stock and digital-asset handover. That part of the contract is in substance a licence under Article 141 of the IP Law.
What if the distributor registered the brand’s mark itself?
If the application is still in its publication phase, the brand files an opposition with evidence that the applicant is its distributor and filed in bad faith. If a registration has issued, the brand seeks invalidation under Article 96 of the IP Law on the ground the registrant had no right to register and filed in bad faith, while invoking the contract clause compelling assignment of the filing.
How are mark-use rights recovered when distribution ends?
Use rights end under the contract; the brand issues a termination notice with a deadline to cease use, requires removal of the mark from premises, channels and materials, and handles stock under any sell-off clause. Continued use by the distributor after that point infringes the trademark and can be pursued administratively and civilly under the IP Law.
Should the licence with the distributor be recorded?
Where the licence is structured as a separate agreement, recording it with the Intellectual Property Office gives it third-party effect under Article 148 of the IP Law and strengthens the file in infringement actions or scope disputes with the distributor. For long-term, high-value exclusivity, FLAT recommends recording rather than leaving the clause inside the distribution agreement alone.
Action conclusion
Never appoint an exclusive distributor before the mark is filed in Vietnam and the contract carries the full IP clause set: filing ban, post-termination duties and digital-channel handover. These two protection layers are cheaper than any invalidation lawsuit.
This article has been quality-reviewed by the FLAW AI Legal Council