Stronger IP protection key to Vietnam’s competitiveness, high-quality investment attraction

Pressure from U.S. trade policy should be viewed as an opportunity to strengthen legal enforcement, foster innovation and build a more transparent business environment.

Tariffs are just tip of the iceberg

When the Office of the United States Trade Representative (USTR) released its Special 301 Report, an annual review that evaluates IP protection, enforcement, and market access in countries around the world, and later launched a separate investigation into Vietnam’s enforcement of IP rights, many people focused only on the risk of additional tariffs on exports.

In reality, tariffs are merely the tip of the iceberg.

IP protection has become a measure of the reliability of an investment environment, the quality of institutions and a country's ability to participate in global value chains.

In the digital economy, a company's assets are no longer limited to factories and machinery but also include inventions, software, brands, data, designs, technological know-how and creative products.

A country that fails to adequately protect IP rights will struggle to attract high-tech investment and find it even more difficult to become an important link in global supply chains.

Therefore, the U.S. Section 301 investigation should not be viewed solely as external trade pressure.

If Vietnam focuses only on responding to an investigation or negotiating lower tariffs, it will be addressing the symptoms rather than the root cause.

More importantly, it must continue improving its legal framework so that IP rights can truly become a driver of development.

Restoring order, paving way for innovation

Vietnam has not stood still amid rising international trade requirements.

Over the past few years, alongside digital transformation and the development of a knowledge-based economy, Vietnam has gradually improved its IP laws, promoted amendments to legislation related to science, technology and innovation, and laid new legal foundations for artificial intelligence and the digital economy.

At the same time, the country has pursued the development of a more transparent science and technology market, creating conditions for intellectual assets to be commercialized and serve as a source of growth.

More importantly, stronger law enforcement has sent positive signals. From administrative sanctions to criminal prosecution for IP violations, Vietnam is gradually demonstrating its determination to restore order in an area that has long been considered a weakness.

This is not merely about protecting the interests of a few large businesses or foreign corporations.

Every counterfeit product, pirated software program and act of unauthorized copying not only causes losses to rights holders but also erodes confidence in the investment environment and weakens Vietnamese businesses' incentives to conduct research and innovation.

An economy that seeks to grow through knowledge cannot accept IP infringement as a normal occurrence.

While Vietnam's competitive advantages once came mainly from low labor costs, political stability and its network of free trade agreements, these advantages are gradually diminishing in the country's new phase of development.

Investors today are not only looking for a cost-effective production base but also a transparent legal environment that respects IP rights and protects intangible assets.

In practice, tech corporations and businesses in semiconductors, artificial intelligence, biotechnology and the digital economy all place IP protection high on their list of priorities when choosing investment locations.

An environment where inventions, trade secrets, data and software are not adequately protected will struggle to attract high-quality FDI, a priority in Vietnam’s development strategy for the new period.

The U.S. Section 301 investigation not only poses an immediate challenge to exports but also reflects broader shifts in global trade.

Standards on labor, environmental protection, supply chain transparency and IP rights are increasingly becoming new “passports” for goods entering international markets.

The positive point is that Vietnam has already taken proactive steps.

Efforts to strengthen institutions related to science, technology, innovation and digital transformation are creating an important foundation for a modern innovation ecosystem.

Amendments to the Law on Science and Technology, efforts to develop a legal framework for artificial intelligence, the expansion of the science and technology market and policies promoting technology transfer all demonstrate the determination to shift from a growth model based on low-cost labor to one driven by knowledge and innovation.

Stronger law enforcement must remain a priority. A market cannot function properly if counterfeit goods, knockoffs, copyright violations and patent infringements remain widespread.

Strict enforcement against IP violations, ranging from administrative sanctions to criminal prosecution in serious cases, is aimed not only at protecting rights holders but also at building confidence among businesses and investors.