Unfair competition practices are punishable by fines of up to 200 million VND.

According to the Decree detailing the Law on Competition regarding the handling of violations of competition law, recently issued by the Government, the maximum fine for unfair competition practices and other violations of competition law is VND 100 million for individuals and VND 200 million for organizations.

Selling goods below cost to eliminate competitors will be subject to a fine of up to 10% of total revenue.

A fine of up to 10% of the total revenue in the fiscal year preceding the year in which the violation occurred will be imposed on a market-dominant enterprise or on individual enterprises within a group of market-dominant enterprises for selling goods or providing services below total cost in order to eliminate competitors.

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In addition to the fines stipulated above, businesses that violate regulations on abuse of dominant market position may be subject to one or more of the following supplementary penalties and remedial measures: Confiscation of profits obtained from the violation; removal of illegal clauses from relevant contracts or business transactions; and restructuring of the dominant market enterprise.

Violations of regulations on multi-level marketing can result in fines of up to 100 million VND.

According to the Decree, the act of paying participants in multi-level marketing schemes a total value of commissions, bonuses, and other economic benefits in a year exceeding 40% of the multi-level marketing business's revenue in that year will be subject to a fine of 40-60 million VND.

Businesses engaged in multi-level marketing (MLM) will be fined between 60 and 100 million VND for any of the following acts: conducting MLM business without registering with the competent state agency; requiring prospective participants to deposit or pay a certain amount of money in any form to gain the right to join the MLM network; requiring prospective participants to purchase a certain quantity of goods in any form to gain the right to join the MLM network; requiring participants to pay an additional amount of money in any form to maintain, develop, or expand their MLM network;...

Severe penalties will be imposed for advertising and promotional activities aimed at unfair competition.

The decree stipulates that a fine of 60-80 million VND will be imposed for advertising practices that: directly compare one's own goods or services with similar goods or services of other businesses; or imitate another product's advertisement to mislead customers.

A fine of 80-140 dong will be imposed for advertising that provides false or misleading information to customers regarding any of the following: price, quantity, quality, uses, design, type, packaging, production date, expiration date, origin of goods, manufacturer, place of production, processor, place of processing; method of use, method of service, warranty period; or other false or misleading information.

Unfair promotional practices will also be severely penalized. Specifically, a fine of 60-80 million VND will be imposed for any of the following actions: Organizing promotions with fraudulent prizes; conducting dishonest or misleading promotions about goods or services to deceive customers; discriminating against the same customers in different locations within the same promotional program; giving away goods for free to customers but requiring them to exchange similar goods produced by another company for the company's own goods.

For the aforementioned unfair competition practices, if the promotional activities are organized on a scale covering two or more provinces or centrally governed cities, a fine of 80-100 million VND will be imposed.

The decree takes effect from September 15, 2014.

According to chinhphu.vn