Who must take responsibility for SABECO’s risk of being swallowed by a Singaporean partner?

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The website of SABECO ASIA PACIFIC

As VietNamNet reported on November 24, Vietnamese Saigon Beer Alcohol Beverage (SABECO) is facing the risk of being swallowed by a Singaporean partner. Several questions have been raised in the case. Why did SATRACO, a subsidiary of SABECO, decide to choose a partner who was then only one month old, to sign a contract described as the “contract on selling souls to demons”? Who must take responsibility for SABECO’s risk of possibly loosing its brand?

Did not know much information about partner?

After discovering that Singaporean SABECO ASIA PACIFIC uses the image of SABECO’s logo in its stamp, which may lead to misunderstanding that SABECO ASIA PACIFIC owns “SABECO” brand, on July 14, 2010, Nguyen Ba Thi, Chair of the Board of Director of SABECO released a document, requesting SABECO’s Marketing Managing Director Le Hong Xanh, and Chair and General Director of SATRACO Van Thanh Liem to explain and submit all the documents relating to the cooperation between SABECO, SATRACO and SABECO ASIA PACIFIC. The two leaders were also asked to send all information about SABECO ASIA PACIFIC.

In a document dated July 16, 2010, replying to the request by Thi, Van Thanh Liem affirmed that the signing of the contract with SABECO ASIA PACIFIC was carried out in the same procedure as other contracts.

“SABECO’s marketing division is in charge of building brands in export markets, while SATRACO only does one thing: seek buyers to sell products,” Liem stressed.

Marketing Director Le Hong Xanh also answered Thi and the information about SABECO ASIA PACIFIC’s profile became clearer.

Xanh explained that SABECO ASIA PACIFIC was chosen as the product distributor in Asia-Pacific. The company was established in November 2009. SABECO ASIA PACIFIC registered its name itself and followed the registering procedures in accordance with Singaporean laws.

Under SABECO’s regulations, SABECO ASIA PACIFIC has the right to use SABECO’s logo in images and signboards.

However, though SABECO’s marketing division knows that SABECO ASIA PACIFIC uses SABECO’s logo and name in its stamp, the division did not report the case to higher levels of authority.

However, documents acquired by VietNamNet’s reporters show that in February 2010, Le Hong Xanh, Marketing Director of SABECO, sent a document to SABECO’s General Director asking to complete registration for protecting SABECO’s logo with the dragon in the markets it was exporting products to, and to carry out the registration for trademark protection in Asia Pacific.

SABECO’s General Director Nguyen Quang Minh replied: “The marketing division needs to reconsider the case”.

In April 2010, Xanh submitted a plan to register the trademark in 21 countries in Asia Pacific, and the plan was approved by the General Director.

As such, while a foreign partner signed a 5-year contract with SATRACO and got the right to exclusively distribute SABECO’s products, the general director only agreed to protect product trademarks, not to register for brand protection. As the result, SABECO ASIA PACIFIC now freely uses SABECO’s logo.

It will be a difficult case

On August 18, 2010, SABECO’s Chair released a document, requesting SABECO’s marketing division and SATRACO to clarify the responsibility for the case and suggest solutions to the problem.

Van Thanh Liem, Chair of SATRACO, once again said that SATRACO is only in charge of seeking clients and selling products.

Liem said that SATRACO and SABECO need to meet the Singaporean partner to settle the problem

Xanh said that SATRACO must request its partner to follow the provisions on using SABECO’s logo and its partner must not use the SABECO logo and name on its stamp without the permission of SABECO’s chair.

SABECO should hire a law firm to represent SABECO to discuss a solution to the problem with SABECO ASIA PACIFIC.

For the time being, the name SAIGON BEER ALCOHOL BEVERAGE CORPORATION (ASIA PACIFIC) PTE LTD (SAP) must be used in all transactions, while the words SABECO ASIA PACIFIC must not be used to avoid misunderstanding.

Who is the Singaporean partner?

If searching on Google to look for the information about SABECO ASIA PACIFIC and typing “SAIGON BEER ALCOHOL BEVERAGE CORPORATION (ASIA PACIFIC) PTE LTD”, one will not be able to find any information in English.

If typing one word “Singapore” more, one would be led to a website, where he would only find basic information, such as the name of country, city, address, and no more.

SABECO ASIA PACIFIC was established in November 2009, just one month before it signed a contract with SATRACO to become the exclusive distributor of SABECO’s products in Asia Pacific.

Cam Quyen

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