Local carrier Pacific Airlines was renamed Jetstar Pacific Airlines in May last year under a branding agreement with Jetstar Airways, which is a subsidiary of Australia-based Qantas Airlines.

Just one month later the Civil Aviation Administration of Vietnam warned Jetstar Pacific Airlines against using the “Jetstar” logo or “Jet” and a star image, saying these trademarks could cause people to confuse the Vietnamese airline with Australian carrier Jetstar Airways.

But Jetstar Pacific Airlines said under the branding agreement, it has the right to use Jetstar’s brand name.

The dispute was thought over until recently, when Jetstar Pacific Airlines applied for a permanent business license to replace its current one, which will expire in October next year, according to Tien Phong newspaper. In the application, the airline also sought permission to continue using Jetstar trademarks.

Once again, the Civil Aviation Administration of Vietnam insisted the trademarks were illegal and misleading. Jetstar Pacific Airlines is a Vietnamese carrier and it has to develop its own trademarks, online newspaper VietnamNet quoted an administration report as saying on October 22.

When Jetstar Pacific Airlines advertised its services, it looked like the airline was advertising for Jetstar Airways, the administration said in the report. It also said other airlines in the region operating under similar branding agreements are not allowed to use identical trademarks either.

Jetstar Pacific Airlines said in response that it had done nothing wrong.

If a branding agreement is in accordance with the intellectual property law and the aviation law doesn’t have any restrictions on branding, thus it is impossible to say the branding is illegal, said a report that Jetstar Pacific Airlines sent to SCIC, the government’s investment that holds a nearly 70 percent stake in the carrier, as quoted by VietnamNet.

The National Office of Intellectual Property of Vietnam had said it was ok for Jetstar Pacific Airlines to use Jetstar’s trademark in December 2008.

As requested by the aviation administration, the carrier had the name Jetstar Pacific painted on its planes. But the Jetstar logo was also still used alongside the brand name.

All ticket offices and branches of the airline also used the trading name Jetstar Pacific or Jetstar Pacific Airlines Joint Stock Aviation Company, separating themselves from Australia’s Jetstar Airways.

Jetstar Pacific Airlines also cited several international cases in support of its contention. It said Air Asia Malaysia, Thai Air Asia and Indonesia Air Asia, for instance, are airlines from three different countries. However, they use the same brand Air Asia and all of them are allowed to fly to Vietnam.

“If the Civil Aviation Administration can distinguish those three airlines, is it possible it can’t tell the difference between Jetstar Airways, Jetstar Asia Airways (Singapore) and Jetstar Pacific?” online newspaper VnExpress quoted Jetstar Pacific Chief Executive Officer Luong Hoai Nam as saying.

The unreasonable ban on the use of Jetstar’s brand name could force the foreign investor to withdraw money out of Vietnam, Jetstar Pacific Airlines said, referring to Qantas.

But the Civil Aviation Administration of Vietnam said the concern is groundless and it would not compromise in this case, according to VietnamNet.

Australia’s Qantas Airways Ltd. plans to increase its stake in Jetstar Pacific from 27 to 30 percent next year, VietnamNet reported this month. Last year SCIC requested the government’s permission to allow Qantas to raise its stake in the local carrier to 49 percent, above the current 30 percent foreign ownership cap on airlines.

According to VnExpress, Jetstar Pacific Airlines held 40 percent of the market share on the Hanoi-Ho Chi Minh City route over the past six months.

Jetstar Pacific is considering expansion, including adding to its network of seven domestic destinations and possibly opening an international hub in HCMC, Jetstar Airways Chief Executive Officer Bruce Buchanan told Bloomberg this month. The Vietnamese carrier became profitable in July after boosting its market share to 23 percent from 14 percent and driving down operating costs by 29 percent.

Source: Thanh Nien, Agencies