In a significant crackdown on counterfeit goods, the Domestic Market Management Department of Vietnam announced the discovery of a factory in Ho Chi Minh City that was producing approximately 50,000 pairs of shoes bearing the Nike brand, suspected to be counterfeit. This revelation was made public on July 24, following an investigation prompted by a tip-off from the U.S. Homeland Security Investigations (HSI) regarding a network engaged in the production of Nike-branded footwear in Vietnam for export to the U.S.

Initially, authorities suspected around 12,000 pairs of shoes were in violation of trademark laws. However, further investigations revealed the scale of the operation to be much larger, encompassing nearly 50,000 pairs of finished and semi-finished products. On July 16, officials from the Domestic Market Management Department, along with the A05 Department of the Ministry of Public Security and local police, conducted a raid on the MP Company in Ho Chi Minh City.

During the inspection, authorities found that the counterfeit goods were produced with a high level of sophistication, making them difficult to distinguish from genuine Nike products. Even the authentication codes on the shoes were reportedly copied. Some of these counterfeit items had already been exported to the U.S. At the time of the inspection, the factory was found to be producing and storing 25,396 finished pairs of Nike and Air Jordan shoes, valued at over 12.3 billion VND. Additionally, there were 20,875 shoe uppers and 10,800 shoe soles also bearing the Nike mark, which were in the process of completion, valued at over 11.2 billion VND. The total estimated market value of the seized goods exceeds 100 billion VND.

The company claimed that all products were manufactured under a contract with F.C.T Company, with raw materials supplied by a foreign partner, and that they were merely fulfilling orders. They presented contracts, emails with partners, and documents purportedly granting them permission to use the Nike brand along with export records to justify the origin of the goods.

However, the Domestic Market Management Department stated that Nike Vietnam had confirmed through official documents that it had never issued any licenses, contracts, or authorization letters to MP Company or any related entities, thereby denying any representation or business activities conducted on behalf of Nike.

This case is considered one of the largest and most complex intellectual property rights violations detected in recent years, involving cross-border elements and connections to organizations and companies in the U.S., China, and Vietnam. It highlights the exploitation of international contract manufacturing and the use of seemingly legitimate documents that are, in fact, forged to introduce counterfeit goods into the supply chain.

Tran Huu Linh, Director of the Domestic Market Management Department, remarked that the initial findings underscore the effectiveness of international cooperation in identifying and addressing cross-border intellectual property violations. He noted, "The discovery not only addresses a specific infringement but also indicates that such violations may persist in the market, potentially involving multiple parties and even collusion." The Domestic Market Management Department is currently compiling evidence, verifying the origins of the raw materials and importing partners, and plans to refer the case to investigative authorities for further action.