VNG Corporation is planning to register for trading on the UPCOM market, which will give it a greater opportunity to approach investors and raise capital.
Recently VNG announced plans to finalise the shareholders list to register with the centralised depository custody and prepare to be listed on UPCOM.
The move has caught the market by surprise since it was speculated the company was planning an IPO in the US.
According to its consolidated third quarter financial statements published in October, VNG had net revenues of VND2.1 trillion (US$89.2 million), down 3.7 per cent from the same period last year.
In the period it suffered a loss after tax of more than VND254 billion ($11 million), whereas in the same period last year, the company reported a profit of nearly VND32 billion ($1.4 million). In the first nine months its losses were worth VND764 billion ($32.4 million) compared to the same period last year when they made a profit of VND196 billion ($8.3 million).
Its total liabilities as of September 30 amounted to VND3.61 trillion ($153 million), up nearly 24 per cent for the year.
Its equity was VND5.58 trillion ($237 million), down 11.7 per cent, of which undistributed profits were worth VND5.87 billion ($249,000).
In another development, the tech unicorn has been reported to involve in controversies over intellectual property rights infringements.
On August 23, September 19 and September 29 this year the People's Court of HCM City heard the first-instance case about intellectual property right infringement of cinematographic works in Vietnamese territory in which VNG Joint Stock Company was the accused.
It is a serious violation, the Court of First Instance concluded and ordered VNG Joint Stock Company to pay more than VND14.3 billion ($606,400) in damages.
Prior to this case there has been no court judgement on copyright infringement (either at the first instance or appellate level) that allowed the plaintiff such a large amount of damages.
This is a positive sign that Vietnamese authorities are strengthening the enforcement of intellectual property laws.
“Intellectual property laws enable rights holders to protect themselves when they detect violations. The fact that the court accepted the plaintiff's claim for damages for such a large amount, in fact, shows the extent of the intellectual property rights losses that VNG has caused to the plaintiff and the extent of damage the plaintiff has suffered as a result of this violation,” said Phan Vu Tuan, Vice President of HCM Intellectual Property Association.
The plaintiff in this lawsuit is granted the exclusive rights to commercialise all episodes of the three historical drama series, The Story of Minglan - Minh Lan Truyen, Princess silver – Bach Phat Vuong Phi and Legend of the Phoenix – Phuong Dich, on all television and service platforms and on Internet applications within the territory of Viet Nam.
However, the plaintiff found out that VNG Corporation had pirated these three series in the form of posting them directly on a website under the company’s management and ownership called "tv.zing.vn".
The act of exploiting these exclusive works caused significant damage to the plaintiff and VNG was sued for its action.
Before this incident, VNG was also sued for intellectual property infringement for uploading the drama series The Leaves – Chiec La Cuon Bay on “tv.zing.vn” without the consent of or buying the rights from the copyright owner, violating that party’s exclusive right to distribute and commercialise the content in Viet Nam.
The court ruled that the plaintiff’s claims for damages were rightful.
According to the agreement and appendix 2 signed on July 22, 2019, to be granted exclusive rights to distribute and broadcast the drama series The Leaves – Chiec La Cuon Bay, the plaintiff must pay the licensing company a franchise fee of $39,500.
So the court ruled that VNG Corporation has to pay the plaintiff compensation of VND829 million ($35,200) and legal costs of VND120 million ($5,100).
In addition, VNG had to publicly apologise for its wrongdoing in three national newspapers.
VNG has also been sued by many other IP owners over copyright issues in the past.
In 2014 Lang Van Music Distribution and Production Center announced that it had sued VNG Group, the owner of the Zing Mp3 online music website, in a US court for violating its copyright.
Also in 2014 Zing MP3 was sued for copyright infringement of Korean music.
The plaintiff filed a lawsuit and asked the court to order VNG to pay VND4 billion ($170,000) in damages. — VNS