Int’l brands fined for misleading advertising in Vietnam

Despite their long-standing presence in Vietnam, Sharp and AQUA, two well-known brands originated from Japan, have recently been slapped with hefty fines for misleading consumers about their products.

In a recent ruling, the Vietnam Competition Authority imposed a fine of VND200 million ($8,000) on Sharp Vietnam Electronics Co., Ltd., headquartered in Ho Chi Minh City, for misleading advertising about its AIOT FP-J80EV-H air purifier.

The company was found to have provided incorrect information about the product to lure customers from other businesses, violating Vietnam’s Competition Law.

Similarly, AQUA Vietnam Electronics Co., Ltd., based in the Bien Hoa 2 Industrial Park in Dong Nai province, which borders HCMC, was fined VND200 million for misleading consumers about two of its products: the AQR-S682XA Side-by-Side refrigerator and the AQA-KCRV10WNZA Inverter air conditioner. These acts were found to have been intended to lure customers from other brands, violating the same law.

Both companies have been required to publicly correct the misleading information on their official websites.

Declining quality after owner changes?

Sharp and AQUA both carry a significant legacy in the global consumer electronics market, and continue to perform strongly in Vietnam. Sharp has reestablished itself in recent years with popular kitchen appliances like rice cookers and air fryers, while AQUA has become a market leader in air conditioners, refrigerators, and washing machines.

However, the recent violations raise a question: Have these brands changed after being acquired by Chinese companies?

Sharp, a household name in Japan, has been present in Vietnam since 1995. The brand was once a dominant force in the Vietnamese market, especially in the rice cooker and consumer electronics segments, thanks to good product quality and competitive pricing.

In 2009, Sharp Corporation officially established Sharp Vietnam Electronics Co., Ltd. to take over local operations, including product quality assurance, warranties, and after-sales service, from Mitsui Vietnam, its authorized distributor in Vietnam from October 2007 to June 2009.

Despite its historical success, Sharp’s fortunes began to decline in 2012. Facing severe financial difficulties, the company accepted a bailout from two Japanese banks after posting losses in the hundreds of billions of yen.

In 2016, Sharp was acquired by Foxconn of Taiwan, a electronic component supplier of Apple, for 700 billion JPY (about $6.2 billion at the time). The acquisition helped Sharp recover, though it marked the end of its status as a purely Japanese-owned brand. With Foxconn's backing, Sharp has managed a significant comeback, but it still faces challenges in regaining its former market dominance.

A similar story unfolded with AQUA, a brand originally launched by Sanyo, which entered the Vietnamese market in 1995. Sanyo, founded in Japan in 1950, was acquired by Panasonic in 2008 and became a subsidiary of the conglomerate.

In 2012, China’s Haier Group Corporation acquired Sanyo Electric, including all of its ASEAN operations, and took over the Sanyo HA ASEAN company in Vietnam.

Following Haier’s acquisition, the AQUA brand was relaunched in Vietnam in 2014. Since then, AQUA has expanded rapidly, becoming a key player in Vietnam’s household appliance market. The company now employs more than 2,000 people and produces a wide range of products, including refrigerators and washing machines. In 2018, AQUA’s revenue surpassed $200 million, with ambitious plans to exceed $500 million in the coming years.

Haier has positioned Vietnam as a strategic market in its global expansion efforts, and the company has been actively supporting AQUA's local production and integration into the multinational culture, focusing on brand promotion, research, and manufacturing to strengthen its position and expand its share in Vietnam.

Zhang Shoujiang, CEO of AQUA Vietnam, noted that the company has adapted to meet evolving consumer demands, including a 40% rise in popularity for front-loading washing machines in recent years.