China – CNIPA Issues Reply To Determine Prior User Rights Under The Trade Mark Law.

国知局批复《商标法》第五十九条第三款法律适用问题
 

Laws & Regulations
 

CNIPA Issues Reply in Relation to Determining Prior User Rights under the Trade Mark Law

国知局批复《商标法》第五十九条第三款法律适用问题
 

Issue Number: CNIPA (2021) No. 77
 

Issue Date: 2021-05-25
 

On 25 May 2021, the CNIPA issued its reply to queries on the application of law in Article 59(3) of the PRC Trade Mark Law (the “Reply”). The Reply highlights that the purpose of Article 59(3) PRC Trade Mark Law is to balance the interests of the trade mark registrant and the prior user of the trade mark and to safeguard the rights and interests of the prior user of the unregistered trade mark with a certain degree of influence in the market, in order to prevent damage to the trade mark registration and acquisition system.
 

In order for the provision to apply, the prior user must meet the following five requirements:
 

1. The trade mark has been used by the prior user before the trade mark registrant has applied for registration;

2. The trade mark has been previously used by the trade mark registrant;

3. The trade mark has reached a certain degree of influence in the market before the trade mark registrant has applied for registration;

4. The user of the trade mark should not go beyond the original scope of goods or services, business scope or other scope of use; and

5. Where the trade mark registrant requires an appropriate distinguishing mark to be attached, the prior user shall attach such distinguishing mark.
    

Commentary
 

Further guidance on the interpretation and application of the five requirements from the CNIPA would be welcomed.  In particular, what type and amount of evidence is needed for a mark to qualify as one with “a certain degree of influence”.  In addition, the fourth element contains a number of vague terms, for example:-
 

• How should “the original goods/services” be defined? Does this refer to the identical goods/services or would include closely similar ones as well, and if so, only those in the same subclass?

• How should “the original scope of use” be defined? If the prior user operates an online store with national reach, can the prior user use the mark on another online shop or a bricks and mortar store?  If the prior user operates its own business, can the user license the use of the mark to a third party within “the original scope”? 
   

While making these requirements too prescriptive would defeat the intent of the Article, some guidance and “typical cases” from the CNIPA and courts would provide both the prior user and the trade mark registrant some comfort on the scope of protection offered by their respective rights.
 

Source: http://www.cnipa.gov.cn/art/2021/5/25/art_75_159637.html
 

rtan@rouse.com