19 April, 2017
For any EU SME operating in China, Trade Marks will be an important IP asset to have. So in order to meet any questions you might have, our China IPR SME Helpdesk expert Mr. Charles Feng from East & Concord Partners based in Beijing has kindly drafted for us a very useful and informative blog post on Trade Mark Protection in China. In this comprehensive Trade Mark guide, our Q&A with Mr. Feng will give you all the answers you need on Trade Mark protection in China.
1 Relevant Authorities and Legislation
1.1 What is the relevant trade mark authority in your jurisdiction?
The Trademark Office (“TMO”), which is affiliated with the State Administration for Industry and Commerce, is the authorised government agency in charge of trademark administration including examinations of trademark applications, oppositions as well as the cancellation of trademark registrations for three years of non-use. The Trademark Review and Adjudication Board (“TRAB”) oversees the examination of various applications for appeals against the TMO’s decisions, as well as trademark invalidation matters.
In addition, local Administrations for Industry and Commerce (“AICs”) or Market Supervision Administrations (“MSAs”) are in charge of the administrative enforcement of trademark rights.
People’s Courts have jurisdiction over trials for trademark-related administrative or civil litigation.
1.2 What is the relevant trade mark legislation in your jurisdiction?
The most fundamental legislations include the Trademark Law of the People’s Republic of China (“PRC Trademark Law”), the Implementing Regulations of the PRC Trademark Lawas well as multiple Judicial Interpretations related to trademark law which are issued by the Supreme People’s Court.
In addition, the Anti-Unfair Competition Law of PRC provides protection to unregistered marks such as distinctive names, packaging or decoration of famous goods. The criminal code provides protection against counterfeiting activities where the illegal turnover exceeds a certain amount.
2 Application for a Trade Mark
2.1 What can be registered as a trade mark?
According to Article 8 of the PRC Trademark Law, any sign that distinguishes the goods and services of an individual or organisation from those of others, including any words, graphs, letters, numbers, three-dimensional signs, colour combinations, sounds and combinations thereof, may be registered as trademarks.
Therefore, in addition to words and logos, three-dimensional signs, colour combinations and sounds (including musical jingles) may also be registered as trademarks; namely, non-traditional marks.
2.2 What cannot be registered as a trade mark?
The PRC Trademark Law provides absolute and relative grounds for refusal of registration.
Article 10 of the PRC Trademark Law provides the absolute grounds for refusal of trademark registration and exclude the following signs from registration:
(1) Those identical with or similar to the State name, national flag, national emblem, national anthem, military flag, army emblem, military songs, medals and others of PRC; those identical with the names and signs of central state organs, names of the specific locations thereof, or those identical with the names or device of landmark buildings.
(2) Those identical with or similar to the state names, national flags, national emblems or military flags of foreign countries, unless permitted by the government of the country.
(3) Those identical with or similar to the names, flags, or emblems of international inter-governmental organisations, unless permitted by the organisation concerned or unlikely to mislead the public.
(4) Those identical with or similar to an official sign or inspection seal that indicates control and guarantee, unless it is authorised.
(5) Those identical with or similar to the names or signs of the Red Cross or the Red Crescent.
(6) Those discriminating against any race.
(7) Those which may easily mislead the public as to the quality of goods or their place of production.
(8) Those detrimental to socialist morals or customs, or having other “unhealthy influences”.
A mark which lacks distinctiveness can be refused registration. According to Article 11 of the PRC Trademark Law, such marks include signs that merely bear generic names, devices, or model numbers of the goods, or simply indicate the quality, main raw materials, function, use, weight, quantity or other features of goods.
In addition, a three-dimensional trademark application is rejected if the three-dimensional mark merely indicates the shape inherent in the nature of the goods concerned, the mark is dictated by the need to achieve technical effects or the need to give the goods substantive value.
2.3 What information is needed to register a trade mark?
The information needed for application for registration includes the basic registration/identity information of the applicant, a sample of the mark for application and the goods or services sought to be registered.
2.4 What is the general procedure for trade mark registration?
The general procedure for trademark registration follows the following procedure: (1) submission of the application for registration; (2) preliminary examination and approval or rejection; (3) publication of the trademark in the gazette for opposition; and (4) grant of registration by the Trademark Office.
2.5 How can a trade mark be adequately graphically represented?
A formal drawing of the mark must be in black and white. If colour is claimed as a feature of the mark, a colourful drawing of the mark is also needed. The drawing should be larger than 5cm × 5cm but not exceed 10cm × 10cm.
2.6 How are goods and services described?
Goods and services are classified according to the Classification of Similar Goods and Services issued by the TMO, which is edited on the basis of the Nice Classification. Generally, the names of designated goods and services in the application shall be consistent with the Classification of Similar Goods and Services.
2.7 What territories (including dependents, colonies, etc.) are or can be covered by a trade mark in your jurisdiction?
A certificate of trademark registration granted by the Trademark Office of China will cover mainland China, exclusive of Hong Kong SAR, Macao SAR and Taiwan.
2.8 Who can own a trade mark in your jurisdiction?
Any individual, registered legal entity such a registered company or other organisation is authorised to register and own a trademark.
2.9 Can a trade mark acquire distinctive character through use?
A descriptive mark may acquire distinctiveness by continuous commercial use, which is called “acquired distinctiveness” or “secondary meaning”.
2.10 How long on average does registration take?
The application and examination for registration of a trademark usually takes 12–18 months.
2.11 What is the average cost of obtaining a trade mark in your jurisdiction?
According to Article 18 of the PRC Trademark Law, foreign applicants must entrust a Chinese trademark agent to conduct trademark application and other trademark matters. The official fee for a trademark application is 600RMB.
2.12 Is there more than one route to obtaining a registration in your jurisdiction?
Trademark registration can only be obtained by filing an application with the Trademark Office in China.
2.13 Is a Power of Attorney needed?
Power of Attorney (“PoA”) is needed in most trademark matters.
2.14 If so, does a Power of Attorney require notarisation and/or legalisation?
The PoA must be signed by the applicant and the agent, while notarisation and legalisation are not required for trademark application and prosecution matters. However, court proceedings including trademark related administrative or civil litigation require notarisation and legalisation of PoA.
2.15 How is priority claimed?
According to Article 25 of the PRC Trademark Law, where an applicant files an application for trademark registration in China within six months from the date of filing the first application for registering the same trademark for the same goods in a foreign country, the applicant may have priority in accordance with any agreement concluded by and between the People’s Republic of China and the foreign country concerned, or with the international treaty to which both countries are parties, or on the basis of the principle of reciprocity.
In addition, according Article 26 of the PRC Trademark Law, in the event that an applicant uses a trademark for the first time on goods displayed at an international exhibition organised or recognised by the Chinese Government, the applicant may be entitled to claim priority provided that it files an application to register the trademark within six months from the date of the exhibition.
The priority claim shall be made along with the submission of application for registration.
2.16 Does your jurisdiction recognise Collective or Certification marks?
China recognises both Collective marks and Certification marks.
Article 3 of the PRC Trademark Law provides that “Collective mark” refers to a mark registered in the name of a group, association, or any other organisation and used in business activities by its members to indicate their membership.
“Certification mark” refers to a mark which is controlled by an organisation that exercises supervision over particular goods or services and which is used to indicate that third-party goods or services meet certain standards pertaining to place of origin, raw materials, and mode of manufacture, quality, or other specific characteristics.
Article 4 of the Implementing Regulations of the PRC Trademark Law provides that Geographical indicators as stipulated in Article 16 of the PRC Trademark Law may, according to the provisions of the PRC Trademark Law and the Regulations, be registered as certification marks or collective marks.
3 Absolute Grounds for Refusal
3.1 What are the absolute grounds for refusal of registration?
The absolute grounds for refusal of registration include lack of distinctiveness. In addition, Article 10 of the PRC Trademark Law, as mentioned in question 2.2 above provides other absolute grounds for refusal of registration.
3.2 What are the ways to overcome an absolute grounds objection?
Generally, an absolute ground for refusal of registration may be overcome by the following reasons:
(1) The mark rejected is not identical with or similar to the signs provided in Article 10 of the PRC Trademark Law.
(2) The application is authorised by the relevant parties, e.g. the government or organisations.
(3) The mark acquires distinctiveness through commercial use.
3.3 What is the right of appeal from a decision of refusal of registration from the Intellectual Property Office?
Any applicant for registration of a trademark is authorised to appeal the decision of refusal with the Trademark Review Board of the State Administration for Industry and Commerce.
3.4 What is the route of appeal?
A decision of refusal could be appealed initially with the Trademark Review Board. In the event that the applicant is still dissatisfied with the Review Decision made by the Trademark Review Board, the applicant may further appeal to the Beijing Intellectual Property (“IP”) Court by initiating the first instance of administrative litigation. The applicant may
pursue another appeal at the second instance with the Beijing High Court, whose decision is final.
4 Relative Grounds for Refusal
4.1 What are the relative grounds for refusal of registration?
The relative grounds for refusal of registration may include the following:
(1) The trademark whose registration is being applied for is identical with or similar to the trademark of another person which has been previously registered or preliminarily approved with respect to the same or similar goods/services.
(2) The trademark whose registration is being applied for is identical with or similar to a mark of another person which
has been filed previously with respect to the same or similar goods or services.
(3) The applicant, as an agent, applies for registration of its principal’s trademark in its own name without the authorisation of the principal.
(4) The trademark whose registration is being applied for infringes upon the prior legitimate rights of others.
(5) The trademark whose registration is being applied for constitutes pre-emptive registration of a previously used trademark with a certain influence and renown.
4.2 Are there ways to overcome a relative grounds objection?
Generally, a relative grounds objection could be overcome in the following ways:
(1) By substantiating that the trademark whose registration is being applied for is neither identical with nor similar to the quoted mark, and that the designated goods or services of the applied mark and quoted mark are neither identical nor similar.
(2) By cancelling or invalidating the quoted marks.
(3) By challenging the validity or ownership of prior rights.
(4) By challenging the agent-principal relationship between the applicant and the opponent.
4.3 What is the right of appeal from a decision of refusal of registration from the Intellectual Property Office?
An applicant is authorised to file appeal against the unfavourable decision of refusal with Trademark Review Board. It also authorised to sue the TRAB with the Beijing IP Court against the unfavourable decision made by the TRAB.
4.4 What is the route of appeal?
An applicant may file an appeal with the TRAB against an unfavourable decision of refusal issued by the TMO.
If the applicant is still dissatisfied with the decision made by the TRAB, the party may appeal the case with the Beijing IP Court by initiating the administrative litigation. It can further appeal the case with Beijing High Court at the second instance.
5 Opposition
5.1 On what grounds can a trade mark be opposed?
The prior right-owner or interested party may file an opposition on the following relative grounds:
(1) The opposed mark is identical with or similar to the opponent’s trademark which is previously registered with regard to the same or similar goods or services.
(2) The opposed mark is identical with or similar to the opponent’s trademark whose registration was previously applied for with regard to the same or similar goods or services.
(3) The opposed mark infringes upon the opponent’s prior legitimate rights, such as copyright, trade name, etc.
(4) The application for the opposed mark constitutes pre-emptive registration of the opponent’s prior marks with a
certain influence and a relatively high reputation.
(5) The opposed mark is a reproduction, imitation or translation of the opponent’s well-known trademark which has not been registered in China, on the same or similar goods/services, and is likely to lead to confusion.
(6) The applicant of the opposed mark, as an agent or a representative of the registrant of the opponent, seeks to register the opponent’s trademark under its own name without the authorisation of the opponent.
In addition, any person could file an opposition against a trademark on the following absolute grounds:
(1) The opposed mark lacks distinctiveness or goes against Article 10 of the PRC Trademark Law mentioned in question 2.2 above.
(2) The application of the opposed mark is filed by fraud or other improper means.
(3) The application of the opposed mark violates the principle of honesty and good faith.
5.2 Who can oppose the registration of a trade mark in your jurisdiction?
As mentioned above, any party will be authorised to file an opposition against a trademark on absolute grounds. Meanwhile, the relevant party with prior rights or a previously used famous mark is authorised to file an opposition against a trademark application on relative grounds.
5.3 What is the procedure for opposition?
Generally, an opposition against a trademark follows the below procedures:
(1) Filing the opposition – an opponent files opposition arguments and submits evidence to support the arguments.
(2) Reply from the opposed party – the Trademark Office will send the opposition application as well as the evidence to the opposed party and give the opposed party a reasonable period in which to reply.
(3)The TMO examination – the Trademark Office should consider the arguments and evidence provided by both sides and decide whether or not to approve the registration.
(4) Filing invalidation with the Trademark Review and Adjudication Board – in the case that the TMO decides to approve the registration, the opponent may file an invalidation against the registration with the Trademark Review Board.
6 Registration
6.1 What happens when a trade mark is granted registration?
The trademark owner will enjoy the rights to use the mark and the rights to exclude others from using the mark according to the PRC Trademark Law.
6.2 From which date following application do an applicant’s trade mark rights commence?
An applicant’s trademark right commences from the date of registration.
6.3 What is the term of a trade mark?
The term for protection of a registered mark is 10 years, which can be renewed at the end of the term.
6.4 How is a trade mark renewed?
An application for renewal shall be filed within 12 months before the expiration date of the registration.
If such an application cannot be filed within that period, a grace period of six months will be given after the expiration date.
7 Registrable Transactions
7.1 Can an individual register the assignment of a trade mark?
Under current trademark law, only a commercial entity, such as a registered company, is authorised to apply for registration of a trademark.
An individual may register and own a mark as an individual commercial household.
7.2 Are there different types of assignment?
There are no different types of assignment of trademarks in China.
7.3 Can an individual register the licensing of a trade mark?
Yes, an individual, as the licensor of a mark, can register the licensing.
7.4 Are there different types of licence?
Theoretically, there are three types of licence. Firstly, a non-exclusive licence means that a trademark under the licensing agreement may be used by the licensor or the licensee, while it does not exclude other licensees from using the mark where there is a licensing agreement. Secondly, a sole licence means that a trademark could be used by the licensor and the licensee, while the licensing agreement excludes other parties from entering into a licensing agreement with the licensor. Finally, an exclusive licence means the trademark could only be used by the licensee.
7.5 Can a trade mark licensee sue for infringement?
According to a Judicial Interpretation issued by Supreme People’s Court in Trial of Trademark Infringement cases, the licensee of an exclusive licence is authorised to sue for infringement independently; the licensee of a sole licence is authorised to jointly initiate a civil lawsuit along with the licensor or file a lawsuit alone if the licensor refuses to initiate the lawsuit; the licensee of a non-exclusive licence is not authorised to initiate a lawsuit unless so authorised by the licensor.
7.6 Are quality control clauses necessary in a licence?
According to Article 43 of the PRC Trademark Law, the licensor shall supervise the quality of the goods where the licensee is licensed to use its registered trademark. The licensee shall guarantee the quality of the goods with which the registered trademark is used. Therefore, quality control clauses are generally necessary in a licence.
7.7 Can an individual register a security interest under a trade mark?
According to Article 70 of the Implementing Regulations of the PRC Trademark Law, a registered mark can be pledged and the pledger and the pledgee shall conclude a pledge contract in written form and shall jointly file a pledge registration application with the Trademark Office.
7.8 Are there different types of security interest?
No other types of security interest except the pledge are permissible for a registered trademark.
8 Revocation
8.1 What are the grounds for revocation of a trade mark?
According to Article 49 of the PRC Trademark Law, a registered trademark may be revoked on the following grounds:
(1) The trademark registrant, at his/her discretion, alters the registered trademark, name or address of the registrant or other information during the use of the registered trademark and refuses to rectify this.
(2) The registered trademark has not been used for three consecutive years.
8.2 What is the procedure for revocation of a trade mark?
Generally, revocation of a trademark follows the following procedures:
(1) Filing Revocation Application – any individual or organisation may apply to the TMO to revoke a trademark.
(2) Reply from the Registrant – the TMO will notify the registrant about the revocation and give the registrant a reasonable period in which to reply.
(3) Examination by the TMO – the TMO shall decide whether or not to revoke the trademark.
(4) Appeal to the Trademark Review Board – the party dissatisfied with the decision of the TMO may appeal to the Trademark Review Board.
(5) Appeal to the People’s Court – the party dissatisfied with the decision of the Trademark Review Board may initiate legal proceedings with the People’s Court.
8.3 Who can commence revocation proceedings?
As mentioned above, any individual or organisation may apply to the TMO for revocation of a trademark’s registration and the Trademark Office is authorised to revoke a registered trademark at its discretion where the registrant substantially alters the registered trademark, name or address of the registrant or other information during the use of a registered trademark where the registrant refuses to rectify such violating use.
8.4 What grounds of defence can be raised to a revocation action?
Generally, the defence against a revocation action may be based on the following grounds:
(1) The registered trademark has been used before the filing date of the revocation application.
(3) The three years of non-use are due to force majeure.
(4) The reason for the three years of non-use is bankruptcy liquidation.
(5) The three years of non-use are due to other justifiable reasons not attributable to the registrant.
8.5 What is the route of appeal from a decision of revocation?
As mentioned in question 8.2, a revocation decision may be appealed to the Trademark Review Board first. The decision of the Trademark Review Board may be further appealed to the People’s Court to initiate the first-instance legal proceedings. The decision of the first instance may be further appealed to a higher-level court to initiate the second-instance legal proceedings. Generally, the decision of the second-instance court is final and no further appeal is
permitted.
9 Invalidity
9.1 What are the grounds for invalidity of a trade mark?
In essence, an invalidation of a registered trademark may be based on the following absolute grounds:
(1) The registered mark lacks distinctiveness or goes against Article 10 of the PRC Trademark Law mentioned in question 2.2 above.
(2) The application of the registered mark is filed by fraud or other improper means.
(3) The application of the registered mark goes against the principle of honesty and good faith.
In addition, the invalidation of a registered trademark may also be based on the following relative grounds within five years from the registration date:
(1) The registered mark is a reproduction, imitation or translation of the opponent’s well-known trademark which has not been registered in China on the same or similar goods/services, and is likely to lead to confusion.
(2) The applicant for the registered mark, as an agent or a representative, seeks to register the opponent’s trademark in its own name without the authorisation of the opponent.
(3) The registered mark is identical with or similar to the opponent’s trademark which has been previously registered or preliminarily approved on the same or similar goods/services.
(4) The registered mark is identical with or similar to the opponent’s trademark which has been previously filed on the same or similar goods/services.
(5) The registered mark infringes upon the opponent’s prior legitimate rights, such as copyright, trade name, etc.
(6) The application of the registered mark constitutes pre-emptive registration of the opponent’s prior used trademarks
with a certain influence and renown.
9.2 What is the procedure for invalidation of a trade mark?
An invalidation decision of a registered trademark may be made by the Trademark Office ex officio or by the Trademark Review Board upon request. Invalidation decisions made by the Trademark Review Board (“TRAB”) generally follow the following procedures:
(1) Filing the invalidation application – any individuals or organisations may file an invalidation application to the TRAB based on absolute grounds. A relevant party may file an invalidation application to the TRAB based on relative grounds.
(2) Reply from the registrant – the TRAB will notify the registrant about the invalidation application and give the registrant a reasonable period to reply.
(3) Examination by the TRAB – the TRAB shall make a decision to maintain or to invalidate the registered trademark.
(4) Appeal to the People’s Court – a party dissatisfied with the decision of the TRAB may appeal to the People’s Court to initiate legal proceedings.
9.3 Who can commence invalidation proceedings?
As mentioned above, any individuals or organisations may file an invalidation application against a trademark registration to the TRAB on the basis of absolute grounds.
Most invalidation proceedings are commenced by the relevant party on the basis of relative grounds.
9.4 What grounds of defence can be raised to an invalidation action?
A defence against an invalidation based on absolute grounds may be based on:
(1) the registered trademark having distinctiveness itself or having acquired distinctiveness through commercial use; and
(2) the registered mark not having violated other provisions of absolute grounds for rejection of registration.
A defence against an invalidation based on relative grounds may be based on:
(1) the registered trademark being neither identical with nor similar to the prior trademarks;
(2) the goods/services claimed by the registered trademark being neither the same nor similar to the goods/services claimed by the prior trademarks; and
(3) the registrant not knowing the prior marks.
9.5 What is the route of appeal from a decision of invalidity?
For an invalidation decision made by the TMO ex officio, the registrant may appeal to the TRAB at first and then further appeal to the People’s Court to initiate legal proceedings. For an invalidation decision made by the TRAB upon request, the registrant may appeal to the People’s Court immediately.
10 Trade Mark Enforcement
10.1 How and before what tribunals can a trade mark be enforced against an infringer?
A claim of infringement may be brought before the Administrative Department for Industry and Commerce and, usually, the People’s Court.
10.2 What are the pre-trial procedural stages and how long does it generally take for proceedings to reach trial from commencement?
The People’s Court will grant each party a reasonable period in which to produce evidence. If the evidence is complex or voluminous, there may be an exchange of evidence before the official court hearing is held. On average, it takes one to six months from commencement to reach trial.
10.3 Are (i) preliminary and (ii) final injunctions available and if so on what basis in each case?
Chinese courts may grant a preliminary injunction by taking into account the following factors:
- The likelihood of prevailing on the merits, including the validity and stability of rights owned by intellectual property owners or their relevant parties.
- Whether the actions and other reasons of the respondent will result in impossibility of enforcing the judgment or other harms being caused to the applicant, or irreparable harms being inflicted on the plaintiff.
- Whether the harm that the continuation of certain behaviour inflicts on the respondent will obviously exceed the harm inflicted on the applicant in the absence of the continuation of such behaviour.
- Whether the behavior preservation will inflict harm on the public interest.
The final injunctions are granted if the court finds infringement after the trial.
10.4 Can a party be compelled to provide disclosure of relevant documents or materials to its adversary and if so how?
There is no discovery procedure in China. Therefore, a party is not compelled to provide documents or materials to its adversary.
However, according to Article 75 of Several Evidence Rules for Civil Litigation issued by the Supreme People’s Court, if a party refuses to provide evidence to the court without reasons where it has been shown that the party holds such evidence, then the court may decide on the basis of reference to the evidence provided by the other party.
10.5 Are submissions or evidence presented in writing or orally and is there any potential for cross-examination of witnesses?
Submissions of evidence are presented in writing or other forms provided by civil procedural law. A written witness statement is usually deemed to be oral evidence. Any evidence that is used as the basis to decide a case may be cross-examined by the two parties.
10.6 Can infringement proceedings be stayed pending resolution of validity in another court or the Intellectual Property Office?
A registered mark will be presumed valid. In infringement litigations, Chinese courts will generally not suspend the trial in order to wait for the result of invalidation proceeding initiated by a defendant against a plaintiff.
10.7 After what period is a claim for trade mark infringement time-barred?
According to the judicial interpretation from the Supreme Court, a claim for damages in trademark infringement litigation may be time-barred after two years from the time the plaintiff knew or had reason to know of the infringement, unless the infringement continues at the time the suit is brought, where the damages will be calculated retroactively for two years from the date of filing of the lawsuit.
10.8 Are there criminal liabilities for trade mark infringement?
There are three kinds of criminal offence for trademark infringement:
- Counterfeiting, which means using an identical trademark on the same goods without the permission of its owner
- The suspect of the counterfeiting shall be sentenced to a fixed term of imprisonment or criminal detention of no more than three years and/or be given a fine if: the illegal turnover is more than 50,000RMB or the illegal proceeds are more than 30,000RMB; more than two registered trademarks are counterfeited, the illegal turnover amounting to more than 30,000RMB, or the illegal proceeds being more than 20,000RMB; or there are other serious circumstances.
- The suspect shall be sentenced to a fixed term of imprisonment of more than three years but no more than seven years with a fine, if: the illegal turnover is more than 250,000RMB, or the illegal proceeds are more than 150,000RMB; more than two kinds of registered trademark are counterfeited, with the illegal turnover being more than 150,000RMB; the illegal proceeds amount to more than 100,000RMB; or there are other especially serious circumstances.
Knowingly selling counterfeit goods with a relatively large amount of sales
The suspect shall be sentenced to a fixed term of imprisonment or criminal detention of no more than three years and/or be given a fine if the illegal turnover is more than 50,000RMB, and shall be sentenced to a fixed-term of imprisonment more than three years but no more than seven years with an accompanying fine if the illegal turnover is more than 250,000RMB.
Forging the registered trademark of others or manufacturing the registered trademark without the authorisation of the owner, or selling the trademarks thereof
The suspect shall be sentenced to a fixed term of imprisonment or criminal detention of no more than three years and/or
be given a fine if: the illegally manufactured trademark amounts to more than 20,000 pieces, or the illegal turnover is more than 50,000RMB, or the illegal proceeds are more than 30,000RMB; two kinds of registered trademark in an amount of more than 10,000 pieces are illegally manufactured, with the illegal turnover being more than 30,000RMB, or with the illegal proceeds being more than 20,000RMB; or there are other serious circumstances.
The suspect shall be sentenced to a fixed term of imprisonment of more than three years but no more than seven years and be given a fine if: the illegally manufactured trademark amounts to more than 100,000 pieces, the illegal turnover is more than 250,000RMB, or the illegal proceed is more than 150,000RMB; two kinds of registered trademark more than 50,000 pieces are illegally manufactured, with the illegal turnover being more than 150,000RMB, or with the illegal proceeds being more than 100,000RMB; or there are other especially serious circumstances.
10.9 If so, who can pursue a criminal prosecution?
Traditionally, the local Public Security Bureaux are authorised to investigate intellectual property crimes, where the People’s Procuratorates are authorised to pursue a criminal prosecution.
10.10 What, if any, are the provisions for unauthorised threats of trade mark infringement?
According to the Judicial Interpretation issued by the Supreme People’s Court, the receiver of a Cease-and-Desist Letter (“the receiver”) on the basis of an unestablished claim of trademark infringement is authorised to send a reminding notice to the sender of such C&D Letter (“the sender”).
The receiver will be authorised to initiate a non-infringement declarative lawsuit against the sender after two months from the date of issuance of the reminding notice by the receiver, or after one month from the date of receipt of such reminding notice by the sender.
11 Defences to Infringement
11.1 What grounds of defence can be raised by way of non-infringement to a claim of trade mark infringement?
A defence could be raised by the way of non-infringement on the following grounds:
- The trademark in question is neither identical with nor similar to the plaintiff’s registered trademark.
- The trademark in question is not used on the same or similar goods/services with the plaintiff’s registered trademark.
- The trademark in question is previously registered, with certain influence.
- The use of the trademark in question is not a use in a trademark sense.
- The use of the trademark in question is a fair use.
- The exclusive rights of the registered trademark have been exhausted.
11.2 What grounds of defence can be raised in addition to non-infringement?
In addition to non-infringement, a defence may also be raised on the following grounds:
- The infringement claim is time-barred.
- The plaintiff is not the qualified right-owner or interested party.
- The court has no jurisdiction.
12 Relief
12.1 What remedies are available for trade mark infringement?
The remedies available for trademark infringement include injunction and damages.
12.2 Are costs recoverable from the losing party and if so what proportion of the actual expense can be recovered?
Generally, the actual loss due to infringement as well as the reasonable expenses incurred to cease the infringement, such as expenses for investigation and reasonable lawyers’ fees, may be recovered.
13 Appeal
13.1 What is the right of appeal from a first instance judgment and is it only on a point of law?
A first-instance decision may be appealed to a higher court to initiate the second-instance proceedings. The decision will be reviewed in its entirety, including the factual issues and legal issues, during the second-instance proceedings.
Generally, the decision of second instance is the final decision.
13.2 In what circumstances can new evidence be added at the appeal stage?
New evidence which may be adduced at a hearing of second instance includes:
evidence newly discovered after the first instance has been completed; and
evidence which the court was requested to investigate and collect during the first-instance proceedings, but which was refused by the court.
14 Border Control Measures
14.1 What is the mechanism for seizing or preventing the importation of infringing goods or services and if so how quickly are such measures resolved?
The Intellectual Property Customs Protection Regulation, issued by the General Administration of Customs, provides the mechanism for seizing or preventing the importation of infringing goods or services in China. According to the Regulation, the registered trademark owner who records its trademark with the General Administration of Customs will be notified of suspicious infringing products by local customs and is required to confirm the illegality of goods within three working days. The local customs will seize the infringing goods upon receiving the confirmation.
15 Other Related Rights
15.1 To what extent are unregistered trade mark rights enforceable in your jurisdiction?
An unregistered mark could be protectable as an unregistered “well-known” mark according to Article 13 of the PRC Trademark Law.
An unregistered mark may also be protectable as a distinctive name or packaging of famous goods under the Anti-Unfair Competition Law of PRC.
15.2 To what extent does a company name offer protection from use by a third party?
A company name could be protected by trademark law if the company name is registered as a mark.
A company name can also be protected under the Anti-Unfair Competition Law as a distinctive name of famous goods.
The owner of such mark or name is authorised to prohibit others from using the mark/name without authorisation.
15.3 Are there any other rights that confer IP protection, for instance book title and film title rights?
There is no specific kind of rights provided to the book title or file title. However, such titles can be protected as a distinctive name of famous goods, where the name is sufficiently distinctive and functions as an identifier of the source of origin.
16 Domain Names
16.1 Who can own a domain name?
Any companies, individuals or organisations are authorised to own a domain name in China.
16.2 How is a domain name registered?
Generally, a domain name could be registered before a domain name registrar. Domain name registration follows the first-to-file principle and there is no substantive examination. Domain name registration is usually conducted online.
16.3 What protection does a domain name afford per se?
Firstly, a domain name could prevent others from registering domain names identical or similar to prior-registered ones if their registration and use may cause confusion.
A domain name registrant may further prevent others from registering a similar domain name, registering a trademark identical with or similar to the domain name, or using the domain name as a trade name.
17 Current Developments
17.1 What have been the significant developments in relation to trade marks in the last year?
The following significant developments have taken place in relation to trademarks in the last year:
(1) The Jin Ahuan v. Jiangsu TV Station decision stated that a matchmaking reality TV show may be deemed as providing the same or similar service with an actual matchmaking service.
(2) Zhou Lelun v. Newbalance established that reverse confusion may be deemed as trademark infringement.
(3) In Michael Jordan v. Qiandan Sports, the Court decided that the Chinese name of a famous foreign individual may not be registered as a trademark.
17.2 Please list three important judgments in the trade marks and brands sphere that have issued within the last 18 months.
As mentioned in question 17.1, Jin Ahuan v. Jiangsu TV Station, Zhou Lelun v. Newbalance as well as Michael Jordan v. Qiandan Sports can be regarded as the three most important cases of the last 18 months.
17.3 Are there any significant developments expected in the next year?
We expect that a new judicial interpretation related to trademarks will develop in the coming year.
The revised Trademark Examination Guideline was issued in January 2017.
17.4 Are there any general practice or enforcement trends that have become apparent in your jurisdiction over the last year or so?
Over the last year, it has become apparent that the courts are more willing to award higher damages to the right owners in IP infringement litigation.
Helika Jurgenson, China IPR SME-Helpdesk
