Overview of Japanese Trademark Law

2nd Edition

Shoen Ono

注: これは、日本語で書かれた『商標法概説［第2版］』（有斐閣、1999）の英訳です。
原著者に翻訳及び公開の許可をいただき公開しております。翻訳については財団法人
知的財産研究所（現在、一般財団法人知的財産研究教育財団 知的財産研究所）が翻訳事業者に依頼して作成した英訳であり、原著者及び弊所は日本語版と英語版の間に生じ得る差異について責任を負いません。テキストに対する公式な言及、またその引用を行う場合には、オリジナルの日本語版に当たり確認してください。

Note: This is the English translation from “Overview of Japanese Trademark Law [2nded.]” (Yuhikaku, 1999), written in Japanese. The original author has given permission fortranslation and publication. The translation was created by a translation company at therequest of Institute of Intellectual Property (Currently: Foundation for Intellectual Property,
Institute of Intellectual Property). The original author or Foundation for Intellectual
Property, Institute of Intellectual Property is not responsible for any discrepancies that
may exist between the Japanese and English versions. Readers are recommended toconfirm the original Japanese version when formally referencing or citing the text.

PART 1. INTRODUCTION
CHAPTER 1: INTRODUCTORY STATEMENTS
CHAPTER 2: THE HISTORY AND DEVELOPMENT OF TRADEMARK LAW
CHAPTER 3: THE CONCEPT OF THE TRADEMARK LAW
CHAPTER 4: SYSTEMATIC POSITION OF THE TRADEMARK LAWPART 1. INTRODUCTION
CHAPTER 1. INTRODUCTORY STATEMENTS
Significance of Trademark Protection
Trademarks play a vital role in day to day choices made by the consuming public.
Consider the effect of trademarks on those who purchase goods and receive services,
consumers. Consumers rely on trademarks, for example, to more easily facilitate repeatpurchases of goods or services based on a previous pleasurable experience or amanufacturer’s reputation for quality. Trademarks enable consumers to make repeatedpurchases without extensive research.
A critical trait of a strong mark is that it uniquely serves to identify source. Marks thatare similar not only inadequately designate true origin, but can actually suggest thewrong origin, encouraging confusion and misleading consumers.
Trademarks have significance not only for private consumers but for corporations thatsell goods and furnish services as well. Long ago, in an economy of face-to-face tradeand of craftsmen and women, merchants considered credibility (or reputation) to be avital asset. The more credible the merchant was, the more goodwill he or she acquired.
At one point, merchants use the word "goodwill" as a mark to indicate consumer
satisfaction, on other occasions the word was used to indicate a quality businessorganization. Marks are more unique in today’s highly developed distribution economy,
but trademarks still play a role of immeasurable importance in facilitating economic
activities.
Trademarks are usually the fruit of extensive corporate effort. All the hard work
corporations invest in enhancing the quality of their goods or services and working tolower prices is embodied and accumulated in trademarks. Corporations use techniquesof repetition and saturation to publicize their marks as the symbols of their goods orservices. They are aware that consumers make purchases using trademarks as their
guide.
Imagine for a moment a world in which trademarks on goods are unprotected.
Counterfeiters and forgers, seeking to profit from the goodwill of merchants with skill
and quality products, are unleashed to flood the marketplace with “knock-offs” andimitations. Consumer confusion as to true source results in inadvertent purchasing of
low quality goods. From a merchant’s (or corporation’s) perspective, the incentive tobuild a reputation through sincere effort and scrupulous business practices is lost. The
likely result of such a scheme is a haphazard distribution economy bordering on
disorder and chaos.
Trademarks maintain the important role they have today due to the protection offeredunder current laws. Trademark Law1 and other laws2 for protecting trademarks exist.
1

Japanese Trademark Law, known simply as “The Trademark Law,” is codified at Law No. 127 of
1959, as amended.
2
One example is The Unfair Competition Protection Act, Law No. 14 of 1934, as amended.
1

The Trademark Law regulates trademarks; but is not directly related to the trademark
registration system. However, in many countries, modern trademark laws protect
trademarks through registration requirements. Trademark laws originated to protect
trademarks because charging offenders (unfair competitors) with fraud under thecriminal law was insufficient to protect the credibility of infringed trademarks. A
trademark registration system was also implemented that, over time, encouraged theemergence of "trademark as property." As the economy developed further, trademarks
became recognized as important intellectual property. As a result of the evolving
intellectual property perspective, a number of revisions of trademark legislation havebeen attempted and various interpretative studies have developed regarding Trademark
Law. Because trademarks have great significance for consumers in the distribution
economy, future Trademark Law examinations and interpretive studies should
significantly take into account the perspective of consumer protection.
Section 1. Functions of Marks
Trademarks are signs that are associated with the exchange of goods and services. A"sign" is a mark; its function is identification. A trade “sign” is a representation
enabling an article to be identified and distinguished from others on the basis of its
origin.
The history of signs is almost as old as that of human beings. Signs carved in caves andon stones have been studied in archeology. More recently, signs were also found on
bricks or glass products. Ancient signs used as marks might identify the objects ofsome religions or indicate the artist of a work. Then, however, marks were used byartists not for the purpose of repeated transactions, but for indicating their pride in orstrong attachment to their works. They were different from today’s "manufacture
marks" in that they were not intended to encourage repeated transactions. When"potter’s marks" began to be used in ancient Greece and Rome, marks began to develop
qualities of ownership, i.e. "proprietary marks." Marks also began to appear about thattime to indicate tax payment in kind, to attest to warranties of quality, or to demonstrate
membership in a guild. These marks were used out of obligation rather than for the
benefit of users of the marks. Such obligatory marks are sometimes called, "police
marks." Eventually, in the Middle Ages, "trading marks" began to appear, the origin of
trademarks that we have today. These were marks intended for repeated transactions
and usually indicated the manufacturer, the seller or the place of origin.
The concept of "signs" is far broader than that of trademarks. The category of "signs"
includes all of the above-described marks, whether trademarks in today’s sense of theword or not.
Signs are applied to a wide range of articles and are not limited to goods and services.
A national flag, a coat of arms or a stamp that represents a group, such as a country, areall signs. A name, title, pen name, stage name, or pseudonym that represents a person;a trade name that represents a merchant; a business mark that represents a business
operation; and a service mark that represents services are also all signs.

2

There are many types of signs related to goods and services. Trademarks indicate not
only the specific origin of goods and services but might indicate a source or place wellknown for a product or class of products; generic names define goods and services.
Some marks identify the place where services are furnished or the quality, nature orquantity of goods or services. These marks can also be called figures, certification
marks and warranty marks. All are included within the scope of the term "sign."
Containers, packaging and appearances (“trade dress”) that have gained acceptance intrading or have come to serve as a designation of origin or source also belong under thedefinition of "signs."
Marks essentially serve as distinguishers, helping to identify articles or things anddistinguish them from others. For example, the word "liquor" is a sign. When affixed
to a bottle or a can, it identifies the contents of the bottle or the can as liquor. On theother hand, if a bottle displays a symbol of a prize, such as a blue ribbon, the mark helps
enables a consumer to recognize that the liquor has won that prize.
A mark is defined as a "symbol or device that acts as an appellation of source” in Kojien(the most authoritative Japanese dictionary) (5th edition. p.2277). Its primary purpose
is to distinguish between goods and indicate source. If the mark fails to do either one, it
is not a sign.
As discussed above, the basic function of a "mark" is distinctiveness. A mark that is thelast name of a person (e.g. "Kubota" or "Honda") can be distinguishing. However, useof a commonplace last name as a mark performs only a limited function. A
commonplace last name does not indicate to consumers the origin of a good. However,
if a commonplace mark is frequently affixed to, for example, agricultural equipment ora bicycle, over time it might begin to indicate a particular origin (also known as“secondary meaning”). Some Japanese examples of surnames used as marks that haveacquired distinctiveness through use include Kubota Tekko for iron or Honda Giken fortechnology research. Consumers need not recognize the specific source identified by amark, only that the mark identifies some specific source. It is sufficient that the name ormark will induce consumers to recall the manufacturer or supplier. Such distinctivenessenables a trader or service provider to secure repeat purchasers of goods or acquire a
reputation. It is not until a mark is associated with a particular company that consumers
have a certain expectation about the quality of goods displaying the mark. This is
known as a "warranty function" as the mark begins to serve as a warranty of quality orsource. As discussed above however, the primary purpose of a sign or a mark is todistinguish between goods and identify source. One effect of this is the genesis of a"publicity function" that will arise out of the distinguishing and warranty functions.
Section 2. Significance of Trademarks
I. Concept of Trademarks
A trademark helps to distinguish the goods or services originating from one person orentity from the goods or services originating from others. It was said when Trademark
Law covered only goods that " trademarks are the face of goods." Under the current law,which covers both goods and services, trademarks are said to be "the face of trade.")3

That is to say that a trademark represents the credibility, reputation or fame of goods orservices in the same way the face of a person represents his or her as a person. We candistinguish a person from others by looking at his or her unique face, even if we don’t
remember their name. Some Japanese trademarks are likewise very facially distinctive
such as merchandise trademarks (e.g., Cannon, National, Sony, or Arinamin) or service
marks (e.g., Nichigin (Bank of Japan), JAL, Hankyu, or NHK).
As mentioned above, a trademark is a mark that a business affixes to the goods orservices it produces or furnishes in order to distinguish its own goods or services fromthose of other origins.
1. Marks(1) Definition of markUnder the Trademark Law of Japan, marks are defined as "characters, figures, symbols,
three-dimensional shapes or any combination thereof, or any combination thereof withcolors." (Article 2, Paragraph 1)
As discussed above, ”marks” are part of a broader concept called “signs." The "marks"
category includes its own subcategories of which "trademarks" is one. A "trademark" isa mark that a business affixes to its own goods or services in order to distinguish themfrom others.
(2) Composition of markSince trademarks under the current Trademark Law are limited only to identifiers that fit
the definition of "marks," marks must be those displayed visually in a plane or threedimensional form with respect to goods or services. Therefore, a mark expressed insound or voice ("sound mark"), light, or taste cannot be registered in Japan, no matter
how unique and how effective it is as a sign indicating particular origin or ownership. In
contrast, sound marks in the United States such as the "roaring lion" that appears at the
beginning of MGM films, or the creaking of a door made at the beginning of the oldprogram, "Twenty Questions," are potential marks under the U.S. Trademark Act.
The current Trademark Law of Japan allows for registration of three-dimensional marks.
For example, wine bottles in France, arches at McDonald’s, or a statue of the founder ofa shop (sometimes seen in front of a shop in the United States) are registerable as threedimensional trademarks.
Although marks and trademarks applied to goods were traditionally required to be flat(or two-dimensional) according to former Japanese Trademark Law, a trademark
applied to a piece of soap would not remain two-dimensional when applied to thesurface of the soap. It was therefore regarded as reasonable to treat such threedimensional marks as acceptable trademarks. (Chikujo Kaisetsu Commentaries on theTrademark Law, P.981, Monya, 50th lecture, p.16; describing a view that a trademark
was required to be flat when registered, but it could be three-dimensional when used.
(Yoshiwara and Takahashi, Setsugi (Lecture), p.20). We see some similarities in this4view and the following analogy: Although voice is not allowed to be registered as atrademark under the current law, it can be treated as a trademark when used as an
instrument of infringement. That is to say, even though a mark must be twodimensional for registration, an infringer will not find a safe harbor in embossing thesame mark on its product; similarly, although a voice cannot be a registered trademark,that fact alone will not protect an infringer who copies a “signature” vocal mark.
(3) Confusion of terms related to marks and trademarks
There are several trademark-related terms that are frequently misused. The purpose ofthis section is to clarify what is meant by some of those words. "Name of goods,""trade name," "brand," "mark" and "trademark” are all commonly confused.
Goods can have generic or common names, or trademarked names. The word “camera”
refers generically to a piece of photography equipment, while “Cannon” is a trademarkthat refers to specific cameras. Some words that may once have been trademarks (e.g.
"Escalator") are widely used to identify generic goods.
The term "brand" originally meant a mark affixed to a barrel or box with a hot iron. At
one time, Britain’s Trademark Law contained the following definition: "'mark' means
design, brand, label, sign ...." From this definition it is apparent that the concept of"brand" was regarded as subordinate to that of "mark." Over time, however, the word
“brand” has come to be synonymous with the word “mark,” and, in many places, more
widely used. Although service marks of airlines or banks are usually not called"brands," even service marks are increasingly called "brands" now. Still, technicallyspeaking, the term "brand" should be used only for indicating a mark for goods.
Fundamentally, the concept of "mark" is far broader than that of "brand." In Japan,
however, "brand" is more casually used than "mark" in relation to advertisingbusinesses. Some common “buzz words” now used are brand image, brand loyalty, etc.
The Japanese word for "mark" is "hyosho." "Hyosho" means a shape or form toindicate a specific meaning. In the United States, trademarks can refer to goods orservices and even to certification marks or collective marks. Trademarks in the UnitedStates may be registered with the Patent and Trademark Office (the “USPTO”) or may
remain unregistered. Some dictionaries incorrectly use the following definition: "Atrademark is a brand mark that becomes a trademark when registered." This definitionreflects confusion of trademark concepts regarding when rights attach.
(4) The concept of trademarks and distinctivenessThe current Trademark Law does not expressly require a mark to be distinctive prior toregistration. According to "Chikujyo Kaisetsu, Commentaries on the Trademark Law"
(1959; p.552), this exclusion has been made for the purposes of (a) simplifying theexamination procedure for trademark registration; and (b) avoiding an argument onwhether the character, symbol or figure affixed to the goods that is alleged to be
infringing is a trademark or not; that is, an argument over infringement based onwhether the mark in question is a trademark or not. Such legislation was considered tostrengthen the protection of trademarks. (Chikujo Kaisetsu, Commentaries on the5

Trademark Law, p. 552, 1959) On the other hand, the Trademark Law provides that theability of a trademark to distinguish itself from other trademarks shall be a requirement
for trademark registration (Article 3). Nevertheless, these purposes of legislation havenot been fulfilled.
Initially, after the enactment of the current Trademark Law as discussed above, the law
was criticized as follows: "According to the definition under the Trademark Law, even a
symbol affixed to goods to indicate the quality or quantity thereof can be a trademark."(Yoshiwara and Takahashi; Setsugi (Lecture), p.20). A question was even raised as towhether a stain or a price tag on a book was a trademark or not. The distinguished
Trademark Law expert, Dr. Amino, 3 divided trademarks into the following two
categories; "trademarks pursuant to the Trademark Law" 4 and "generally accepted
trademarks."5 He argued that the trademarks under Article 1 were generally accepted
trademarks, while those under Article 2 were trademarks legally and technically defined
pursuant to the Trademark Law. (Amino, p.129)
Despite Dr. Amino’s argument, the use of a character, symbol or figure that is notregarded as a trademark in the ordinary sense is not generally considered an
infringement of another’s trademark right. In every case of trademark infringement, theinfringing party has to argue whether the allegedly infringing character, symbol orfigure applied to the goods is a trademark or not. At present, "Chikujo Kaisetsu,
Commentaries on the Trademark Law" edited by the Patent Office, states, "If all of the
purports of the provisions of Article 1, Article 2, Paragraph 1 and Article 3 of theTrademark Law are taken into account, the essential function of a trademark is
considered to be its distinguishing ability from others." (Chikujo Kaisetsu,
Commentaries on the Trademark Law, p.986)
This view went too far in some cases. One Japanese case involved the unique patternaffixed to a bag produced by Louis Vuitton (a well-known bag maker). Commentators
questioned whether a certain character or figure such as the pattern in question was adesign or not. They concluded that since it was a design, it should not be regarded as atrademark, even if the design acquired the ability to distinguish source due to use overtime. Therefore the legislature intends to change the above mentioned definition.
In reality, a trademark and a design are not mutually exclusive. They are compatible.
Whether a character or figure is only a design, or whether it is a design and also a
trademark, is judged on the basis of its distinctiveness from others. (Supreme Court,
Quick Report No. 154, p.4242, Jan. 19, 1968; Vol. 19, No. 2, Mutaishu, Osaka High
Court, p. 256, Jul. 15, 1987; Vol. 19, No. 1, Mutaishu, Osaka High Court, p. 66, Mar. 18,
1987) In other words, a design may be considered a trademark if it performs thefunction of trademark, and if not, it is only a design.
2. Use with respect to Goods or Services

3

See Mokoto Amino, Shohyo, “Trademark Law” (1999; p. 129).
i.e. registered marks
5
Marks that are being used in commerce, but which have not been registered. Consumers havegenerally come to accept such marks as “trademarks” though they are not registered.
46

Trademarks are marks used "with respect to goods" by a person "who produces, certifies
or assigns such goods in the course of trade" (Article 2, Paragraph 1, Item 1) or "withrespect to services" by a person "who provides or certifies such services in the course of
trade" (Item 2).
(1) Use with respect to goods or services
Only marks that are used “with respect to goods or services" are trademarks. (Since
price tags and issue dates do not serve to distinguish source, they are not marks.) Marks
used with respect to services (service marks) were not included in trademarks before therevision of the Trademark Law. Neither the mark of any local public entity, such as agovernment or municipal government, nor that of a voluntary organization, such as acommodity center, is a trademark, unless it serves to indicate goods or services. A
house mark is not a trademark in the same way a trade name is not a trademark;however the house mark and the trademark may overlap in some cases.
A mark that indicates the State or a local public entity (or public utility corporation) is
not a trademark. However governments or public organizations may own a trademark
or may change the mark into a trademark for profit. (Article 4, Paragraph 2) In thesecond case, the mark is the mark of the public corporation, and at the same time thetrademark of the profit-making business operated by the company.
(2) Use with respect to goods or services
The Trademark Law lists the following acts as "use of a mark." (Article 2, Paragraph 3)
1. Placing a mark on goods or their packaging.
2. Assigning, delivering, displaying for the purpose of assignment or delivery, or
importing, goods on which a mark has been applied (this includes marks applied to
packaging)
3. Attaching marks to items used in rendering services and used by parties receiving
those services (herein, this shall include items that are sold or leased).
4. Offering services by using such marked items to be used by those receiving theservices.
5. Displaying items on which the mark is attached for the purpose of offering thoseservices (herein, these items shall include those to be used by parties receiving thoseservices).
6. Application of a mark to articles related to the provision of services where suchitems are used by those receiving the services.
7. Displaying or distributing advertisements relating to goods or services on which amark has been applied, including price lists or business papers.
(a) Trademarks are typically displayed on a label or as a seal impressed on goods.
However, attaching a tag displaying a mark on goods, or shaping goods such as soap orbuttons into a mark may also be included. Displaying a mark as part of the pattern on abag, as do Gucci or Louis Vuitton, is included under Item 1 (above) as long as the marknot only makes up a part of the pattern but also indicates origin.

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"Packaging of goods" as discussed in Article 2 of the Japanese trademark act refers to
packaging in a broad sense that includes all sorts of containers, package boxes,
wrapping paper (product wrap) and other articles which cover or wrap goods. If a
trademark is applied to packaging that is not yet used in commerce by one other than
the trademark owner, the trademark owner can file a claim to prevent infringement.
This protection is found in Article 37 under indirect infringement. "Wrapping paper"that has not been applied to a good is not included under the term "packaging of goods."
Infringement cannot be determined until it is known what the paper will wrap: paints(Class 2) or soap (Class 3) for example. The “wrapping paper” becomes packaging
under the statute only when it covers particular goods; that is, it becomes packaging
associated with particular goods as described in Item 1.
Incidentally, there may be substantial problems in prosecution for infringement where
wrapping paper (product wrap) is illegally copied or counterfeited. Take for instance a
department store having a “house brand.” An infringer who copies the departments
store’s product wrap is not infringing a trademark for the mark on paper under Class 16.
Trademarks in Class 16 are for printing businesses such as Dai Nippon Printing Co.,
Ltd., Toppan Printing Co., Ltd. and Kokuyo, or stationery manufacturers. The
department store’s trademark is for each individual item of good the department store
sells under its “house brand.” That is to say, the mark only applies to the actual goods
to which it is affixed, not to the external packaging that is over the goods. For example,
the trademark of a department store may be a trademark with respect to a book case inClass 20, of foodstuffs in Class 30 or of seat ticket arrangement services in Class 41.
Until a mark is actually used for wrapping goods (or for wrapping an article related tothe provision of services, such as an envelope for tickets), it will be impossible todetermine which trademarks are being infringed.
In some circumstances, circumstantial evidence can be used to infer potential
infringement. In such a case, a request to prevent infringement may be made under
Article 37 (acts denoting infringement) regarding indirect infringement. In such a casean injunction may be obtained by the department store but only for a portion of theirtrademark portfolio. (Practically, such a claim or action may be filed in a morereasonable manner under the Prevention of Unfair Competition Act.)One significant Japanese court case held that applying a price tag bearing a trademark to
packaging of goods for sale fell under the definition of "transferring or assigning thegoods covered by packaging to which a mark has been affixed” under Article 2,
Paragraph 3, Item 2. (Vol. 24, No. 2, Chitekishu, Tokyo District Court, p. 440, June 30,
1992, "Tops"). In the Robinson Case, the court ruled that displaying the mark“Robinson” on the body of a helicopter that was imported from a foreign manufacturer
fell under Article 2, Paragraph 3, Item 2. It was also held that displaying anddistributing pamphlets with regard to the helicopter fell under the provision of Article 2,
Paragraph 3, Item 3 of the Trademark Law before the revision in 1991. (Vo. 22, No. 3,
Mutaishu, Osaka District Court, p. 651, "Robinson")(b) Under the former Japanese trademark law, there was significant disagreement as towhether or not displaying a mark was included as distribution under Article 2,
Paragraph 3, Item 3. The common view once held that it was. Prior to the 1991
8

revision, distribution included "displaying" and other similar acts. However, the clauseat that time was still imperfectly worded and did an inadequate job protecting
trademarks, since the concept of possession was not included in the clause.
For example, assume that goods carrying a counterfeited trademark were discovered in
the warehouse of a retail store. Under Article 2, Paragraph 3, Item 2 the manufacturer
would be deemed to be using the goods, since it applied the mark to goods
manufactured by itself. But the goods are out of the manufacturer’s possession. The
goods are being stored for sale, but a seller does not apply the mark. A seller uses a
trademark by "assigning" the goods on which the mark is applied. Article 2, Paragraph
3, Item 2 of the Trademark Law provides that the acts of a seller are to assign, deliver,display for the purpose of assignment or delivery, or import the goods." The question
becomes: what if a person who has purchased goods bearing an infringing trademark
keeps the goods in a warehouse before "assigning, delivering, or displaying for the
purpose of assignment or delivery"? There is technically no display of the goods and,
consequently, no direct infringement. The only remedy in this situation is to assert
indirect infringement as "possession for the purpose of assignment" pursuant to Article
37, Item 2.
Under the former Trademark Law, some argued that storage in a warehouse should be
deemed to be part of a series of actions: assignment, delivery, and display. Prior to the1991 revision of the Japanese trademark law, display and storage of goods in awarehouse by a seller had to be interpreted as part of a series of acts such as assignment,delivery, display, etc., to be an infringement. Possession for the purpose of sale was not
sufficient.
Absent the preceding circumstances, a mark of goods that was a trademark with respect
to the manufacturer of the goods is not necessarily a trademark of the same goods withrespect to the person who stored the goods. There is a minority opinion that acts ofindirect infringement do not deserve punishment. This opinion is based on the view thatindirect infringement is a minor offense. The preceding scenario shows how this cannot
work. It would be unjust for the manufacturer to be found guilty of trademark
infringement, while the person who stored the same goods (with intent to sell) is not.
"Delivery" means physical transfer of the control of goods, not only transfer of legal
rights. For example, assume a seller issues to a purchaser a purchase agreement statingthat the purchaser will be in possession of the goods after the sale for the benefit of thepurchaser. The legal rights transfer to the purchaser, even though the goods have notbeen physically transferred. Such transfer is not considered delivery.
"Importing" is an international transaction "for the purpose of bringing goods produced
in a foreign country into a domestic market." Some experts maintain that goods stored
in a bonded area (a bonded warehouse or bonded plant) should not be regarded asimported goods. 6 This interpretation of "importing" is only reasonable in when
discussing importation in the course of ordinary trade.
6

As far as manufacturing is concerned, a bonded plant is regarded as the territory of Japan. If a
bonded plant which is part of a bonded area were to be exceptionally regarded as an overseas area,
the interpretation would become unreasonable. "Outline of Patent Law," Yoshifuji, p. 442.
9

These views that regard only goods that have cleared customs to be considered imported(“custom clearance” view) are not appropriate. If a product bearing a pirated mark isexported to an end destination via a Japanese port, and is discovered in a bonded
warehouse in Japan disguised as a Japanese product, the "custom clearance" protocol
would take all risk of responsibility from the bonded warehouse.
Importing should be interpreted in accordance with either the "territorial water" or"unloading" view, not with the "custom clearance" view. (The Swiss Federal Supreme
Court See 18 Swiss Supreme Court Rulings, IIC, 120; held, on November 2, 1984, thatfreight kept at the airport before custom clearance was considered to be domestic
freight.) Under this rationale, goods displaying pirated marks are regarded, in mostcases, as “imported” once they enter territorial waters. (Ono, "Protection of Intangible
Property Right Under Criminal Law," Commemoration of Someno’s 70th Birthday/
Industrial Property Rights, 240).
(c) Items 3, 4, 5 and 6 of Article 2, Paragraph 3 were added in connection with the 1991
revision of the Trademark Law regarding service marks.
Examples of articles “for use by persons to whom the services are being provided”
under Article 2, Paragraph 3, Item 3 include for example, a vehicle used for taxi service,
and a first aid kit for medical services. The application of a service mark to such avehicle or kit is the kind of action provided for in the Item.
Some actions that denote use under Article 2, Paragraph 3, Item 4 include furnishing
services using the articles set forth in the preceding Item such as a vehicle a for taxi
service that bears a service mark under Item 3.
Item 5 (of paragraph 3, Article 2) indicates that “use” may include displaying carsbearing service marks in front of a rent-a-car shop, or using tableware bearing service
marks in the food service industry.
Article 2, Paragraph 3, Item 6 includes as use a laundryman attaching a tag bearing aservice mark to a shirt after laundry. Unlike goods, it is impossible to apply a mark tointangible services. Accordingly, use of a trademark to indicate services or thefurnishing of services may be accomplished by applying marks to tangible articles
related to the services.
(d) Acts of display or distribution may include a service provider’s employee uniform, abank book, a box of matches, or an admission ticket to which a service mark is applied(Article 2, Paragraph 3 and Item 7). Other examples include displaying or distributing
advertisements, price lists or business papers to which a mark indicating goods orservices has been applied. However, advertisements, price lists and business documents
are usually not permitted to be used as examples in connection with the registration of
trademarks. Before the 1991 Trademark Law Revision, some authorities advocated thatadvertisements, price lists and business documents did not amount to “distribution” ofthe mark. The revision clarified the meaning of distribution in the use of trademarks inview of these opinions. (According to "Chikujo Kaisetsu, Commentaries on the10

Trademark Law," p.983, and Monya, "50th Lecture," p.18, these words have been newly
added.) Business papers include merchandise samples, written estimates, order forms,delivery statements, invoices, receipts and catalogues. To be protected, however, theyneed to be displayed or distributed. Advertisements include all kinds of advertisingmeans such as fliers, signboards and television.
Using trademarks in publicity is now regarded as "use of trademarks" in the sense that ithelps to accumulate goodwill. Use of trademarks in advertising that impairs credibility
without permission will be subjected to liability for infringement.
"Displaying or distributing advertisements" includes acts ranging from advertisement
placement on printed materials such as newspapers or magazines to display of a markon signboards, neon lights, ad pillars, or in TV commercials, to application of a mark on
coupons distributed to customers. (Vo. 15, No. 1, Mutaishu, Nagoya District Court, p.
15, "Jugoya Store," Jan. 31, 1983). On the other hand, publicity campaigns over radioor public sound systems are not included because they do not actually apply a mark to
goods. Recall that sound marks are not protected under Japanese law. ("Chikujo
Kaisetsu, Commentaries on the Trademark Law," p.985; Amino, p.153). There is apossibility, however, that a publicity campaign could be taken as infringement if itimpairs the value of a trademark.
In a trial for cancellation of a trademark registration (Article 50), it was held that
trademarks are not subject to cancellation if they are used for advertising. However, if
they are only nominally used, cancellation is inevitable. (Vol. 25, No. 3, Chitekishu,
Tokyo District Court, p. 22, Nov. 30, 1993; Supreme Court, Quick Report No. 199,
p.5702, Oct. 11, 1991. This judgment was on the question of suitability of the demand
for relief, but nominal use of trademarks in advertising was discussed in dicta.)(3) Use with respect to goods or services
Use of marks need to be "with respect to" goods or services.
A company employee’s business card often bears the mark (trademark) of his or hercompany. In most of these cases, the trademark is not used for "advertising goods orservices" but for advertising the trademark itself (neither goods nor services). This is
not considered to be a mark “applied to goods or services for advertisement."
Trademarks are applied to business cards in an effort to increase trademark recognition,
indirectly benefiting the business operations of the company. Merely advertising themark in such a way does not fall under "use of trademarks" pursuant to Article 2,
Paragraph 3, Item 7 because it is not used “in relation to” goods or services. (Vol. 22,
No. 2, Minshu, Supreme Court, p.152, Feb. 9, 1968)
However, an unusual business card on which a photograph of goods bearing a
trademark is displayed may fall under the meaning of "use of trademarks," because themark and the goods have a high degree of relatedness and the trademark is used for"advertisement of goods." (See 3-(5) below). When a business card has a trademark on
one side and a description of services provided on the reverse side a legitimate use of
the mark is more frequently found.
11

3. Concept and Use of Trademarks
Recall that trademarks are signs, devices, mottos, and others included within the larger
concept of marks. As defined in the statute, "trademark" means characters, figures,symbols or three-dimensional shapes or any combination thereof, or any combination
thereof with colors which are (i) used with respect to goods by a person who produces,certifies or assigns such goods in the course of trade, or (ii) used with respect to services
by a person who provides or certifies such services in the course of trade. (Article 2,
Paragraph 1, Items 1 & 2).
(1) Kinds of marks contained in the definition of Article 2
Article 2 defines marks as those "used with respect to goods by a person who produces,certifies or assigns such goods in the course of trade" (Item 1) and those "used withrespect to services by a person who provides or certifies such services in the course of
trade" (Item 2). Therefore, "production marks" (manufacture marks), "business marks,""certification marks" and "transfer marks" (sales marks) are included as trademarks
under the current Trademark Law.
"Goods" are articles that can independently be the objects of business transactions,especially personal chattels. ("Chikujo Kaisetsu, Commentaries on the Trademark
Law," p.985). Specifically, “goods” refers to chattels produced for exchange within
trading markets and does not include real estate. Accordingly, the components of aprefabricated warehouse are chattel and a trademark may be used thereon. On the other
hand, a prefabricated warehouse that has been assembled has become real property anda trademark for goods may not used thereon.
Instead, a "service mark" for "transaction and management of buildings" (Class 36) or"construction works" (Class 37) could be applied to such a building.7
Since trademarks are used “with respect to goods or services" service marks are also
included in the meaning of trademarks under the current Trademark Law.

(2) Service marks
Article 2 provides that trademarks are marks “used ... with respect to services by aperson who provides such services, in the course of trade.”"Services may be defined as "labor or favorable treatment that is supplied or provided
for the benefit of others and can independently be the objects of business transactions."("Chikujo Kaisetsu, Commentaries on the Trademark Law," p.985). Under thisdefinition, domestic labor and internal training of employees are not included under
7

There is an opinion opposing this interpretation and asserting that such a mark should be a
"trademark for goods. See Amino, p.63 and No. 2737, Patent News, Osaka District Court, p. 3, May
20, 1941, "Daidarasaurs. In reality, however, no such property can be found in the classification ofdesignated goods and the common opinion is traditionally influential in actual practice.
12

services. Home delivery of meals by a food service shop can be a "service rendered in
procuring food or drink"(Class 42); however could be transportation (Class 39) if thedelivery of those meals is the primary business of another company.
For example, bedding, tea and cakes supplied as part of the services of a hotel or aJapanese-style inn are not independent objects of business transactions, but articles
incidental to services; that is, "articles supplied for use by persons to whom (other)services are provided" (Article 2, Paragraph 3). Trademarks affixed to such bedding,teabags, or cakes are service marks incidental to services and fall under Class 42("services rendered in procuring food or drink, and lodgings"). In contrast, trademarks
affixed to the same type of cakes sold at a souvenir shop in the hotel or inn are
trademarks for goods included under "processed vegetables" (Class 30).
Applying marks to paper wrappings covering disposable table ware at fast foodrestaurants is not regarded as use of trademarks, while applying marks to bags that
contain take-out bread or cakes is regarded as applying a mark to the packaging ofgoods. (8491, Supreme Court, 2d, p.84, Jul. 3, 1990; 1333 Tokyo High Court, p. 151,
Aug. 16, 1989; Comments on Rulings, Vol. 41, p.872, Patent Management, "Chaen
Seiju"). If a food service shop continually and repeatedly sells cooked meals, “take-out
meals,” the meals are considered goods under the Trademark Law, in contrast to meals
served in the shop. The Tokyo High Court addressed this issue in Tenichi, holding that
“goods" under the Trademark Law must be interpreted as tangible articles distributablein business transactions (as the objects of the transactions); namely, articles produced
for the purpose of distribution on general trading markets. Therefore, take-out meals
exceptionally prepared at the shop (of the appellee) as a coming-home present for acustomer, for a fee, at his or her special request, or a customer’s leftovers which he or
she requested to take out in a box are comparable to meals eaten on the spot (services).
Contrast the case in which take-out meals are continually and repeatedly sold at theshop, tangible articles produced for the purpose of distribution. (Vol. 20, No. 1, Tokyo
High Court, Mutaishu, p. 98, Mar. 29, 1988).
In another case, a restaurant was designed so that rock concert audiences could enjoy
meals before or after the show. One floor was a restaurant while the basement was used
for concerts. Also in the basement, food was sold to the audience in plastic boxes or
paper packaging bearing the mark of the business. Some members of the audiencepurchased the food available in the basement and took home leftovers in a paper
shopping bag provided by employees. This was not necessarily a regular occurrence,
havingoccurredonly
threetimes.
The
court
statedthat”the restaurant had not prepared paper shopping bags for the purpose of offering takeouts to customers, but had supplied shopping bags, only meant for employees’ privateuse, only upon requests by the customers.” This practice was not held to demonstrate aroutine practice of offering take-outs. The court found that the plastic boxes andpackaging should have been regarded as tableware in a food service business. The markaffixed to the packs would have been recognizable by the customers as a markrepresenting the services of the restaurant (i.e., music performances together with meal
services). (Tokyo High Court, Quick Report No. 243, p.6900, Oct. 26, 1994) In
particular, the court denied the claim for trademark infringement in this case because themark applied to the packaging of the food actually represented the services provided in13relation to it. The Supreme Court affirmed, holding that "the original decision is valid
because cooked meals sold by the restaurant do not fall under the goods pursuant to
Article 37 of the Trademark Law...." (Supreme Court, Quick Report No. 259, p.7350,
Oct. 14, 1996).
This concept is sufficiently vague as to invoke a substantial amount of litigation.
(3) Color as a component of trademarks
Recall that the Trademark Law defines "trademark" as “characters, signs, figures,symbols, three-dimensional shapes or any combination thereof, or any combination
thereof with colors, which are used with respect to goods by a person who produces,certifies or assigns such goods in the course of trade.”
Prior to 1991, trademarks with different colors were generally regarded as identical.
However, it became apparent over time that each "identical" figure actually creates adifferent impression depending on its color. (Recall the red polka dot futon cover or
Dunhill’s8 trademark with white polka dots. Red polka dots, white polka dots and blackpolka dots respectively give greatly different impressions.) The former Trademark Law
stipulated a color-limited registration system, under which any commonplace figuresuch as a polka dot pattern could attain distinction through use if the color was limited
and it was otherwise registerable under Article 1, Paragraph 3 (of the former Act). If amark was registered with its color restricted, it was treated differently from a markwithout color. Under current Trademark Law, color is regarded as a component of a
trademark; it is considered unreasonable to deal with color on a case-by-base basis.
However, unlike characters, figures or symbols, color is not an independent component.
Color alone, or a combination of colors, is not sufficient to be registered as a mark.
Color can be a mark only when combined with another element, such as characters, forexample. It could be said that color is a secondary component.
Incidentally, black and white are regarded as colors under Japanese Trademark Law.
("Chikujo Kaisetsu," Commentaries on the Trademark Law p. 985). The backgroundcolor of a specimen in an application for trademark registration does not form part of
the trademark. (Article 5, Paragraph 4).
(4) A trademark may be two-dimensional or three-dimensional
The Trademark Law defines "trademarks" as "characters, signs, figures, symbols, threedimensional shapes or any combination thereof, or any combination thereof with colors"
which are used with respect to goods by a person who produces such goods or withrespect to services by a person who provides such services in the course of trade.
From this definition, it can be inferred that trademarks are flat or three-dimensional
shapes and are visual. In Japan, sound, smell and taste cannot become registered8

A major Japanese cigarette manufacturer.
14

trademarks.9 Three-dimensional marks were not recognized before the revision of theTrademark Law in 1996. There were a few exceptions. After the "Nyrol spectacle
frames" Case (Vol. 5, No. 1, Mutaishu, Tokyo District Court, p. 42, Mar. 9, 1973),
protection of three-dimensional marks was recognized under the Unfair Competition
Prevention Law. After the revision of the Trademark Law in 1996 three-dimensionalmarks were added to the marks under protection.
The protection of sounds is best dealt with not as an issue of registerability of soundmarks at the Patent Office, but as an issue of trademark infringement, because such
infringement violates the rights of the trademark owner. For example, radio advertisingthat uses a mark of another without permission could be treated as infringement of a
trademark right. Before three-dimensional marks were recognized as registerable, theact of creating a three-dimensional character from a two-dimensional graphic was aquestionable act capable of harming a trademark right. At that time, the mark had to be
represented as a flat (two dimensional) graphic for registration. However, strictly
speaking, a trademark, once applied to goods, will never keep its original flat shape atall times. Although a shape in relief on the surface of goods or a carved trademark on
the surface of soap was not deemed to be use of the mark as a flat shape in the strict
sense, it was recognized as the use of a trademark within a generally acceptable range.
In this light, the improper use of a sound or voice mark may be interpreted as trademark
infringement, even though sound marks are not allowed to be registered.
(5) Relationship between marks and goods or services
Article 2 of the Trademark Law defines trademarks as marks used "with respect togoods or services" by a person who produces such goods or who provides such services
in the course of trade.
A trademark right does not necessarily grant exclusive rights to the mark. The right
granted is tied to the relationship between the mark and its user. A person who hasregistered the trademark FUJI for "futons” does not exclusively possess the word FUJI.
The trademark embodies the goodwill the owner has gained by manufacturing or sellingfutons under the mark FUJI. It creates a relationship between the mark, FUJI, and thegoods, futons. A trademark may serve to distinguish one product’s source from another,it may also represent customer trust or serve as a guarantee as to quality. To some, themark FUJI is sufficient inducement to buy a product. Trademark law seeks, therefore,
to protect this relationship between a mark and the associated goods.
The significance of a mark has a direct relationship to goods or services to when it isaffixed. In one case, a trademark registrant affixed the mark KYOHO to a package ofgrapes. The mark was intended to indicate the source of the grapes, not the source ofthe packaging, but the owner registered KYOHO for the packaging of grapes and9Sound trademarks are recognized under the Unfair Competition Prevention Law, but not approved
as marks under the current Trademark Law. In one Unfair Competition case, Harley Davidson Co.
argued that the sound of its motorcycle was a distinctive mark. In other cases, types of smell arealleged to be distinctive under the Unfair Competition Prevention Law (Vol. 5, No. 1, Mutaishu,
Tokyo District Court, p. 42, Jan. 28, 1980; No. 5662, Patent News, Tokyo High Court, p. 1, Feb. 25,
1981).
15

subsequently filed for a preliminary injunction against a competitor. The injunction was
refused because it was related to the packaging of the grapes, not the grapes themselves.
(Vol. 3, No. 2, Mutaishu, Fukuoka District Court, Iizuka Branch, p. 317, Sep. 17, 1971.)
In a similar case, the owner of a trademark "Shumi-no-Kai" (“Hobby Club”), which had
registered its mark for use on printed materials, brought an infringement action against aperson who independently distributed a monthly advertising brochure for ceramic wares
bearing the same mark to the Hobby Club members. The court held that the actual
goods being distributed were ceramic wares, not booklets. Because the booklet was
printed matter distributed free of charge for advertising purposes, it did not have any
exchange value and, therefore, was not a good (Vol. 12, No. 3, Kaminshu, Tokyo
District Court, p. 410, Mar. 22, 1961). The conclusion was here was correct, but the
court applied incorrect reasoning in getting there. The act of distribution in this casewas not regarded as infringement because the booklet had no exchange value as printed
matter. However, the court should have found that the mark, "Shumi-no-Kai," was not
infringing the prior mark because it was registered and used for ceramic wares, notprinted matter. (The actual value of the printed advertisements should never have beena consideration).
In another similar case,10 a drug store chain having a registered mark and operating
under a large pharmaceutical company distributed origami paper free to customers. The
court stated that the origami was delivered (by the plaintiff) to Takeda Kai (the drug
store chain), and then to an individual employee or pharmacist, together with the goods(pharmaceuticals) to be sold, for the purpose of distributing the origami free of charge
to customers. The origin of the origami is obvious to the purchaser, and the trademark
affixed to the origami does not further enhance that knowledge. The drug store thatpurchased the origami distributes it to customers as a free gift for advertisement
purposes. The court found that the origami was not a tangible article for distribution in
general trading markets.
There was no evidence to show that the drug store that purchased the origami wasdistributing it for consideration. The court further clarified that even if the store hadreceived incidental consideration, the origami was not "goods" pursuant to theTrademark Law, since “it was not intended for distribution as an object of commercial
transactions." (Vol. 21, No. 3, Mutaishu, Tokyo High Court, p. 832, Nov. 7, 1989)(6) Trademarks indicating goods or services
The current Trademark Law defines trademarks as "characters, figures, symbols or
three-dimensional shapes or any combination thereof, or any combination thereof withcolors which are used with respect to goods by a person who produces, certifies orassigns such goods in the course of trade, or used with respect to services by a person
who provides or certifies such services in the course of trade."
Dr. Amino has a theory that trademarks include all of the characters, figures, symbols or
10

There are many other similar infringement cases. (See Vol. 9, No. 2, Mutaishu, Tokyo High Court,
p. 572, Aug. 24, 1973, "Sunday Evening News"; Vol. 19, No. 2, Mutaishu, Osaka District Court, p.
268, Aug. 26, 1987, "Boss")16

three-dimensional shapes or any combination thereof, or any combination thereof withcolors which are used by a trader or dealer with respect to its goods or services.
According to this theory, company names, indications of grade or quality, price tags andwarning labels are all trademarks if they are used with respect to goods or services. The
proponents of this theory assert that these ”signs” are trademarks pursuant to theTrademark Law, although they are not generally accepted as trademarks. (Amino,
p.129).11
An opposing, more comprehensive theory uses Article 1, Article 2, Paragraph 1, andArticle 3, to reinforce the assertion that trademarks essentially serve to distinguish thegoods of particular manufacturers from those of others. ("Chikujo Kaisetsu,"
Commentaries on the Trademark Law, p.986).12
In the Tenichi, the court ruled that trademarks registered under the Trademark Law areintended to indicate the origin of the goods bearing the trademark. The purpose of theTrademark Law is to ensure the maintenance of the accrued goodwill of trademark
owners by protecting their marks, thereby contributing to the development of industry
and protecting the interests of consumers (Article 1). Article 2 of the Trademark Law
provides that trademarks are marks to indicate goods or services.13
In one unusual case, an instruction manual was placed inside transparent packaging thatsurrounded certain goods. The manual displayed the registered trademark associatedwith the goods and was affixed to the inner surface of the plastic bag. The trademark,which was recognizable from the outside, served to distinguish the goods from othergoods and to avoid confusion as to the origin of the goods. The court held that putting
the manual in a plastic bag fell under "the acts of applying a mark to the packaging of
the goods" provided in Article 2, Paragraph 3. (Vol. 20, No. 3, Tokyo High Court,
Mutaishu, p. 457, Sep. 29, 1988, "Othello" Sponge Case).
If the phrase, "used with respect to goods or services" is interpreted to mean "used inorder to distinguish goods or services," any symbol indicating for example, quantity,that does not also serve to distinguish goods or their origin, does not indicate its
association with goods or services. If the purpose of Trademark Law lies in theprotection of the association between a mark and goods (also called “goodwill”), there
may be no discrepancy between the concept of "trademark under the Trademark Law"
and that of "generally accepted trademark." [Commentaries in "Chikujo Kaisetsu,"
Commentaries on the Trademark Law, attempt to eliminate such discrepancy.](7) Use of three-dimensional trademarks with respect to goods or services
11

Even in the minority opinion trademarks do not include everything used with respect to the"goods." Only marks visible from the outside of the goods are intended to be included. (In fact,some critics in challenging the theory refer to flaws and stain spots on the goods.) Eguchi, p.22. It is
obviously incorrect to include flaws and stain spots of goods in the discussion of marks, even if they
are visible from outside.
12
The commentaries in "Chikujo Kaisetsu" have been changed since the legislation. (Nakamura,p.29, Goto, Haruo, Vol. 77, No. 4 & 5, Invention, Interpretation of Registered Trademarks in Rulings,
Books I & II)
13
Price tags or flaws are not trademarks because they do not identify goods.
17Three-dimensional trademarks were added to the Trademark Law in 1996 and must also
be used with respect to goods or services. The revised Trademark Law explicitly
clarified that a three-dimensional trademark can consist of the shape of goods or otherarticles. "Application of a mark to goods or other articles as prescribed in the preceding
subsection shall include goods or their packaging, or articles that are supplied for use in
the provision of services and advertisements relating to goods or services, that areshaped into a mark" (Article 2, Paragraph 4).14
Goods are, as discussed above, corporeal things produced or traded for the purpose of
distribution in general trading markets. Buildings fixed on land are not included in themeaning of goods. 15 Creating an entire building such as a retail store into a threedimensional shape is not by itself a trademark for goods. However, if an entire buildingin which goods and services are offered is recognized as a three-dimensional sign (e.g. afull-size model of a registered three-dimensional mark)), it is regarded as use of a mark.
"Commentaries on Industrial Property Rights" as revised in 1996, Edited by the Council
for Amendment of the Patent Office, p.161).
Three dimensional "packaging" includes containers of goods (bottles of liquor or
drinking water, etc.). Three dimensional "advertisements" include ad towers (such asbuilding discussed, supra), dolls, figures or statues (e.g. a figure or statute in front of ashop, a mascot, or a doll attached to a signboard). However, it is not sufficient forregistration purposes to merely have a three-dimensional sign or figure, the must also beable to distinguish goods or services from others.
Three-dimensional trademarks are discussed more comprehensively in the following
section.
4. Three-dimensional trademarks(1) Types of trademarks and three-dimensional trademarks(a) Introduction
Recall that trademarks are a kind of mark, defined as "characters, figures, symbols, or
three-dimensional shapes or any combination thereof, or any combination thereof withcolors." (Article 2, Paragraph 1).
Before the 1996 amendments, registered trademarks were limited to two-dimensionalmarks. Neither the promotional figure depicting the founder of Kentucky Fried Chicken
often seen in front of its stores nor the three-dimensional signboards of McDonald’s
were permitted to be registered under the old Trademark Law, although they wereundoubtedly serving as trademarks. Because trademark law did not protect threedimensional marks from imitation, famous three-dimensional marks facing a likelihood
14

Because Paragraph 4 is a continuation of Paragraph 3, "other articles" in this provision isunderstood to mean packaging of goods, articles for use in the provision of services andadvertisements relating to goods or services.
15(An opposing opinion was presented by Amino.)18

of confusion with other marks were protected under Unfair Competition Laws.
(b) History
The system of registering three-dimensional trademarks originated in the U.S, but ascountries revise their trademark law, protection of three-dimensional trademarks under aregistration system is becoming the norm.16 Japan also introduced a registration system
for three-dimensional trademarks so as to be in line with trademark systems of othercountries.
Three-dimensional trademarks were introduced after the 1996 amendment of theTrademark Law, as a new category of trademarks. In making this change, Japan
realized that evolving transactional circumstances required the introduction of a threedimensional trademark system. This was particularly true in light of recent international
treaties. In order to become a signatory to the treaties, all countries needed to provide
registration for three-dimensional trademarks. 17 The three-dimensional trademark
system was adopted after the 1996 amendment of the Trademark Law, in order to meetthis requirement.
(c) Revision of the definition of trademarks
The addition of three-dimensional marks to the trademark registration system made itnecessary to revise the definition of trademarks set forth in Article 2, Paragraph 1. Thiswas done by adding the words "three-dimensional shapes" and "any combination ofcharacters, figures, symbols and three-dimensional shapes" to the definition of marks
constituting trademarks.
The change also affected the word "use" in Article 2, Paragraph 3, and in Paragraph 4.
Therefore, the meaning of "applying a mark" in the definition of "use" in the Trademark
Law was modified to include “goods or their packaging, articles that are supplied foruse in the provision of services, and advertisements relating to goods or services that areshaped into a mark."(2) Distinctiveness of three-dimensional trademarks
The biggest problem surrounding three-dimensional trademarks is that of distinctiveness.
Relaxed distinctiveness requirements lead to more registrations, but also to increased
barriers for future market participants. Rigidly defined distinctiveness requirements
impede the efficiency of the system set up to protect three-dimensional marks in the firstplace.
The amendment in 1996 of Article 3, Paragraph 1, Item 3 of the Trademark Law, further
granted protection to the trade dress of a product. However, three-dimensional
16

Industrialized countries recently agreeing to register three dimensional marks include: France(1991), Great Britain (1994), and Germany (1995).
17
The incorporation of a registration system of three-dimensional trademarks was temporarily
delayed at the time of the Trademark Law amendment that introduced service marks, in view of theneed to align the Trademark Law with the Design Law.
19

trademarks or trade dress that merely depict common usage (or are “functional”) are noteligible for trademark registration, unless they are considered by consumers to be
distinctive as being a mark having become associated over time with particular goods orservices (acquisition of distinctiveness through use).18 It is fully expected that some of
the ambiguities surrounding three-dimensional trademarks and trade dress will be moreclearly defined in the coming years as they are dealt with by the Patent Office.
(3) Potential treatment of distinctiveness in three-dimensional trademarks
An analysis of the operational policies of the Patent Office may shed some light on how
distinctiveness is likely to be dealt with in the future with regard to three-dimensional
trademarks.
(a) Understanding Trademark Law, Article 3, Paragraph 1, Item 3
Article 3, Paragraph 1, Item 3 states that trademarks which describe in a common
manner the goods’ place of manufacture, place of sale, quality, raw material, efficacy,use, quantity, shape (including the shape of its packaging) price or method or time of
manufacture and use will not be registered. This provision applies to not only such
written descriptions, but to figures or diagrams.
A mark that merely indicates the shape of goods or their packaging, or the shape ofarticles used in services will not be registerable under Article 3, Paragraph 1, Item 3. If
a three-dimensional mark is merely fashioned after commonly known goods, it will betreated strictly in accordance with Article 3, Paragraph 1, Item 3.19(b) Construction of Trademark Law, Article 3, Paragraph 1, Item 5
Prior to the 1996 amendment, extremely simple and commonplace designs were notpermitted to be registered. 20 With the implementation of the three-dimensional
trademark system, shapes such as spheres, cubes, cuboids, cylinders and triangularprisms were added to the list of "simple and commonplace marks," under Article 3,
Paragraph 1, Item 5 and thereby denied registration.
(4) Trademarks...whose shapes are essential to the function of the product or the
packaging of a product (Article 4, Paragraph 1, Item 18)
When the shape of goods or packaging is undeniably functional, the shape will not beregistered as a mark. Allowing functional shapes of goods or packaging to be registeredas three-dimensional trademarks would effectively create a monopoly of that product by
the trademark owner. Registration of functional shapes would hinder the developmentof industry and inhibit fair and free competition in conflict with the purpose of theTrademark Law as stated in Article 1.
Functional shapes are not eligible for registration even if their distinctiveness increases
18

This concept is commonly referred to as “secondary meaning” in the United States.
For example, a baker may not register a three-dimensional loaf of bread as a trademark because aloaf of bread is a symbol commonly used to describe a generic product.
20
Some examples include: a single line, a wavy line, or the outline of a triangle, square or circle.
1920

as a result of use (Article 3, Paragraph 2). However, in the case of a shape mark thathas acquired distinctiveness as a result of use over a long period of time, an action for
infringement will undoubtedly raise questions as to whether that three-dimensional
trademark is in fact solely functional. The primary focus in such a case would be thefeasibility of "circumventing" the shape by using an alternative shape. This could likely
be proven by showing that a functional portion was combined with a non-functional
shape to form the distinctive three-dimensional shape.
Examination under Article 4, Paragraph 1, Item 18 focuses on the elements of the shapeof goods or packaging that put the product at a practical advantage. Frequently the
courts do this by referring to advertisements or business papers that have been
submitted to comply with Article 3, Paragraph 2.21 The courts will look to see whether
the shape is indispensable to the function of the goods or their packaging and whether
any other alternative shapes exist that could secure the same functions. If alternatives
are found, the court will look at the feasibility of those alternatives as a function of cost.
(5) Limits of the trademark right
Based on the preceding rationale, Article 26, Paragraph 1, Item 5 says that a trademark
right does not extend to “trademarks which are merely three-dimensional shapes ofgoods or packaging and are essential for the packaging of a product.”This is a protective provision. Even if a trademark that consists solely of a functional
three-dimensional shape is erroneously registered, anyone using the same shape will not
be held liable for infringement of trademark rights.
(6) Application procedures
The application procedures for registering three-dimensional trademarks are the same as
those for registering two-dimensional trademarks except as follows.
(a) Description indicating the three-dimensional nature of the trademark on theapplication form
A three-dimensional trademark will be displayed on the flat surface of an application
form, and often it is difficult to detect whether the trademark is three-dimensional or not.
It is therefore necessary to indicate on the application form that the trademark inquestion is in fact three-dimensional. (Article 5, Paragraph 2) The description mustclearly indicate the mark's three-dimensional nature in the space provided fordescription of the trademark, even if it is a "diagrammatic drawing." Otherwise, themark’s "composition and style" as a three-dimensional trademark will not be evident.
When registering a three-dimensional trademark, an explanation must be made so as toclarify the composition and style of the three-dimensional shape, etc.22 Submission of
21

Article 3, Paragraph 2 says “Even trademarks which would fall within [the exceptions listed in]
Items 3-5 of paragraph 1 above may still be eligible for trademark registration if, as a result of themark’s use, consumers come to distinguish the goods or services of the applicant from those ofothers....”
22
More than one diagram or photograph is not necessarily essential; a photograph taken from one
angle may suffice. In practice though, two or more diagrams or photographs are often required to21both a written description and a graphic indication in the form of a diagram orphotograph is required.
(b) Changing from a two- to three-dimensional trademark
Unless a trademark is stated to be a three-dimensional mark in the application forregistration, it will be treated as a two-dimensional mark.
Changes to a submitted application that allege that the trademark is three-dimensional,
will be treated as an amendment which introduces a new matter.
(c) Application for Trademark Registration in which the composition and style of athree-dimensional trademark is not specified
When it is stated in a trademark application that the trademark is three-dimensional, andits shape is indicated in the space designated on the application form, the mark will be
understood as a three-dimensional trademark if the mark is clearly shown to be a threedimensional object. Even if it is impossible to fully represent a three-dimensional
object in a two-dimensional format, the three-dimensional trademark is deemed to be
specific and will be treated as such.
If a trademark application lists the mark as three-dimensional but the shape provided on
the application falls into one of the following categories, it will not be recognized as athree-dimensional trademark.
Nothing in the description indicates that the mark is three-dimensional.
The mark cannot be distinguished as a three-dimensional trademark because
there is absolutely no indication of the shape of its outward appearance, such as
the thickness or depth of the mark.
Indicating separate composition and style elements for a three-dimensional shape that is
combined with a two-dimensional trademark in the mark’s description.
Although both the three-dimensional shape and the two-dimensional trademark
are shown together, the two are not affixed to each other in a way that showstheir relationship. Since the merged whole is seen as consisting of two separate
and detached units, each with individual characteristics, the mark as a whole,cannot be recognized as one.
Two or more drawings are provided, yet the three dimensional marks indicated do notcorrespond to them.
Despite using two or more drawings, the marks made up of three-dimensional
shapes, characters, figures and colors, etc., do not match and therefore cannot berecognized as a three-dimensional object.
(d) Submitting explanations"indicate clearly" without a doubt that it is a three-dimensional trademark.
22

In order to examine a trademark being considered for registration, it is necessary tounderstand it accurately. Sometimes this requires explanations, such as which of themultiple diagrams or photographs is the frontal view or side view. Other requirements
could include a specimen of the trademark being considered for registration, or a
depiction of the mark’s shape.
(7) Determining when three-dimensional trademarks are similar
One factor to consider when deciding if three-dimensional marks are similar, is theprincipal consumer class to whom the goods or services are directed (e.g., experts, theelderly, children, or women). Consumer sophistication is also used to decide whether
the outward appearance, name and concept of the trademark are recognizable. In theseways the similarity of three-dimensional marks is analyzed no differently from theanalysis for two-dimensional marks.
It should be noted that when a three-dimensional trademark is viewed from certain
angles, its overall impression might not be evident. A characteristic unique to threedimensional trademarks is that one’s perception of the image differs according to theangle from which it is viewed.
To be similar to a two-dimensional mark, a three-dimensional trademark must be
perceived as similar when viewed from an angle that corresponds to the representationof the two-dimensional mark Three-dimensional trademarks which appear identical toone another when viewed from a particular angle must also appear to be generally
similar.
Names and concepts that are associated with three-dimensional trademarks often
become associated with the images as perceived from certain angles, not necessarily
only when seen as a whole. Where a three-dimensional trademark consists of a
combination of a three-dimensional form and characters, it is possible (and usually therule) that the consumer may respond primarily to the part of the trademark consisting of
the characters, the portion which actually provokes recall of the associated names andconcepts.
(8) Adjustment of rights when conflicting with patent and other rights
The Trademark Law prior to 1991 had provisions for the adjustment of rights when
trademark rights conflicted with rights under the Design23 and Copyright24 Laws. The
introduction of the three-dimensional trademark, however, has given rise to a new
problem. The shapes involved in patented inventions and registered utility models canconflict with a three-dimensional trademark in ways they would not conflict with a twodimensional trademark. It was therefore decided that the Trademark Law, Article 29,
would be revised to deal with the conflict between trademark rights and patent utility
model rights. In the new Law, Article 29 addresses not only cases where trademarks
conflict with rights under the Design and Copyright Laws, but also where they conflict
23
24

Article 26
Article 29
23

with patent and utility model rights.
Under the new Trademark Law, when the use of a registered trademark for goods orservices conflicts with another person’s patent, utility model or design right under anapplication that predates the trademark, or with another person’s copyright taking effectprior to the date of the trademark, the owner or licensee of the trademark shall not use
the mark in connection with the part of the goods or services giving rise to the conflict.
(9) Right to use three-dimensional trademarks after expiration of the term ofpatent right
Where a patent right, utility model or design right (herein collectively referred to as"patent right") under a patent application filed prior to or on the date of an application
for registration of a trademark, conflicts with a trademark right, the patentee has theright to use the patent freely without restrictions imposed by the owner of the trademark.
However, when the term of the patent right expires, there was speculation that thecontinued use of patented inventions by the original patent owner would suddenly
infringe the three-dimensional trademark right still valid after expiration of the patentright. Article 33-2 was written to address this concern. It states that where a patentright under a patent application filed prior to or on the date of an application forregistration of a three-dimensional trademark conflicts with the trademark right underthat trademark application and the term of the patent right has expired, the patentee shallhave the right to continue to use the invention to the extent of the original patent
protection. (Paragraph 1 of the same article). However, this provision shall apply only
where the registered trademark is used without the intention of violating the rules of faircompetition. This means that if, for example, a person plans on continuing to use an
expired patent, and a competitor with trademark rights uses its mark in a mannersuggesting an aim of unfairly damaging operating profits of the former patent holder,
the right to continue use of trademark will not be permitted.
(10) Transitional measures(a) The right to use three-dimensional trademarks by virtue of prior use
The introduction of three-dimensional trademarks has had a significant impact on
trademark management, making it necessary for those who have been using threedimensional trademarks prior to their introduction into the law to have a plan forprotecting the present value and goodwill of their marks. (Trademark Law,
Supplementary Provisions, Article 2). It would be more accurate to refer to the use of
these marks as the use of three-dimensional shapes, as opposed to three-dimensional
trademarks, because the "three-dimensional shape" mentioned in the Supplemental
Provisions, Article 2, Paragraph 1 does not need to "have become well known among
consumers," as is the case for three-dimensional shapes referred to in Article 2,
Paragraph 3 of the same statute. The protection therefore covers three-dimensional
shapes that would not be considered trademarks. Even if a three-dimensional shapewhich had not been considered to have trademark status became a three-dimensional
trademark after the enforcement of the new Law, the description in Article 2, Paragraph
1 leaves no doubt that the right to continue the use would be acknowledged.
24

When a person used a three-dimensional trademark prior to the new Law coming into
effect without any intention of violating the rules of fair competition, he had the right touse the trademark with respect to the same goods or services provided he does so
continuously. (Supplementary Provisions, Article 2, Paragraph 1). Furthermore, when atrademark had "acquired distinctiveness among consumers" as an indicator of the goods
or services which were connected with his business at the time of the enforcement the
new Law, he had the right to use the trademark beyond the scope of his business.
(Supplementary Provisions, Article 2, Paragraph 3).
In other words, a person who, prior to the 1996 amendments, continuously used a threedimensional trademark without any intention of violating the Unfair Competition
Prevention Law, had the right to continue using the trademark even if another person
had registered a trademark upon which the mark would infringe (including thosesubmitted for trademark registration after the enforcement and since registered). The
same applies to a successor-in-right who has taken over the business concerned.
The owner or licensee of the three-dimensional trademark is allowed to request of theowner of the continuous-use right, "an indication appropriate for avoidance ofconfusion" between goods and services in question. (Supplementary Provisions, Article
2, Paragraphs 2 and 4).25(b) Transitional measures for exceptional cases at the time of the application andclaim of priority.
If goods or services bearing an unregistered three-dimensional trademark have been
displayed (for example, at exhibitions) and an application for registration is filed for thesame trademark, the date of the exhibition or display is taken as the date of application.
(Supplementary Provisions, Article 9). When a priority claim based on an application
for trademark registration that was filed in one or more countries that is a signatory to
the Paris Convention, the Japanese application will be considered to have a filing datethat is the same as the date of the application in the first contracting country.
(Supplementary Provisions, Articles 9-2, 9-3; Patent Law, Article 43, 43-2, Paragraphs 2
and 3 applied mutatis to Supplementary Provisions, Article 13, Paragraph 1). In cases
where the exhibition or display date of goods or services of an application filed in or for
the first country falls before April 1, 1997, the application would be treated as if theTrademark Law prior to the 1996 amendments was in effect and would be
unacceptable.26
II. Classification of Trademarks
Trademarks can be categorized according to (1) composition, (2) function, (3) user, (4)others. Below is a list of terms commonly used in the Trademark Law.
1. Classification according to Composition25

As previously mentioned, the same applies to utility or design rights. (Supplementary Provisions,
Article 2, Paragraph 3)
26(Revised Trademark Law, Supplementary Provisions 2(5) and 2(6))
25

(1) Character trademarks
Japanese character trademarks refer to trademarks such as SONY, Wakamoto, Toyobo,
and NTN-4"H, which are made up entirely of characters. Characters can be in katakana,hiragana, Chinese characters, Roman letters or numbers. However, when Japanesepeople are unable to decipher the characters used in a character trademark, (trademarks
in Arabic, Thai, etc.), it may be more appropriate to consider them as design trademarks
rather than character trademarks.27(2) Design trademarks
Design trademarks are trademarks made up entirely of graphics. Design trademarks
may be any of the following: realistic graphics (such as a picture of a feather), a stylized
picture (the moon-shape used by Kao 28), a geometric diagram (Mitsubishi’s logo), a
combination of pictures (the moon and star combined used by Tsukiboshi 29 ), or astylized set of characters which give an impression completely different from thecommon use of characters (POLA’s logo30). Design trademarks are historically the mostbasic of trademarks. (The first registered trademark in Japan was comprised of realistic
graphics). The popularity of character trademarks is a more recent phenomenon.
(3) Symbol trademarks
Symbol trademarks are made up entirely of symbols. They are the oldest known
examples of marks and are believed to date back several thousands of years. A symbol
today can be one with a long history, such as the "noren" symbol 31 used in shop
entrances or the "monsho," (family-crests).32 On the other hand, they may be encircled
Roman or kana characters, (UC's card logo in a circle, OLFA's cutters logo in a circle33)
or modern monogrammed letters (Louis Vuitton’s LV logo).
(4) Color Trademarks
There are many problems associated with color as a component of trademarks. Under
the Trademark Law, color is not recognized as a trademark in its own right, but a
trademark’s distinctiveness may be achieved through its color. (Vol. 21, Ohan,
Minroku, ??p. 647, May 5, 1915, for the old Trademark Law). One case brought under
the Unfair Competition Prevention Law found that the color orange as applied by the
manufacturer to its sliding doors, had become a well-known appellation of source. Vol.
17, 5-6, Osaka District Court, Kaminshu, p. 562, June 29, 1967). A trademark withidentical graphics but differing colors may on rare occasions be considered not to be27

In the past when the author visited the Patent Office in Great Britain, Japanese trademarks werefiled as design trademarks.
28
A famous Japanese cosmetic manufacturer.
29[American readers will not understand this reference…please clarify as in FN 28, above.]
30[Same as FN 29.]
31
A decorative cloth, usually bearing a logo or symbol, hung in a doorway or entrance.
32
Such as the Mitsui logo, Shimadzu’s logo with a cross in a circle.
33[See FN 29, above]26

similar. Consider for instance, when color is added to characters or designs, such as to acircle with a red ball. A circle with a black ball or a circle with a blue ball, for example,
would result in a totally different impression.
Despite the Trademark Law’s recognition of color as a component, a trademark
application is generally submitted in black and white. There is no need to apply for
different colors since color trademarks that are similar to a black and white registeredtrademark would be considered identical. (Article 70, Paragraph 1). Some trademarks
may have slight differences in color or shape. If they exceed reasonable limits ofsimilarity (with respect to color and shape) such that consumers would mistake them forbeing identical, even if they are merely similar, they will usually be considered the same
trademark.34
Article 70-3 states that if two trademarks are similar and only distinguishable
because of their color, the use of the second mark would still infringe upon the priormark. Furthermore, because it is absurd to have trademarks cancelled on the basis thatusing marks similar to another but only of different colors amounts to an intent toconfuse, the applicability of Article 51-1 is limited.35(5) Three-dimensional Trademarks
Until 1996, when the Trademark Law was revised, the registration of trademarks waslimited to two-dimensional marks. However, the promotional figure standing in front of
the Kentucky Fried Chicken store and Victor’s statue of a dog listening intently to "hismaster’s voice" on a gramophone are clearly associated with their origin and serve tofunction as trademarks. Prior to 1991, the more commonly known three-dimensionalmarks have been protected as business indicators under the Unfair Competition
Prevention Law when their use without permission would have resulted in likelihood ofconfusion. The trend now is for all developed industrial nations to protect threedimensional trademarks under a registration system. In Japan, the three-dimensional
trademark was introduced in the Amendment of 1991 as a new category of trademark
subject matter according to composition.
(6) Combined Trademarks
Trademarks can be categorized into the following groups according to their content:
character trademarks, design trademarks, symbol trademarks and three-dimensional
trademarks. Any combination of characters, symbols, graphics and three-dimensional
shapes are called combined trademarks. "Characters and design" "characters andsymbols" "design and symbols" and their three-dimensional counterparts, as well as"characters, designs, symbols and three-dimensional shapes combined" are all examples
of combined trademarks.
A combination of characters, such as "Minolta," is not included because it is only asequence of characters: "M" "i" "n" "o" "l" "t" and "a." "Moonstar," however, made up
of two distinct words "moon" and "star" would be a combined trademark in the35

See also Sec. I, 3(3) of this book on color as a component of trademarks.
27

narrower and more accurate definition of ”character combination.” Likewise two or
more marks, characters, designs, or symbols each of which could be a trademark
independently, could join together to form a combined trademark.
2. Clarification according to function
A Trademark can be categorized according to its function as a mark and what it isindicating.
(1) Merchandise trademark
When marks are used in connection with a product or a piece of merchandise, they are
considered "merchandise marks." Some merchandise marks have gradually increased inprominence to the point where they indicate not only merchandise itself but the businessfrom which the merchandise emanates. The "Sony" trademark from Sony's Totsuko era(Sony was previously known as Tokyo Tsushinki Kogyo) demonstrates this. The
employees of Totsuko were themselves called "Sony-san." Over time, the trademark
began to indicate both the merchandise (”Sony”) and the business (Tokyo Tsushinki
Kogyo) as a whole, so that the merchandise mark also functioned as a business mark.
Eventually, Totsuko changed the company name to “Sony.”
Trademarks were, originally, marks for use on individual products (individual
trademarks). The term "trademarks" is now often used in the context of individual
trademarks, in that the differentiation of one specific product from another is the mainfunction of the trademark. Toshiba, for example, uses "Toshiba," the trademark of thecompany, for its television sets. (Toshiba, in this case, is a general mark and a housemark.) The company also uses individual trademarks such as "Meimon" and "Kokage"for specific types of television sets.
(2) Service Trademarks
Service trademarks are commonly referred to as service marks. Service marks(Dienstleistungszeichen) are marks used by businesses in the service industries in order
to differentiate between their own services and those provided by another. Examples ofservice industries include: advertising, finance, construction, electronic communications,transport, film development, education, and hotel industries.
Prior to the amendment of 1991, trademarks meant "merchandise marks." The Law has
since defined trademarks to include services, similar to the United States’ definition of a
"trademark." The trademark of the old Law (merchandise mark) is now called a"merchandise trademark" in order to distinguish them with "service trademarks."36
Services can be separated into those that deal with the sale of goods, such as restaurantsthat deal with food, and those that do not deal with selling goods, such as advertising,36

In the Trademark Law, the term "service trademark" is expressed as "trademarks which are usedwith respect to services" (Article 2) or "trademark with respect to services" (Article 64). The term
"service trademark" is only now starting to become familiar and accepted. Therefore, the terms"service trademarks" and "service marks" are used interchangeably.
28

broadcasting and transport. The services that deal with the sale of goods can be further
classified as services where the goods are a part of the everyday transactions, such as
food service, and services that treat or handle goods, such as by processing, dying or
cleaning them.37
Marks used on the premises of the first type of service are easy to recognize as service
trademarks, but it becomes more difficult to classify the latter type of service as either"merchandise trademarks" or "service trademarks." (Masanobu Ono "Introduction of
the Service Mark Registration System" Tokkyo Kenkyu 2, page 18.)
It is not always necessary to determine whether a mark is a "service trademark" or a"merchandise trademark." If the same disposable chopsticks are used inside a sushi shop
offering take-out as well as eat-in service, the advertisement on the shop’s rooftop, forexample, will promote both the eat-in and the take-out aspects of the shop. There aretrademarks which designate a product (a car for example) that are also used as a sign for
a service (the maintenance service of the car company). When a trademark is used as a
product trademark and a service trademark simultaneously, or, as in the latter example,
not simultaneously but encompassing both, it is called a "double-role trademark."(3) Business Trademarks
A house mark is a typical example of a business trademark, although the house markcan sometimes be used for individual products or services. It is usually a corporate
mark indicating the company’s operation, but can also function as a mark indicating a
product or a service. (Toshiba and Gunze are examples of this.) Sometimes anindividual trademark is used over a period of time to indicate many of the goods andservices of a particular company so that it begins to indicate the business where thesegoods and services originated. In this case the individual trademark has developed into
a company mark. (Sony is a prime example, but there are many others, such as Citizen,
Suntory and Ozeki.)In most cases, business trademarks such as house marks indicate the business as a whole,but on rare occasions, they indicate a particular operation of the business.
(4) Collective Trademarks
Collective trademarks are trademarks that an association allows its members to use, theassociation having businesses as members. The use of a collective trademark is not toclarify the origins of individual goods and services, but rather to indicate a characteristicthat is common to all the goods and services associated with the members.
Take the Metalworkers Association in Tsubame City, for example. The Association
allows its individual metalworker members of that region to use the collective37

No. 146, Flash News, Supreme Court, June 18, 1987, p. 3987: The High Court upheld the rulingof the lower court that items consumed in the shop, for example, the food and drinks at a restaurant,
will be considered as goods under the Trademark Law. The ruling should apply to take-out services
as well, but only on the condition that the business provides take-out service on a regular basis.

29

trademark "TSUBAME" on their metal goods. The Association itself does not use themark as a trademark indicating its goods or services.38 It is the members who use themark on their goods and services as trademarks. In transactions, collective trademarks
function mainly as guarantees of quality.
Under the trademark system of Japan, the rules concerning collective marks were
established in 1921, but were then abolished in 1959 with the introduction of the"consent to use system" which was considered sufficient to provide protection similar tothat afforded other trademarks.
The collective trademark, however, possesses qualities which differ from those ofregular trademarks, such as the non-use by the owner of the trademark. The need forinternational alignment with countries such as the U.S., Great Britain, Germany andFrance, led to the restoration and clarification of the collective trademark, so that
corporate judicial persons established under the Civil Law, Article 34, could holdcollective trademarks.39(5) Grade trademarks
A company may attach a trademark not only to one particular product, but may makeand attach more than one trademark to the same product to enable the consumer todistinguish between various grades of the product. Such a trademark is called a grade
trademark. Sometimes a company will use a particular mark as a foundation and will
add ornamentation to it, change its form, or add other words, in order to create marksthat will be used as grade trademarks. These are sometimes referred to as "familymarks" or, seen from the perspective of compositional characteristics, "derivativetrademarks." Suntory Co., for example, uses various grade trademarks: Toris, Suntory
Red, Suntory Select, Suntory Custom, Suntory Old, Suntory Reserve, Suntory Royal,
Imperial, etc. (All of the above except Toris and Imperial are also derivative trademarks
and family marks.)40
3. Classification according to user
Trademarks can be classified according to their users into three categories: (1)manufacturer trademark, (2) retailer trademark and (3) certification trademark. Unlike
goods, the provision of services cannot be divided by manufacturer and retailer, and thesame applies to their trademarks. There is no distinction in the service sector whichcoincides with the distinction between manufacturing and retail of goods. Certification
trademarks do, however, apply to services as well to goods.
(1) Manufacturer trademarks
A "manufacturer trademark" is a product trademark used by the manufacturer to indicate
38

Because of this, the old Law referred to this type of mark as a "collective mark," but the present
Law uses the term "collective trademark."
39
The main points of registration and other details will be discussed later, starting on p. 150.
40

[Please refer to FN 28]
30

that it is the manufacturer of the product. The quality and characteristics of the
manufacturers’ craftsmanship are manifested in the product and associated with thetrademark. This results in an advantageous position for the manufacturer, compared tomarketing the product with only a retailer trademark. This advantage is critical because
the retailer wants to impress upon the customers their own retailer trademark. This is
why so frequently a power struggle ensues between manufacturer and retailer whenchoosing which trademarks are to be used.
(2) Retailer trademarks
A "retailer trademark" is used by the retailer to indicate that it is the particular retailer
itself who selected the product for sale. A retailer trademark can act as a guarantee of
quality based on selection. Trademarks have slightly different roles when used byretailers as opposed to manufacturers.
When the manufacturer has very little leverage in a business transaction, the retailer
trademark alone may be used. Sometimes both the manufacturer trademark and theretailer trademark are used side by side (when two or more trademarks are used inconnection with a product like this it is called "double chop").
(3) Service Trademarks
A service mark is used by the provider of a service to identify the service as one that heis providing. The mark reflects the qualities and characteristics associated with theservice provider and its function in this respect is no different from the manufacturer
trademark in its relationship to the manufacturer. The service mark can act as aguarantee of quality in regard to the service provided and is similar in function to that ofboth manufacturer trademarks and retailer trademarks.
In the 1991 amendments, the word "processing" was eliminated from the definition of
trademarks, which had stated that trademarks were "used by persons who produce,
process, certify or transfer the designated product." This change took effect at the sametime as the introduction of the service trademark. Processing of fabrics and clothing
involve services that fall into Class 40. Under the revised Law, Class 40 service
trademarks are viewed as marks representing processing services as a whole.
In the past, trademarks relating to processing industries were filed under the category of
product trademarks. Services involving processing, such as dyeing, used these
trademarks, but the marks did not represent the service per se. Instead, based on theassumption that the product that was processed was going to be transferred, thetrademark was filed as a product trademark because the mark signifying the dyer
indicates the goods involved.
(4) Certification Trademarks
Certification trademarks are used by quality assurance examiners in guaranteeing thequality of goods. Under the U.S. Trademark Law, the certification mark is defined
separately from laws governing regular trademarks and provisions exist to ensure that31

they are not abused or used to adverse effect. (U.S. Trademark Law, Article 4 andArticle 14, Paragraph 5).
4. Other Terms and Phrases(1) Family Marks
A family mark is the name given to a family of trademarks where trademarks derived
from one main trademark are created by adding various characters to it to form “new”
trademarks for use on other products of the same company. The trademarks createdsubsequently within the family are called derivative trademarks. For example,
Kodacolor, Kodachrome, Kodaline are derivative trademarks of Kodak.
(2) Coined Marks
These are marks coined by the user of the trademark, and are made up of character
trademarks which do not intrinsically possess specific concepts. They are considered asstrong marks in terms of their distinctiveness as soon as they are selected. For example,
prior to the 1986 amendment of the British Trademark Law, only coined marks could be
adopted as defensive marks. Kerorin, the frog used in connection with dental pain-relief,for example, is a suggestive trademark and considered weak, but with use over a long
period of time, the mark acquired distinctiveness and became a strong mark.
Unfortunately in this case, the trademark could not be registered under the British Law
as a defensive mark because it was not a coined trademark.
Coined marks are also known as “arbitrary marks.” An arbitrary mark could be selectedfrom a list of arbitrary words with no meanings attached which have been generated by
a computer.41(3) Stock marks
Trademarks which are stored by a company for future use are called stock marks(Vorratszeichen). In Germany, trademarks whose "non-use extension period" hasexpired are considered illegal as failing to meet the "duty of use" requirement. In Japan
however, examination procedures take longer and, therefore, the considerable number ofstock trademarks which are kept for product development are not considered to beillegal.
(4) Promotional Trademarks
When a trademark functions predominantly as a promotional tool, it is called apromotional trademark. Slogans and one-liners, like "good medicine tastes good" by
Asada Ame, are promotional trademarks.
(5) Private Brands
41

Arbitrary marks can also be arbitrary with respect to the good or service to which is applies. In
other words, the word “cat” is generic for a feline animal, but is arbitrary when applied to a piece ofclothing or machinery, for example.
32

In the past, when manufacturers wielded more power, most merchandise trademarks
were brand names, but with the emergence of discount stores and huge retailers, theretail sector has grown stronger to the point that the retailer trademark became more
frequently becoming the sole trademark on the goods, eliminating the manufacturer
trademark altogether. These retailer trademarks are casually referred to as private
brands. Private brands are one kind of retailer mark.
III. Signs similar to trademarks
Trademarks are often confused with designs, trade names, business signs, slogans, etc.
that are similar conceptually to trademarks. They are not the same, however, and someof those differences are discussed below.
(1) Trademark and design
A mark is a sign that is attached to goods in order to distinguish those goods from others.
In contrast, designs are shapes, patterns, colors or combinations thereof that appeal tovisual sense of beauty. Marks and designs are common in that both of them maybe used
to stimulate purchasing power of users. However, they are fundamentally different fromeach other in their purposes: Marks serve a primary purpose of identifying goods, while
designs primarily focus on taste and aesthetics. In exceptional cases, some marks, likefancy marks, combine function with taste and aesthetics). However, motivatingpurchase through taste or aesthetics is not a typical function of marks.
In some circumstances, one form can be a subject of trademark applications in one case,and a subject of design applications in another case. Further, it may be difficult toevaluate whether a certain form, when used on goods, is a design, trademark or a
combination of those functions, until function is identified through use over time. In acriminal case, patterns on shoes made by Vuitton were differently evaluated among
Public Prosecutors. Some asserted application of the Trademark Law claiming that thepatterns are showing origin, and others insisted on application of the Unfair
Competition Prevention law by pointing that they are just a background pattern. Later, it
was settled by the Supreme Court in a civil case that marks and designs are neither
exclusive of each other nor a matter of choice. They commented that designs that can bea pattern shall be considered marks as far as used to identify certain goods from others,
and supported the original judgment. Thus, Vuitton’s shoe patterns were found to be atrademark. (Supreme Court Judgment Jan. 19, 1988, No. 154-4242; Osaka High Court
Judgment Jul. 15, 1987, Mutaishu, Vol. 19, No. 2, page 256; Osaka District Court
Judgment Mar. 18, 1987 Mutaishu, Vol. 19, No. 1, page 66). Determination of whether amark is a trademark or design should depend on whether or not it possesses power toindicate origin through gaining a reputable position. The Trademark Law and the
Design Law can be applied in an overlapping manner.
In practice, it is a delicate matter to determine whether a sign on goods indicates origin
or contents, or if it is merely a pattern. A pattern applied to goods should be considereda mark if it indicates origin. In a case involving baby T-shirts bearing a large"HEAVEN" logo at the breast, the court found that the sign functioned to indicate origin
33

of the goods even though it could have been perceived as a pattern. It found that thelogo violated a registered trademark having "Heaven" in a first row and "Hevan" in thesecond row. (Tokyo District Court Jan. 29, 1990, Case [Second Session Edition] page7992).
(2) Trademark and Work
Works are external expression of thoughts and feelings belonging to literature, science,
arts, etc. In some cases works or portions of them become subjects of trademark
applications or are used as signs on goods. Heroes or heroines and characters of cartons,
for example, are often used as trademarks on goods. The use of heroes or characters forexample, does not mean that the subjects of those works intend to indicate origin simply
because they have been utilized by chance to function as trademarks. Strictly speaking,therefore, the subjects of works such as thoughts and feelings, or fancy characters incase of cartoons, have nothing to do with the subjects of marks such as relationships
between marks and goods or indication of origin.
Sometimes, works and protected marks overlap. This is most often seen with respect tobook titles, character patterns used as marks, or marks created through slogan contests
held to make out new slogan trademarks. In a case involving the word POPEYE as amark, the court held that the right to prohibit use of the mark may not be exercised
against goods of a person who is duly granted license from the copyright owner,
because the word POPEYE does not constitute any copyright, and therefore, Trademark
Law Article 29 shall not be applied. [Osaka High Court, Sep. 26, 1985, Mutaishu Vol.
17, No. 3, page 411]. The Supreme Court supported the original judgment.42(3) Trademarks and slogans
Slogans express characteristics of goods in a simple manner suitable for advertisement.
In principle, it is almost impossible to have slogans registered as trademarks because
slogans, even if used in marks, do not function to distinguish goods from others. It isalso inappropriate to permit a monopoly on descriptive slogans. In exceptional cases,
some slogans may be helpful for identification of goods. Those slogans gain power todistinguish goods from others over time from extensive use.
(4) Trademarks and the form of goods
The German Trade Law (Item 1 of Article 3) provides for protection of forms of goods.
This protection is similar to the conception of "Get Up" of the English law and "Trade
Dress" of the American Law. These concepts do not carry over directly into JapaneseTrademark Law. They are mainly concerned with external forms such as the shapes ofgoods themselves, packaging, container shapes, colors or decorations. Trade dress or“form of goods” protections can include some advertisements or sign boards relating totrademarks, and can be two-dimensional or three-dimensional. If trade dress isperceived as a sign for goods in certain business transactions, it needs to be given
trademark protection to prevent adverse effects caused by misappropriation of “usual”
42

For an opposing viewpoint, see Copyright Cases 100, page 56, Takeshi Kikuchi
34

trademarks.
In Germany, when conflicting “forms of goods” must be decided under the Trademark
Law or the Unfair Competition Prevention Law, the issue is settled in accordance withthe "principles of priority" (Grundsatz der Prioritaet; Priorotaetsprinzip). This meansthat priority between two signs is determined by which form of goods is generally
accepted in transactions first and by which forms of goods have been applied for
trademark registration. In Japan, containers, packaging, and other matters indicating
merchantable goods are protected under the Unfair Competition Prevention Law Article
2, Paragraph 1, Item 1.43 Because there have been no cases on point, any potential
conflict for the protection of “form of goods” (trade dress) between the Unfair
Competition Prevention Law and the availability of registration for three-dimensional
trademarks has not been unified into a single view and is still the subject of muchacademic discussion.
(5) Marks and Names
People use names to identify themselves in society. Names usually refer to a natural
person, but other names can include professional names, screen names and pen names,
and can further include "family names" only, or forenames in exceptional cases.
Names constitute a subject of personal rights. Article 12 of the German Civil Law
provides for protection of names. The Civil Code of Japan similarly protects names
under “rights of names” or “rights of designations” theories. There is, therefore,
significant support for protective injunctions.
Names are not only a subject of personal rights but can also be a subject of trademark
registrations because they can be used as a sign of goods. Generally speaking, however,family names or forenames are an indication of persons, and therefore, public policy
dictates that they should be available for use by many people. For an ordinary name toreceive protection as a mark, it needs to have reached a level of distinctiveness overtime that indicates a specific supplier of goods. This is often an exceptional situation.
(6) Marks and trade nameTrade names 44 differ from marks in that they are the names of merchants and not
signifiers of goods. In some cases, however, trade names also function as a sign ofgoods, and may be protected as registered trademarks in practice. Sanyo Electric Co.,
Ltd. (known in Japan as Sanyo Denki Kabushiki Kaisha) is an example of trade name.
Previously, the entire name “Sanyo Denki Kabushiki Kaisha” was not accepted for a
trademark; only the material element (Sanyo Denki or Sanyo) was recognized as having
identification power. However, because trade names may over time also function to
identify goods, the entire trade name (Sanyo Denki Kabushiki Kaisha) is now accepted
as a trademark for assurance of protection. In fact, many trade name type trademarks
have been registered.
43

See also, "Protection of Goods Appearance" by Akinobu Ono in Theses Works for 70th Birthday ofProf. Nobuyoshi Sugibayasi, pages 191 to 216
44
For a definition, see "General" in the Commercial Code.
35

While some trade names have been registered at Legal Affairs Bureaus, others are not
but are still being used as trade names in the course of business. Relative to Trademark
Law, the difference is immaterial. Although trade names and trademarks are technicallydifferent (the former is the "name of merchants" and the latter the "sign of goods"), in
reality, many people are unable to distinguish trade names from trademarks appearing
on packaging materials or other materials. This is principally because both trade names
and trademarks (such as Sanyo Denki or Sony) are usually printed or scattered acrossthe materials. In fact, trade name-type trademarks are the typical case. In respect to thispoint, there is no need to distinguish them from each other. The one should not be
exclusive of the other. It is very probable that the same letters function as a trade namein one case, and as a trademark in another case.
(7) Trademark and service markService marks (Dienstleistungszeichen) are used by service companies such as those infinance, transportation, construction, or hotels, in order to distinguish their services
from those of others, or to distinguish their trademarks from those that represent goods.
Service marks were discussed in the preceding section (Marks for service).
Section 3. Functions of Marks
The primary function of marks is to distinguish goods or services from others. The
ability to distinguish producers is a very powerful characteristic of trademarks. The
ability to distinguish is also an underlying basis for other functions of marks. Some ofthose functions are discussed below.
Ordinary names of persons and places such as Kubota and Toyota have little
identification power on their own. However, common names can become distinctive,
even strong , if they acquire a significant reputation through long-term use. Generally,coined words have strong distinguishing power, while marks merely indicating quality
or performance are weak. Yet even weak marks can become strong if they become
distinctive through use.
There are a variety of opinions as to what functions trademarks have. Generally
speaking, however, trademarks are considered to have the following functions: (1) toindicate origin and ownership (2) as a guarantee, and (3) as an advertisement.
(1) Marks that serve to indicate origin or ownershipMarks that are attached to goods or services serve to indicate the origin and ownershipof those goods or services. This function is based on the identification power of marks.
Through use, identifying marks acquire goodwill as they increasingly gain recognition
in society. If no mark is attached to goods or services, the consumer will be unable toascertain their origin.
Origin, with respect to goods, means not only manufacturers but also sellers, including
owners, processors, and importers. It is widely known that department stores and36supermarkets attach their own trademarks ("private brands") to some of the goods theysell that were manufactured by others. Sometimes different “private brand” marks areattached to goods made by the same manufacturer. This kind of arrangement is made toclarify distribution channel of goods if distributed in different routes, or to avoid
customers’ potential complaints arising from a price difference which can occur if, forexample, full-time sales personnel are assigned to goods in one distribution channel,
and not in other distribution channels. Additionally, there will be cases where either amanufacture mark or sale mark (or a combination) is attached to goods.
Merchants use their own marks so that their goods or services (and presumably, their
excellence or uniqueness) will be recognized by users. For this reason, they try toembody their marketing efforts in their marks.
Finally, a mark that indicates origin or ownership does not necessarily indicate details
about manufacturers or sellers of goods or providers of services.45 Marks have fulfilled
their purposes if consumers, when seeing the marks, are able to recognize origin.
Consumers may recall seeing or purchasing the product previously, or may recall having
received the same services or having visited the same service provider on a prioroccasion. In such cases, the trademark is said to have satisfactorily performed its
function of indicating origin and ownership.
The function of indicating origin and ownership is derived from the identification powerof mark. The power of indicating origin and ownership in turn gives rise to theguarantee and advertising functions, discussed below.
(2) Guarantee function
The original purpose of a mark may be to indicate origin and ownership. If a mark isused repeatedly, however, users of goods or services will come to expect that goods orservices under the same mark hold the same quality. Users are usually more interested
in the quality or performance of their purchased goods or services than their origin.
Similarly, sellers or providers of goods or services will make efforts to maintain thequality associated with a mark.
This cycle is known as the "guarantee function" and it helps to facilitate business
transactions. The guarantee is taken from the viewpoint of buyers, in contrast to
indication of origin or ownership, which is taken from the viewpoint of sellers andproviders. Typically, marks associated with the production of goods or provision ofservices are in a better position to serve as guarantees of quality if they are produced orprovided on a very large scale. This can be very important for high-end products
especially.46 47
45

Things that are not included include trade names or addresses.
Some products in which this might be especially important include cosmetics or fashion goods.
47
This point has been addressed by many researchers in Europe surrounding their “optional sales
system.” The “optional sales system” is a sales protocol that permits only shops satisfying certain
elevated standards to sell high-quality items. Remedies include damage to a store image that arises
from discount sales. The issue is discussed in reference to advertising function described below.
See page 163 of this book.
46

37

The guarantee function of a trademark is not a literal guarantee as to the quality ofgoods or services. Unlike a liability guarantee, defective goods or services will not be
replaced or repaired. There is no guarantee of the payment of damages. If a liability
guarantee is provided for contractually, no legal remedy will attach under the
Trademark Law. Attaching marks to goods or services means that consumers can
expect goods or services to be of consistent quality. This also supports the advertising
function discussed below and acts to attract customers to particular goods and services.
Research shows that attaching marks to goods plays an important role in the salability
and pricing legitimacy of goods.
However, if marks are transferred as part of a license or transfer of business, newowners or licensees of those marks will be responsible to assure and maintain thequality of the transferred goods and services. Consumers and the general public could
be easily misled by previous confidence in marks. Confusion could result regarding thetransferred marks and any marks that were not part of that transfer or license.
Sellers and providers of goods and services consider the guarantee function of marks tobest satisfy the purpose of Article 1 of the Trademark Law because their primaryreliance is on the goodwill associated with their goods and services and maintaining
consumer confidence. In this way, the Trademark Law accomplishes the social
purposes of contributing to the development of industries and the protection of owners’
profits. It is critical that the sellers and providers of goods and services take into
account consumers’ reliance on the trademark guarantee, and commit to theimprovement and maintenance of the quality of their goods and services.
(3) Advertising and other functions
The function of a trademark is not limited to the notification of origin and the creationof expectation that identical marks ensure consistent quality. Marks may also serve toadvertise goods and services.
Consumers tend to remember trademarks or associate them with certain images. They
may also feel an attachment to goods or services bearing certain marks. As a result,marks can be very effective beyond mere quality assurance tools as a promotional
weapon. (F.I. Schechter, "Historical Basis of Law Regarding Trademarks," p. 64). Thiscan be known as the "advertising function” of a mark (Werbefunktion).
Sometimes, owners of marks focus on the advertisement of marks rather thanadvertisement of the goods and services to which the marks are attached. Although thisdoes not technically meet the basic requirement that advertising should be informative,
it still works to create valuable, competitive assets in the sense that the marks are a
result of accumulated corporate efforts. Traditionally, in the case of widely known
trademarks, substantial financial expenditures are invested in the advertisement ofmarks, and the accumulated value (worth) of the marks therefore becomes extremely
large.48 This would be understood if we suppose what price amount Ajinomoto Co., Inc.
48

Consider the price Ajinomoto Co., Inc. would set if their trademark "Ajinomoto" were for sale;38

would set if they were to sell their trademark "Ajinomoto.”49
Some problems associated with using marks for advertisement include the concept of"free ride" of the advertising function of marks, dilution (Verwasserung) of theadvertisement value of marks, and the violation of the motif of marks.50
A large portion of the value of a trademark is as an advertising asset. This function cancommand significant attention regarding the evaluation of the value of marks and in the
granting of business and trademark licenses.

though such assumption is totally impractical.
49
A major foodstuffs manufacturer, much like General Mills or Pillsbury Companies in the UnitedStates.
50
The legal theory of dilution originated in Germany and was introduced and used (and later, further
developed) in the U.S.A. This shows that the theory can also be implanted in Japanese law.
39