Source: https://iclg.com/practice-areas/trade-marks-laws-and-regulations/china
Timestamp: 2019-04-22 10:55:49+00:00

Document:
The Trademark Office (“TMO”), which is affiliated to the State Administration for Industry and Commerce, is the authorised government agency in charge of trademark administration, which includes the examination of trademark applications, oppositions, as well as cancellation against trademark registrations on the basis of three years of non-use. The Trademark Review and Adjudication Board of the State Administration for Industry and Commerce (“TRAB”) is in charge of the examination of various applications for appeal against the decisions made by the TMO, as well as trademark invalidation matters.
In addition, local Administrations for Industry and Commerce (“AICs”) or Market Supervision Administrations (“MSAs”) are in charge of administrative enforcement of trademark rights.
Besides, People’s Courts are in charge of trials for trademark-related administrative or civil litigation.
The most fundamental legislation is the Trademark Law of PRC (“Trademark Law”), the Implementing Rule of the Trademark Law of PRC and Judicial Interpretations issued by the Supreme People’s Court relevant to trademarks.
In addition, the Anti-Unfair Competition Law of PRC provides protection to unregistered marks by providing protection for distinctive names, packaging or decoration of famous goods. The Criminal Code provides criminal protection against counterfeiting activities where the illegal turnover satisfies the numerical threshold.
According to Article 8 of the Trademark Law, any sign that distinguishes the goods and services of an individual or organisation from those of others, including any words, graphs, letters, numbers, three-dimensional signs, colour combinations, sound and combinations thereof, may be registered as a trademark.
Therefore, in addition to words and logos, three-dimensional signs, colour combinations and sound (including musical jingles) may also be registered as a trademark; specifically, as a non-traditional mark.
The Trademark Law provides the absolute and relative grounds for refusal of registration.
Article 10 of the Trademark Law provides the absolute grounds for refusal of trademark registration, which exclude the following signs from registration.
Furthermore, a mark which lacks distinctiveness can be refused registration. According to Article 11 of the Trademark Law, such marks include signs that merely bear the generic names, devices or model numbers of the goods, or simply indicate the quality, main raw materials, function, use, weight, quantity or other features of the goods.
In addition, a three-dimensional trademark application shall be rejected if the three-dimensional mark merely indicates the shape inherent in the nature of the goods concerned or only dictated by the needs to achieve technical effects or the needs to give the goods substantive value.
The information needed for application for registration includes the basic registration/identity information of applicant, a sample of the mark for application, and the goods or services that are designated for application.
The general procedure for trademark registration follows the following procedure: (1) submission of the application for registration; (2) preliminary examination and preliminary approval or rejection; (3) trademark publication by gazette for opposition; and (4) grant of registration by the Trademark Office.
Graphical mark: a formal drawing of the mark should be in black and white. If colour is claimed as a feature of the mark, a colourful drawing of the mark is also needed. The drawing should be larger than 5cm × 5cm but not exceed 10cm × 10cm.
Three-dimension mark: the drawing shall clearly identify the three-dimensional shape of the mark, including at least three views of the mark.
Sound mark: a sample of the sound less at than 5 MB shall be submitted in the format of .wav or .mp3. A stave or numbered musical notation of the sound together with words description is also required.
Goods and services are classified according to the Classification of Similar Goods and Services issued by the TMO, which is edited on the basis of the Nice Classification. Generally, the names of designated goods and services shall be consistent with the Classification of Similar Goods and Services.
Any individuals, registered legal entities such a registered company, or other organisations, are authorised to register and own a trademark.
The application and examination for a trademark registration may take 12–18 months on average.
According to Article 18 of the Trademark Law, foreign applicants shall entrust a Chinese trademark agent to conduct a trademark application and other trademark matters. The official fee for a trademark application is 600 RMB.
A Power of Attorney (“POA”) is needed in most trademark matters.
The POA needs to be signed by the applicant and the agent, while notarisation and legalisation are not compulsorily required for trademark application and prosecution matters. By contrast, legal proceedings with the court, including trademark-related administrative or civil litigation, will require the notarisation and legalisation of a POA.
According to Article 25 of the Trademark Law, where an applicant for trademark registration files an application for trademark registration in China within six months since the date of filing the first application for registering the same trademark for the same goods in a foreign country, the applicant may have priority in accordance with any agreement concluded by and between the People’s Republic of China and the foreign country concerned, or with the international treaty to which both countries are parties, or on the basis of the principle of reciprocity.
In addition, according Article 26 of the Trademark Law, in the event that an applicant uses a trademark for the first time on goods displayed at an international exhibition organised or recognised by the Chinese Government, the applicant may be entitled to claim priority, provided that it files an application to register the trademark within six months from the date of the exhibition.
■ “Collective mark” in the Law refers to a mark registered in the name of a group, association, or any other organisation and used in business activities by its members to indicate their membership.
■ “Certification mark” in the Law refers to a mark which is controlled by an organisation that exercises supervision over particular goods or services and which is used to indicate that third-party goods or services meet certain standards pertaining to place of origin, raw materials, mode of manufacture, quality, or other specific characteristics.
Article 4 of the Implementing Rule of the Trademark Law provides that geographical indicators, as stipulated in Article 16 of the Trademark Law, may, according to the provisions of the Trademark Law and the Regulations, be registered as Certification marks or Collective marks.
The absolute grounds for refusal of registration includes the lack of distinctiveness. In addition, Article 10 of the Trademark Law as mentioned in question 2.2 above also provides other absolute grounds for refusal of registration.
Any applicant for a trademark registration is authorised to appeal against the decision of refusal with the TRAB.
A decision of refusal could be appealed initially with the TRAB. In the event that the applicant is still dissatisfied with the Review Decision made by the TRAB, the applicant could further appeal to the Beijing IP Court by initiating the first instance of administrative litigation. The applicant could appeal even further to the Beijing High Court at the second instance, while the decision made by the Beijing High Court is the final decision.
(1) The trademark whose registration is applied for is identical or similar to the trademark of another person who has been registered earlier or preliminarily approved with respect to the same or similar goods/services.
(2) The trademark whose registration is applied for is identical or similar to a mark of another person which has been filed earlier with respect to the same or similar goods or services.
(4) The trademark whose registration is applied for infringes upon the prior legitimate rights of others.
(5) The trademark whose registration is applied for constitutes pre-emptive registration of the prior used trademark with certain influence and famousness.
(1) Substantiate that the trademark whose registration is applied for is neither identical nor similar to the quoted mark, or that the designated goods or services of the applied mark and quoted mark are neither identical nor similar.
(2) Cancel or invalidate the quoted marks.
(3) Challenge the validity or ownership of prior rights.
(4) Challenge the agent-principal relationship between the applicant and the opponent.
An applicant is authorised to file an appeal against an unfavourable decision of refusal with the TRAB. It also authorised to sue the TRAB at the Beijing IP Court against an unfavourable decision made by the TRAB.
An applicant may file an appeal against the unfavourable decision of refusal issued by the TMO with the TRAB.
If the applicant is still unsatisfied with the Decision made by the TRAB, the party may appeal the case at the Beijing IP Court by initiating the administrative litigation. It can further appeal the case at the Beijing High Court at the second instance.
(1) The opposed mark is identical or similar to the opponent’s trademark which is registered earlier with regard to the same or similar goods or services.
(2) The opposed mark is identical or similar to the opponent’s trademark whose registration is applied for earlier with regard to the same or similar goods or services.
(4) The application for the opposed mark constitutes pre-emptive registration of the opponent’s prior marks with certain influence and relatively high reputation.
(5) The opposed mark is a reproduction, imitation or translation of the opponent’s well-known trademark which has not been registered in China on the same or similar goods/services, as well as being likely to lead to confusion.
(6) The applicant for the opposed mark, as an agent or a representative of the registrant of the opponent, seeks to register the opponent’s trademark under its own name without the authorisation of the opponent.
(1) The opposed mark lacks distinctiveness or goes against Article 10 of the Trademark Law mentioned in question 2.2 above.
As mentioned above, any party will be authorised to file opposition against a trademark on absolute grounds. Meanwhile, the relevant party with prior rights or a previously used famous mark, is authorised to file an opposition against a trademark application on relative grounds.
(2) Reply from the opposed party – the Trademark Office will send the opposition application, as well as the evidence, to the opposed party, and will give the opposed party a reasonable period to reply.
(3) The TMO examination – the Trademark Office should consider arguments and evidence provided by both sides and decide to approve or not approve the registration.
(4) Filing invalidation with the Trademark Review and Adjudication Board – in the case that the TMO decides to approve the registration, the opponent could file an invalidation against the registration with the TRAB.
A trademark will enjoy the right to use the mark and the right to exclude others from using the mark in accordance with the Trademark Law.
Under the current Trademark Law, only a commercial entity, such as a registered company, is authorised to apply for registration of a trademark.
Yes; an individual, as the licensor of a mark, can register its licensing.
■ A non-exclusive licence, which means that a trademark under the licensing agreement may be used by the licensor and the licensee, while it does not exclude other licensees from using the mark where there is a licensing agreement.
■ A sole licence, which means that a trademark may be used by the licensor and the licensee, while the licensing agreement excludes other parties from entering into a licensing agreement with the licensor.
■ An exclusive licence, which means the trademark may only be used by the licensee.
According to a Judicial Interpretation issued by the Supreme People’s Court on the Trial of Trademark Infringement Cases: a licensee of an exclusive licence is authorised to sue for infringement independently; a licensee of a sole licence is authorised to jointly initiate a civil lawsuit along with the licensor, or file a lawsuit alone if the licensor refuses to initiate the lawsuit; and a licensee of a non-exclusive licence is not authorised to initiate a lawsuit unless authorised by the licensor.
According to Article 43 of the Trademark Law, the licensor shall supervise the quality of the goods on which the licensee is licensed to use its registered trademark. The licensee shall guarantee the quality of the goods with which the registered trademark is used.
Therefore, quality control clauses are generally necessary in a licence.
According to Article 70 of the Implementing Rule of the PRC Trademark Law, a registered mark can be pledged, and the pledger and the pledgee shall conclude a pledge contract in written form and shall jointly file a pledge registration application with the Trademark Office.
No other types of security interest except a pledge are permissible for a registered trademark.
(1) The trademark registrant, at his/her discretion, alters the registered trademark, name or address of the registrant or other information during use of the registered trademark and refuses to rectify this.
(1) Filing of the Revocation Application – any individuals or organisations may apply to the TMO to revoke a trademark.
(2) Reply from the Registrant – the TMO will notify the registrant about the revocation and give the registrant a reasonable period to reply.
(3) Examination by the TMO – the TMO shall decide to revoke or not to revoke the trademark.
(4) Appeal to the TRAB – a party dissatisfied with the decision of the TMO may appeal to the TRAB.
(5) Appeal to the People’s Court – a party dissatisfied with the decision of the TRAB may initiate legal proceedings with the People’s Court.
As mentioned above, any individuals or organisations may apply to the TMO for revocation of a trademark registration, and the Trademark Office is authorised to revoke a registered trademark at its discretion, where the registrant substantially alters the registered trademark, name or address of the registrant or other information, during the use of a registered trademark where the registrant refuses to rectify such violating use.
(5) the reason for the three years of non-use is due to other justifiable reasons not attributable to the registrant.
As mentioned in question 8.2 above, the revocation decision may be appealed to the TRAB at first. The decision of the TRAB may be further appealed to the People’s Court to initiate the first-instance legal proceedings. The decision of the first instance may be further appealed to a higher-level court to initiate the second-instance legal proceedings; generally, the decision of the second-instance court is the ultimate decision and no further appeal is possible.
(1) The registered mark lacks distinctiveness or goes against Article 10 of the Trademark Law mentioned in question 2.2 above.
(1) The registered mark is a reproduction, imitation or translation of the opponent’s well-known trademark which has not been registered in China on the same or similar goods/services, as well as being likely to lead to confusion.
(3) The registered mark is identical or similar to the opponent’s trademark which is registered earlier or preliminarily approved on the same or similar goods/services.
(4) The registered mark is identical or similar to the opponent’s trademark which is filed earlier on the same or similar goods/services.
(6) The application of the registered mark constitutes pre-emptive registration of the opponent’s prior used trademarks with certain influence and famousness.
(4) Appeal to the People’s Court – a party dissatisfied with the decision of the TRAB may appeal to the People’s Court to initiate the legal proceedings.
Besides, most invalidation proceedings are commenced by the relevant party on the basis of relative grounds.
(1) The registered trademark has distinctiveness itself or has acquired distinctiveness through commercial use.
(2) The registered mark did not violate other provisions of absolute grounds for rejection of registration.
(1) The registered trademark is neither identical nor similar to the prior trademarks.
(2) The goods/services claimed by the registered trademark are neither the same nor similar to the goods/services claimed by the prior trademarks.
(3) The registrant does not know nor should know the prior marks.
A claim of infringement could be brought before the Administrative Department for Industry and Commerce and, mainly, the People’s Court.
Basically, the key pre-trial procedural stage is evidence collection. There can also be the stage of evidence exchange before the official court hearing is held, if the evidence is complex or extensive. On average, it may take one to six months to reach trial from commencement.
(1) The likelihood of prevailing on the merits, including the validity and stability of rights owned by intellectual property owners or their relevant parties.
(2) Whether the actions and other reasons of respondent will result in the impossibility of enforcing the judgment or cause other harm to the applicant, or otherwise inflict irreparable harm to the plaintiff.
(3) Whether the harm that the behaviour’s continuation inflicts on the respondent will obviously exceed the harm inflicted on the applicant in the absence of the behaviour’s continuation.
(4) Whether the behaviour’s continuation will inflict harm to the public interest.
Final injunctions are granted if the court finds infringement after the trial.
There is no discovery procedure in China. Therefore, a party cannot be compelled to provide documents or materials to its adversary.
However, according to Article 75 of Several Evidence Rules for Civil Litigation issued by the Supreme People’s Court, if a party refuses to provide evidence to the court without reasons, where it has been proved to hold such evidence, then the court may decide on the basis of reference to the evidence provided by the other party.
Basically, submissions of evidence shall be presented in writing or other forms provided by civil procedural law. A written witness statement is usually deemed as oral evidence. Any evidence that is used as the basis to decide a case shall be cross-examined by the two parties.
A registered mark will be presumed as valid. In infringement litigation, Chinese courts will generally not suspend the trial, in order to wait for the result of the invalidation proceeding initiated by a defendant against a plaintiff.
According to the judicial interpretation from the Supreme Court, a claim for damages in trademark infringement litigation may be time-barred after two years from when the plaintiff knows or has reason to know of the infringement, unless the infringement continues at the time the suit is brought, where the damages will be calculated retroactively for two years from the date of filing of lawsuit.
The suspect of counterfeiting shall be sentenced to a fixed term of imprisonment or criminal detention for no more than three years and/or be subject to a fine if: the illegal turnover is more than 50,000 RMB; the illegal proceeds are more than 30,000 RMB; more than two registered trademarks are counterfeited, with the illegal turnover being more than 30,000 RMB, or with the illegal proceeds being more than 20,000 RMB; or there are other serious circumstances.
The suspect shall be sentenced to a fixed term of imprisonment of more than three years but no more than seven years with a fine imposed if: the illegal turnover is more than 250,000 RMB; the illegal proceeds are more than 150,000 RMB; more than two kinds of registered trademark are counterfeited, with an illegal turnover of more than 150,000 RMB; the illegal proceeds are more than 100,000 RMB; or there are other especially serious circumstances.
The suspect shall be sentenced to a fixed term of imprisonment or criminal detention of no more than three years and/or be subject to a fine if the illegal turnover is more than 50,000 RMB, and shall be sentenced to a fixed term of imprisonment of more than three years but no more than seven years with a fine being imposed, if the illegal turnover is more than 250,000 RMB.
The suspect shall be sentenced to a fixed term of imprisonment or criminal detention of no more than three years and/or be subject to a fine if: the illegally manufactured trademark is more than 20,000 pieces; the illegal turnover is more than 50,000 RMB; the illegal proceeds are more than 30,000 RMB; illegally manufacturing two kinds of registered trademark in more than 10,000 pieces, with the illegal turnover being more than 30,000 RMB, or with the illegal proceeds being more than 20,000 RMB; or other serious circumstances.
The suspect shall be sentenced to a fixed term of imprisonment of more than three years but no more than seven years and shall be subject to a fine if: the illegally manufactured trademark is in more than 100,000 pieces; the illegal turnover is more than 250,000 RMB; the illegal proceeds are more than 150,000 RMB; two kinds of registered trademark in more than 50,000 pieces are illegally manufactured, with the illegal turnover being more than 150,000 RMB, or with the illegal proceeds being more than 100,000 RMB; or other especially serious circumstances.
Traditionally, the local Public Security Bureaus are authorised to investigate intellectual property crimes; whereas the Procuratorates are authorised to pursue a criminal prosecution or public prosecution.
(1) The accused’s trademark is neither identical nor similar to the plaintiff’s registered trademark.
(2) The accused’s trademark is not used on the same or similar goods/services with the plaintiff’s registered trademark.
(3) The accused’s trademark is prior, with certain influence.
(4) The use of the accused’s trademark is not a use in the trademark sense.
(5) The use of the accused’s trademark is a fair use.
(6) The exclusive rights of the registered trademark have been exhausted.
(3) the court having no jurisdiction.
Generally, the actual loss due to infringement, as well as the reasonable expenses incurred to cease the infringement, may be recoverable from the losing party.
Since the actual loss due to infringement is often very difficult to identify, it is usually replaced by the illegal outcome of the infringement, which could be calculated by multiplying the sales volume of the infringing products by the profits of each piece.
Expenses incurred to cease infringement, such as expenses for investigation and reasonable lawyers’ fees, may also be recoverable.
A first-instance decision may be appealed to a higher court to initiate the second-instance proceedings. The decision will be reviewed in its entirety, including the factual issues and legal issues during the second-instance proceedings. Generally, the decision of second instance is the final decision.
(2) evidence which parties had applied to the court to investigate and collect during the first-instance proceedings, where such request was refused by the court.
In China, the Intellectual Property Customs Protection Regulation issued by the General Administration of Customs provides the mechanism for seizing or preventing the importation of infringing goods or services in China. According to the Regulation, the registered trademark owner, who records its trademark with General Administration of Customs, will be notified by the local customs of suspicious infringing products and required to confirm the illegality of goods within three working days. The local customs will seize the infringing goods upon receiving the confirmation.
An unregistered mark is protectable as a unregistered “well-known” mark according to Article 13 of the Trademark Law.
An unregistered mark is also protectable as a distinctive name or packaging of famous goods, under the Anti-Unfair Competition Law of PRC.
A company name could be protected by the Trademark Law if the company name is registered as a mark.
There is no specific kind of rights provided to the book title or file title. However, such titles can be protected as a distinctive name of famous goods, where the name is sufficiently distinctive and functions as an identifier to the source of origin.
Generally, a domain name could be registered before a domain name registrar. Domain name registration follows the first-to-file principle and there will be no substantive examination. Domain name registration is usually conducted online.
Firstly, a domain name could prevent others from registering domain names identical or similar to the prior ones if the registration and use may cause confusion.
A domain name registrant may further prevent others from registering a similar domain name, registering a trademark identical or similar to the domain name, or using the domain name as a trade name.
(1) The commercialisation rights of the famous movie Kung Fu Panda were protected according to the administrative litigation case of HU v. TRAB, DreamWorks Animation SKG, Inc. (The Third Party).
(2) The trademark “ABC”, a simple and normal description, may also obtain significance on indicating the source of service after being used and promoted in the long term, according to the ABC Education Group v. iTutorGroup case.
(3) A trademark right may be transferred, but the public awareness and popularity of such trademark may not be transferred simultaneously. When determining the ownership of the famous trademark “稻香村”, the honour and awards obtained may become a significant factual basis, according to the Beijing Daoxiangcun v. Suzhou Daoxiangcun case.
As mentioned in question 17.1, we consider HU v. TRAB, DreamWorks Animation SKG, Inc. (The Third Party), ABC Education Group v. iTutorGroup and Beijing Daoxiangcun v. Suzhou Daoxiangcun to be the three most important cases that have been issued within the last 18 months.
We consider that a new judicial interpretation related to trademarks may be expected in the next year.
Over the last year, it has become apparent that courts are more flexible on the application of the Trademark Law, and are more willing to attach importance to whether confusion exists based on fact.

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