What are some of the important changes that the Trademark Law brings to registration and opposition proceedings?
Spring Chang: The revision added the registrable element for trademark registration: the requirement for the precondition of “visually perceptible” signs for trademark registration has been cancelled in the revised Trademark Law; the registrable element “sound” for trademark has been stipulated in the revision (Article 8).
Multi-class application has been introduced: the applicant may file one application for several classes for a trademark; before the revision, the applicant could only file a trademark on one class in one application (Article 22.2).
The revision also clarified the effectiveness of electronic trademark applications: it clearly stipulated that a trademark registration application and other relevant documents may be submitted in writing or by way of data message (Article 22.3).
The time limit for trademark examination and review has been set: before the revision, the Law only required the “on time” standard for trademark examination and review; after the revision, the Law has clarified the time limits for different types of trademark examination and review cases; therefore, it improves the efficiency of trademark examination and review, and also regulates the administrative behaviors of the related authorities.
Finally, before the revision, the opposition procedure was complex and the period for examination was too long. The revised Trademark Law has restricted the qualification for the opposing party and simplified the opposition procedure.
What changes were made to either getting or using well-known trademarks?
Frank Liu: Before the revision of the Trademark Law, well-known status was often misused as an honorific title in the promotion of products and advertising by the trademark owner. Finding that the relevant public may be misled by such use (Article 13), the new law clarifies a number of issues to prevent misuse.
First, the revised law further clarified the meaning of “well-known trademark”. Previously, there was no clear definition regarding well-known trademarks in the Trademark Law. In Article 13 of the revised law, it added that a well-known trademark is one that is well known by the relevant public.
In 2009, the Interpretation of the Supreme People's Court defined that “‘well-known trademarks’ shall mean the trademarks that are widely known to the relevant pubic within the territory of China”.
The definition of “well-known trademark” in the new Trademark Law is more accurate and it helps the relevant public in China to better understand the original meaning of the “well-known trademark” as originally defined in Paris Convention for the Protection of Industrial Property.
The revision also clarified the principles of case by case recognition and passive recognition. Article 13 of the new law adds the precondition for recognition of well-known trademarks by the related authorities, requiring that the holder is of the opinion that its rights have been infringed upon. Furthermore, it clarified that the purpose of the well-known recognition of a mark is for the protection of the holder’s trademark rights and not for commercial promotion or propaganda.
In addition, Article 14 of the revised law further clarifies that the recognition of a well-known trademark shall be based on the request of the concerned party, and it shall be recognized only as a fact that needs to be ascertained in the handling of a trademark-related case. It aims to rectify the improper use of well-known status by some right holders who actively create a dispute in order to obtain well-known status for their marks.
I think these above revisions clarify the principles of case by case recognition and passive recognition.
Chang: Related to the above, the commercial use of the words "well-known trademark" in advertising or promotion has been prohibited (Article 14). The commercial use of the term may be punished by a fine of RMB 100,000 ($ 16,700), which may be levied by a local Administrative for Industry and Commerce (AIC) (Article 53)
The revision clearly defined the related authorities and the applicable procedures for the recognition of the well-know trademark” (Article 14). The procedures are:
1) During investigations and punishments of trademark-related illegalities cases by the AIC;
2) During the process of handling of trademark disputes by the Trademark Review and Adjudication Board (TRAB); and
3) During the process of trials of trademark-related civil or administrative cases before the People's Court designated by the Supreme People's Court.
What does the new law do to deal with bad faith registrations and oppositions?
Tom Wang: Bad faith registration and opposition are two problems that rights holders have been facing in China. The new Trademark Law has several provisions aimed at addressing these issues.
The registration of a trademark registration by a party with knowledge based on a business relationship with the prior user of the mark is prohibited. This is designed to tackle the problem of agents or business partners registering a brand owner’s mark without consent.
Article 14 in the new Trademark Law also looks to deal with bad faith. It adds that if the applicant clearly knows of the existence of the trademark of another party due to contractual, business or other relationships, such registration shall not be approved.
The new Trademark Law also provides protection for prior usage. Article 59.3 of the new law grants protection for the useby a party that has a history of prior use of a trademark with a certain level of reputation. In such a circumstance, the holder of the exclusive right to use the registered trademark shall have no right to prohibit the prior user from continuing to use the trademark within the original scope of use. However, it may require that prior user to add suitable logos for distinguishing purposes.
Article 58 also clarifies the prohibition of the usage of another party’s trademark as a trade name. Although such protection has been stipulated in the current Implementing Regulations and related Supreme Court interpretations before the revision, the clarifying of the same in the Trademark Law is still a positive development that will help to clarify and smooth out the performance of the law.
The new Trademark Law also addresses bad faith oppositions. Before the revision, anyone can initiate opposition proceedings against any trademark application. Under Article 33 of the new law, only a holder of prior rights or an interested party may raise opposition based on relative grounds, such as having a prior trademark right, prior use or other rights. Therefore, bad faith oppositions which aim to prolong the registration procedure with no concrete reason will be limited.
What are the procedural changes, such as shortened timelines, that rights holders need to be aware of?
Liu: The time limits to complete the examination of the trademark by the China Trademark Office (CTMO) and TRAB have been stipulated in the revision.
• ‑Registration examination: nine months (Article 28)
• ‑Review of application after refusal: nine months (Article 34)
• ‑Non-use cancellation application: nine months (Article 49)
• ‑Review application for non-use cancellation: nine months (Article 54)
• ‑Invalidation application with absolute ground: nine months (Article 44)
• ‑Invalidation application with relative ground: 12 months (Article 45)
• ‑Opposition application: 12 months after the expiration of the three-month publication period for opposition (Article 35);
• ‑Review application for opposition: 12 months (Article 35)
If there are any special circumstances, the AIC can grant extensions of three to six months to the above time limits.
Wang: Article 35 of the new Trademark Law also simplifies the opposition procedures. Other than a preliminary ruling on the opposition, the CTMO may directly decide whether to approve the registration application after the revision of the trademark law.
One important change is that if the CTMO decides to approve the registration of the trademark after opposition, the opposing party CANNOT file the opposition review with the TRAB. Instead, it must initiate invalidation proceedings TRAB in accordance with Article 44 and Article 45 of the revised Trademark Law.
How should rights holders deal with the new opposition proceedings, especially the new provision that an application that survives an opposition is immediately registered?
Chang: Under the new law, if the opposition against an application fails at the CTMO, the opposing party cannot appeal with the TRAB. Instead, the opposing party may initiate an invalidation procedure according to Article 44 and 45 of the revised law. In the invalidation procedure, the opposing party may make good use of the Revision against the bad faith registration (trademark squatting) as discussed above.
Please note that even when the opposing party wins the opposition in the CTMO, if the TRAB overrules the CTMO decision, the trademark will still be immediately registered, and the opposing party will need to proceed with the invalidation procedure in accordance with Articles 35, 36, 44 and 45.
Another point that needs to be mentioned is that the registered trademark after the opposition examination shall have no retroactive effect on the use of a mark by another party, provided that the use by the other party is not based on bad faith. That other party shall not be liable for compensating the losses caused to the trademark registrant.
What unanswered questions are there about the new Trademark Law in terms of registrations and opposition? Do the Implementing Regulations address these issues?
Liu: As you know, the draft Implementing Regulations have already been published on the website of the Legislative Affairs Office of the State Council for comments and it has addressed many detailed issues for the revised law, such as how to apply for sound marks. This also came into force on May 1. However, there are still many other issues to be addressed, such as how distinguishable marks will be added to prior use trademarks as required in Article 59 (3).
