We have been consulted for many similar cases this year, and most involving the operational difficulties or brand dilemmas that foreign companies face due to trademark squatting. These unregistered trademarks could also be legally protected in certain situations, though normally the trademarks shall be first administratively approved for legal registration. Today, Bridge IP Law Commentary will introduce to you the matters related to unregistered trademarks.
I. The reputed unregistered trademark
The protection over unregistered trademark is mainly regulated in Article 13:
Where a trademark in respect of which the application for registration is filed for use for non-identical or dissimilar goods is a reproduction, imitation or translation of the well-known mark of another person that has been registered in China, misleads the pub1ic and is likely to create prejudice to the interests of the well-known mark registrant, it shall be rejected for registration and prohibited from use.
And Article 31:
Nor unfair means be used to pre-emptively register the trademark of some reputation another person has used.
The above regulations granted the user of the noted trademark a chance of relief, by which the user could file the trademark opposition or cancellation procedure when facing the squatting. And in practices, the user will also register the trademark in the same time.
The difference between the regulations above is whether the squatter has made the unfair meas. For the unregistered reputed trademark, it may invalidate the squatted marks by continuously using in the same or similar classes where it could be determined as the well-known trademark when the squatted mark is first registered.
Nevertheless, the normal reputable trademarks are more frequently squatted, therefore it could be unfair and unreasonable if there were no legal regulations on it. For this reason, the legal protection in Trademark Law also covers trademarks with public influence, which must prove the unfair means of those squatting, compared to the protection of the reputable unregistered marks. For example, the squatter has business relationship with the mark holder or he knows the existence of the noted trademark.
II. Other prior rights on the unregistered trademark
By Article 31 of the Trademark Law, no trademark shall violate others prior rights, then it could be the legal reference for protection of the holder of the unregistered trademark. There is no legal regulation on the scope of such prior right, and by our experience, it could be divided into the following two main categories:
1. The exclusive prior right
This right refers to those monopoly rights, such as the copyright or design patent. It’s easy to judge the infringement on such rights, for once the righted elements are involved, the owner of the prior right could file the opposition or argument procedure or initiate the lawsuit in the court for the trademark cancellation regardless whether the infringement is conducted with malicious purpose or has led to public confusion.
2. The non-exclusive prior right
Under such right, the owner only has the right of use without the monopoly or is only partly monopolized, such as the unregistered trademark made up by names or company names. To use the trademark with these rights will not infringe others’ right, for example, the trademark of Jordan in China is considered no infringement against Jordan’s name right by the trademark office in China for it is a family name in the public domain. The company name of the famous enterprise will only be protected when it becomes an influential unregistered trademark.
III. To protect the brand through unfair competition law
By the Law Against Unfair Competition in China, no one shall use without authorization, the name, packaging or decoration peculiar to well-known goods or using a name, packaging or decoration similar to that of well-known goods, so that his goods are confused with the well-known goods of another person, in turn causing buyers to mistake them for the well-known goods of the other person and creating unfair competition. That could be the legal basis in protecting an unregistered noted brand when the infringing mark is not registered either (for the combat on the registered ones, you may initiated the cancellation procedure as described above).
It’s noticeable that the clause has two restricted conditions, first, the use of the same trademark is not adequate to the confusion for it shall take the name, packaging or decoration into the consideration, and second, it could not stop others applying such trademark to other different products which have not been registered, for the confusion is not possible when the products are totally different.
Construction of a brand is essential to the enterprise, and even though the unregistered trademark could also be protected by law in China, this protection is more difficult to attain than those for the registered ones. Bridge IP Law Commentary thus suggests that foreign invested companies pay more attention to the registration for trademarks as it could save energy and time protecting the legal rights of the company.
Author: Mr. Luo Yanjie
Attornry-at-law of DeBund Law Offices
Co-author: Mr. You Yunting
Founder & Editor-in-Chief of Bridge IP Law Commentary
Partner & Attorney-at-law of Shanghai DeBund Law Offices
Email: Bridge@chinaiplawyer.com, Tel: 8621-5213-4900,
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