Will Alcohol Trademarks Implying Them the State Liquor Be Registered in China?

By Albert Chen:

By the latest trademark gazette of State Trademark Office of China on 20th July of 2012, “Guo Jiu Mao Tai”, which implies it the state liquor, has come through the preliminary examination and has been published. The news soon agitated the argument among the industry and academic circle, and other brewers like Feng Jiu (SSE:600809) and Luzhou Laojiao (SZSE: 000568) have all expressed their oppositions on it and planed to block the registration of “Guo Jiu Mao Tai”.

As retrieved on the state trademark website, I find it’s not the trademark’s first application. Early in 2011, the applicant China Kweichow Moutai Distillery Co., Ltd (the “Maotai Company”) tried to register the trademark, yet it was refused by the authority and the same for the follow on 5 applications. The current preliminarily approved marks are concentrated in Class 33, covering the fruit wine, Bitter, wine, aperitif, spirit, and alcohol beverage excluding beer, etc.

Then, is “Guo Jiu Mao Tai” not far from its final registration? Could its competitor successfully block its registration? I hope you could find the answer after reading today’s post.

I. A mistake of the preliminary examination?

(1) What will be considered in the preliminary examination?

By the existing laws, the trademark office shall make a preliminary formal examination and a followed on substantive examination. The formal examination is mainly focusing on the full preparation of the application files and the procedures, also the legitimacy will be checked. As to the substantive examination, it could be divided into the examination on the absolute conditions including distinctiveness, non-functionality and legitimacy, and on the relative conditions referring to no infringement against others’ prior rights. In light of “Mao Tai” in the mark “Guo Jiu Mao Tai” has already be registered in the office, and that makes the key of the preliminary examination lay on the examination of the absolute condition.

(2) Analysis on the resolute conditions examination

A. Distinctiveness. The distinctiveness of the trademark refers to the nature that highlighting the origin of the product or the service so as to distinguish it from other products or services. In “Guo Jiu Mao Tai”, “Mao Tai” is equipped with the inherent distinctiveness and the showing up of it may inevitably link the mark to a certain product or service. “Guo Jiu” shall be the description or propaganda to the quality of the product and the using of it appears no distinctiveness. Therefore, once the distinctiveness of “Guo Jiu Mao Tai” could be judged, it could either from the distinctiveness extension of “Mao Tai” or produced from its long term use. To me, I prefer to take the distinctiveness come from a long term use.

B. Non-fundamentality. The key to the examination on it is to ensure the avoidance of the combination of technical effect and the practical value, or the situation that the article could not be showed in other forms, like a bulb shape as the mark of a bulb. So, it could be of no problems as to the non-fundamentality of “Guo Jiu Mao Tai”.

C. Legitimacy. It might be the most arguable part, “Guo Jiu Mao Tai” may be conflict with the prohibitive provisions in the Trademark Law and Examination Standard to the Applied Marks with “China” or “Nation”( the “Examination Standard”)

The article 10 of Trademark Law,

“The following signs shall not be used as trademarks:

(1) those identical with or similar to the State name, national flag, national emblem, military flag, or decorations, of the People’s Republic of China, with names of the places where the Central and State organs are located, or with the names and designs of landmark buildings;

(7) those having the nature of exaggeration and fraud in advertising goods; and

…”

Part III of the Examination Standard:

“I. To the application of the marks constituted with ‘nation + product name’, or when a mark includes ‘nation + product name’ in it, such an application might be refused for ‘exaggeration and deception in propaganda’, ‘lack of distinctiveness’ and ‘the possible bad influence’.

For the above marks with ‘China’ in it or started with ‘nation’, the examination on it shall be strict and prudent, and shall be considered and approved by the joint conference acceded by the examination committee, trademark office examination conference, trademark office meeting or the Board of Trademark Review and Adjudication. ”

With the reference to the above regulations, firstly, despite no direct using of “China” or other prohibitive words in “Guo Jiu Mao Tai”, yet “Guo” just means “nation or state” in Chinese, and could be seen the abbreviation of China, and also it could be explained in Chinese as “of a nation or state”. Secondly, although the “lack of distinctiveness” could not be applied to “Guo Jiu Mao Tai” as discussed above, the other side, it does confront the risk of “exaggeration and deception in propaganda”. And moreover, the approval procedure is extremely strict for once one party among all the assessors says NO, the mark shall fail its preliminary examination.

So far, despite the reputation of Mao Tai liquor in China, its title of nation alcohol has never been admitted or granted by the nation. However, considering Mao Tai’s rival, Lu Zhou Lao Jiao has successfully registered the mark of “Guo Jiao” (means the nation’s cellar), and the mark has been established the well-known trademark in 2006, therefore, the approval the preliminary examination of “Guo Jiu Mao Tai” shall not be seen a secular case, and it may even have the chance to be a registered trademark.

II. What procedures to go through after the preliminary procedure?

By the Trademark Law, the mark will be into its publish period after the preliminary examination, and any one may file an opposition to the mark during that term. After the opposition, the trademark office will notice the applicant to prepare its reply. The trademark office may adjudicate either positive or negative to that opposition, and any party dissatisfying with the adjudication could appeal to the Board of Review and Adjudication (the “Board”). Also the decision by the Board is not final, for it could be brought to the First Intermediate People’s Court in Beijing for a administrative lawsuit, and the case will be heard through two instances.

Surely, once no one has filed the opposition to the mark during the publish term, a right of the registered trademark will be granted. By now, Feng Jiu  has stated that it will file an opposition to “Guo Jiu Mao Tai”. Considering the huge commercial interests behind it, I estimate the battle wille last till the end of all the statutory procedure.

All these are the preliminary ideas on the trademark application of “Guo Jiu Mao Tai”. And in fact, the reason to approve the application in the preliminary examination interests me most, and may be the answers to the current questions and doubt could be found in it.

Other recommended posts on our website:
1. The Actual Term of Trademark Registration in China
2. How to Apply for the Trademark Record in China Custom
3. How to improve the success rate of trademark registration in China?
4. Matters for Attention in Trademark Refusal Review in China
5. Introduction of China’s Legal System of Trademark Renewal
6. Introduction on the Regulations concerning the Capital Contribution in IPR or Domain Name in China
7. The Copyright Registration in China Could Be FREE?
8. China Copyright Protection Term Longer than EU’s?
9. Matters for Attention in the Patent Preliminary Injunction Application in China(I)

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