—Comment I on the revision of China Trademark Law
Highlights: The Comment One on the draft of China Trademark Law amendment. The new regulation expands the scope of malicious squatting of trademarks and the protection on well-known ones, while it still leaves an ambiguous space for application.
The draft of China Trademark Law amendment (the “Draft”) is issued by the Legislative Office of State Council (LAO), a working body to the State Council assisting the Premier in handling legislative affairs and other legal affairs, for the public comments. After study on the draft, Bridge IP Commentary will make series analysis on it.
As provided in Article 31 of the current China Trademark Law, “An application for the registration of a trademark shall not create any prejudice to the prior right of another person, nor unfair means be used to preemptively register the trademark of some reputation another person has used.”
In the Draft, the following new regulation is added: Where a trademark in respect of which the application for registration is filed for identical or similar goods is same or similar with another trademark earliest used in China, the applicant knows the other trademark presence because of contract, business, regional relationship or other relationship, it shall be rejected for registration. Where a trademark in respect of which the application for registration is filed for non-identical or dissimilar goods is a reproduction, imitation or translation of the famous trademark of another person which has a strong distinctive and has been registered in China, misleads the public, it shall be rejected for registration.
Bridge IP Commentary takes a positive view on the draft for the following improvement contained in the amendment:
I. Expand the scope of malicious trademark squatting
By the original provision, the subject of malicious registration limits to the “agent or representative”. While, in judicial practice, it’s a more common misconduct of competitors, distributors or even employees. The new provision expands the scope of subject. Bridge IP Commentary thinks that the newly added “if an applicant has a contract, business, or geography relationship with the right holder of an existent trademark” could cover the general squatters. And the squatting may be effectively reduced once the Chinese Trademark Office could strictly apply the new provisions when reviewing trademarks.
II. Expand the range of “famous” trademark protection
The well-known trademarks may enjoy cross-class protection by the original regulation, which now has been extended to any registered trademarks with strong distinctiveness in the Draft.
Nevertheless, the “strong distinctiveness” is a relative vague standard for no legal reference for such determination in China. Thus makes it prominent of the appraisal and title award on trademarks by local governments and administrative departments, such as the “Famous Trademark” held by provincial governments, the “Noted Trademark” from local governments and the “China Top Brand” granted by the General Administration of Quality Supervision, Inspection and Quarantine. In other words, such appraisal or reward is not only an honor, but also has practical significance.
Regretfully, still no interpretation has been made on the scope and application of the controversial “prior rights” in the Draft. However in the case of trademark squatting, it is very common for squatters to register other companies’ name as trademarks.
Theoretically, “company name” is also kind “intellectual property”. But in China, “company name” is only exclusive within certain areas instead of nationwide. For this reason, it has been long argued whether such right could be the “prior right” in Trademark Law, and no unified judicial standard on such determination has been formed. And the revised draft still does not make further explanation.
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Editor-in-Chief of Bridge IP Commentary
Partner & Attorney-at-law of Shanghai DeBund Law Offices
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