Trademark procedures and strategies: China

Legal framework

In China, the laws relevant to trademarks are:

• the Trademark Law (and its implementation regulations);
• the Anti-unfair Competition Law;
• the Copyright Law (and its implementation regulations);
• the Criminal Law;
• the Administrative Procedure Law;
• the Civil Procedure Law;
• the Measures for the Administration of Internet Domain Names;
• the Procedural Rules of the China Internet Network Information Centre (CNNIC) for Resolution of Domain Name Disputes;
• the Measures of the CNNIC for the Resolution of Domain Name Disputes;
• the Regulations on Customs Protection of IP Rights; and
• the Provisions for the Protection of Products of Geographical Indication.

The applicable international treaties include:

• the Paris Convention for the Protection of Industrial Property;
• the Agreement on Trade-Related Aspects of IP Rights;
• the Patent Cooperation Treaty;
• the International Patent Classification Agreement;
• the Singapore Treaty on the Law of Trademarks;
• the Madrid Agreement Concerning the International Registration of Marks;
• the Protocol relating to the Madrid Agreement Concerning the International Registration of Marks;
• the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks;
• the World Intellectual Property Organisation (WIPO) Performances and Phonograms Treaty;
• the WIPO Copyright Treaty;
• the Berne Convention for the Protection of Literary and Artistic Works;
• the Beijing Treaty on Audiovisual Performances; and
• the Convention Concerning the Protection of the World Cultural and Natural Heritage.

Unregistered marks

An interested party may prevent others from:

• applying for registration or using a trademark on the same or similar goods if the trademark is a reproduction, imitation or translation of an unregistered well-known trademark in China and is likely to cause confusion (Articles 13.1 and 13.2 of the Trademark Law);
• applying for registration of a trademark on the same or similar goods if the trademark is known through business dealings or other special relationships (Article 15 of the Trademark Law);
• applying for registration of a trademark on the same or similar goods if the trademark is a reproduction or imitation of an unregistered trademark that has attained a certain reputation (Article 32 of the Trademark Law); and
• carrying out confusing behaviour that misleads others into believing that a commodity is supplied by another party or has specific connections with another party – for example, using an identifier such as product name, packaging or decoration that is similar to that of another party’s highly reputed commodity (Article 6 of the Anti-unfair Competition Law).

Different legal provisions have different requirements for the extent of use to establish unregistered trademarks. Articles 13.1 and 13.2 of the Trademark Law set out the most demanding requirements on the popularity and extent of use of unregistered well-known trademarks. Article 6 of the Anti-unfair Competition Law also lays down demanding requirements on the popularity and extent of use of unregistered trademarks, with the confusing behaviour having to reach a level that can cause misunderstanding. Article 32 of the Trademark Law requires a lower extent of use of unregistered trademarks, wherein established contact with the relevant public is sufficient to support the rights of an unregistered trademark. Article 15 of the Trademark Law does not require evidence of trademark use, but evidence is required to prove that the trademark is known through special business dealings.

Registered marks

Natural persons, legal persons or other organisations that require exclusive rights to trademarks for their goods or services during production and business activities can apply for and own a mark. A power of attorney is required before filing, which does not need to be notarised or legalised.

Any mark that distinguishes the goods of a natural person, legal person or other organisation from those of other parties can be registered as a trademark, including:

• words;
• figures;
• letters;
• numbers;
• three-dimensional signs;
• colour combinations;
• sounds; and
• combinations of the above.

The following cannot be registered as trademarks in China:

• holograms;
• single colours;
• positions;
• motions;
• tactile marks;
• smells; and
• taste marks.

Procedures

Examination procedure

It takes one to two months to receive the official filing receipt from the Trademark Office on acceptance of all the documents and designated goods. If the designated goods need to be amended, there is normally only one chance for amendment. After the formal examination, the application will go into substantial examination; it takes another six to seven months to know whether the application has been rejected or preliminarily approved.

Opposition

Any interested party has the right to file an opposition against a trademark application during the three-month publication period. If the prior right does not concern an applied-for or registered trademark, the preliminary proof of the right must be filed.

Registration

If a trademark application is not opposed by a third party during the opposition period, it will mature into a registration. It normally takes one to two months to receive the certificate.

Removal from register

A trademark can be revoked on the grounds of non-use for three years. Generally, the term starts from the date of registration, with the following exceptions:

• Where the trademark has been approved for registration after an opposition procedure, the three years start from the date of publication of the registration in the Trademark Gazette;
• Where the trademark is an international registered trademark under the Madrid Protocol, the three years start from the date of expiration of the time limit for rejection; and
• Where the trademark is still under review for trademark rejection or opposition, the three years start from the effective date of the administrative decision.

Timeframes

The following timeframes can be expected under normal circumstances:

• It takes 12 months to obtain approval for an unopposed registration;
• It takes 12 months from filing of an opposition to receive a decision in an opposition procedure;
• It takes one to two months to obtain a renewal certificate;
• It takes eight months to obtain a merger certificate; and
• In case of a change of name, it normally takes four to six months to obtain a replacement certificate.

The following official Trademark Office searches are available:

• identical trademark search;
• similar trademark search;
• search per class;
• search of all classes;
• trade name and slogan search; and
• search of traditional graphic marks.

Currently, no search to reveal similar or identical prior non-traditional graphic marks can be conducted. However, if the trademark number, trademark name or registrant’s name is known, they can be searched for in the Trademark Gazette.

Currently there are no official search services offered, but searches can be conducted via the official public online database, available in Chinese at sbj.saic.gov.cn/sbcx/.

Enforcement

According to Article 57 of the Trademark Law, a rights holder may seek administrative or judicial remedies if they find any infringement of the exclusive right to their registered trademark, including where another party:

• uses an identical trademark on the same type of goods without a licence;
• uses a similar trademark on the same kind of goods or uses an identical or similar trademark on similar goods, where such use is likely to cause confusion;
• sells goods that infringe the exclusive rights to the use of the trademark;
• counterfeits or manufactures without authorisation a representation of the trademark, or sells such representation;
• alters the trademark without the permission of the trademark registrant and sells goods bearing the altered trademark on the market; or
• intentionally facilitates others in committing infringements.

According to Article 60 of the Trademark Law, a dispute that arises from an act infringing the exclusive right to use a registered trademark prescribed in Article 57 of the Trademark Law will be settled by the interested parties through consultation; where the parties are reluctant to resolve the matter through consultation or the consultation fails, the trademark registrant or an interested party may institute legal proceedings in court or request that the Administrative Department for Industry and Commerce address the dispute.

On determining that an infringement has been established, the Administrative Department for Industry and Commerce will:

• order the infringer to immediately stop the infringing act; and
• confiscate and destroy the infringing goods and instruments that are used to manufacture the infringing goods or counterfeit the representations of the registered trademark.

If the revenue derived from the infringement is Rmb50,000 or above, a fine of up to five times the illegal revenue may be imposed; if there is no revenue, or the revenue is less than Rmb50,000, a fine of up to Rmb250,000 may be imposed. Anyone who commits infringements on two or more occasions within five years, or where the circumstances are serious, will be subject to a heavier punishment.

If a party sells the goods with no knowledge that the goods have infringed the exclusive right to use a registered trademark, can prove that the goods were obtained by legitimate means and can indicate the supplier thereof, the Administrative Department for Industry and Commerce will order them to stop selling immediately.

Where there is a dispute over the amount of damages for infringement, any interested party may ask the Administrative Department for Industry and Commerce for mediation or institution of legal proceedings in the court. Where no settlement is reached on mediation or the mediation agreement fails to be performed, the interested parties may institute legal proceedings in the court.

According to Article 213 of the Criminal Law, using an identical trademark on the same kind of goods without permission from the owner of the registered trademark will be penalised with:

• a fixed-term imprisonment or detention of up to three years and a fine, where the circumstances are serious; or
• a fixed-term imprisonment of three to seven years and a fine, where the circumstances are particularly serious.

Punitive damages can be claimed in civil proceedings only. The amount of damages is determined according to:

• the actual loss suffered by the rights holder as a result of the infringement;
• the benefit obtained by the infringer from the infringement; or
• a reasonable multiple of the royalty for the relevant trademark licence.

If the above three methods fail to determine the amount of damages, the court may award damages of up to Rmb3 million, based on the circumstances of the infringement. Criminal proceedings are instituted by administrative authorities, not by trademark owners.

The statute of limitations for court action against trademark infringement is two years, calculated from the date that the interested party becomes aware, or should have become aware, of the infringement. If it is a one-off infringement, there is usually no problem with the two-year limit. However, if the infringement is continuous and the trademark owner has been, or should have been, aware of it for more than two years, the court will order the defendant to stop the infringement and the amount of the infringement damages will be calculated based on two years from the date that the lawsuit was filed with the court; any infringement damage beyond two years will not be remedied.

Interim relief can be sought before the court before or after filing a lawsuit. In case of claiming prior to the lawsuit, the lawsuit should be filed within 15 days of the court taking measures to stop the infringement, otherwise the court will lift the measures.

There is no mandatory timeframe for the resolution of an enforcement action.

Ownership changes and rights transfers

Currently no legalisation is required for any documents regarding ownership changes or right transfers. Any use by a licensee will be attributed to the trademark owner, unless exceptions are stated in the licence agreement.

Related rights

A copyright, design patent right or portrait right can be used to protect device marks that have artistic merit. For example, a logo can be protected by trademark, copyright, design and civil laws. An enterprise name right or a natural person’s name right can be used to protect word marks that contain an enterprise name or natural person’s name. For example, a famous person’s name right can be protected by trademark law and civil law.

Online issues

The legislation surrounding registered and unregistered marks are totally applicable to internet use.

The Trademark Law and the Anti-unfair Competition Law, as well as domain name-related regulations and relevant judicial interpretations, contain specific provisions protecting rights holders against unauthorised trademark use in domain names, on websites and in hyperlinks.

Further, the Trademark Law, the Anti-unfair Competition Law and the Advertising Law, as well as relevant judicial interpretations, contain specific provisions protecting rights holders against unauthorised use in online ads and metatags.

Recourses

Relevant laws and regulations can be found in:

• the Interpretation of the Supreme People’s Court Concerning the Application of Laws in the Trial of Cases of Civil Disputes Arising from Trademarks;
• the Trademark Law;
• the Anti-unfair Competition Law; and
• relevant judicial interpretations.

The Uniform Domain Name Dispute Resolution Policy regulates the country-code top-level domain (ccTLD). The applicable regulations are the CNNIC Procedural Rules for the ccTLD Domain Dispute Resolution.