Trademarks

The PRC Trademark Law.

China has adopted a first-to-file system and trademark rights primarily arise through registration.

Unregistered marks, if deemed ‘well known’ by relevant authorities, receive additional protection under relevant laws and regulations.

• The PRC Trademark Law;
• Its Implementing Regulations issued by the State Council;
• Judicial interpretations issued by the Supreme People’s Court; and
• administrative measures and guidelines issued by the China National Intellectual Property Administration.

Any sign that can serve to distinguish the source of goods/services, including but not limited to:

• words;
• devices;
• letters;
• numbers;
• three-dimensional symbols;
• combinations of colours;
• sounds; and
• any combinations of these elements.

The mark must:

• have sufficient distinctiveness;
• not conflict with other parties’ prior rights; and
• not contain prohibited elements (for details, see question 2.3).

• Generic or descriptive terms, and other marks that are deemed non-distinctive under local practice (eg, advertising slogans and internet catchphrases);
• Marks that may mislead consumers as to the qualities or characteristics of the designated goods/services;
• Marks that are harmful to socialist morality or that have other unhealthy influences;
• Names and symbols of countries, national governments, international organisations or certification organisations, unless authorised by the relevant parties;
• Well-known geographical indications, unless they have other meanings or are to be registered as collective marks or certification marks; and
• Functional features of a three-dimensional object.

The registration process is controlled by the China National Intellectual Property Administration (CNIPA).

Only an application fee.

If the application is filed in paper form, the fee will be:

• RMB 300 for the first 10 designated items of goods or services; and
• RMB 30 for each additional item thereafter.

If the application is filed electronically, the fee will be:

• RMB 270 for the first 10 items; and
• RMB 27 for each additional item thereafter.

CNIPA has adopted a modified version of the Nice Classification. As under the Nice Classification, under CNIPA’s classification system, goods and services are divided into 45 classes; but CNIPA divides each class (except Class 33) into varying numbers of subclasses for the purposes of determining similarity during substantive examination. Some subclasses are further divided into subparagraphs. Goods and services that are categorised within the same subclass/subparagraph are generally deemed similar; while those categorised within different subclasses/subparagraphs are generally considered dissimilar.

‘Class-wide’ applications are not allowed. Applicants must identify the specific goods or services for which the mark will be used.

That said, under current law:

• an applicant can obtain a registration without showing prior use; and
• applicants can technically obtain class-wide protection by selecting at least one item from each subclass/subparagraph in the relevant class.

According to Article 4 of the PRC Trademark Law:

• trademark applicants must have an actual business need to apply for a trademark registration; and
• an application filed in bad faith with no genuine intent to use the mark is subject to refusal.

That said, an applicant is not required to demonstrate a bona fide intent to use during the trademark application process. However, if an applicant has an unreasonable number of trademark filings, its applications may be refused on the basis of Article 4.

Yes.

CNIPA also examines the distinctiveness and legality of a trademark application (see question 3.8 for details).

Yes. CNIPA also rejects marks according to the following provisions of the Trademark Law:

• Articles 4, 7 and 44: Marks that are filed in bad faith. CNIPA will mainly look at the applicant’s history of filing to determine whether an application violates these articles.
• Article 10:
• • signs that are similar to the symbols of the state or governmental and certain non-governmental organisations;
  • signs that are discriminatory against any nationality or race;
  • signs that are misleading or deceptive; and
  • signs that are harmful to socialist morals or customs, or that have other unhealthy influences.
• Article 12: Marks that consist of functional features of a three-dimensional symbol.
• Article 19: Marks filed by trademark agencies for goods or services other than agency services.

No. However, a descriptive mark may acquire distinctiveness through use and become eligible for registration in accordance with Article 11 of the PRC Trademark Law.

There are no formal procedures that permit third parties to object to an application prior to its publication. However, in practice, parties may submit ‘interference letters’ on an informal basis to inform CNIPA of a pending application that was filed in bad faith to increase the odds that CNIPA will reject the application.

No, submission of use evidence is not a prerequisite for registration. However, failure to use a registered mark commercially will expose the mark to the risk of cancellation for non-use once it has been registered for three years.

Currently, if CNIPA identifies a formal issue with an application, it will issue a notice of amendment about four to six weeks after the filing date. The applicant will have 15 days to respond to the notice of amendment.

Assuming that an application does not encounter any office actions, it will be published for opposition purposes about four to six months after the filing date.

Yes, trademark applicants have the right to apply for review of the refusal of applications for trademark registration. Applications for review of refusals are submitted to the Trademark Review and Adjudication Department (TRAD) – an independent body within CNIPA that is responsible for handling trademark-related appeals.

After receiving a notice of refusal issued by CNIPA, the applicant has 15 days or 30 days (depending on the filing method) to file an appeal with the TRAD. These deadlines are non-extendable. Once the initial appeal has been filed, the applicant then has three months to file supplemental arguments and evidence if it wishes to do so.

If the applicant is dissatisfied with the TRAD’s decision, it may file an administrative suit against the TRAD with the Beijing Intellectual Property Court (BIPC). If the applicant is dissatisfied with the BIPC’s judgment, it may file a final appeal with the Beijing Higher People’s Court (BHPC).

Yes.

A prior rights holder or a materially interested party may oppose an application based on its prior rights or interests. Any party has standing to oppose a mark on the basis that it violates any of the grounds set out under question 3.8, except for ‘confusion with a senior mark’.

An opposition must be filed within three months of the date of publication of the subject application.

Oppositions are reviewed by CNIPA.

CNIPA will conduct a formalities review of the opposition submission and issue a filing receipt to the opposing party if the submission satisfies all formality requirements.

CNIPA will then forward a copy of the opposition submission to the trademark applicant, which will have 30 days to submit a response followed by a three-month supplemental response period. Under current law, the opposing party does not have the right to review and rebut the applicant’s response.

CNIPA will then review the case and issue a decision based on the parties’ submissions.

If the trademark applicant is dissatisfied with the opposition decision, it may file an appeal with the TRAD within 15 days of receipt of the decision. The opposing party does not have the right to appeal an unfavourable opposition decision.

Once the TRAD has formally accepted the applicant’s appeal, it will forward a copy of the appeal submission to the opponent. Upon receipt, the opponent will have 30 days to file a response to the appeal.

Unregistered trademarks are generally not enforceable in China, except for unregistered trademarks that are recognised as well known in China in accordance with Article 14 of the PRC Trademark Law.

Articles 2 and 6 of the PRC Anti-unfair Competition Law offer some protection to unregistered trademarks, but the owner will need to prove that its unregistered trademarks have acquired a certain level of fame among customers.

Upon registration, the trademark owner:

• will have exclusive rights in the registered trademark; and
• may enforce its rights against a third party that uses the registered trademark (or a similar trademark) on the registered goods or services (or similar goods or services) in China without the registrant’s consent.

There is no separate register for descriptive marks in China. However, a descriptive mark may acquire distinctiveness through use and become eligible for registration in accordance with Article 11 of the PRC Trademark Law.

If the owner of a registered trademark believes that its rights have been infringed, it may file:

• a civil lawsuit with the relevant local people’s court; or
• an administrative complaint with the local market supervision bureau (MSB).

In a civil action, the court may order the infringer to:

• stop the infringing activities;
• compensate for the brand owner’s damages; and/or
• destroy the infringing goods and equipment for making the goods.

The MSB may:

• seize and destroy the infringing goods and equipment for making the goods; and/or
• impose fines on the infringer.

If the infringing goods are to be imported or exported, the brand owner can request Customs to seize and destroy the goods.

If the infringement is serious, the brand owner can request the police to initiate criminal investigations. The infringer, if found guilty, could face a prison sentence and fines.

Protection against trademark dilution is not specifically provided for under Chinese law. In practice, rights holders may seek recognition of a given trademark as well known, which is intended:

• to provide broad cross-class protection against the registration and use of identical or similar marks in respect of dissimilar goods or services; and
• to some extent, to serve as protection against trademark dilution.

Other harms to trademark rights may be regulated by the PRC Anti-unfair Competition Law. These may include damages resulting from:

• misleading or false representations;
• passing off;
• the filing of trademark applications in bad faith; and
• actions against true brand owners in bad faith.

In general, any type of conduct that may cause public confusion, mislead consumers or create improper competitive advantage potentially violates the PRC Anti-unfair Competition Law.

The owner of a registered trademark can file:

• an administrative complaint with a local MSB;
• a civil lawsuit with the relevant local people’s court; or
• a criminal complaint with the local ministry of public security (police) office.

Typical defences include:

• fair use of:
• • generic/descriptive terms;
  • geographical indications; or
  • functional features in a three-dimensional trademark;
• use of an identical/similar trademark prior to filing date of the registered mark – although the trademark registrant may request the defendant to take measures to avoid confusion; or
• lack of actual use of the mark by the trademark registrant in the last three years. In this case, the defendant is not obliged to pay the trademark owner damages, but may still be ordered to halt infringing activities.

After receiving the first-instance judgment, either party may file an appeal with the court at a higher level within 15 days.

Second-instance judgments are final and will come into effect immediately. It is possible to file a retrial request with the court at the next higher level, but:

• retrial requests are not automatically granted – the court will examine the facts and reasoning carefully to decide whether a retrial is necessary; and
• the second-instance judgment remains in effect even after a retrial request has been filed.

Both the initial term and the renewal term are 10 years respectively.

• A renewal application form;
• Certain identity documents; and
• A renewal fee.

A trademark registration can be cancelled based on the following grounds:

• The mark conflicts with the legitimate rights of a third party;
• The mark has not been used in the last three years or the use does not meet requirements in the Trademark Law;
• The mark was filed in bad faith with no genuine intention to use;
• The mark is deceptive or has unhealthy social influences;
• The mark is non-distinctive or no longer has sufficient distinctiveness;
• The mark was filed by a trademark agency for goods or services other than agency services; or
• The mark is a functional feature of a three-dimensional device.

When the registration harms the public interest. Specifically, CNIPA may cancel a registration on its own initiative based on the following grounds:

• The mark has not been used in the last three years or the use does not meet requirements in the Trademark Law;
• The mark was filed in bad faith with no genuine intention to use;
• The mark is deceptive or has unhealthy social influences;
• The mark is non-distinctive or no longer has sufficient distinctiveness;
• The mark was filed by a trademark agency for goods or services other than agency services; or
• The mark is a functional feature of a three-dimensional device.

A third party can seek cancellation of a trademark registration by filing:

• a non-use cancellation (based on lack of use in the last three years); or
• a trademark invalidation (based on the other grounds).

For a non-use cancellation, after CNIPA has issued a decision, either party may appeal the decision:

• to the TRAD; and
• subsequently to the BIPC and the BHPC.

For trademark invalidations, either party may appeal the decision to the BIPC and the BHPC.

There are no particular requirements for a trademark licence to be valid. The parties are free to contract their own licensing terms.

Article 43 of the PRC Trademark Law provides that:

• a licensor should supervise the quality of the licensee’s goods bearing the registered trademark; and
• a licensee should guarantee the quality of goods bearing the registered trademark.

Article 43 also provides that in case of licensed use of a registered trademark, the name of the licensee and the origin of the goods must be indicated on the goods bearing the registered trademark.

It is not a requirement for such provisions to be included in a trademark licence in order for the licence to be deemed valid. However, these provisions must be included if the licence is to be recorded with CNIPA.

It is possible to record trademark licences with CNIPA, but it is not mandatory to do so.

Article 19 of the Interpretation on Issues Regarding the Application of Law in Civil Cases Involving Trademark Disputes issued by the Supreme People’s Court in 2002 states that a trademark licence contract that has not been recorded with CNIPA is still valid.

However, Article 19 also states that if a trademark licence is not recorded, it cannot be enforced against bona fide third parties.

No. Termination and loss of rights under the trademark licence will be subject to contract.

See question 6.1.

No, CNIPA does not permit registration of a mark based on foreign or international registrations. Trademark applicants can:

• designate an international (Madrid) registration to China; or
• claim priority based on a foreign application.

However, the CNIPA will conduct its own examination to determine whether the mark can be registered in China.