Trade Mark Matters in China
August 24, 2009 · Print This Article
If you want to protect your trade mark in China in a cost-effective manner, you need to register it with the China Trademark Office (CTMO).
A trade mark registration can give you access to more simple and inexpensive enforcement options than otherwise available, including access to criminal remedies against counterfeiters.
Without a registration, enforcement is still technically possible under China’s laws and regulations on the basis of unfair competition, but as in other countries, protection under such laws is much less predictable and normally more costly.
China follows a “first-to-file” rule for obtaining trade marks rights. This means that generally the person who files their trade mark application first is entitled to register the trade mark. The person who uses the trade mark first is entitled to register, prior use of a mark affords little or no protection. It is therefore highly advisable to file applications for trade marks as early as possible, and preferably well before you enter the Chinese market. The failure to file early leaves the door open to other parties to file before you do. In some cases, this can lead to the exclusion of your products from entry to the Chinese market because of pre-existing registrations. There are numerous examples of cases where trade mark counterfeiters obtained registrations before the true brand owner and threatened infringement actions against distributors of legitimate products. In such cases, the brand owner is often forced by market realities to pay significant compensation to counterfeiters to procure the assignment of trade mark registrations.
Chinese consumers refer to foreign brands by reference to Chinese versions of the brand, even if there is no “official” Chinese version and advertising uses only the English version. If you don’t have a Chinese version of your trade mark, you are strongly advised to create one and register it. Otherwise, the local market will create one for you (which you might not like) and someone else might register it. It should be noted that the CTMO considers foreign equivalents of marks during the examination process. For example, the Chinese version of the word SEA could stop the English word SEA from being registered for the same goods or services.
A trade mark application can be filed in China either by filing an application directly with the CTMO or alternatively by extending an existing application or registration to China under the Madrid Protocol. There are advantages and disadvantages for both procedures which should be discussed with your intellectual property advisor.The procedure for filing a trade mark application in China is similar to worlwide. However, you have to file through a Chinese trade mark agency which can only act on your behalf upon receipt of a signed power of attorney. In addition, the applicant must provide its name and address in Chinese. If you do not yet have a Chinese name, the agency can assist with this.
The decision as to which mark to file for and how to describe the goods and services to be covered should be considered carefully with your advisor. It is generally preferable in China to file for the version of a mark as it is used and to cover as wide a range of goods and/or services as you reasonably can.
It is also advisable to conduct trade mark searches before filing trade mark applications to check whether anyone else has already filed for a similar or identical mark which might block your planned application.
It is also important that expert advice is obtained to assess whether the proposed mark might be rejected in China on grounds other than prior conflicts. For example, trade mark applications may be rejected if the word or design elements are considered indistinctive, generic or laudatory. The same is true in other countries. However, China has its own particular approach to registrability.
Single colours, smell and sound trade marks are not yet registrable in China. However, it is technically possible to register three-dimensional trade marks as well as combinations of colours. China does not allow divisional applications, series or defensive trade marks. Similarly, the owner of a certification trade mark cannot use the mark itself but can only authorise others who meet the required standards to use it. It is also possible for geographical indications to be protected as collective or certification trade marks in China, For instance, groups of producers of a product where a given quality, reputation or other characteristic is attributable to its location can be granted the exclusive right to use a particular geographic name on the product.
Once an application is approved, it will be published in the CTMO Gazette. Following gazettal, any party may file an opposition within three months, challenging the application on the grounds of prior marks, distinctiveness or other grounds set out in the Trademark Law. A registration certificate will be issued if no opposition is filed within this three-month period.
Chinese trade mark registrations are valid for 10 years and can be renewed for successive 10 year periods. Trade marks registered through the Madrid Protocol are also valid for 10 years.
It normally takes less than 3 years to obtain a trade mark registration in China, with protection generally effective on the date of registration, rather than retroactive to the filing date. This underscores the importance of filing early, since trade mark rights are not enforceable in China until the trade mark is registered.
It is worth noting there are strict and sometimes tight time frames for actions associated with trade mark process, for example 15 days turnaround for an applicant to lodge an appeal with Trademark Review and Adjudication Board (TRAB) regarding a ground for rejection. Registering your marks early is clearly the best way to prevent this type of “counterfeiting”.
But if someone applies to register your trade mark, an opposition can be filed once it is gazetted in the Trademark Gazette. Prior to gazettal, it is generally advisable to send an informal letter to the CTMO bringing your rights to the attention of the appropriate examiner provided of course you have prior registrations in China.
An opposition will normally take 3 to 4 years. The loser in an opposition can file an appeal to the Trademark Review and Adjudication Board which will normally take a further 5 to 7 years to issue a decision. The decisions of the Trademark Review and Adjudication Board can be appealed further to the Intermediate People’s Court in Beijing.
Trade marks registered by others can be cancelled through the filing of petitions with the Trademark Review and Adjudication Board. It is normally advisable to support such cancellation actions through extensive evidence of the fame and use of your mark, both in China and globally.
Cancellations normally take five to seven years to be decided, during which time it is normally very difficult to stop the counterfeiter who stole your mark from using it. If someone has registered your mark but has not used it for three years, it is possible to petition the CTMO to cancel the registration on the grounds of non-use. A non-use petition is normally decided within one to two years.
One final fact that should be noted, while not strictly related to the registration of trademarks rights in China, but it does have significant importance over their enforcement, is that customs authorities have been empowered with their own monitoring system to help prevent the export of counterfeited goods. Trademark owners, provided they are registered in China, can now apply for protection of their trademark rights directly at the borders, by having customs agents actively check for potentially infringing exports. Product samples, packaging and even suspected instances of piracy can be submitted before their consideration, which causes them to, ex officio, take measures to curb and stop these kinds of practices when detected.
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