Standards for the assessment of trademark infringement cases are being refined in China.

Over the last ten years, the number of trademark registrations has increased tenfold in China. Indeed, local and international companies became aware of the importance of registering their IP rights in China, when creating and expanding their business in the territory.

Below the WIPO statistics database regarding IP filings in China:

Source: https://www.wipo.int/ipstats/en/statistics/country_profile/profile.jsp?code=CN

In the eyes of the International community, Chinese legal procedures could remain complex, lengthy, and favoring local entities to foreign companies.

However, and in recent years, the Chinese authorities has implemented several national IP reforms to modernize and strengthen the system of IP protection, such as:  Enforcement of laws & principles of proportionality (2016), a specialized IP judiciary with a regional perspective (2017), and of course, the China’s new Trademark Law (2019).

One of the latest reform is the implementation of Standards for the Judgement on Trademark Infringement, which provides guidelines for the Administrative Court and the People’s courts for a better identification of trademark infringement cases. These Standards have been enacted by the China National Intellectual Property Administration (CNIPA), on June 15, 2020.

Please see our identification of the key aspects of the Standards below:

1. Identity/Similarity of the goods/services: The Guidelines provide a list of criteria to be considered for the comparison of goods and services – especially when they are not standard terms that are listed in the CNIPA Classification. Article 9 to 12.
2. Identity/Similarity between the trademarks: The Guidelines provide a list of criteria to be considered when comparing two trademarks at stake. Cf Article 13 to 18.
3. Clarification about circumstances that cause a likelihood of confusion ( Article 20 to 21):

– Enough to make the relevant public believe that the goods or services involved are produced or provided by the registered trademark right holder.

– Enough to make the relevant public believe that the provider of the goods or services involved, and the owner of the registered trademark have investment, license,franchise, or cooperation relationship.

4. Use of the trademarks:

– The standards provide a list of use example and a list of factors to be taking into consideration to determine whether a trademark is in use (such as the user’s subjective intentions, use methods, publicity methods, industry practices, consumer perceptions and other factors, cf. Article 7).

– More information about the prior use of unregistered mark (referring to an unregistered mark that have considerable influence: beyond the normal scope of protection).

5. Compliance in sales strategy and the seller’s liability exemption (in market or e-commerce): Would it be a move towards more responsible e-business platform? Article 30.

This reform is part of the pursuit of protecting the intellectual property rights, in support of the increased development of innovation and industry in China. It is also in line with the fight against “trademark squatters” and the pursuit of more impartial justice (as seen with the recent Guiding opinions of the Beijing Higher People’s Court on the assessment of damages (2020)).

The next step will be to see how the relevant Chinese authorities will apply and interpret these Standards. The next Chinese trademark infringement cases are to be followed!

To read the standards as enacted, please click here.

Wendy Lam – IP lawyer – INLEX IP Expertise