1 TRADE MARKS - WHY REGISTER?
1.1 The surest means for securing exclusive rights to a trade mark
in the PRC is by registering it with the Trademark Office.
Rights derived from prior use of an unregistered mark are not
recognized under the PRC Trademark Law. (Protection may be
available under other laws, such as the Anti-Unfair Competition
Law, but such protection is much less certain.)
1.2 Registration is granted on a first to file basis, so it is
important to file an application early lest someone else does
it first.
1.3 For companies which have yet to use their trade marks in the
PRC, it is still worth obtaining a registration, as they can be
maintained (every three years) by satisfying nominal use
requirements.
1.4 Certain goods in the PRC are also required by law to bear a
registered trade mark before they can be marketed, eg.
pharmaceuticals for human use and tobacco products.
2 WHAT MARKS CAN BE REGISTERED?
2.1 Marks may be protected by registration in respect of specified
goods and services (using the international classification
system):
2.1.1 as marks used in business/commerce to denote the goods
of a particular trader
2.1.2 as collective marks (ie. to distinguish members of a
trade association or other grouping)
2.1.3 as certification marks (ie. to show that a certain
quality has been reached for the goods or services in
question)
2.2 Marks may also be registered or certified/acknowledged by the
PRC Trade Marks Registry as marks which are "well-known" in
China. Such acknowledgement gives enhanced protection under the
Unfair Competition Law to prevent use of similar marks even on
dissimilar goods or services to those for which the mark has
been registered.
2.3 To be registrable, a mark must be:
2.3.1 a visually perceivable sign. (It is not possible to
register sounds or smells or the three-dimensional
shape of a product.)
2.3.2 distinctive. In other words, it must not be
(i) descriptive of the goods or services in question
(ii) generic to the trade.
2.4 A mark will not qualify for registration if:
2.4.1 it contains a geographical name of an administrative
region in the PRC (at county level or above) or a well-
known foreign place name;
2.4.2 it is a mark which exaggerates the quality or other
characteristics of the goods or services so as to
deceive consumers
2.4.3 it is a mark which is "detrimental to socialist morals
or customs or having other unhealthy influences".
2.5 The Trademark Office may allow otherwise objectionable words to
be put on the register with a disclaimer, but usually only if
the disclaimer is requested from the outset.
2.6 A mark will be rejected if is the same or similar to a mark for
which an application or registration is pending in respect of
the same goods or services. It is possible (and recommended
practice) to search for conflicting prior applications and
registrations before filing.
3 THE IMPORTANCE OF SELECTING A CHINESE TRADE MARK
3.1 It is advisable for anyone marketing their goods or services in
the PRC to have their own Chinese trade mark. As English is not
widely spoken in the PRC, the majority of consumers will
identify with Chinese character trade marks in making their
purchasing decisions.
3.2 A Chinese character mark can be selected by:
3.2.1 "transliteration" of the foreign word mark, using
Chinese characters which sound the same as the foreign
word; or
3.2.2 "translation" of the mark, by choosing Chinese
characters which represent the meaning of the foreign
word.
Further details are set out in the section on "Choosing a
Chinese Trade Mark".
4 SECURING A TRADE MARK REGISTRATION
4.1 The Trademark Office examines applications for inherent
registrability and conflict with prior marks. The application
is then published for opposition; the opposition period lasts 3
months. If no objections are raised, a mark usually proceeds to
registration within 18 months to 2 years from the date of
application.
4.2 If the Trademark Office rejects the mark, an appeal to the
Trademark Review Appeal Board ("TRAB") is possible. This can
take 1 to 2 years to be decided.
4.3 If an opposition is filed, the Trademark Office will invite
each party to make submissions. A decision is usually rendered
1 year later. An appeal from that decision to the TRAB may then
be made.
5 SCOPE AND DURATION OF REGISTRATION
5.1 Each registration is valid for 10 years from the date of
registration with renewals available for further 10 year
periods.
5.2 Registration confers exclusive rights in relation to the trade
mark including the right to prevent others
5.2.1 using an identical or substantially similar trade mark
in connection with the same or similar goods for which
the mark is registered; or
5.2.2 taking unfair advantage of the mark in some other way.
6 INTERNATIONAL REGISTRATIONS VIA THE MADRID AGREEMENT/PROTOCOL
6.1 China is a signatory to the Madrid Agreement and accepts
International Registrations filed under the Agreement via WIPO.
6.2 China is also a signatory to the Madrid Protocol and accepts
filings which claim priority under this international
convention.
7 USE AND MARKING REQUIREMENTS
7.1 If a trade mark is not used as registered at least once every 3
years, the registration may be cancelled. However, simply
advertising the mark in approved publications or exhibitions
should satisfy this use requirement.
7.2 Trade mark owners are also required to use the "R" symbol or
the words "registered trade mark" in conjunction with the
registered trade mark applied to goods, as well as marking the
place of origin and the name of any licensee on to goods
bearing the registered trade mark.
8 CANCELLATION
8.1 Foreign companies entering the PRC market who find that their
trade marks have already been registered or applied for will,
because of the first to file principle, often find themselves
disbarred from using their own mark in China.
8.2 Where a prior application for the same or similar mark has yet
to be advertised, it can be resisted by opposition proceedings
once advertised, within the 3 month opposition period. If the
mark is already registered or the opposition period has
elapsed, it can be attacked by a cancellation action.
8.3 Cancellation actions may be brought without limit of time
against persons who have obtained registration of a mark by
improper means, which includes registering the mark by copying,
imitating or translating a well-known trade mark of another.
8.4 Cancellation actions, like opposition proceedings, can
last several years (including appeals). It is always more cost-
effective to file early and avoid disappointment.
9 BUSINESS NAMES
9.1 The Trademark Office is maintained by a division of the State
Administration for Industry and Commerce (SAIC). A separate
division of the AIC maintains a register for enterprise names
of both foreign and domestic enterprises, at local and national
level.
9.2 Registration at the national level lasts for 5 years from the
date of registration and gives exclusive rights of usage
throughout China within the scope of the enterprise's business
purposes. However, such registrations - for which the applicant
need not have a business presence in China - are currently in
suspension (since December 1994). This is due to perceived
incompatibility with the PRC Company Law which provides for
registration of company names and with the Trademark Law
provisions for registration of service marks.
9.3 Registration of an enterprise name at a local level may be
possible if some form of local presence is envisaged (eg. by
setting up a representative office or joint venture operation).
It is usually possible to reserve the name for up to 6 months
prior to the setting up of the business operation. Such
registrations give exclusive rights only for the geographical
area covered by the local AIC with which the registration is
filed (which could be at city, municipal or provincial level).
10 UNFAIR COMPETITION/PASSING OFF
10.1 Even if a trade mark or enterprise name has not been
registered in the PRC, it may be protectable under the Anti-
Unfair Competition Law.
10.2 This law provides for protection against
10.2.1 unauthorized use of unregistered trade marks,
packaging or trade dress, enterprise names or the
personal name of another party when these are well-
known in China;
10.2.2 "passing off" the registered trade mark of another
party (that is, using an identical or confusingly
similar mark, trade name or trade dress on identical
or similar goods or services); and
10.2.3 the making of false trade descriptions, including
misleading advertising.
10.3 Further protection is afforded to unregistered trade marks
under the pricks Product Quality Law. Whilst the aim of the
law is to make producers and sellers liable for defects in the
quality of their products, the law specifically prohibits the
counterfeiting or passing off of quality marks such as
certification marks, marks of fame and marks of excellence.
Traders are also prohibited from falsifying the place of
origin of their products, or from passing off the name and
address of their competitor.
1 May 1996
LINKLATERS & PAINES, HONG KONG OFFICE - Contact Partner Tom Hope
Internet address - thope@landp.com
Tel - 852 28424888
Fax - 852 28108133
FURTHER INFORMATION on the above may be obtained via Linklaters & Paines Hong Kong office or via any of the other nine Linklaters & Paines offices world-wide, located in Singapore, Tokyo, London, Brussels, Paris, Frankfurt, New York, Washington D.C. and Moscow. Contact details for the various L&P offices worldwide are available via the Linklaters & Paines corporate listing c/o Business Monitor Online - http://www.businessmonitor.co.uk
