China: The Problem With Defining ‘Famous'

Last Updated: 12 December 2016
Article by Cynthia S. Wang

A "well-known mark" is a concept provided by the China Trademark Law; while there is no definition of "famous mark" in any governing laws and regulations in China. In some jurisdictions, "famous" and "well-known marks" are treated as synonymous, or the standard for achieving famous trademark status is higher than that for well-known trademark. But in China, that's quite another matter.

Well-known Trademark

1. Definition and Protection Scope
A "well-known" trademark is usually considered as the mark which is known widely by the relevant public and enjoys relatively high reputation in China. Unregistered trademark or registered trademark owned by any party from any countries and areas could be recognized as a well-known trademark in China, if the relevant requirements could be met.
According to Article 13 of the China Trademark Law:

(1) Holders of trademarks known to the public may seek for protection of well-known trademarks in accordance with the provisions hereof, when they believe that their rights have been infringed.

(2) Where a mark is a reproduction, imitation, or translation of a third party's well-known trademark that has not been registered in China in respect of identical or similar goods, which is likely to lead to confusion, such mark shall not be registered and shall be prohibited from being used.

(3) Where a mark is a reproduction, imitation, or translation of a third party's well-known trademark that has been registered in China in respect of different or other types of goods, which may mislead the public and damage the interests of the registrant of the well-known trademark, such mark shall not be registered and shall be prohibited from being used.

Protection of well-known trademark in China is passive because it could only be used as one of arguments once trademark dispute occurs, according to Article 13.1 of China Trademark Law. The recognition of well-known trademark is on a case-by-case basis, so the effect of recognition is limited to the specific case. The successful recognition of a well-known trademark in one case thus does not necessarily mean that another case will yield the same result, although it can be cited as a reference in examination. There are mainly three ways to acquire well-known trademark in China: 1) TMO/TRAB case, such as opposition, opposition appeal, invalidation; 2) AIC enforcement against trademark infringement; and 3) Civil litigation against trademark infringement.

Protection of unregistered well-known marks is limited to identical or similar goods or services in accordance with Article 13 (2) of the Trademark Law; whereas the registered well-known marks can obtain cross-class protection according to Article 13 (2) of the Trademark Law. Such cross-class protection does not mean that the registered well-known trademark could be protected in any of 45 Classes, the factors, such as association between the goods and services, the distinctiveness of the trademark, the degree of its reputation, and the possible misunderstanding that will be caused to relevant consumers, will be taken into consideration in each specific case. Sometimes, the gap among the goods and services is large, and in such cases, the well-known trademark may also be protected to prevent the possible dilution of the distinctiveness and reputation, providing that the degree of trademark's reputation is very high, and the application of the disputed mark was filed in bad-faith.

2. Considered Factors in Determining Well-known Trademark Status

According to Article 14 of the Trademark Law, when determining whether a trademark is well known, the following factors should be considered:

(1) the extent of awareness by the relevant sector of the public;
(2) the duration of use;
(3) the duration, extent and geographical scope of advertising activities;
(4) other records of well-known status being granted;
(5) other factors serving to make the mark well known.

It is usually considered that the sales of trademarked products and promotion of the trademark should cover at least 10 provinces.

The examination process involves a comprehensive consideration of the above factors.

Where the trademark cannot meet all of these requirements, but it can nonetheless be proved that the trademark has a long history or enjoys a high reputation in the market, the mark may still be recognized as well known. For foreign applicants whose trademarks have long enjoyed a high reputation on the Chinese market, the burden of proof can be reduced to a reasonable extent.

In the case of Chanel v Huayi Maternal and Child Suppliers Company concerning trademark opposition ([2013] Goxingzhongzi No. 2019, issued by Beijing High People's Court), Chanel's trademarks were considered as achieved well-known status, though their submitted evidence does not meet each of factors listed in Article 14 of Trademark Law; and the opposed mark was rejected for registration finally. Hereunder is the brief summary of the case:

Opposed Trademark Cited Trademarks

Trademark

Goods Class 5: Sanitary napkins; antisepsis paper; etc. Class 5: Cosmetics, etc.

In this case, the Court held that, when determining a well-known mark, all the factors listed in Article 14 of Trademark Law will be comprehensively considered, but each of them is not a prerequisite that a well-known mark must satisfy. For the trademark that is widely known by relevant Chinese consumers, if the trademark holder has provided the basic evidential materials to prove that the trademark constitutes a well-known trademark, or the other party concerned had no objections, the Court recognizes the well-known status of the Chanel's trademarks. It is a fact that Chanel has been widely known to the public in China, enjoys high reputation through a long-term use and a lot of publicity. Cited marks also have been protected as well-known trademarks in previous cases. Therefore, the burden of proof can be reduced on Chanel, and their trademarks could be recognized as well-known trademarks.

The Court further considered that, the Chinese characters in the opposed trademark are identical to the cited mark 2, thus it is the imitation of the cited mark 2. The designated goods of both parties' marks are daily items. Therefore, the coexistence of the marks in the market would easily mislead the relevant public, dilute the well-known effect of the cited marks and may cause damages to Chanel.

- Famous Trademark

China Trademark Office and TRAB, State Administration for Industry and Commerce (SAIC) and Court are the authorities in charge of the identification of well-known trademark. While, as for famous trademark in China, it is governed and identified by local AIC of each province, and it is only applicable for trademarks registered by local companies or individuals. For foreign applicants, it is not available to apply for certification of "famous trademark" in China. For example, the Beijing Administration for Industry and Commerce could only organize and govern the certification of famous trademarks registered by the individuals or companies in Beijing city, China.

Generally, only the trademarks that registered for more than three years could be applied as "famous trademark" before local AIC. When filing petition, the evidence showing certain reputation of the trademark in this area should be submitted: the trademark have been used for 3 years already; economic indicator supported by audit report or certificate issued by tax authority; industry ranking at provincial level; rewards granted by the authorities at provincial level; publicity supported by the evidence such as advertising contract, copies of advertising and invoices. The certification of famous trademark could last for three years.
This may be a considerable option for the joint ventures or subsidiaries of foreign companies in C

Opposed Trademark Cited Trademarks

Trademark

Goods Class 5: Sanitary napkins; antisepsis paper; etc. Class 5: Cosmetics, etc.

In this case, the Court held that, when determining a well-known mark, all the factors listed in Article 14 of Trademark Law will be comprehensively considered, but each of them is not a prerequisite that a well-known mark must satisfy. For the trademark that is widely known by relevant Chinese consumers, if the trademark holder has provided the basic evidential materials to prove that the trademark constitutes a well-known trademark, or the other party concerned had no objections, the Court recognizes the well-known status of the Chanel's trademarks. It is a fact that Chanel has been widely known to the public in China, enjoys high reputation through a long-term use and a lot of publicity. Cited marks also have been protected as well-known trademarks in previous cases. Therefore, the burden of proof can be reduced on Chanel, and their trademarks could be recognized as well-known trademarks.

The Court further considered that, the Chinese characters in the opposed trademark are identical to the cited mark 2, thus it is the imitation of the cited mark 2. The designated goods of both parties' marks are daily items. Therefore, the coexistence of the marks in the market would easily mislead the relevant public, dilute the well-known effect of the cited marks and may cause damages to Chanel.

- Famous Trademark

China Trademark Office and TRAB, State Administration for Industry and Commerce (SAIC) and Court are the authorities in charge of the identification of well-known trademark. While, as for famous trademark in China, it is governed and identified by local AIC of each province, and it is only applicable for trademarks registered by local companies or individuals. For foreign applicants, it is not available to apply for certification of "famous trademark" in China. For example, the Beijing Administration for Industry and Commerce could only organize and govern the certification of famous trademarks registered by the individuals or companies in Beijing city, China.

Generally, only the trademarks that registered for more than three years could be applied as "famous trademark" before local AIC. When filing petition, the evidence showing certain reputation of the trademark in this area should be submitted: the trademark have been used for 3 years already; economic indicator supported by audit report or certificate issued by tax authority; industry ranking at provincial level; rewards granted by the authorities at provincial level; publicity supported by the evidence such as advertising contract, copies of advertising and invoices. The certification of famous trademark could last for three years.
This may be a considerable option for the joint ventures or subsidiaries of foreign companies in China.

It is important for Chinese trademark registrant to apply for the certification of famous trademark. It believed that the quality of the commodities or services on which the trademark is registered as famous trademark is relatively high, so registering famous trademark would be helpful for promotion of the business, the trademark, as well as the designated goods/services. Further, this also could play an important role in recognizing well-known trademark in future.

- Conclusion

Well-known trademark and famous trademark are two different concepts in China. The well-known trademark is offered a broader scope of protection; whereas the certification of famous trademarks are only applicable to trademarks registered by Chinese companies and citizens.

As for the foreign applicant's unregistered trademark that had acquired certain reputation but has not achieved well-known status, they could obtain a certain degree of protection under relevant articles of China Trademark Law, if any disputes occur. Considering the first-to-file principle in China, it is recommended filing trademark applications in China as early as possible.

The China Trademark Office also becomes more open to protect the trademark that had acquired certain reputation but not reached the well-known status. We have seen some opposition cases, where the marks are confusingly similar/identical, the goods/services are highly connected but not similar according to Chinese Classification system, such as goods in Class 30 (Coffee) and services in Class 43 (restaurant), and the cited mark enjoyed certain reputation. The China Trademark Office finally rejected these applications according to Article 10.1.(7) of Trademark Law, "signs deceptive, and may easily mislead the public with regards to quality and other features of the goods shall not be registered as a trademark".

Defensive applications in other related or even unrelated classes of goods/services would be an advisable way to better protect the trademark right in China, as compared to filing opposition/invalidation of other's trademarks, which cost much time and money, and the results are full of uncertainty.

It is important for Chinese trademark registrant to apply for the certification of famous trademark. It believed that the quality of the commodities or services on which the trademark is registered as famous trademark is relatively high, so registering famous trademark would be helpful for promotion of the business, the trademark, as well as the designated goods/services. Further, this also could play an important role in recognizing well-known trademark in future.

Conclusion

Well-known trademark and famous trademark are two different concepts in China. The well-known trademark is offered a broader scope of protection; whereas the certification of famous trademarks are only applicable to trademarks registered by Chinese companies and citizens.

As for the foreign applicant's unregistered trademark that had acquired certain reputation but has not achieved well-known status, they could obtain a certain degree of protection under relevant articles of China Trademark Law, if any disputes occur. Considering the first-to-file principle in China, it is recommended filing trademark applications in China as early as possible.

The China Trademark Office also becomes more open to protect the trademark that had acquired certain reputation but not reached the well-known status. We have seen some opposition cases, where the marks are confusingly similar/identical, the goods/services are highly connected but not similar according to Chinese Classification system, such as goods in Class 30 (Coffee) and services in Class 43 (restaurant), and the cited mark enjoyed certain reputation. The China Trademark Office finally rejected these applications according to Article 10.1.(7) of Trademark Law, "signs deceptive, and may easily mislead the public with regards to quality and other features of the goods shall not be registered as a trademark".

Defensive applications in other related or even unrelated classes of goods/services would be an advisable way to better protect the trademark right in China, as compared to filing opposition/invalidation of other's trademarks, which cost much time and money, and the results are full of uncertainty.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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