Protection of Prior Used but Unregistered Trademarks in China

Although China adopts the principle of registration in trademark protection, it offers certain protection for prior used and unregistered marks in some circumstances. The China Trademark Law has gone through four amendments in 1992, 2002, 2013 and 2019. According to the current trademark law (2019), the prior used but unregistered trademarks can be protected under Article 13.2, 15, 31, 32 and 59.3. Examples are as follows:

Article 13.2 offers protection to unregistered well-known trademark(s) on the same or similar goods in China. A trademark applied for registration in respect of identical or similar goods is a reproduction, imitation or translation of another party’s well-known mark that is not registered in China and is liable to create confusion, shall not be registered and its use shall be prohibited. It is very difficult to achieve well-known mark (WKM) recognition in China as the mark owner shall submit a huge amount of evidence to prove the extensive use of its mark and high reputation acquired in China. Fortunately, we helped our client Chateau Lafite Rothschild achieve it in a civil litigation against two defendants on trademark infringement before Shanghai Intellectual Property Court. We claimed the plaintiff’s mark “拉菲“ (read as LA FEI, Chinese name of LAFITE) was an unregistered well-known mark during the period the two defendants used the infringing marks “MORON LAFITTE” and “拉菲特” (read as LA FEI TE）on wines and requested the Court to grant WKM protection of this unregistered mark. Upon examination, the court held that it is necessary to recognize the well-known status of the plaintiff’s unregistered mark “拉菲“(Chinese name of LAFITE), finally decided the defendants infringed upon the right and interests of the plaintiff’s registered mark “LAFITE” and unregistered well-known mark “拉菲“ (Chinese name of LAFITE), and granted RMB 2 million as compensation damages and reasonable fees. The case was one of 50 typical IP cases nationwide selected by China Supreme People’s Court for year 2017, and one of ten typical litigation cases announced by Shanghai Court for year 2018[i].

Article 15 prohibits trademark registration in the name of the agent or representative of the proprietor without the latter’s authorization. It was first introduced in the amendment of China Trademark Law in 2001 and was improved in the amendment in 2013 by adding Article 15.2 which prohibits trademark registration in the name of a related party who is aware of the existence of another party’s trademark due to contractual, business or other relationships. We helped our client BELLAMY'S ORGANIC PTY LTD (the opponent) claimed protection of Article 15 and successfully opposed its agent’s trademark applications for “BELLAMY’S” and Chinese equivalent “贝拉米” (read as BEI LA MI) in classes 29 and 5. In the oppositions, we filed solid evidence to show the trademark applicant Guangzhou Dingbang Healthcare Products Co., Ltd. (the opposed party) was the local distributor/agent of the opponent’s dairy products, milk powder, milk powder for babies in China, and was fully aware the opponent’s marks and applied for the same marks and corresponding Chinese marks in its own name without authorization. After the China Trademark Office justified our oppositions, BELLAMY'S ORGANIC PTY LTD removed the prior obstacles and has registered the marks “BELLAMY’S” and Chinese mark “贝拉米” (read as BEI LA MI) in classes 29 and 5 in its name.[ii]

Article 32 offers protection to other prior rights and interests (instead of prior trademark registration) and unregistered marks already used by another party and with certain influence in China. The other prior rights cover prior trade name, copyright of work of art, design patent, personal name, personal portrait, etc.. For example, in the China Supreme People’s Court’s guiding case of No. 113[iii], the Supreme Court decided that the trademark Reg. No. 6020569 “乔丹” (Chinese name of JORDAN) in class 28 in the name of JORDAN SPORTS CO., LTD infringed upon the invalidation applicant Michael Jordan’s prior personal name and violated the principle of good faith. Taking into account of the Supreme Court’s retrial decision, the CNIPA provides explicitly the general conditions for protecting prior personal name in the Guideline of Trademark Examination and Adjudication (2021). The conditions include: 1. The personal name shall enjoy a certain reputation in China and has established a steady corresponding relationship with the natural person. The related public uses the name to refer to the natural person; 2. The mark is likely to cause damages to the natural person ’s prior personal name; 3. The mark is registered without authorization of the natural person who enjoys the personal name right.

The last sentence of Article 32 provides that no applicant for trademark application may, by illegitimate means, rush to register trademark that is already in use and has certain influence. We won cases for our clients. In the appeal we filed on behalf of BINGGRAE CO., LTD. regarding the invalidation against the disputed mark No. 31504396 “” in class 32, Beijing Intellectual Property Court recently decided our evidence proved the promotion and advertisement of the client’s mark “ ” on coffee and had achieved certain influence in mainland before the application date of the disputed mark. The disputed mark is identical in composing letters, design and details. It is hardly a coincidence. The mark owner LIANG SHU MIN should be aware of our client’s business and the goods “milk tea (non-milk based), etc.” of the disputed mark in class 32 are similar to our client’s coffee in function, use, distribution channels and customers. So the Court upheld our appeal and overthrew the CNIPA’s invalidation decision.[iv]

Article 59.3 provides protection for the right of prior use of trademark under certain conditions. It was introduced in the amendment of China Trademark Law in 2013. The purpose is to balance the interests of trademark registrants and prior users of trademarks. The prior users of unregistered trademarks shall satisfy five conditions at the same time: 1. The unregistered mark shall be used before the trademark registrant applied for trademark registration; 2. The unregistered mark shall be used before the trademark registrant’s use of its marks; 3. The unregistered mark shall have established certain influence before the trademark registrant applies for trademark registration; 4. The use of unregistered mark shall not exceed the original scope of goods and services, business area, etc.; 5. If the trademark registrant requires, the prior user shall add appropriate indication for the purpose of distinction. However, according to our experience, the defendants may claim prior use but can hardly meet the conditions in the civil litigations on trademark infringement.

Besides, in order to use an unregistered mark freely, the prior user or owner can bring an action (e.g. opposition, invalidation, cancellation) against other party’s prior trademark registration according to Article 10.1.7 (deceptive or misleading marks), 10.1.8 (marks with bad influence), 11 (marks in lack of distinctiveness), 12 (special requirements for three-dimensional marks) , 16.1 (marks containing geographical indications), 19.4 (restriction on trademark agency’s applications), 31 (prior applications prevail), 44.1 (marks acquired via fraud or illegitimate means) and 49 (cancellation of marks for becoming a generic name of goods, and cancellation of unused marks). Alternatively, after disputes arise, the prior user of unregistered trademarks can try to reach an agreement with the trademark registrant in China. Whatever actions, it may take years to complete the procedures before the CNIPA and Courts, and/or cost a lot.

In summary, considering the principle of registration for trademark protection in China, if it is possible, trademark registration in the first place is cost and time saving. We strongly suggest trademark owners make the most of China’s trademark system and register their trademarks in China if they use the marks in China, or if they make the goods in China but sell them in other countries.

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Abstract: While China's trademark system is centered on trademark registration, it offers certain protection for prior used and unregistered marks in some circumstances after four rounds of amendment of China Trademark Law. But after reviewing the examples, if it is possible, trademark registration in the first place is cost and time saving.