Page 22 - THE SOUTH CHINA BUSINESS JOURNAL
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kle on Bad-Faith Trademark
Registration in China
By Terrence Leow to transfer marks (“trade mark squatting”) or
UTC Intellectual Property Law Firm to piggy-back on the reputation of established
brands. The issue of Bad-faith trade mark
In today’s global economy, China has always been applications is the single most common business
an attractive market for many foreign companies irritant reported to the British Embassy in Beijing,
to conduct business. But bad-faith trademark affecting hundreds of marks each year across all
registration has always been a major problem in the industry sectors.
filed of trademark which highlights the dilemma that
foreign enterprises may face in the country. IT IS TIME TO BUILD UP THE FIREWALL
WHY BAD-FAITH APPLICANTS CAN MOVE THE To counter bad-faith trademarks, China has passed
CHEESE? a new law, the Trademark Law of the People's
Republic of China (2019 amendments) which come
As the number of trademark registrations in into force on 1 November 2019. CNIPA, provides
China is increasing rapidly, with the continuous the explanation with the needs for amendments.
development of the economy, the speed of With the optimization of the trademark
information dissemination, the optimized registration process, the shortening of the
trademark registration procedure, the increasing registration cycle, and the reduction of registration
development of the people’s brand awareness, a costs, it is more convenient for parties to obtain
large number of bad-faith trademark registration trademark registrations. At the same time, there
has also come with it. have also been problems such as bad- faith
applications for the purpose of naming famous
According to the statistic extracted from the China brands and a large number of trademark hoarding
National Intellectual Property Administration for profit transfer. It disrupted the order of
(CNIPA), In the first half of 2019, the number of the market economy and the management of
trademark applications in China was 3.438 million, trademarks, aroused widespread concern in
with a year-on-year decrease of 4.1%; the amount society, and strongly called for regulation. A few
of trademark registration was 3.515 million, with a notable grounds of challenging bad-faith filings
yearly increase of 67.8%. As of the end of June, the changes come in the form of amendments to the
number of valid trademark registrations in China Trademark Law. Article 44, which provides that "A
was 22.743 million, an increase of 35.3% year-on- natural person, legal person, or other organization
year, and on average, 5.2 market entities had one that needs to obtain exclusive rights to a trademark
valid trademark. for its goods or services in its production and
business operations shall apply to the Trademark
China’s registered trademark protection adopts Office for trademark registration. An application
the principle of ‘first-to-file’, which meant that the for the registration of a malicious trademark not
right to use a logo and brand does not belong to for the purpose of use shall be rejected.." In simple
the entity that created it, but to the one that files terms, any bad-faith trademark applications
it first. In other words, as long as the application without intent to use shall be dismissed.
for registration of a trademark is approved, the
trademark are now protected by the law, regardless In accordance to Article 445,“Registered
of its actual use and subjective intention of the trademarks that violate Articles 4, 106, 117, 128,
trademark applicant to apply for registration of and 199 of Article 4 of this Law, or have obtained
the trademark. registration by deception or other
improper means, The Trademark Office shall
Thus, this creates a loophole, that bad-faith declare the registered trademark invalid; other
applicants are taking advantage of it. Bad-faith
applicants in China target both domestic and
international brands, seeking to extract payment
19 AmCham South China
Registration in China
By Terrence Leow to transfer marks (“trade mark squatting”) or
UTC Intellectual Property Law Firm to piggy-back on the reputation of established
brands. The issue of Bad-faith trade mark
In today’s global economy, China has always been applications is the single most common business
an attractive market for many foreign companies irritant reported to the British Embassy in Beijing,
to conduct business. But bad-faith trademark affecting hundreds of marks each year across all
registration has always been a major problem in the industry sectors.
filed of trademark which highlights the dilemma that
foreign enterprises may face in the country. IT IS TIME TO BUILD UP THE FIREWALL
WHY BAD-FAITH APPLICANTS CAN MOVE THE To counter bad-faith trademarks, China has passed
CHEESE? a new law, the Trademark Law of the People's
Republic of China (2019 amendments) which come
As the number of trademark registrations in into force on 1 November 2019. CNIPA, provides
China is increasing rapidly, with the continuous the explanation with the needs for amendments.
development of the economy, the speed of With the optimization of the trademark
information dissemination, the optimized registration process, the shortening of the
trademark registration procedure, the increasing registration cycle, and the reduction of registration
development of the people’s brand awareness, a costs, it is more convenient for parties to obtain
large number of bad-faith trademark registration trademark registrations. At the same time, there
has also come with it. have also been problems such as bad- faith
applications for the purpose of naming famous
According to the statistic extracted from the China brands and a large number of trademark hoarding
National Intellectual Property Administration for profit transfer. It disrupted the order of
(CNIPA), In the first half of 2019, the number of the market economy and the management of
trademark applications in China was 3.438 million, trademarks, aroused widespread concern in
with a year-on-year decrease of 4.1%; the amount society, and strongly called for regulation. A few
of trademark registration was 3.515 million, with a notable grounds of challenging bad-faith filings
yearly increase of 67.8%. As of the end of June, the changes come in the form of amendments to the
number of valid trademark registrations in China Trademark Law. Article 44, which provides that "A
was 22.743 million, an increase of 35.3% year-on- natural person, legal person, or other organization
year, and on average, 5.2 market entities had one that needs to obtain exclusive rights to a trademark
valid trademark. for its goods or services in its production and
business operations shall apply to the Trademark
China’s registered trademark protection adopts Office for trademark registration. An application
the principle of ‘first-to-file’, which meant that the for the registration of a malicious trademark not
right to use a logo and brand does not belong to for the purpose of use shall be rejected.." In simple
the entity that created it, but to the one that files terms, any bad-faith trademark applications
it first. In other words, as long as the application without intent to use shall be dismissed.
for registration of a trademark is approved, the
trademark are now protected by the law, regardless In accordance to Article 445,“Registered
of its actual use and subjective intention of the trademarks that violate Articles 4, 106, 117, 128,
trademark applicant to apply for registration of and 199 of Article 4 of this Law, or have obtained
the trademark. registration by deception or other
improper means, The Trademark Office shall
Thus, this creates a loophole, that bad-faith declare the registered trademark invalid; other
applicants are taking advantage of it. Bad-faith
applicants in China target both domestic and
international brands, seeking to extract payment
19 AmCham South China
