Opinion on protection of well-known marks in civil disputes issued

As part of its continuing efforts to protect well-known marks, the Adjudication Committee of the Supreme People's Court of the People's Republic of China issued an "Opinion on Certain Issues Concerning the Protection of Well-Known Marks in Civil Disputes" on April 22 2009. The opinion came into effect on May 1 2009.

According to the opinion, 'well-known marks' are trademarks which are widely known and are recognized by the public in China. The opinion specifies that the courts will determine whether a mark is well known where:

the plaintiff claims that the infringing mark is a reproduction, imitation or translation of a well-known mark and use of such a mark may lead to confusion among the public;
the dispute involves a company name which is identical or similar to a well-known mark; and
the defendant claims that the trademark relied upon by the plaintiff is a reproduction, imitation or translation of a third party's well-known mark.

The opinion states that in trademark infringement, unfair competition and domain name disputes, if there is no need to determine whether the mark at issue is well known, the court should not make a determination in this respect. If the court determines that the mark is well known, this finding should be used only as the factual basis of the decision and in the reasons for judgment, but should not be included in the court order. If the matter is resolved by mediation, the decision should not include a determination as to whether the mark is well known.

Further, the opinion provides that where a mark has been recognized as well known by the courts or by the State Administration for Industry and Commerce before the filing of an action for trademark infringement or unfair competition, the court must confirm that the mark is well known, unless the defendant disputes that fact.

In determining whether a mark is well known, the court should consider:

the reputation and history of use of the mark;
the duration, extent and geographical scope of any advertising activities;
any enforcement actions; and
other factors as may be appropriate.

According to the opinion, the owner of the mark will typically have to provide the following information to ensure that the court can make a thorough and objective assessment:

market shares;
sales territories;
profits;
ranking within the industry;
market survey reports; and
market evaluation analysis.

If the mark is already widely known in China and the owner has provided the relevant basic information, the court must confirm the well-known status of the mark, unless the defendant disputes this status.

Where the court is asked to restrain a defendant from using a mark which is identical or similar to a well-known mark for dissimilar goods or in a company name, the court must take into consideration:

the degree of fame of the well-known mark;
the degree of recognition of the well-known mark among consumers;
the degree of association between the goods offered under the well-known mark and those offered under the allegedly infringing mark or company name; and
other relevant factors.

The opinion further states that if a registered trademark is a reproduction, imitation or translation of a well-known mark and allegedly infringes that mark, the court should not order that the defendant cease using its mark:

unless the action was initiated within five years of the date of registration of the mark or, if the action was initiated after expiry of the five-year period, it is proved that the registration has been made in bad faith; or
where the well-known mark was not well known when the defendant applied fo the registration of its mark.

The opinion also explains what constitutes 'confusion' for trademark infringement purposes. According to the opinion, confusion occurs when the public may be misled into thinking that goods bearing the allegedly infringing mark:

originate from the owner of the well-known mark; or
are endorsed by, or otherwise affiliated or associated with, the owner of the well-known mark.

Further, the opinion states that such confusion will "prejudice the interest" of the owner of the well-known mark where use of the allegedly infringing mark would:

disparage or dilute the distinctiveness of the well-known mark; or
take unfair advantage of the reputation of the well-known mark.

Kenny Wong, JSM, Hong Kong

Opinion on protection of well-known marks in civil disputes issued

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