SAIC published revised examination standards for trademarks

On January 4, 2017, revised Trademark Examination Standards (hereinafter the “Standards”) came into force. The new Standards would have some impact on certain elements of interpretation of the Trademark Law and Implementing Regulations to the Trademark Law. It is worth mentioning that the Standards have an important role in guiding the action of administrative and judicial authorities which in most cases abide literally by the Standards.

Among the most relevant elements of novelty we wish to bring to your attention those relating to bad faith interpretation.

In accordance with the previous formulation of the Standards,trademark applications shall be rejected – under Art. 15.2 of the Trademark Law - where the infringer’s marks meet the following conditions:

1) The trademark had been used by the real owner before the infringer’s application date;

2) The real owner can prove a business relationship with the infringer thanks to which the infringer had access to the trademark;

3) The trademark is identical or confusingly similar on the same or similar goods or services.

We highlight that in this formula the representative relationship is limited to the on-going or finished relationship. The real owner shall prove such relationship with contracts, invoices, purchasing documents, etc.

In the newly issued Standards, while the conditions remain unchanged, the scope for representative relationship is broadened for the reasons as follows.

1) It protects the intention and preparation of the business relationship. If an infringer preemptively registers the mark during the trade negotiation, the trademark shall not be approved and if approved rejected/invalidated upon opposition/invalidation. The evidence can include not only the contracts or invoices, but also any materials showing the intention of cooperation.

2) The definition of “infringer” is limited not only to the infringer himself or itself, but also to his or its relatives, investment partner or a third party with collusive fraudulent intention.

The following actions should be considered when determining whether there is bad faith:

1) Registration by fraudulent means.

a) Signature falsification: trademarks will be cancelled where an infringer forged the signatures or seals shown on the application form;

b) Qualification falsification: trademark will be cancelled where an infringer forged the certification of incorporation, ID card, passport, etc.

c) Other falsifications

Besides the falsification, the new Standardsalso add the following improper means:

a) The infringer files many trademarks that are identical or similar to distinctive trademarks belonging to others;

b) The infringer files numerous trademarks which are identical or similar to famous trade names, company names, trademarks, packages or association names belonging to others;

c) The infringer files several trademarks without an intention to put them into actual use (e.g. threatening the real owner for a high transfer fee or possible business authorization, tort compensation, etc.)

d) Other cases in practice.

Furthermore, it clearly demonstrates the above-mentioned infringer is limited not only to himself/itself but also to a third party with collusive fraudulent intention or relationship.