Working Guidelines on the Recognition of Well-known Trademarks

Regulation of trademarks in China is governed primarily by the Trademark Law of the People's Republic of China, which was initially passed in 1982, revised for the first time in 1993 and revised again in 2001. The 2001 version introduced the concept of "well-known trademarks," which offered broader and more comprehensive (albeit still limited) protection to trademark owners. Such trademarks can be recognized either by courts, including the Supreme People's Court (SPC), during litigation, or by the State Administration for Industry and Commerce (SAIC) via the SAIC's Trademark Office and its Trademark Review and Adjudication Board. Since 2001, Chinese courts and the SAIC have recognized approximately 1000 trademarks as "well-known" in accordance with the Trademark Law and its implementing regulations.

The term well-known trademark generally refers to a mark that is widely known by the relevant public and is highly reputable in China. Under the PRC Trademark Law regime, a well-known trademark is granted more comprehensive protection than a general trademark in two important respects:

i) a well-known trademark can be protected (as it pertains to similar goods or services) even if it has not been registered in China; and

ii) if a well-known trademark has been registered in China, courts may protect the trademark against usage with different classes of goods or services, in addition to the class of use for which the owner has registered the mark.

The law does, however, limit the protection granted to dissimilar products or services, prohibiting usage only when it might mislead the public or prejudice the interests of the owner of the well-known trademark.

Because the added protection afforded to well-known trademarks is valuable, numerous trademark owners in China have sought recognition in recent years. In some cases, they have even gone so far as to manufacture trademark dispute cases in an attempt to win well-known trademark recognition by a court.

China's Supreme People's Court and the SAIC have released two documents that aim to regulate, clarify and standardize the rules, definitions and procedures governing the recognition of well-known trademarks throughout China. The SPC released the Interpretation on the Application of the Law Concerning Several Issues Regarding the Trial of Civil Disputes Related to the Protection of Well-known Trademarks (Civil Disputes Interpretation) on April 23, 2009, two days after the SAIC issued its Working Guidelines on the Recognition of Well-known Trademarks (Trademark Recognition Guidelines).

Civil Disputes Interpretation

The main impact of the Civil Disputes Interpretation is to limit recognition of well-known trademarks by courts to cases in which the question of whether a trademark is well known constitutes a key factual element of the case. On the other hand, if a court can settle a dispute without granting recognition, it should do so. (For example, if the court would find infringement against an ordinary trademark, declaration of the trademark as being well known would be gratuitous.) This interpretation is designed to limit instances in which courts, rather than the SAIC, grant status as a well-known trademark.

In accordance with the Civil Disputes Interpretation, recognition as a well-known trademark can only be granted by a court where a lawsuit is filed based on a limited number of circumstances:

(i) an infringer's mark infringes on a well-known trademark that is not registered in China, with identical or similar goods or services;

(ii) an infringer's mark infringes on the rights of a well-known trademark registered in China with a different class of goods or services;

(iii) an enterprise name is identical or similar to a well-known trademark; or

(iv) a defendant institutes a counterclaim on the grounds that the plaintiff's registered trademark infringes its earlier unregistered well-known trademark.

In accordance with the Civil Disputes Interpretation, recognition as a well-known trademark can not be granted where:

(i) the presentation of the trademark as being well-known is not the factual basis for establishment of the alleged trademark infringement or unfair competition; or

(ii) the alleged trademark infringement or unfair competition is not established because it lacks crucial conditions specified in law.

In addition, recognition of a trademark as well known shall be recorded by courts as a fact in the case and grounds for judgment, rather than, as before, in the main body of the final judgment of the case.

The Civil Disputes Interpretation likewise attempts to clarify the meaning of key phrases in China's Trademark Law. As mentioned above, protection of trademarks against use with dissimilar goods or services is afforded only to registered well-known trademarks, and is to be granted only when infringement would mislead the public; the Civil Disputes Interpretation clarifies, for example, the standard that courts should use in deciding whether the allegedly infringing use does indeed mislead the public.

Trademark Recognition Guidelines

While the Civil Disputes Interpretation addresses the issue of courts recognizing well-known trademarks, the Trademark Recognition Guidelines address the other route by which trademark owners can seek "well-known" status: application to and review by the State Administration for Industry and Commerce. The Trademark Recognition Guidelines provide detailed procedures for such recognition.

An applicant for recognition as a well-known trademark shall go through application, review, re-examination and final examination procedures by different agencies under the SAIC before achieving final recognition.

Three agencies under the SAIC are authorized to grant recognition of well-known trademarks:

• The Trademark Office is responsible for reviewing applications for recognition initiated in the course of trademark administration.
• The Trademark Review and Adjudication Board is responsible for reviewing applications for recognition initiated in the course of trademark dispute procedures.
• The Well-known Trademark Recognition Committee (a new committee organized by high-level officers from the above two SAIC agencies) is responsible for the re-examination and verification of applications after review by the two agencies.