Zhang Ping
Executive Vice-President of Intellectual Property School of Peking University
China’s trademark industry has made qualitative leaps in recent years, however there exist some deficiencies.
The following two aspects can state the qualitative leaps of trademark industry in China. Firstly, the trademark legal system is improving gradually. The third revision of the Trademark Law is not a passive response driven by meeting international treaties’ obligation, it is a proactive revision to adapt China’s current social and economic development. Some newly added provisions such as good faith, punitive damages, time limits on trademark registration examination and case trial are all vital to China’s trademark development. It is worth to expect the results it will bring to China’s trademark development.
Secondly, trademark judicial protection is significantly enhanced. China’s trademark protection adopts both judicial and administrative protection within one system, with the judicial protection playing the dominate role. The Chinese courts properly handled a large number of trademark dispute cases in recent years, which shows the great enhancement of trademark judicial protection. The problem of insufficient compensation has long been criticized. In practice, if the plaintiff fails to establish evidence in meticulous details with regard to its losses due to the infringement or the infringer’s unjust enrichment, courts could award nothing but statutory damages, which before the third revision of the Trademark Law, was merely 500,000 yuan of its upper limit. To address the above problem, the Chinese courts explore the deliberating compensation approach. By applying this approach in some cases, which the plaintiff can provide some infringing and losses evidence but fail to calculate the exact amount of losses, the court can break the shackles of statutory damage provision.
As for the deficiencies, there are three major problems. Firstly, the trademark squatting problem is still prominent. There are a various forms of squatting, including infringing others’ prior rights squatting, trademark agent squatting, large-scale speculative squatting and etc. It is good for Chinese companies to realize the value of trademark, but such kind of improper use of trademark should be prohibited. Cultivating a good faith ethos and philosophy in business operation is the only way for China’s trademark industry development.
Secondly, the protection on well-known trademark needs further enhancement. Well-known trademark system aims to strengthen protection, to make the protection scope corresponds with the brand’s popularity and distinctiveness. However, the well-known trademark is always considered as a honorary title rather than a legal concept in China for a long period, which results to the false trademark litigation aiming at the well-known trademark granting. The third revision of the Trademark Law newly added the provision states that “a producer or operator shall not use the words ‘Well-known Trademark’ on its goods, packaging, or container, or in its advertising, exhibitions or other commercial activities.” The judicial authority can take this opportunity to make full and good utilization of the system, and strengthen the protection of well-known trademark thereafter.
Thirdly, working efficiency and quality of the trademark administrative authorities on trademark authorization and determination need to be improved. Trademark authorization and determination procedure in China is rather complicated, with limited staffs but a great number of applications, the whole procedure from application to right authorization tends to be rather long. It is learned that the trademark office and the trademark review and adjudication board still get backlog to deal with. How to effectively manage and make the entire procedure works more smoothly in high quality is a priority for the administrative authorities.
