'Chi Ming' - well-known trademarks in the PRC
by David Allison
June 2003 has seen the implementation of three new trademark regulations by China's State Administration for Industry and Commerce ("SAIC") designed to meet China's WTO and TRIPS obligations . Of most interest to foreign enterprises dealing with China has been the introduction of the Recognition and Protection of Well-known Trademarks ("the New Regulations") which repeal the 1996 Recognition and Administration of Well-Known Trademarks Tentative Provisions.
Recognition of Well-known Status
Obtaining recognition of well-known status ("chi ming" in Chinese) provides the holder of a foreign registered trademark a cause of action against infringement in China with respect to the same class of goods. Well-known status also provides the holder of a mark registered in China protection from infringement in regards to dissimilar goods and services . The Trademark Law does not define "well-known" and previous pronouncements from SAIC have assisted in clarifying its meaning.
The New Regulations
Article 2 defines a well-known mark as a trademark: "that is widely known to the relevant public and enjoy(s) a relatively high reputation in China". This definition emphasises that regardless of overseas reputation, an applicant for well-known status must establish reputation in China.
Evidentiary issues are addressed in Article 3, clarifying the Trademark Law by providing that the following may be used to prove well-known status;
(a) materials proving the degree to which the trademark is known among the relevant public;
(b) materials proving the length of continuous use of the trademark;
(c) materials proving continuous length, degree and geographical scope of any publicity work for the trademark, including materials relating to the form of advertising and publicity;
(d) material proving the record of protection of the trademark; and
(e) other evidence proving that the trademark is well known, including output, sales volume, etc.
It is noteworthy that these evidentiary considerations are almost identical to those which influenced the Court in deciding the famous IKEA case . The use of identical considerations is unlikely to be a mere coincidence and provide an pertinent example of the growing influence of court-made decisions in China .
Articles 4 to 9 of the New Regulations address procedural issues and focus on opposition and revocation of infringing marks. Of particular note is Article 9 which imposes a one year ban on applying for recognition on the same grounds if well-known status is not made out. This should provide a warning to foreign mark holders to avail themselves of the full suite of evidentiary avenues provided under Article 3 and not merely rely on the fact that their mark is well known outside of China.
Finally, Article 12 provides that prior protection as a well-known mark can be used as evidence in future proceedings. This is a welcome advance but does not provide the blanket protection that holders of foreign marks were hoping to obtain. Rather than gaining prima facie protection in all subsequent proceedings, the recognition of well-known status is merely one factor to be taken into consideration in future actions.
The New Regulations constitute another important step in China's IP reform program aimed at ensuring compliance with China's WTO obligations. Foreign trademark holders of famous brands will likely welcome the additional clarity and certainty that the New Regulations provide. However, the Regulations make it clear that a foreign trademark holder cannot merely rely on the reputation of the mark outside China - the foreign mark holder must actively promote the mark, develop its reputation and establish it as well-known within China.