The China IP Administration’s Trademark Application Submission Rules translated here by CBL into American English provides additional regulations for trademark applications and cancellations beyond the Trademark Act. These rules seek to impose integrity (规范) on the translation application process, to prevent intellectual property theft and trademark squatting. Of particular interest is rules prohibiting bad faith or unfair applications, regulatory penalties, and a route to cancel such trademarks. These rules offer rights that can be used to fight back against trademark squatters and counterfeiters.
******************
Trademark Application Integrity Rules
(Issued on October 11, 2019 by the National Administration for Market Regulation under Order No. 17)
Section 1 The purpose of these rules is to govern trademark application practices, deter bad faith applications, ensure integrity in trademark registrations, and protect the public interest, and are issued under the PRC Trademark Act and its Administrative Regulations (the “Trademark Act” and “Administrative Regulations”)
Section 2 Trademark applicants must have a genuine need for exclusive rights to the trademark, and file trademark applications in accordance with applicable laws, administrative regulations, and agency rules.
Section 3 Trademark applications must be filed in good faith. A person may not:
(a) In bad faith and lacking intent to use, as provided in Trademark Act §4;
(b) Copy, imitate, or translate famous marks, as provided in Trademark Act §13;
(c) For agents or representatives, file trademark applications without their client’s consent as provided in Trademark Act §15; knowingly apply for a trademark that the applicant knows has prior use whether through contracts, business, or otherwise;
(d) Infringe on others’ prior use rights or bad faith squatting on trademarks that have significant prior use, as provided by Trademark Act §32;
(e) File trademark applications through deceptive practices or other bad faith methods;
(f) Do anything that violates the principle of good faith, is immoral, or has a bad influence.
Section 4 Trademark services must act in good faith. Trademark services shall not accept engagements from clients for a trademark application that is:
(a) In bad faith and lacking intent to use, as provided in Trademark Act §4;
(b) Subject to Trademark Act §15;
(c) Subject to Trademark Act §32;
Trademark services shall not disrupt the trademark agent services market with unfair practices, or file trademark registrations without authorization.
Section 5 The trademark registrar may reject bad faith trademark applications that violate Trademark Act §4, and without making public notice.
The trademark registrar shall establish specific examination criteria under the Trademark Act and its Administrative Regulations.
Section 6 The trademark registrar shall review oppositions filed within the opposition period for trademarks that have been published after passing the preliminary examination, and shall reject applications if the oppositions are established.
The trademark registrar shall reject reexamination requests for trademarks previously refused, if they fail to comply with the criteria set forth in these Guidelines.
Section 7 The trademark registrar shall review the requests for cancellation of registered trademarks made within the prescribed period resulting from violation of these Rules. Such trademarks shall be declared canceled if the cancellation requests are established.
The trademark registrar shall cancel an existing registration pursuant to Trademark Act §44 if it violates these Rules.
Section 8 The trademark registrar shall weigh the following factors to determine if an application violates Trademark Act §4:
(a) The number of trademark applications filed, the scope of goods and services designated, and trademark transactions of the applicant or their affiliate, whether an individual, legal entity, or another organization;
(b) The applicant’s industry and business conditions;
(c) A prior effective administrative judgment or decision, or court judgments that found the applicant acted in bad faith when making a previous trademark application, or infringed upon another’s exclusive rights to a registered trademark.
(d) The application is for a mark similar or identical to one with notable commercial recognition;
(e) The proposed mark is similar or identical to the name of a public figure, business entity’s registered name, business entity name abbreviations, or other commercial identifiers.
(f) Other factors weighed by the trademark registrar.
Section 9 Trademark assignments shall not affect any subsequent findings of violations of §3.
Section 10 Any individual or entity can petition the trademark registrar to cancel a trademark registration if it goes unused for three consecutive years without valid reason. Upon receiving such a petition, the trademark registrar will require the registrant to establish use of the mark or describe the valid reason for nonuse within two months of receipt of notice. In the absence of a valid reason for non-use, failure to provide evidence of use or invalid evidence, will result in the cancellation of the trademark registration by the trademark registrar.
Section 11 The trademark registrar will make all decisions and judgments under §5, §6, and §7 available to the public.
Section 12 Applicants who submit filings in bad faith or in violation of §3 herein will incur penalties under PRC Trademark Act §68(4). Jurisdictional market regulatory agencies at or above the county level may impose warnings, penalties, or other administrative sanctions based on the severity of the violations. Violators may be fined up to three times the illegal gains from the violation, with a maximum of ¥30,000, or up to ¥10,000 if no profits were involved.
Section 13 Jurisdictional market regulatory agencies shall issue warnings to trademark service providers who breach §4 of these Rules and set a deadline for correction. In addition, providers may be fined between ¥10,000 and ¥100,000, while responsible managers and others are subject to fines ranging from ¥5,000 to ¥50,000, and crimes shall be prosecuted to the full extent of the law. Intellectual property administrative agencies may prohibit service providers guilty of severe violations from providing trademark representation services and publicize the restriction.
Section 14 All administrative penalties will be displayed in the National Business Entity Credit Information Lookup System.
Section 15 Intellectual property administrative agencies will meet with directors of service providers found in violation of §4 to discuss required corrective actions.
Section 16 Intellectual property and market regulatory agencies will provide guidance for trademark applicants and service providers in submitting compliant registrations, providing compliant representation services, and ensuring proper use of registered trademarks.
Furthermore, intellectual property administrative agencies shall improve trademark application channels, registration processes, and services to facilitate direct submissions.
Section 17 Intellectual property administrative agencies shall continue developing internal oversight policies and enhancing oversight of agency employees to ensure compliance.
Government employees found to have engaged in negligence, abuse of power, misconduct, unauthorized processing of trademark registrations, or bribery will face legal penalties and may be criminally prosecuted if their actions amount to a crime.
Section 18 Trademark service industry associations are required to refine self-regulation guidelines, enforce action against members that violate these guidelines, and promptly report member violations.
Section 19 These rules shall take effect on December 1, 2019.
******************
See Trademarks FAQ to learn more about how trademarks work in China
This article was translated to American English from the following government publication:
市场监管总局：“规范商标申请注册行为若干规定”
https://www.gov.cn/xinwen/2019-10/16/content_5440654.htm#