New guidelines on trade mark examination and review issued in China

The China National Intellectual Property Administration ("CNIPA") has adopted new Guidelines on Trade Mark Examination and Review ("Guidelines") to replace the previous Trade Mark Examination and Review Standards ("Standards"). The Guidelines became effective on 1 January 2022, and we are now ready to embrace several new practices.

The new Guidelines are composed of two sections. The contents have almost been doubled compared with the old Standards. The first section, composed of 25 chapters, provides guiding opinions on the formal examination and detailed information about the CNIPA's internal procedures for each case. It helps practitioners understand and manage the case from the formality aspects. This section is basically the same as our current practice, and therefore we will not discuss it in this blog.

The second section, with 19 chapters, provides guiding opinions on the substantive examinations in different cases. It is quite a substantial update and development of the old Standards. Having compared the two versions, we set out the key changes to our practice and our insights below for the readers' reference:
 

1. Basic principles on trade mark examination and review

The Guidelines introduce five basic principles of trade mark examination and review, namely the good faith principle, the principle of taking registration as primary, and the use as complementary, the principle of protecting prior lawful rights, the consistent standard and case-by-case principle, and the principle of preventing abuse of rights. These five basic principles provide a general basis for interpreting and applying law in the trade mark examination and review.  

2. Bad faith applications without intent to use

Based on the precedents and experience, the Guidelines identify nine typical cases that could be deemed as bad faith applications without intent to use, namely:

• Filing a large number of trade marks that obviously exceeds the needs of normal business activities and does not have an intent to use;
• Filing a large number of marks which are copies, imitations of  third parties' marks with certain fame or highly distinctive marks;
• Repeatedly filing one entity's mark which enjoys certain fame or has a strong distinctiveness;
• Filing a large number of trade marks that are identical with or similar to an other's trade name or its short form, domain name, product's name, packaging or trade dress with certain fame, slogan, design, etc.;
• Filing a large number of trade marks that are identical with or similar to a celebrity's name, famous work's name or character's name, and other's famous work of arts falling in the public domain;
• Filing a large number of marks that are identical with or similar to the names of administrative divisions, mountains, scenic spots, building names, etc.;
• Filing a large number of marks that are identical with or similar to the generic terms, signs directly indicating the quality, main raw materials, function, use, weight and quantity of designated goods or services;
• Filing a large number of applications for recordal of assignments transferring the registration to many different entities; and
• An entity which sold many marks to seek improper interests, forced commercial cooperation, and demanded high transfer fees, licensing fees, or infringement compensation from the other entities who used the mark first.

Meanwhile the Guidelines also confirm that marks filed for defensive purposes, which are similar to the applicant's registered marks and marks filed for future use with real expectations, shall not be deemed as a bad faith application. 

3. More unregistrable signs are added under Article 10 of the Trade Mark Law

Article 10 of the Trade mark Law stipulates the signs that shall not be registered and used as a trade mark. The Guidelines add more explanations and examples in this chapter. 

One of the significant changes is that the essential political terms of the CCP (Chinese Communist Party) are now added as a "political sign of bad influence". This change requires  practitioners to keep an eye on the political terms they might not be familiar with, as those terms themselves usually do not have any negative meanings.  

In addition, the names and the emblems of significant events, exhibitions, and archaeological activities are added as unregisterable marks. However, there is an exception to this if a permit from the relevant authority can be obtained when the mark may then be allowed to be registered.

4. Trade mark's distinctiveness issue

The following scenarios have been added as lack of distinctiveness, and more examples have been given:

• Words and expressions for daily use
• Only the full name of the applicant (excluding the natural person)
• Internet buzzwords and internet popular emojis
• Commonly used signs and symbols
• Festival name
• Aphoristic sentences

Where the mark includes the company's full name, if it also contains a distinctive logo, the mark could still be registerable. Or, if the full name has been used for a long time and has been firmly associated with the entity without confusion, it could be registered.

In addition, another change in this chapter is that, according to the old Standard, if a trade mark was composed of a non-distinctive sign and other elements, as long as the other element or the mark taken as a whole was distinctive and therefore can distinguish the source of goods and services, the trade mark was found to be distinctive. The guidelines change this to "for the trade mark consisting of independent words and other elements, if the word part is not distinctive, the trade mark as a whole shall be identified as lack of distinctiveness". If the examiner considers that the other element is distinctive, they may issue an examiner's opinion requesting the applicant to disclaim the word part. Accordingly, adding a disclaimer when the application is filed will be timesaving to avoid the examiner's opinion in such a situation. 

5. Examination on similarities issues

In the chapter for examination on similarities issues, more scenarios and examples for similar marks have been provided, while fewer exceptions have been added. We feel that as a result it is more likely that an examiner will find two similar rather than dissimilar marks and predict that the general success rate on the review of refusal cases will further decline.

6. Examination on recognition of well-known trade marks

For the cases requesting the recognition of well-known marks, the applicant shall be responsible for the authenticity, accuracy, and completeness of the said facts and the evidence submitted. For the entities who have been listed as untrusted entities, its mark shall not be recognised as a well-known mark. 

The Guidelines also update the list of acceptable evidence by including non-traditional business and non-traditional media evidence into the list.

7. Removal of prior use in the Chinese market

In the cases against the bad faith filing by the entity with a specific relationship (under Article 15.2) and pre-emptive filing based on prior use (under the second part of Article 32), the new guidelines removed the "use in the Chinese market" from the threshold requirements. The prior use does not necessarily need to be within the Chinese market. For the claims under Article 15.2, the entity only needs to show the use (not restricted in the Chinese market) and the specific relationship; for the claims under Article 32, it also needs to show that its mark enjoys certain fame or influence in China.

This change undoubtedly is good news for the entities who have not entered the Chinese market yet, but enjoy some internet reputation extended to China.

Our thoughts

From the above changes, we think that trade mark protection will be enhanced, especially against bad faith applicants, where it will be easier for the right owner to enforce its rights. On the other hand, we also note that the CNIPA seems to be becoming more conservative in granting registrations which is perhaps due to the increased and large number of filings. 

Finally, from the explanation of the publication of the Guidelines, we note that it states that the aim of trade mark examination and review is not only to protect the interests of the trade mark owner, but also to safeguard the state's dignity, public social interests, socialist market economy order and protect the rights and interests of consumers. It looks like that the CNIPA will take a more patriarchal role in trade mark examination, and as a result, there might be more unexpected issues in our new practice.