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China’s Fourth Amendment of the Trademark Law Come Into Force in November of 2019

Hengtai Law Offices
Shanghai, China

The fourth amendment of the Trademark Law of the People’s Republic of China was passed by the Standing Committee of the National People’s Congress on April 23, 2019 and the Amendments come into force from November 1, 2019.

In the past, one of the common complaints amongst foreigners on China’s trademark law, is the holding ransom of foreign trademarks by Chinese nationals. What this means is because China operates a ‘first-to-file’ system of IP protection, if a foreign company does not have their trademark protected in China, often some wicked Chinese companies will apply to have those marks protected. If the foreign company, to whom the trademark applies, then wants to use the mark in China, these Chinese company will demand an exorbitant fee for that right. This, unsurprisingly, has been a particular source of anguish amongst foreign companies and has led to several high-profile court cases involving the likes of Apple, New Balance and Michael Jordan.

The fourth amendment addressed this kind of complaint:

  1. The fourth amendment provided that the malicious trademark registration application not for the purpose of use shall be rejected and that any trademark registration which is obtained by deceptive or other improper means shall be declared invalid by the Trademark Office. Other legal entities or individuals may request the Trademark Review and Adjudication Board to declare such registered trademark invalid.
  2. The fourth amendment imposed an obligation on trademark agencies to avoid the malicious registration. A trademark agency shall not accept the entrustment of a client if it knows or should have known that the trademark entrusted by the client for registration application is a malicious trademark registration application.
  3. The newly amended Trademark Law stipulated the punishment to the malicious application of trademark registration and maliciously trademark lawsuit. The malicious applicant for trademark registration shall be subject to a warning, a fine or other administrative punishment.

The fourth Amendment also responded to foreigners’ another common complaint on China’s trademark law—-Inadequate compensation for trademark infringement. According to the newly amended Trademark Law, “Where the actual loss suffered by the right holder as a result of the infringement, the profits gained by the infringer from the infringement and the royalties of the registered trademark concerned are difficult to determine, the people’s court shall render a judgment on awarding damages of up to RMB five million depending on the circumstances of the infringing acts”.

The fourth Amendment improved protection of consumers’ interests too.

 

For more information, please contact:

Edward Sun, Managing Partner         email: edward.sun@hengtai-law.com

April Yang, Associate            email: aprilyang@hengtai-law.com


The general information contained herein is intended for informational purposes only. It is not intended to be, and should not be construed as, legal advice or legal opinion on any specific facts or circumstances.

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