Weekly China Trademark News Updates

September 7, 2021

1. “NEW BALANCE” ousted “New bunren”

On August 13, 2021, the Beijing High Court affirmed the first instance court decision in favor of the CNIPA over a trademark invalidation dispute.

Disputed Mark	Cited Mark

The Disputed Mark was approved for registration on January 7, 2011, and New Balance filed an invalidation petition on June 28, 2018, after the five-year statute of limitation on filing an invalidation petition against a registered trademark. The CNIPA, however, found that the Disputed Mark constituted as maliciously imitating other’s well-known registered trademark under Article 13(3) of the Chinese Trademark Law, and concluded that New Balance’s invalidation petition was not limited by the five-year statue of limitation.

The Beijing High Court affirmed the first instance court decision finding that New Balance had submitted sufficient evidence proving that the Cited Mark was widely known and enjoyed high fame among the relevant public on “shoes” related goods and constituted as a well-known mark.

Article 13(3) of the Chinese Trademark Law protects well-known trademarks in China and is applicable to registered trademarks. The legislative intention of Article 13(3) is to provide stronger protection to well-known trademark than general registered trademarks. If identical or similar trademarks are registered or used on identical or similar goods approved for the well-known trademark, the consequential damage on the well-known trademark are obviously higher than those trademarks registered or used on different or dissimilar goods. Therefore, applying for trademark registration by copying, imitating, and translating other’s registered well-known trademark on “identical or similar goods” shall be regulated by Article 13(3).

In this case, both the Disputed Mark and the Cited Mark contained “NEW,” while the pronunciation of “BALANCE” and “bunren” was similar, thus, the Disputed Mark and the Cited Mark were similar in terms of word compositions, pronunciations, overall appearances, and visual effects. The Disputed Mark constituted as an imitation of the Cited Mark. The goods approved for the Disputed Mark were identical or similar to the shoes related goods approved under the Cited Mark in terms of function, use, production department, sales channels, consumers, etc., which constituted as identical or similar to the Cited Mark’s approved goods. Where the cited trademark has constituted a well-known trademark and the Disputed Mark is an imitation of the Cited Mark, when purchasing goods approved for use by the Disputed Mark, the relevant public would easily believe that such goods had certain association with the Cited Mark, which would weaken the Cited Mark’s distinctiveness and damage New Balance’s interests obtained through its well-known Cited Mark. The Court concluded that the Disputed Mark violated Article 13(3) and shall be invalidated.

2. From September 1, 2021, intentional IP infringements, filing irregular patent applications, bad faith trademark applications, and serious violation of patent and trademark agency will be included in the serious violations of law and dishonest list

The Administrative Measures for Lists of Parties with Seriously Unlawful and Dishonest Acts for Market Regulation Authorities (“Administrative Measures”), passed on July 22, 2021, came into force on September 1, 2021.

Article 2 of the Administrative Measures states where a party violates laws and administrative regulations, has a bad nature, under serious circumstances, imposes great social harm and is subject to heavy administrative punishment by the market regulation authorities, the relevant market regulation authorities shall list violators in the Lists of Parties with Seriously Unlawful and Dishonest Acts in accordance with the provisions of the Administrative Measures, publish it through the national enterprise credit information publicity system, and implement corresponding management measures.

Article 9 of the Administrative Measures states those who commit the following illegal acts that undermine the order of fair competition, disrupt the market order and fall under the circumstances specified in Article 2 of the Administrative Measures shall be included in the Lists of Parties with Seriously Unlawful and Dishonest Acts:

1. Unfair competition actions that seriously undermine the order of fair competition, such as infringing trade secrets, business slander, organizing false transactions, etc.;
2. Intentional infringement of intellectual property rights; submitting irregular patent applications and bad faith trademark applications that damages the social and public interests; and engage in serious violation of patent and trademark agency.

3. The State Administration for Market Regulation published the draft of “the Decision on Revising the E-Commerce Law of China (Draft to solicit public opinion)” for comments

On August 31st, the State Administration for Market Regulation published on its website and WeChat account the draft of “the Decision on Revising the E-Commerce Law of China (Draft to solicit public opinion),” and the deadline for feedback is October 14, 2021.

Among them, Article 43 is amended as: “upon receiving the notice of transfer, business operators who use the e-commerce platform may submit a non-infringing statement to the operator of the e-commerce platform that there is no infringement. The statement shall include prima facie evidence that there is no infringement.

After receiving the statement, the operator of the e-commerce platform shall transmit the non-infringing statement to the intellectual property right holder who sent the notice, and inform him that he can file a complaint with the relevant department or bring a lawsuit to the people’s court. If the operator of the e-commerce platform does not receive the notice of complaint or notice of infringement within 20 working days after the transfer statement was sent to the intellectual property right holder, the operator of the e-commerce platform shall timely terminate the measures taken.

The operators within the e-commerce platform shall provide corresponding guarantees to ensure compensation for losses caused by potential intellectual property infringement, and the operators of e-commerce platform can temporarily suspend the measures taken.

If the operator within the e-commerce platform submits a false statement that there is no infringement, resulting in the expansion of the loss of the intellectual property right holder, the operator’s liability of compensation shall be doubled.

The above amendments have the following purposes: first, to extend the waiting period after the counter notice transferred from the e-commerce platform operator to the operator within the e-commerce platform from 15 days to 20 business days. Second, in order to alleviate the possible transaction losses caused by the long waiting period for the counter notice, a provision is added: if the operator within the platform provides a guarantee to compensate for the losses caused by potential intellectual property infringement, the operator of the e-commerce platform can temporarily suspend the measures taken. Third, another new provision states that if the operator within the platform submits a false statement that there is no infringement, resulting in the expansion of the loss of the right holder, the liability of compensation of the operator within the platform shall be doubled.

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