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New amendments to China’s trade mark laws were recently approved and are due to come into force in May next year. Some of the major changes are briefly summarised below.
Many UK household name businesses have had their trade marks registered by unauthorised third parties in China. These third parties are typically looking to sell the registrations to the organisations that would generally be considered the rightful owners. High profile trade marks that have been registered by unauthorised Chinese individuals or companies include those of Sainsbury’s, John Lewis, Dixons and Topshop.
Currently, the law does allow for such registrations to be revoked if it can be shown that the application was made in bad faith or that the trade mark in question was well known. In practice, though, it is often very difficult and expensive to succeed in such revocation actions.
The new law includes a general provision that applications to register a trade mark, and use of a trade mark, must comply with the principles of good faith. The new law also specifically provides that upon opposition by an aggrieved party, an application to register a previously unregistered mark will be refused if the applicant knew (or should have known) of the trade mark as a result of a contractual, business, or other relationship with the aggrieved party.
More stringent obligations to act in good faith have also been placed on Chinese trade mark agents and harsher punishments against dishonest conduct have been introduced.
These changes are clearly a positive development that could make it easier to recover unfairly ‘hijacked’ trade mark rights. However, as before, it will invariably be more cost-effective to act early and register your trade marks in China before somebody else does.
China currently has a ‘single-class’ trade mark registration system. Therefore, if registered trade mark protection is sought for a range of goods, say for clothing and handbags, separate trade mark applications need to be filed.
Under the new law it will be possible to file a single application covering multiple classes of goods and services.
This has the potential to significantly reduce the cost of obtaining trade mark protection in China. However, it remains to be seen what cost structures will be implemented by the Chinese authorities.
At present, Chinese trade mark law does not set out timeframes for the various official procedures relating to trade mark applications. Such timeframes are introduced under the new law. For instance, initial examination of an application must be completed within nine months and a straightforward application should proceed to registration within fifteen to eighteen months.
These changes should introduce some welcome predictability to the Chinese trade mark system.
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