The China National Intellectual Property Administration (CNIPA) has presented a draft amendment that might add to the pressure on trademark owners to provide evidence of use every five years in an effort to enhance China’s Trademark Law.
The draft for the fifth amendment to the Trademark Law was posted on the CNIPA’s official website on January 13, 2023, along with public comments and some explanatory notes.
The CNIPA emphasized the following issues with the current system in their notes:
- trademark registration without use, which is relatively common;
- malicious registration of trademarks, which still happens;
- protection of trademark rights, which is still difficult;
- improper exercise and abuse of rights, which occurs occasionally; and
- profit-making through litigation or even malicious litigation, which is becoming increasingly prevalent.
The CNIPA’s study showed that the cause for these problems is that China’s Trademark Law has not yet matched the market’s requirements and growth rate. The system “emphasizes registration, but not use,” the extent and effectiveness of the effort against fraudulent trademark registration are still lacking, and the level of protection for well-known trademarks is inadequate.
In China, trademark registration, not use, confers the sole right to use the mark. However, subsequent changes to the Trademark Law have enhanced the requirement to utilize a trademark after it has been registered.
The suggested amendment this year introduces a mechanism wherein the registrant must give justifications for the use of its trademark every five years after registration and adds a need to use — or undertake to use — the mark during the application stage (as per Article 5). If the owner of the rights does not provide an explanation for the unauthorized use, the trademark is declared abandoned. The trademark is completely revoked (described in Article 61) if it is discovered via random inspections that the reasons provided were untrue.
The specific but crucial details, such as the statement’s level of detail and how it will differ from the current evidentiary standards in revocation proceedings, as well as whether interested parties can read the file or request a random inspection from the competent authorities, are currently unclear with regard to the requirement to submit a statement of use every five years. As a result, it is now impossible to determine the full degree of the burden placed on trademark owners, but it is plausible that those who do use their trademarks will be subject to more pressure and that those who do not will have an increased burden of proof.
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