Article 31 of the Trademark Law applicable at the beginning of 2013 prohibits an application from infringing another person’s existing prior rights or using unfair means to register a mark that another person already uses and that has acquired a certain influence. This article addresses the latter form of pre-emptive registration.
Trademark pre-emption has become increasingly serious in China. Prior users who fail to register promptly or seek effective relief may lose their brands to others or incur substantial costs to recover them or obtain permission to use them. When a mark has been pre-empted, the prior user should analyse the circumstances and consider timely, flexible and combined responses. Six approaches are discussed below.
1. File a new application promptly
Upon discovering a pre-emptive application or registration, promptly file an application for the mark in China. Although the earlier filing may cause refusal, the new application may succeed during examination or review if the pre-emptive filing is cancelled in the meantime. Filing also helps prevent another third party from applying for the mark again.
2. Seek cancellation through the trademark authorities
If the pre-emptive application is still in its three-month publication period, file an opposition with the China Trademark Office. If the opposition succeeds, the mark will not be registered.
If the mark has been registered for less than five years, the mark’s owner or another interested party may request cancellation before the Trademark Review and Adjudication Board. The five-year limit does not apply to the owner of a well-known trademark in the circumstances described in the article.
Evidence that the mark has acquired influence through use, and evidence of the pre-empting party’s bad faith or unfair means, are essential. Many cases fail because the evidence is insufficient.
3. Consider civil proceedings
If the opposition and dispute deadlines have been missed, the prior user may consider a civil action relying on the good-faith principle in the General Principles of the Civil Law.
Both administrative relief and civil proceedings are remedies after the event. They can take a long time, evidence may be difficult to collect, and the requirements for establishing influence, use and bad faith are demanding. Their prospects of success may consequently be relatively limited.
4. Negotiate an assignment or coexistence arrangement
Many pre-empting parties seek high transfer fees, particularly individual or self-employed applicants and those whose business differs markedly from the goods or services covered by the application. The prior user can approach them to negotiate an assignment or an arrangement allowing shared or coexisting use, thereby obtaining all or part of the rights needed.
5. Adopt a new mark
Considering the use of the mark, available evidence and circumstances of the pre-empting party, the prior user may decide that approaches 2–4 are impractical or too expensive. Rebranding may then be considered. Opposition and review procedures may delay registration of the pre-emptive application and provide more time to prepare for the change.
6. Seek cancellation for non-use
Many pre-empting parties do not intend to use their registered marks. The prior user can monitor actual use and, if the mark remains unused for three consecutive years, request cancellation under Article 44.
