In June 2020, the China National Intellectual Property Administration (“CNIPA”) issued the Judging Criteria for Trademark Infringement (“Criteria”). There are 38 articles in the Criteria, which specify and clarify the regulations on use of trademarks, identical and similar goods and services, identical and similar trademarks, likelihood of confusion, seller’s liability exemption, conflict between different rights, application of suspension, identification opinions of the trademark owner, etc. The following are some key aspects of the Criteria.

●Use of trademarks 1. Improve the definition of "trademark use".

Compared with Article 48 of the Trademark Law which only prescribed trademark use on goods, the Criteria improves the definition by adding the use at places of services, or on transaction documents of services. It also lists the specific forms of trademark use on goods, services, promotion, advertisement, exhibition and other commercial activities, especially some new forms in this internet era, like trademark use on websites, instance messaging tools, social network service(SNS) platforms, two-dimensional codes, etc.

2. Determination on use of trademark In order to determine whether a trademark is used, the subjective intention of the user, the method of use, the method of promotion, the industry practice, and the consumers' perception should be taken into consideration comprehensively.

●Determination on Identical and Similar Goods and Services Determining identical or similar goods and services may be a straightforward comparison of the items listed in the CNIPA Classification. For the goods or services that are not included in the Classification, the Criteria provide the following principles:

For the goods not listed in the Classification, the determination shall be based on the general understanding of the relevant public and comprehensively consider the function, purpose, main raw material, production department, target consumer, sales channel, etc.

For the services not listed in the Classification, the determination shall be based on the general understanding of the relevant public and comprehensively consider the purpose, content, method provider, target, place, etc.

●Likelihood of confusion In the judgment of trademark infringement, the likelihood to cause any confusion shall be taken into account. The Criteria clarify two circumstances that easily cause confusion:

a) it is sufficient to make the relevant public believe that the alleged infringing goods or services are produced or provided by the owner of the registered trademark;

b) it is sufficient to make the relevant public believe that there is a relationship of investment, license, alliance or cooperation between the supplier of the alleged infringing goods or services and the owner of the registered trademark.

The Criteria prescribe that, the judgment of "likelihood of confusion" shall take into account a variety of factors, including: the similarity of trademarks; the similarity of goods or services; the significance and popularity of registered trademarks; the features of goods or services and the manner of trademark use; the degree of attention and cognition of the relevant public; and other relevant factors.

●Seller's Liability Exemption Paragraph 2 of Article 60 of the PRC Trademark Law states that “in the case of persons who engage in sale of goods which infringe upon exclusive rights to use registered trademarks without knowledge of the infringement, if it can be proven that the goods are obtained legitimately and the supplier of the infringing goods can be provided, the persons will be only ordered to stop selling the infringing goods”. The Criteria specify the following circumstances that do not constitute “selling goods that infringe the exclusive right to use a registered trademark without knowledge of such infringement”.

(1) The purchasing channel fails to meet the commercial practice and the price is obviously lower than the market price;

(2) Where the enterprise refuses to provide accounts, sales records and other accounting vouchers, or the accounting vouchers are falsified;

(3) Transferring or destroying physical evidence, or providing false proof or information, after the case has been discovered;

(4) Committing similar violations again after being punished for such violations;

(5) Any other circumstance where it is clear that the party concerned knows or should have known.

●Right of Prior Use of Unregistered Trademark The Criteria clarify that "having a certain influence" should be judged comprehensively by taking into account factors such as the duration of the trademark's continuous use, sales volume, business volume, advertising and publicity, etc.

The user shall not be deemed as using the unregistered trademark continuously within the original scope of use when it adds specific goods or services into which the trademark is used or changes the design, text, color, structure or writing style of the trademark, except for changes made for the purpose of distinguishing the trademark from registered trademark of others.

●Constitution of Trademark Infringement The Criteria listed some specific acts of trademark infringement in practice, including:

(1) Unauthorized change of registered trademarks or combined use of several registered trademarks on identical or similar goods/services, which may easily lead to confusion;

(2) Prominent use of other’s registered trademark as corporate name without authorization on identical or similar goods/services, which may easily lead to confusion;

(3) Applying color of a registered trademark that does not designate a color for the purpose of free riding, which may easily lead to confusion;

(4) Undertaker’s use of infringing goods in the business activities of contracting labor and material for processing.

(5) Business operator’s use of infringing goods as a gift in the sale of other goods.

(6) Operators clearly know or ought to have known a trademark infringement but failed to stop such infringement or failed to take necessary measures to stop such infringement after being notified by the trademark enforcement authorities or by the trademark owner;

(7) Unauthorized use of registered trademark as domain name and carry out e-commerce transactions of related goods or services through such domain name. Source: https://baijiahao.baidu.com/s? id=1670252262671848852&wfr=spider&for=pc