In a bid to address the persistent issue of bad-faith trademark filings, the China National Intellectual Property Administration (CNIPA) has been taking decisive action. Notably, in 2021, the CNIPA rejected a staggering 482,000 trademark applications that were deemed to be filed with malicious intent. Building on this progress, the administration continued its efforts in 2022 to combat trademark squatting, freeriding, and the imitation of renowned brand trademarks.
To fortify its enforcement actions, the CNIPA issued the Circular on Continuing to Severely Crack Down on Acts of Malicious Registration of Trademarks in April 2022. This circular aims to intensify measures against trademark filings made without genuine intent of use and crack down on those engaging in unfair competition through malicious applications.
A significant legal precedent was set in the case of Emerson v Xiamen Hemeiquan el al (2021). The Fujian High People’s Court upheld the ruling that numerous malicious trademark applications constituted acts of unfair competition. In response, the court ordered the defendants to cease filing such applications, granted damages of RMB 1.6 million (USD 230,000) to the plaintiff, and held the trademark agency of the applicant jointly liable.
Acknowledging the pivotal role of trademark agencies in facilitating these malicious filings, the CNIPA launched the “Blue Sky” campaign in 2022. Furthermore, the State Administration for Market Regulation (SAMR) issued the Provisions on the Regulation of Trademark Agencies in November 2022. These provisions outline detailed regulations to prevent violations of the Trademark Law by local trademark agencies and enhance the deterrent effect of penalties.
Both the CNIPA and local market regulation administrations have taken action against trademark agencies involved in malicious trademark filings and other unlawful activities. The objective is to curb the influence of these agencies and uphold the integrity of the trademark registration process.
To discourage bad-faith applications, a new article (Article 4) was introduced in the Trademark Law through a 2019 amendment (You may check our previous post for more information: Highlights of The Amended Trademark Law of PRC) . Article 4 stipulates that malicious applications lacking genuine intent of use should be rejected. In line with this provision, the CNIPA has increasingly cited Article 4 in its decisions throughout 2022. However, this legal change has placed a heavier workload on the CNIPA and has resulted in refusals of defensive marks filed by legitimate rights owners. The interpretation of what constitutes a bad-faith trademark application has often been unclear, causing frustration and challenges for rightful trademark holders.
As a result, successfully overcoming refusals under Article 4 has become more arduous. Legitimate rights owners continue to navigate the obstacles posed by this new system, seeking innovative strategies to protect their trademarks and rights.
While progress has been made in combating malicious trademark filings in China, ongoing efforts are essential to refine the interpretation of the law, strike a balance between protecting legitimate rights owners and deterring bad-faith applicants, and ensure a fair and effective trademark registration system. The commitment to combating these infringements remains a priority as China works towards fostering a robust and trustworthy intellectual property landscape.
