The China National Intellectual Property Administration (CNIPA) rejected 482,000 bad faith trademark filings in 2021, and made further efforts in 2022.
The CNIPA issued the Circular on Continuing to Severely Crack Down on Acts of Malicious Registration of Trademarks in April 2022, endeavouring to intensify its enforcement actions against bad-faith trademark filings that were made without genuine intent of use, trademark squatting, freeriding and imitation of trademarks of famous brands.
In Emerson v Xiamen Hemeiquan el al (2021), the Fujian High People’s Court upheld the ruling of Xiamen Intermediate People’s Court that the defendants’ conduct of filing numerous malicious trademark applications constituted acts of unfair competition.
In this case, the court ordered the defendants to cease filing malicious trademark applications, granted damages to the plaintiff in the sum of RMB1.6 million (USD230,000) and specified the respective liabilities of the three main defendants. It also held the trademark agency of the applicant jointly liable.
ACTIONS AGAINST TM AGENCY
The CNIPA has intensified its “Blue Sky” campaign against IP agencies in 2022. The State Administration for Market Regulation (SAMR) issued the Provisions on the Regulation of Trademark Agencies in November 2022, providing detailed regulations to prevent violations of the Trademark Law by local trademark agencies and to increase the deterrent effect of punishments.
At the same time, the CNIPA and multiple local administrations for market regulation punished certain trademark agencies involved in malicious trademark filings and other unlawful acts.
MECHANICAL TM REFUSALS
To deter bad-faith applications, the Trademark Law introduced a new article 4 in a 2019 amendment, setting out that malicious applications without a genuine intent of use should be rejected. With the intention to deal with bad-faith filings, the CNIPA has been citing this provision more often in its decisions in 2022.
Such a change in the law has resulted in a heavier workload for the CNIPA. Also, many defensive marks filed by legitimate rights owners have been refused because of an unclear interpretation of what amounts to a bad-faith trademark application. In particular, the CNIPA has more frequently issued refusals or examination opinions requesting evidence of use when the applicants filed numerous applications within a short period.
Under these circumstances, the chances of successfully overcoming article 4 refusals are discouraging. Legitimate rights owners are still finding ways to cope with the hurdles of the new regime.