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CNIPA’s Amended Trademark Examination and Adjudication Guideline on Article 4 of the Chinese Trademark Law regarding bad faith filing without an intent to use the trademark
by Yan Zhang & Austin Chang
Bad faith trademark filings have been one of the most notorious pains for rights holders in the PRC and worldwide. The amended Chinese Trademark Law 2019 (“Trademark Law 2019”) was adopted with provisions to tackle down on bad faith trademark filings and registrations. Article 4 states that “[a]ny natural person, legal person, or other organizations that needs to acquire the exclusive right to use a trademark in the production and operation activities shall file an application for trademark registration with the Trademark Office. Trademark applications that are filed in bad faith and not filed for the purpose of use shall be refused.” This is the first time the language “purpose of use” is seen in the Chinese Trademark Law.
The legislative intent of Article 4 of the Trademark Law 2019 is to refuse bad faith applications filed without an intent to use from registration, clear sleeping trademark registrations obtained without an intent to use, and to encourage trademark applicants to perform their obligation by using their trademarks. Bad faith applications and trademark hoarding can usually be found in applicants who file in excess of regular business needs and in large quantities, because such filings may indicate that the applications are “not filed for the purpose of use,” which means that the applicant filed the applications either without actual purpose to use the trademark, or without anticipation to use the trademark in the near future, or there is no actual possibility the applicant will use the trademark based on the facts, background information, and evidence submitted. Article 4 specifically target bad faith applications and trademark hoarding because these applications will damage the public interests by depleting public trademark resources and disturbing trademark registration order. Hence, Article 4 does not apply to 1) applicants who file for defensive purpose or 2) applicants who file for use in foreseeable future business. As for trademark filings that only damage a particular entity’s civil rights, other provisions, but Article 4, of the Trademark Law 2019 should be applied.
In determining whether an application constitutes as a bad faith one filed not for the purpose of use, the Trademark Examination and Adjudication Guideline (“Guideline”) specified that in preliminary examination, examiners should pay attention to the facts discovered while examining the application. In oppositions and other adjudication proceedings, examiners should pay attention to the evidence submitted. The Guideline further provided the following six factors to be considered when examining or adjudicating whether an application constitutes as a bad faith application filed not for the purpose of use.
The Guideline also listed 10 circumstances that would constitute as trademark applications “filed in bad faith and not filed for the purpose of use” as stipulated in Article 4 of the Trademark Law 2019, unless the applicant or other interested party proves otherwise. Note, point 3 and 9 should be primarily applied in oppositions and other adjudications, while the rests can be both applied in examinations, oppositions, and other adjudications.
Although the Guideline listed the 10 circumstances for the examiners to consider when determining whether a trademark application “filed in bad faith and not filed for the purpose of use” as stipulated in Article 4 of the Trademark Law 2019, these factors are not limited to bad faith trademark applications filed by the applicant. It also applies to natural persons, legal persons, or other organizations that have a specific relationship or connections with the applicant or have colluded with the applicant to filing the applications. Finally, simply assigning a registered trademark to a third party does not affect the determination of whether an application was filed in violation of Article 4 of the Trademark Law 2019..
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