One of the most significant changes is the withdrawal of refusal review proceedings
Article 21 of the draft amendment introduces a ban on repeat applications
While the proposed changes seek to make trademark proceedings more efficient, they also raise some concerns
The China National Intellectual Property Administration (CNIPA) recently released draft amendments to the Trademark Law, seeking public comments by 27 February 2023. By withdrawing refusal review proceedings for trademark oppositions, shortening the period for filing oppositions and prohibiting repeat trademark registrations without legitimate reasons, the draft amendment seeks to make trademark proceedings more efficient and effective. However, the proposed changes also raise some concerns and create uncertainties, particularly with regard to potential conflicts between administrative and judicial proceedings, and with regard to limitations to the strategies available to legitimate trademark holders. This update highlights the key changes to trademark proceedings proposed by the draft amendment and their potential impact on trademark holders.
Withdrawal of refusal review proceedings for trademark oppositions - more potential conflicts between administrative and judicial proceedings?
One of the most significant changes proposed by the draft amendment is the withdrawal of refusal review proceedings. This means that trademark applicants can appeal directly to the court after receiving a refusal decision in opposition proceedings. This change is expected to save applicants at least 12 months.
According to the Explanation of the Amendment provided by the CNIPA, the organisation is exploring the possibility of introducing cross-examination sessions and oral hearings for complex trademark opposition cases. This is expected to improve the fairness and efficiency of the opposition process, as it provides a more comprehensive and dynamic platform for evidence presentation and debate.
While this change may expedite the process of appealing a refusal decision, it may also lead to more potential conflicts between administrative proceedings and judicial proceedings. The draft amendment does not change trademark invalidation proceedings substantially. If a trademark is approved in the opposition proceedings, the opponent can file an invalidation action. There may be instances in which a trademark is approved for some goods or services, but rejected for others. In such cases, the applicant may appeal to the court with regard to the rejected goods/services, while the opponent may file an invalidation action with regard to approved goods/services. This scenario may require further clarification and refinement to ensure consistency in principles governing trademark review, as well as convergence between administrative and judicial proceedings.
Shortening of the period for filing oppositions from three to two months - more frequent screenings of opposition targets?
The draft amendment also shortens the period for filing oppositions from three to two months. By analogy, the period for the opponent to supplement the opposition and for the applicant to reply to the opposition should also be shortened to two months. This move aims to reduce the time taken to obtain approval of a trademark application if an opposition is filed. As a result, trademark right holders may need to increase the frequency with which they screen potential opposition targets from preliminary approval announcements.
Ban on repeat applications - fewer available strategies for legitimate trademark holders?
Article 21 of the draft amendment prohibits anyone from repeatedly registering the same trademark for the same goods and services, unless the registrant agrees to cancel the original registrations or has legitimate reasons. This change aims to stop bad-faith applicants from repeatedly registering the same trademarks to defend opposition, invalidation or non-use cancellation actions filed by legitimate rights holders.
The amendment defines a 'repeat registration' as a trademark that is the same as one that has been "previously applied for or registered, or cancelled, withdrawn or invalidated within a period of one year". It also provides five legitimate reasons that constitute exceptions to this rule (eg, failure to renew the trademark for reasons not attributed to the applicant, and slight but distinguishable changes to the prior trademark due to production and operation needs), along with a catch-all provision.
While the ban on repeat applications is expected to curb bad-faith registrations, it may also limit the strategies available to legitimate trademark holders to challenge bad-faith applications. For instance, some trademark holders use repeat registrations as a defensive strategy, registering the same trademarks every three years to defend against non-use cancellation applications. If a trademark application is rejected due to cited marks, the applicant may resubmit a new application and wait for the outcome of the invalidation or non-use cancellation actions, or the purchase of the cited marks. The draft amendment does not clarify whether these situations may constitute exceptions.
What to expect next
Initial draft amendments to the Trademark Law often contain several significant changes, some of which may be deleted during the subsequent revision process. The CNIPA is currently seeking initial opinions on this first draft. Once public comments have been collected, the draft will be submitted to the Legislative Affairs Office of the State Council for further formulation. This revised draft may also be released a second time for public comments before being submitted to the Standing Committee of the National People's Congress for another formulation. The committee makes an annual work plan for law and amendment review, which is typically released every April. Even at this stage, multiple rounds of review will still be required before the amendment becomes official, and the entire process may take several years. Overall, it is important for trademark holders and legal professionals to stay up-to-date with the latest developments concerning the Trademark Law and be prepared to adapt to any changes.
"This article first appeared in WTR Daily, part of World Trademark Review, in February 22, 2023. For further information, please go to www.worldtrademarkreview.com."
