On April 23, 2019, the Legislative power passed the fourth revision of the Chinese Trademark Law. It will be implemented on November 1, 2019.
The amendments show the importance of the use. It tackles the prohibition of abuse of rights, the bad faith registration and the malicious litigation. The new Trademark Law also raises the limit of legal compensation and introduces the category willful infringement compensation.
Hence, the main changes are:
- Bad faith registration (art. 4, art.19, art. 33 and art. 44)
The draft regulates the malicious application for trademark registration that is not filed for the purpose of use. Any application for trademark registration that is malicious and is not filed for the purpose of use shall be rejected.
Furthermore, Article 19, Article 33 and Article 44 of the amended Law regulate the above malicious registration coming from trademark agencies, affecting opposition procedures and invalidation procedures.
- Malicious litigation (art.68)
Article 68 of the Trademark Law further provides a punishment mechanism for the trademark agencies filing maliciously a trademark lawsuit. The reasoning behind is to prevent some trademark agencies from seeking improper interests through a lawsuit.
- Damages compensation and willful infringement) (art. 63)
Article 63 raises the maximum limit to trademark infringement from RMB 3 million to RMB 5 million. Further increases upon the penalties may apply to willful infringement. In fact, the maximum amount of compensation, for this type of practice, may be five times the actual loss of the title holders.
- Seizure upon infringing products and facilities (art. 63)
The draft specifies the seizure of the infringing facilities and products. Article 63 of the Trademark Law provides that the materials and tools which are mainly used for the manufacture of commodities with falsely used registered trademarks shall be ordered to destroy without compensation; or the aforesaid materials and tools shall be prohibited from entering market without compensation.
Particularly, it also stipulates that the commodities with falsely used registered trademarks shall not enter market even though having removed the falsely used registered trademarks.
In conclusion, the bona fide registrations, then intended use and the willful infringement, are the key aspects of this 4th amendment upon the Chinese Trademark Law.