Legal framework

National

Trademark rights in Taiwan are governed by the Trademark Act and the Enforcement Rules of the Trademark Act. The competent authority for the application and registration of trademarks is the Taiwan Intellectual Property Office (TIPO) under the Ministry of Economic Affairs. Types of protection include trademarks, certification marks, collective membership marks and collective trademarks.

Further, Article 22 of the Fair Trade Act provides supplemental remedies against unfair competition violations for the holders of well-known trademarks. However, pursuant to the most recent amendments, the Fair Trade Act no longer grants protection to registered trademarks, which fall under the Trademark Act.

International

Due to its complex political relationship with China, Taiwan did not accede to any international treaties until it joined the World Trade Organisation in 2002. As a result of this accession, Taiwan is now bound by the Agreement on Trade-Related Aspects of Intellectual Property Rights, which obligates all members to comply with the existing conventions for the protection of IP rights, including the Paris Convention.

The latest amendment to the Trademark Act incorporated into Taiwanese law aspects of the Singapore Treaty on the Law of Trademarks. Further, the Nice Agreement on the International Classifications of Goods and Services has long formed the basis for the Enforcement Rules of the Trademark Act.

Unregistered marks

As stated in Articles 30(11) and (12) of the Trademark Act, well-known unregistered marks can preclude later registration of identical or similar marks without permission of the rights holder, where the later registration will dilute the distinctiveness of the mark; further, prior used unregistered marks may also preclude registration of identical or similar marks without permission of the rights holder, where the later registration is made in bad faith.

Well-known unregistered marks are also protected under the Fair Trade Act. Under Article 22 of the act no enterprise may use a commonly known trademark in the same or similar manner for the same or similar category of merchandise.

Registered marks

The owner of a registered trademark may prevent use of the mark for the same or related goods or services without permission. Penalties for infringement include directions to cease or desist, destruction or detainment of infringing goods, civil remedies, monetary damage compensation and criminal actions.

Ownership

Any party may apply to register a trademark, certification mark, collective membership mark or collective trademark. Under Article 7 of the Trademark Act, an application to register a jointly owned trademark must be filed in the names of all joint applicants, one of which is appointed as the representative.

Under Article 4 of the act, parties from other countries that provide reciprocal protection of trademarks or accede to the same international treaties as Taiwan may also register trademarks in Taiwan.

Scope of protection

Under Article 18 of the Trademark Act, any form of sensory sign that is distinctive enough to identify goods or services from others can be registered as a trademark. A trademark may refer to any distinctive sign, which may consist of words, designs, symbols, colours, three-dimensional shapes, motions, holograms, sounds or any combination thereof. A distinctive sign must be recognisable by relevant consumers as an indication of the source of goods or services and distinguish goods or services of one undertaking from those of other undertakings.

Articles 29 and 30 of the Trademark Act outline the absolute and relative grounds for refusal of a trademark registration. Trademark protection will be denied to any mark that:

  • consists exclusively of:
    • a description of the quality, intended purpose, material, place of origin or relevant characteristics of the goods or services; or
    • a generic mark, term or other sign which is devoid of distinctiveness;
  • is exclusively necessary for the goods or services to be functional;
  • is identical or similar to:
    • a geographical indication for wines or spirits;
    • a registered trademark or earlier filed, well-known or earlier used trademark covering similar or identical goods or services, belonging to another party;
    • the national flag, emblem or seal, or military flag, insignia, seals or medals, of Taiwan;
    • the state flags, armorial bearings, national seals or other state emblems of any other country;
    • the portrait or name of founding father Sun Yat-Sen or the present head of state of Taiwan;
    • the mark of a government agency of Taiwan or official exhibition, or any medal or certificate awarded thereby;
    • the armorial bearings, flags, other emblems, abbreviations or names of international intergovernmental organisations or well-known public interests; or
    • official signs or hallmarks indicating control and warranty adopted by Taiwan or any other country;
  • is contrary to public policy or pinciples of morality;
  • is likely to mislead the public as to the nature, quality or place of origin of the goods or services;
  • contains another person’s portrait or well-known name, stage name, pseudonym or alternative name;
  • contains the name of a well-known legal entity, business or group; or
  • infringes another party’s copyright, patent right or other right.

Further, no trademark that contains a functional or indistinctive element can be registered unless the applicant disclaims any exclusive right to such element.

Procedures

Examination

An application for trademark registration must be filed at the TIPO, where it will first be examined with regard to formal requirements. A single application must relate to a single trademark, which may designate goods or services classified in two or more classes. Series trademarks may not be filed.

A TIPO-appointed examiner will inspect the application for grounds of refusal. The examiner may issue an approval, a request for amendment (issued for failure to meet formal requirements) or a preliminary notice of disapproval (before the official rejection of the application). On receiving a preliminary notice of disapproval, the applicant may submit an opinion regarding the intended refusal within a prescribed period, which the examiner will take into account before rendering final refusal or approval.

A final refusal of the application may be appealed to the Board of Appeals within 30 days of receiving the official notice. An unsatisfied applicant may then appeal to the IP court, and finally to the Supreme Administrative Court.

Opposition

Taiwan adopts a post-registration opposition procedure. Under Article 48 of the Trademark Act, once the trademark is registered and published in the Trademark Gazette, any person may file an opposition with the TIPO up to three months after publication. The grounds for opposition are similar to those for refusal.

The opposing party must submit a written opposition stating the facts and reasons for opposition. On receiving the opposition brief, the registrant must respond within 30 to 60 days. Once the registration of a trademark is contested by an opposition, no invalidation may be filed against the opposed trademark based on the same facts, evidence and grounds as those in the opposition.

Registration

Once a trademark is accepted for registration, the registration fee must be paid within two months of receiving the notice of acceptance; if not, a doubled registration fee may be submitted within six months of the two-month expiration date. Once the registration fee is submitted, the registration will be published in the Trademark Gazette and the trademark certificate will be issued.

Under Article 33 of the Trademark Act, both unopposed trademarks and opposed trademarks which were registered after examination for opposition are protected for 10 years from publication in the Trademark Gazette. This term may be extended successively every 10 years via application for renewal.

For the trademark right to be renewed, an application for renewal must be filed within six months of the expiration date. An application for renewal can still be filed up to six months after the expiration date, but the renewal fee will be doubled. Other interested parties besides the rights holder may also apply for renewal by filing a written request with reasons provided.

Removal from register

Before rendering a decision to remove a trademark registration, the TIPO will notify the rights holder to submit a written argument within a prescribed period. Reasons for removal are as follows.

Invalidation: Under Article 57 of the Trademark Act, a motion for invalidation can be filed by an interested party or a trademark examiner. The grounds for invalidation are the same as the grounds for opposition. According to Article 57(2), an applicant for invalidation on grounds of similarity to another party’s registered or prior-filed trademark must prove that the earlier trademark has been used – or has proper reasons for non-use – during the three years preceding the application for invalidation.

Before the TIPO accepts or rejects a petition of invalidation, the rights holder will be notified to submit a written argument, which will then be forwarded to the petitioner for counter-argument within a prescribed period. Once the petition for invalidation is rendered, no party may file invalidation against the subject trademark based on the same facts, evidence and grounds as those in the earlier invalidation.

Revocation: Article 63 of the Trademark Act stipulates that the TIPO shall, ex officio or upon request, revoke the registration of the trademark if any of the following takes place after the trademark is registered:

  • Unauthorised alteration or addition to the mark makes it identical or confusingly similar to another registered mark;
  • Non-use for three years has occurred without proper reasons, unless the trademark has been put to use by a licensee;
  • Where two or more parties are using identical or similar trademarks due to trademark assignment, no appropriate and distinguishing indication has been attached;
  • Where the trademark has become the generic mark or term or common shape for the designated goods or services; or
  • Where the trademark is put to actual use, it is likely to mislead the public as to the nature, quality or place of origin of the goods or services.

In case of application for removal on grounds of non-use, the rights holder must provide proof of actual use of the mark. According to Articles 63(1) and (2) of the Trademark Act, if the trademark has not been used for three years after registration or such use has been suspended for a continuous period of more than three years without proper reason for non-use, the registration shall be revoked.

Searches

The TIPO provides a publicly accessible, free database on its website, where trademark registrations, disputes information and updates can be researched. However, the language used in the online search platform is Chinese.

Enforcement

Whereas trademark prosecution is handled at the TIPO, infringement litigation falls under the jurisdiction of the IP court.

Under Articles 68 and 70 of the Trademark Act, the following actions – conducted in the course of trade and without the consent of the trademark owner – constitute trademark infringement:

  • using a trademark identical or similar to the registered trademark on goods or services that are identical or similar to those covered by the registered trademark;
  • knowingly using a trademark which is identical or similar to another person’s well-known registered trademark;
  • knowingly using words contained in another party’s well-known registered trademark as the name of a company, business, group or domain; and
  • knowingly manufacturing, possessing, displaying, selling, exporting or importing labels, tags, packaging or containers that would likely infringe trademark rights as prescribed in Article 68.

The rights holder can seek civil remedies and request criminal actions against the infringer.

Civil remedies

Under Article 69 of the Trademark Act, the rights holder is entitled to exclusion and prevention of infringement and monetary damages. However, if the rights holder does not exercise its rights within two years of the date on which it becomes aware of the infringement, or within 10 years of the period of infringement, such rights will be nullified.

The rights holder may claim compensation for damages from a violator which knowingly commits infringement. Under Article 71 of the act, the damages claimed may be calculated according to any of the following:

  • the lost profits caused by the infringement, in accordance with Article 216 of the Civil Code;
  • the profits earned by the infringer as a result of the infringement;
  • up to 1,500 times the unit retail price of the infringing goods. However, if over 1,500 pieces of infringing goods are found, the amount of damages shall be the overall market value of the infringing goods; or
  • the amount of royalties that would have been collected from licensing the trademark.

Detention by Customs

Under Article 72 of the Trademark Act, a rights holder may apply to Customs to detain specific articles suspected of infringement. Under Article 75, Customs may also act on its own initiative. If it does so, it will notify both the rights holder and the importer/exporter of the suspected infringed articles. If the rights holder provides evidence of infringement and the importer/exporter provides no evidence of non-infringement, Customs may suspend the release of such articles. However, if evidence of non-infringement is provided, Customs will notify the rights holder to file an application for detention pursuant to Article 72(1).

Criminal penalties

Under Articles 95 and 96 of the Trademark Act, the penalty for infringement of a registered trademark, collective trademark or certification mark is up to three years’ imprisonment and/or a fine of up to NT$200,000.

The penalty under Article 97 for knowingly selling or possessing, displaying, exporting or importing (with intent to sell) the goods of another party that infringe a registered trademark, collective trademark or certification mark is up to one year’s imprisonment and/or a fine of up to NT$50,000.

Ownership changes and rights transfers

Assignments

Under Articles 27 and 42 of the Trademark Act, a rights holder may assign rights derived from a trademark application or registration to another party. Articles 28(1) and 46 state that any transfer of the right derived from a joint application or registration, or any transfer of a share of such right, must have the consent of all joint registrants. The assignment may only be asserted against third parties if recorded at the TIPO.

Licensing

Under Article 39 of the Trademark Act, the rights holder may license exclusive or non-exclusive use of a mark for all or some of the designated goods or services for which it is registered and for a particular locality. An exclusive licensee may, within the scope of the licence, exclude the rights holder and any third party from using the registered trademark. A non-exclusive licensee may not sub-license the registered trademark to another party unless granted consent by the proprietor or exclusive licensee. The licence and sub-licence of the trademark rights may be asserted against third parties only if registered or recorded at the TIPO. Any termination of a licence that occurs before the expiration of the licence term should also be recorded with the TIPO, including supporting evidence.

Related rights

Copyright can be used to protect device marks that meet the creativity standard of copyright protection. Design patent rights may also overlap with trademark rights. For instance, the product configurations and patterns on the fabric of a bag not only are eligible for trademark protection, but may also be registered as a design. Further, a distinctive store decoration may be registered as a trademark and may also become well-known trade dress protected by the Fair Trade Act.

Online issues

Articles 70(1) and (2) of the Trademark Act specify the extent of online protection for registered, well-known trademarks. The act of knowingly using words contained in another person’s well-known registered trademark as a domain name is deemed infringement.

Country-code top-level domain name registration is administered by the Taiwan Network Information Centre (TWNIC), and disputes regarding domain names are governed by the TWNIC-approved Domain Name Dispute Resolution Policy. Grounds of complaint include domain names that are identical or confusingly similar to registered or unregistered marks and domain names that are registered in bad faith. Under Article 9 of the Domain Name Dispute Resolution Policy, the available remedies are limited to the cancellation of the registrant’s domain name or transfer of the domain name to the complainant. 

Crystal J Chen, Iris LC Lin and Yiling Liu

This article first appeared in World Trademark Review. For further information please visit www.worldtrademarkreview.com.