According to the Trademark Act, exclusive licensees as well as trademark owners are entitled to take legal action against trademark infringement. The act also stipulates that a licence cannot be cited against third parties unless it is duly registered in Taiwan. Due to the unclear definition of the legal effect of an unregistered licence under the act, whether the unregistered licensee really can file civil litigation or any other legal action against trademark infringement is controversial. The Patent Act also stipulates a similar licence clause governing the patent exclusive licence.
The Supreme Court and some district and high courts have in the past taken the view that unregistered trademark or patent licensees are not entitled to file civil litigations against infringement. Further, the Fair Trademark Commission (the authority in charge of the Fair Trade Act governing unfair competition) prohibits unregistered licensees from dispatching cease and desist letters against infringers.
Nonetheless, the IP Court has taken a different approach. In some civil litigations against trademark infringement it has held that regardless of whether the licence is registered in Taiwan, the exclusive licensee is entitled to file civil litigations against acts of infringement.