The Second Draft Amendment to the Trademark Law of the People’s Republic of China (the “Trademark Law”) was tabled for discussion during the 3rd meeting of the 12th Standing Committee of the National People’s Congress on June 26, 2013. The proposed amendment included several important new provisions which enhance the compensation against trademark infringement, refine the protection for well-known trademarks and notably, regulate for the first time the examination speed of the trademark authorities. The following are the major new amendments compared with the previous versions of draft amendment.
To increase the compensation ceiling to RMB 2 million
The maximum statutory compensation was doubled up from RMB 50,000 to 1 million in the First Draft Amendment. For the purpose of improving the protection of trademark rights and further cracking down on trademark infringement, the maximum statutory compensation is now proposed to increase further to RMB 2 million.
To prohibit the use of well-known trademarks for advertisements
The Second Draft Amendment proposes that manufacturers and dealers should not use the wordings “well-known trademark” on their products, packages or containers of the products; or in advertising, exhibition or other commercial activities. This is to prevent enterprises from taking “well-known” as an honorable title, or as a short-cut to mark their products more popular and competitive, or even as a means of confusing customers. It is predicted that this new amendment, if coming into effect finally, may help cooling down the unusual “fever” of applying for recognition of “well-known trademark” in China.
To shorten the period for preliminary examination of trademark applications to 9 months
The lengthy period for examination of trademark cases has long remained a serious problem for both brand owners and the Chinese trademark authorities. In order to tackle this problem, the Legislative Committee of National People’s Congress suggested to stipulate in the amendment that the period for examination of trademark applications shall be no longer than 9 months; the duration for investigation and verification in opposition cases shall be no longer than 9 months; the period for the Trademark Review and Adjudication Board in deciding on the review cases on the refusal decisions made by the Trademark Office shall be on longer than 6 months; the review on opposition case where the Trademark Office finds the opposition is not tenable shall be no longer than 9 months. If special circumstances arise, upon approval of the State Administration for Industry and Commerce of the People’s Republic of China, the above periods can be prolonged.
To remove the provision for single color trademarks
In the 30th meeting of the eleventh Standing Committee of the National People’s Congress held in last December, single color was allowed to be registered as trademarks in China which was included in the First Draft Amendment. In the Second Draft Amendment, this provision was removed because the Legislative Committee holds that there are few such demand among the Chinese enterprises and China also lacks experience of examining and managing the applications or registrations of such marks.
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