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	INTERPRETATION OF THE SUPREME PEOPLE'S COURT CONCERNING THE APPLICATION OF LAWS IN TRIAL OF CIVIL CASES OF TRADEMARKS IN DISPUTES

	(Public Announcement of the Supreme People's Court of the People's Republic of China (No. 32 [2002] of Legal Interpretations), October 12, 2002: adopted at the 1246th Session of the Judicial Committee of the Supreme People's Court on October 12, 2002, which shall come into force as of October 16, 2002)


SUBJECT : LEGAL INTERPRETATION; TRADEMARK; DISPUTES
ISSUING DEPARTMENT : THE SUPREME PEOPLE'S COURT OF THE PEOPLE'S REPUBLIC OF CHINA
ISSUE DATE : 10/12/2002
IMPLEMENT DATE : 10/16/2002
LENGTH : 2,311 words
TEXT :

To have proper trail of trademark disputes cases some issues concerning the application of laws are hereby interpreted on the basis of the statutory provisions, including the General Principles of the Civil Law of the People's Republic of China, the Contract Law of the People's Republic of China, the Trademark Law of the People's Republic of China, and the Civil Procedure Law of the People's Republic of China:

Article 1. Any of the following acts shall be regarded as the acts of causing other damages to the registered trademark of other people provided in Article 52, Item 5 of the Trademark Law:

(1) Using the words that are identical or similar to the registered trademark of any other person as the name of one's enterprise on identical or similar commodities so that the relevant public are liable to be misled;

(2) Copying, imitating or translating the registered well-known trademark of another person or the major part thereof is used on non-identical or dissimilar commodities as a trademark for the purpose of misleading the general public so that the interests of the registrant of the well-known trademark may be damaged; or

(3) Registering the words or characters identical or similar to the registered trademark of another person as a domain name and engaging in the electronic commerce of relevant commodities via the domain name so that the relevant general public is liable to be misled.

Article 2. In accordance with the provisions of Article 13, Paragraph 1 of the Trademark Law, any one who copies, imitates or translates the well-known trademark registered in China by another person or the major part thereof and use it as a trademark on identical or similar commodities so that confusion may result shall assume the civil liability of stopping the infringement.

Article 3. "Licensed use of trademarks" provided in Article 40 of the Trademark Law include the following three types:

(1) Monopolized licensed use, which refers to that the registrant of a trademark permits only one licensee to use the registered trademark during the time period, in the geographic area or ways agreed upon so that the registrant may not use the registered trademark pursuant to the agreement;

(2) Exclusive licensed use, which refers to that the registrant of a trademark permits only one licensee to use the registered trademark during the time period, in the geographic area or ways agreed upon; the registrant himself may, pursuant to the agreement, use the registered trademark but may not permit another person to use the registered trademark; and

(3) Ordinary licensed use, which refers to that the registrant of a trademark permits other people to use the registered trademark during the time period, in the geographic area and ways agreed upon. The registrant himself may use the registered trademark and may license other people to use the registered trademark.

Article 4. The "interested parties" provided in Article 53 of the Trademark Law shall include the licensee to a contract for the licensed use of registered trademarks and the lawful heirs of the property rights of a registered trademark.

When the exclusive right to use a registered trademark is infringed upon, the licensee to the contract for the monopolized license may institute an action with the people's court; the licensee to the contract for exclusive license may institute a joint action with the trademark registrant or file an action on its own initiative in case the trademark registrant refuses to institute an action, and the licensee to the contract for ordinary license may, upon the explicit authorization of the trademark registrant, file an action.

Article 5. Where the trademark registrant or an interested party applies for renewing the registration during the term for renewal but before obtaining approval and lodges an action on the ground that the exclusive right to use the registered trademark thereof has been infringed upon, the case shall be accepted by the people's court.

Article 6. A civil action instituted on the ground that the exclusive right to use a registered trademark has been infringed upon shall be subject to the jurisdiction of the people's court where the infringing act is carried out, where the infringing commodities are stored or sealed up and detained, or where the defendant has his domicile provided for in Articles 13 and 52 of the Trademark Law.

The place where infringing commodities are stored as provided in the preceding paragraph refers to the place where large quantities of infringing commodities are stored or hidden or infringing commodities are regularly stored or hidden. The place of sealing up and detention refers to the place where the administrative departments such as the customs office and the administration for industry and commerce, lawfully seal up or detain the infringing commodities.

Article 7. With regards to the joint actions instituted against several defendants and with the infringement incurred in different places, the plaintiff may select the people's court at the place where one of the defendants carried out its infringement acts as the jurisdictional court. Where an action is filed against any one of the defendants, the people's court of the place where the defendant committed the infringement shall have jurisdiction.

Article 8. The "relevant general public" mentioned in the Trademark Law refers to the consumers relating to a certain type of commodities or services to which the trademark represents and other business operators that are closely connected with the marketing of the aforesaid commodities or services.

Article 9. The term "identical trademarks" provided in Article 52, Item 1 of the Trademark Law refers to that there are basically no difference in visual perception between the trademark that is charged of infringement and the registered trademark of the plaintiff.

The term "similar trademarks" provided in Article 52, Item 1 of the Trademark Law refers to that the trademark charged of infringement and the registered trademark of the plaintiff are similar in the font style, pronunciation, meaning of the words, or in the composition and color of the pictures, or in the overall structure of all the elements combined, or in the cubic form or combination of colors so that the relevant general public may be confused about the origin of the commodity or believe that there exist certain connections between the origin and the commodity which is represented by the registered trademark of the plaintiff.

Article 10. According to the provisions of Article 52, Item 1 of the Trademark Law, the people's courts shall follow the principles mentioned below in determining whether a trademark is identical or similar:

(1) Taking the general attention of the relevant general public as the standard;

(2) Comparing not only the whole structure of the trademark but also the major parts of the trademarks involved. The comparison shall be made in a situation where the objects are isolated from each other;

(3) Taking the notability and reputation of the registered trademark that is pleaded for protection when determining whether a trademark is similar.

Article 11. The "similar commodities" provided in Article 52, Item 1 of the Trademark Law refers to those commodities that are identical in respect of functions, purposes of use, producers, marketing channels, target consumers, etc. or that the relevant general public usually believe that there exist certain connections between them so that confusion may result.

"Similar services" are those that are identical in respect of the purpose, content, manner, object, etc. of services, or that the relevant general public usually believe that there exist certain connections between them so that confusion may result.

The similarity between a commodity and a service refers to that there exist certain connections between a commodity and a service so that confusion may result.

Article 12. When determining whether a commodity or service is similar on the basis of the provisions of Article 52, Item 1 of the Trademark Law, the people's court shall take into comprehensive consideration of the general understanding of the relevant general public about the commodity or service. The Classification Table of Commodities and Services for the International Registration of Trademarks and the Classification Table of Similar Commodities and Services may be referred to in judging whether a commodity or service is similar.

Article 13. When determining the compensation liabilities of the infringer on the basis of Article 56, Paragraph 1 of the Trademark Law, the people's court may compute the amount of compensation according to the method of computation selected by the right holder.

Article 14. The interests obtained from infringement provided in Article 56, Paragraph 1 of the Trademark Law may be calculated as the product of the sales volume of the infringing commodities and the unit profit of the commodities concerned. In case it is impossible to know the unit profit of the commodity, the unit profit shall be the commodity which is represented by the registered trademark.

Article 15. The losses incurred from infringement provided in Article 56, Paragraph 1 of the Trademark Law may be computed as the product of the reduced sales volume of the commodities concerned resulting from the infringement and the unit profit of the commodities which are represented by the registered trademark.

Article 16. In case it is difficult to determine the interests of the infringer gained from the infringement or the losses of the infringed incurred from the infringement, the people's court may determine the amount of compensation according to the claims of the parties concerned or by applying the provisions of Article 56, Paragraph 2 of the Trademark Law ex officio.

When determining the amount of compensation, the people's court shall take into comprehensive consideration of the elements, including the nature, duration and aftermaths of the infringing act, the reputation of the trademark, the amount of royalties for licensing the trademark, the type, time and scope of the license of the trademark, as well as the reasonable expenses for stopping the infringing acts.

Where the parties concerned have come into any agreement with regard to the amount of compensation according to Paragraph 1 of the present Article, such agreement shall be allowed.

Article 17. The reasonable expenses incurred from stopping infringing acts provided in Article 56, Paragraph 1 of the Trademark Law include the reasonable expenses paid by the right holder or the entrusted agent thereof for investigating into the infringing acts and obtaining evidences.

The people's court may, according to the allegations of the parties concerned and the concrete situations of the cases concerned, include the lawyers' fees provided by relevant departments of the state into the scope of compensations.

Article 18. The statute of limitation for an act of infringing upon the exclusive right to a registered trademark is two years, starting from the day when the trademark registrant or the interested right holder knows or should have known of the infringement. Where the trademark registrant or interested right holder institutes an action after two years' statute of limitation, and if the infringing acts remain when the action is instituted, the people's court shall, during the valid term of the exclusive right to the registered trademark, rule that the defendant shall stop the infringing acts, and the amount for compensating the damages of infringement shall be computed till two years ahead as of the day when the right holder files the action to the people's court.

Article 19. Where a trademark license contract has not been placed on the archivist files, the validity of the contract shall not be affected unless it has been otherwise stipulated by the parties concerned.

A trademark license contract that fails to be placed on the archivist files of the trademark office shall not confront any bona fide third party.

Article 20. The transfer of a registered trademark shall not affect the validity of the trademark license contract that has already become effective prior to the transfer unless it has been otherwise stipulated in the trademark license contract.

Article 21. When hearing a case of dispute over the exclusive right to a registered trademark, the people's court may, according to the provisions of Article 134 of the General Principles of the Civil Law of the People's Republic of China and Article 53 of the Trademark Law as well as the concrete situation of the case, rule that the infringer to assume civil liabilities including stopping the infringement, removing obstacles, eliminating hazards, compensating losses, etc., and may make a decision of civil sanctions including imposing a fine, confiscating such properties as the infringing commodities, forged marks, and the materials, tools, equipments, etc. for producing the infringing commodities. The amount of fine may be determined by referring to the relevant provisions of the Regulation for Trademark Law of the People's Republic of China.

Where the administrative department for industry and commerce has already imposed administrative punishments to a same act of infringing upon the exclusive right of the registered trademark, the people's court shall not give any more civil sanctions.

Article 22. In the hearing of disputes over trademarks, the people's court may, according to the allegations of the parties concerned and the concrete situations of the cases concerned, decide by law whether the registered trademark involved is a well-known one or not.

The determination of well-known trademarks shall be carried out in accordance with Article 14 of the Trademark Law.

Where any of the parties concerned pleads for protecting the well-known trademarks affirmed by the administrative department in charge or the people's court, and the opposite party has no objection to the well-known nature of the trademark involved, the people's court may refuse to make further examinations. If the opposite party has objection, the people's court shall examine the well-known nature of the trademark involved according to Article 14 of the Trademark Law.

Article 23. The provisions of the present Interpretations concerning commodity trademarks shall be applicable to service trademarks.

Article 24. Where any of the previously promulgated provisions is inconsistent with the present Interpretations, the present Interpretations shall prevail.