Business Law Bulletins: Intellectual Property
Trademark coexistence in China
Rouse
Lucy Headington-Horton and Susan Fan,
Trademark Group China
china@iprights.com
T
he word “Polo” may bring to mind
the equestrian sport of Polo. However,
some people may think of the small-sized
car manufactured by Volkswagen, others
may link it with the famous clothing brand
of Ralph Lauren. Some may even think of
the small mint with a hole in the middle
produced by Nestlé. It is not surprising
that such vastly different products that are
being offered under the trademark Polo are
able to peacefully coexist around the globe
without any consumer confusion or any
detrimental effect on the respective parties’
businesses.
in China, a first-to-file jurisdiction, the
use of a similar or identical trademark on
similar or identical goods will infringe the
earlier registered trademark. Therefore, the
concept of coexistence appears only to exist
in situations where the marks are not considered similar or the goods or services of
interest are not similar. If there is confusion
because of the similarity of the marks,
then there is infringement, and if there is
infringement, coexistence is not possible.
Further, as far as registering a
trademark is concerned, an application for
a similar mark will be blocked by a similar
or identical registered trademark covering
a similar sub-class of goods, even though
the goods in reality may be considered
different. Whether a coexistence agreement
would assist in these situations is also
questionable and the examiner in each
case will have the discretion to determine
whether the coexistence on the register is
acceptable.
While there are no legal regulations,
Whether trademarks are able to coexist peacefully in
respect of the same or similar goods both from a legal
perspective and in reality is questionable
Whether trademarks are able to coexist
peacefully in respect of the same or similar
goods both from a legal perspective and
in reality is questionable. China has yet to
develop legal regulations governing the
coexistence of trademarks, but the issue has
arisen in practice and in recent cases, which
means there are some guidelines that may
determine whether coexistence is feasible.
The current position
According to the World Intellectual
Property Organization (WIPO), trademark
coexistence “describes a situation in which
two different enterprises use a similar or
identical trademark to market a product or
service without necessarily interfering with
each other’s businesses.”
However, under the current practice
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it is clear from recent case law and the
current practice in China that where marks
are identical and the goods are identical,
coexistence will not be tolerated. In such
cases, there is a real risk that consumers
will be confused. Where marks are similar,
the question of whether the marks will
cause confusion is significant.
The recent Crocodile v Lacoste case
addressed the importance of confusion from
an infringement perspective. The French
company Lacoste markets its clothing
brand under a logo of a crocodile headed
to the left. The Singapore-based company
Crocodile markets its clothing brand under
the logo of a crocodile headed to the right.
The crocodile logos share visual similarities as well as being conceptually identical.
However, the Shanghai High Court found
that there was no trademark infringement. The Court stated that “similarity
in the sense of trade mark infringement
shall mean confusingly similar, namely the
similarity that is sufficient to confuse the
consumers in the market.” Therefore, marks
have to be more than just similar, there has
to be a real likelihood of confusion. If the
consumer is able to identify the origin for
example, through commercial success, then
the possibility of confusion is unlikely and
there will be no confusion. According to
this decision, there is room for coexistence.
The future of coexistence
The concept of coexistence agreements has
for a long time been an accepted practice
in many Western countries. An increasing number of multinationals are entering
into coexistence agreements in China
and over time such agreements have been
accepted by the trademark authorities, and
in particular by the Trademark Review and
Adjudication Board (TRAB). Although
there is not yet a universal view on this
practice, it appears to support the freedom
of contract. Providing that the coexistence
agreement has been entered into in good
faith, contains clear provisions concerning
the delineation of goods, business interests
and the steps taken to ensure no confusion,
it is likely to be accepted in cases where the
marks are not identical. This is encouraging
in a jurisdiction that operates a first-to-file
system, where it would be detrimental if
later filed marks, with a reputation, were
not able to coexist with similar marks on
the register, if in reality there would be no
confusion.
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