To meet the need of China’s reform and opening up to the outside world as well as the economic development, China promulgated Trademark Law of the People’s Republic of China (referred to hereafter as trademark Law) in August 1982, which entered into force on March 1, 1983. Trademark Law is the first Intellectual Property (IP) Law ever since the reform and opening up, which has laid a solid legal foundation in respect of trademarks for the rapid and sound development of China’s economy. In response to the rapid economic development and China’s entry into the World Trade Organization (WTO), China revised its Trademark Law respectively in 1993 and 2001, and the latest revised version fully complies with the provisions of Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs Agreement). After more than two decades of development in terms of trademark legislation, China has established a comparatively sound trademark legislation, forming a modern trademark legal system which is based on Trademark Law, enjoys fairly comprehensive contents and complies with international rules.

In light of China’s national situation and reality, a “Double Track Protection Mode” with Chinese characteristics has been provided in the Trademark Law concerning the Exclusive Right to use a Registered Trademark, namely, the parallel administrative protection and judicial protection. Regarding the trademark infringement cases, local Administrations for Industry and Commerce (AICs) at or above the county level all have jurisdiction. They can not only deal with trademark infringement cases at the request of the interested parties, but also can investigate and handle cases ex officio. In most countries, trademark disputes shall be dealt with through judicial procedure, which is time-consuming and troublesome. In comparison, the administrative enforcement in China is more rapid in action, simple in procedure and quick in investigation and handling, which not only perfectly enforces the protection of the exclusive right to use a registered trademark, but also safeguards the rights and interests of consumers. In China, the vast majority of trademark infringement cases have been dealt with by AICs, and moreover, AICs deal with those cases ex officio.

In accordance with the provisions under Trademark Law, for any trademark registered in the Trademark Office (CTMO) under the State Administration for Industry and Commerce (SAIC), its registrant shall enjoy the exclusive right to use it, and the right shall be protected by the law. No matter the registrants are Chinese or foreign, they shall all enjoy equal rights and shall be equally protected. Since the implementation of Trademark Law in 1983, AICs at all levels throughout China have fully exploited the advantages in trademark administrative enforcement ---- complete network, simple procedures and high efficiency. They have dealt with a great number of trademark infringement and counterfeiting cases, which not only effectively protect the legitimate rights and interests of trademark registrants both home and abroad, but also safeguard the rights and interests of consumers. In particular, starting from the second half of 2004, in light of the plan of the State Council concerning the Special Campaign on IPR Protection, AICs at all levels throughout the country launched the Special Campaign to Protect the Exclusive Right to Use a Registered Trademark, focusing on protecting well-known trademarks, foreign-related trademarks and trademarks used on food and drugs. Remarkable achievements have been achieved as follows:

I. A Great Number of Trademark Infringement and Counterfeiting Cases were Dealt with

According to the statistics, in 2004, AICs at all levels throughout the country dealt with 40,171 trademark infringement and counterfeiting cases, 51.66% more than that of 2003, among which 5,401 were related to foreign trademarks, 158% more than that of 2003. 96 cases and 82 suspects were transferred to the judicial departments for criminal liabilities. From January to June 2005, based on what had been achieved last year, AICs at all levels throughout the country carried on with the Special Campaign to Protect the Exclusive Right to Use a Registered Trademark, dealt with 18,130 trademark infringement and counterfeiting cases in total, out of which 2,451were foreign related cases. Compared with the same period of last year, the number of trademark infringement cases dealt with and the number of foreign related trademark infringement cases have increased by 13.4% and 55.8% respectively. This effectively cracked down on the infringements and protected the rights and interests of trademark owners both home and abroad.

II. Great Increase in the Number of Trademark Cases Transferred to the Police

At the end of last year, the Supreme People’s Court and the Supreme People’s Procuratorate jointly released the Interpretation on Several Issues on Application of Law for Trial of IPR Criminal Cases by the Supreme People’s Court and the Supreme People’s Procuratorate (referred to as Interpretation below), which strengthened the criminal protection on Intellectual Property. AICs at all levels studied and implemented the Interpretation in a careful manner, and a number of criminals concerning trademark infringements have been punished severely after the cases were transferred to the police in accordance with the new criterion provided in the Interpretation when dealing with trademark infringement cases. On March 7th, 2005, Ouhai Branch of Wenzhou AIC, Zhejiang Province seized 4,497 fake lighters with the trademark “ZIPPO”as well as 4,900 sets of semi-manufactured goods (shell) at No. 87 Cinan Road, Wutiannan Village, Wenzhou City, Zhejiang Province, whose cost price was 7,846.4 RMB. On March 15th, the Branch seized 32,980 fake lighters with “ZIPPO” mark and 6,000 sets of semi-manufactured goods (shell) at No. 8, 18 Lane, Quanjing Alley, Dongfeng Village, Ouhai District, whose cost price was 42,576 RMB. Neither of these two cases shall be transferred to police for criminal liability according to previous standards, since the infringing goods were of comparatively low value and had neither been marked price nor been sold. However, the two cases occurred after the implementation of the Interpretation, which provides that where fake goods have not been marked price or it’s unlikely to know the actual sales price, the price shall be the average market price of the goods which have been infringed. In light of this provision, the Ouhai Branch calculated the sum of illegal operation with the average market price (188/item) of the infringed products, which was provided by the U.S ZIPPO, Manufacturing Company. Calculated in this way, the sum of the two cases rose to 845,436 RMB and 6,200,240 respectively (not including the semi-manufactured goods), both of which reached the criminal standard, therefore the two cases were immediately transferred to the police by Ouhai Branch, Wenzhou AIC.

The implementation of the new Interpretation has contributed to the large increase in the number of cases AICs have transferred to the police. From January to June this year, the number of trademark cases and suspects transferred reached 76 and 88 respectively, which are 3.6 times and 2.3 times those of the same period of last year.

III. New Ways of Trademark Administration

In the Special Campaign, AICs at all levels studied the new situation carefully, summed up new experience, kept blazing new trails in a pioneering spirit and adopted new measures for trademark protection. Beijing AIC and Shanghai AIC took forceful measures to rectify the order of trademark use in circulation. At the request of owners of a number of foreign trademarks with high reputation, on the condition that the trademark owners provided the guaranty, the AICs released Announcements, prohibiting the behavior of selling products with these trademarks without authorization of their owners. Beijing AIC released two announcements, enforcing protection on 48 registered trademarks of 17 enterprises from 8 countries, and 40 trademarks of 10 enterprises were involved in the Announcement released by Shanghai AIC. Since the Announcement involves a  large number of countries, enterprises and trademarks, the act won much international applause. The British RICHEMONT Corporation wrote to Shanghai AIC, praising it as a “a brand new creation, which has established a better system of protecting international reputed trademarks”, and “will contribute to educating the public to respect the legal rights and commercial interests of foreign reputed trademarks”. Moreover, the representatives of foreign invested enterprises also expressed their appreciation for this action at the 6th meeting on the mechanism of regular communication and coordination with foreign invested enterprises held by State Office of Intellectual Property Protection Work Team.

IV. Emphasis on the Protection of Well-known Trademarks

In the Special Campaign, protection of well-known trademarks has always been one of the top priorities for AICs at all levels, and the protection has been increasingly strengthened.

Well-known trademarks refer to those that are widely known to the relevant sectors of the public and enjoy a comparatively high reputation in China. Since well-known trademarks are more appealing to consumers, they are more likely to be infringed and counterfeited. Therefore, in both Paris Convention and TRIPS Agreement, it is provided that the protection of well-known trademarks shall be extended to a broader scope, i.e extended protection. It is clearly provided in the Trademarks Law of PRC, newly revised in 2001, that well-known trademarks shall enjoy extended protection.

Since China’s entry into the Paris Convention in 1985， China has been actively fulfilling the international obligations to protect well-known trademarks. In 1987, the Trademark Office under SAIC determined the trademark “PIZZA HUT” as well as the roof device of US Pizza Hut International Co. Ltd as a well-known trademark (it is the first well-known trademark determined after China became a party to the Paris Convention for the Protection of Industrial Property) in a trademark opposition case, and rejected the application filed by Australian Hongtu Company in the related goods in bad faith. In 1990, the Trademark Review and Adjudication Board （TRAB）under SAIC determined the trademark “SHERWOOD” owned by American SHER WOOD Electronic Experiment Co. Ltd as a well-known trademark, and annulled the trademark “SHERWOOD” registered by a Chinese company in Guangdong Province in related goods in bad faith.

Since the start of the Special Campaign in 2004, the Trademark Office and the TRAB has reinforced the protection of foreign well-known trademarks in the procedures of trademark opposition, dispute and administration, and has determined 30 foreign trademarks as well-known marks involving 9 countries and regions. Among these, the number of American trademarks is 13, French 5, Dutch 3, British 2, Swiss 2, Japanese 2, German 1, Italian 1, and British Virgin Islands 1. These trademarks include American“采乐”,“DU PONT”,“迪士尼”,“吉列 GILLETTE” and “雪碧”, French“LANCOME兰蔻”and“梦特娇”, Dutch “菲利浦PHILIPS”, Swiss “TISSOT T”, Japanese “尼桑”、“YKK”, German “BOSS”, Italian “Ferrari法拉利”and “香格里拉SHANGRI-LA” of the Virgin Islands.(UK). The determination and the protection of these well-known trademarks have been greatly welcomed by a large number of enterprises, especially some large multinational companies, and have strengthened their confidence in Chinese IPR protection.

Protection performed by AICs on the rights and interests of trademark owners home and abroad has contributed to the development of Chinese economy and prosperity of China’s trademark cause, and has attracted more and more foreign trademarks to be registered in China. In 1983, China’s annual trademark applications for registration (i.e. the number of applications for trademark registration received by China Trademark Office) was less than 20,000, and among which only 1,687 were foreign applications; by 2004, the number of annual applications had reached 588,000, and China has been on the top of the world for three consecutive years. Out of the annual applications, 60,000 were foreign trademarks, and the USA, Japan and Germany ranked first, second and third in the number of trademark applications, with 13,343, 11,945 and 5,961 applications respectively. By the end of this June, China’s accumulated number of registered trademarks had reached 2,370,000, among which 422,000 were foreign trademarks from 129 countries and regions. The sharp increase in China’s trademark applications for registration as well as the foreign trademark registration in China demonstrates that China has a comprehensive and sound trademark system, China’s protection on the exclusive right to use a registered trademark is effective and foreign investors have strong confidence in China’s market environment.

In the future, AICs at all levels will strictly conduct the enforcement as always, effectively protect the exclusive right to use a registered trademark of owners both home and abroad and safeguard the market order of fair competition in order to make contributions to the sound, rapid and sustainable development of the socialist market economy.