International legal protection of trademarks in China.

• Author: Hu, Robert H.
• Position: Company overview

ABSTRACT INTRODUCTION I. THE RATIFICATION OR APPROVAL OF TREATIES AND AGREEMENTS IN CHINA II. FORCE AND EFFECT OF TREATIES AND AGREEMENTS UNDER CHINESE LAW III. MULTILATERAL TREATIES AND AGREEMENTS A. Paris Convention for the Protection of Industrial Property B. Madrid Agreement Concerning the International Registration of Marks C. Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks D. Nice Agreement Concerning the International Classification of Goods and Services for the Purpose of the Registration of Marks E. Agreement on Trade-Related Aspects of Intellectual Property Rights, Including Trade in Counterfeit Goods F. Trademark Law Treaty IV. BILATERAL TREATIES AND AGREEMENTS A. Argentina B. Australia C. Austria D. Belgium, Netherlands, and Luxembourg E. Canada F. France G. West Germany H. Greece I. Iran J. Italy K. Japan L. New Zealand M. Norway N. Russia O. Spain P. Sweden Q. Switzerland R. Thailand S. United States V. SELECTED CHINESE COURT DECISIONS A. Eastman Kodak Co. v. Suzhou Keda Elevator Co. (Chinese name: [TEXT NOT REPRODUCIBLE IN ASCII] B. FERRERO-Societa per Azioni v. Trademark Review and Adjudication Board (Chinese name: [TEXT NOT REPRODUCIBLE IN ASCII] C. Infineon Technologies AG v. Hangzhou Yingfeiling Computer System and Engineering Co. (Chinese name: [TEXT NOT REPRODUCIBLE IN ASCII] D. Procter & Gamble v. Beijing Guowang Information Co. (Chinese name: [TEXT NOT REPRODUCIBLE IN ASCII] E. Shanghai Dongbao Department Store v. La City Societe A Responsabilite Limitee (Chinese name: [TEXT NOT REPRODUCIBLE IN ASCII] F. Washington Apple Commission v. China Trademark Review and Adjudication Board (Chinese name: [TEXT NOT REPRODUCIBLE IN ASCII] VI. DISCUSSION AND OBSERVATION INTRODUCTION

China is experiencing a historic transformation of its trademark regime and legal system for intellectual property rights ("IPR"). (1) Each year hundreds of thousands of applications for trademark registration are filed with and approved by the China Trademark Office. (2) The number of trademark applications, and approvals, continues to grow year after year. (3) Based on government statistics, in 2005, the Trademark Office received a total of 664,017 applications, of which 70,635 (or 10.6%) were from foreign owners. (4) During the same period, the Trademark Office granted a sum of 258,532 applications, of which foreign registrations accounted for 39,801 approvals (or 15%) of the total registrations granted. (5) By contrast, in 2006, the China Trademark Office accepted 766,000 registration applications, earning the country the honor of first place in the world for the total number of applications accepted for the fifth consecutive year. (6) This enormous increase in trademark applications, however, presents a serious problem for delays in registration. (7)

Meanwhile, Chinese courts are actively engaged in enforcing the trademark law and adjudicating trademark and other IPR disputes and infringement cases. Since the passage and implementation of the 1982 Trademark Law in 1983, the courts have decided tens of thousands of lawsuits involving trademark controversies and infringement. (8) According to Chinese government statistics, from 1985 through 2004, the nation's courts of first instance accepted a total of 6629 civil cases involving trademarks. (9) In 2006, Chinese courts of first instance accepted and disposed of over 14,000 civil cases involving IPR, whereas the courts of appeals accepted a total of 2686 civil IPR cases and disposed of 2652 of them. (10) The number of trademark and IPR cases accepted by Chinese courts has been rising over the past decades as more and more Chinese companies and citizens become increasingly aware of their IPR and are willing to go to court to protect their rights. (11) Take Beijing First Intermediate People's Court, for example. This court, one of the leading tribunals in China which has decided some prominent foreign IPR cases involving Pfizer, Warner Brothers, Sony, Disney, and 20th Century Fox, has seen its IPR caseload grow threefold from 486 in 2002 to 1386 in 2006. (12)

Historically speaking, the idea of trademark rights, as well as the entire concept of intellectual property rights, is a relatively new phenomenon in China. (13) Although there were a series of official attempts to promulgate regulations governing trademark affairs in the 1950s and 1960s, (14) the first Chinese Trademark Law was not enacted until August 23, 1982, (15) thirty-three years after the founding of the People's Republic. (16) The passage of the 1982 Trademark Law, along with its successive revisions in 1993 and 2001, (17) is a critical part of China's economic development and modernization program and is a response to the political and diplomatic pressures for reform exerted primarily by the United States. (18)

On China's long march toward establishing a modern IPR system compatible with world standards, two milestones are noteworthy. The first milestone was reached on December 19, 1984, when China deposited with the World Intellectual Property Organization ("WIPO") a letter of accession to the Paris Convention on the Protection of Industrial Property, thereafter becoming a member of the Paris Convention on March 19, 1985. (19) The second milestone was in November 2001, when China joined the World Trade Organization ("WTO"). (20) China's WTO membership entails obligations under the WTO's side agreement on IPR--the Agreement on Trade-Related Aspects of Intellectual Property Rights ("TRIPs Agreement"), a matter of great interest to both scholars and practitioners. (21) Between these two milestones, China has taken strides in adopting numerous international regimes that govern trademarks and other IPR matters. Additionally, it has entered into a number of bilateral agreements with Western nations, including the United States, which are intended to offer better protection of IPR. (22) These developments have and will continue to push China forward to meet the international standards for protection of trademarks and other IPR.

As China undertakes its historic, unprecedented development in legal protection of trademarks in particular, and IPR in general, a great controversy and debate rages on between China and the West. On the one hand, Western governments, led by the United States, Japan, and the European Union, insist, perhaps rightfully, that China has done a poor job protecting foreign IPR, and that as a result IP piracy in China is epidemic, costing foreign right holders billions of dollars in lost sales and jobs. (23) One influential British IP magazine recently ranked China at the bottom of a list of twenty-two countries in the world based on the Global IP Index, which primarily measures the effectiveness of an IP regime in a particular country. (24) According to statistics compiled by one industrial lobbying group, in 2005 the United States alone lost $2.3 billion in sales in movies, books, and software due to Chinese piracy (see Figures 1 and 2 for details). (25)

A harsh critique of China is widely propagated in Western media and receives extensive coverage in popular culture. (28) On the other hand, China claims, justifiably, that it has made huge strides in setting up a modern IPR institution within a relatively short period of time, and that it is working hard to curb IP piracy in the nation. (29) This position is vigorously advocated by the Chinese government at home and abroad and is supported by the state-run media. (30)

This article will address major trademark-related international regimes in which China participates, either as a state party or as a signatory. (31) The article will then discuss China's obligations under the relevant international treaties and agreements, both multilateral and bilateral, and analyze pertinent Chinese court decisions to illustrate how these obligations are enforced by the judiciary. (32) Finally, the article will offer suggestions on future development in China's IPR protection through better enforcement of the existing regimes. (33) I will make three arguments: (1) International trademark law is taking roots in China; (2) China is taking its international obligations to protect trademarks seriously, and it has achieved much in harmonizing its domestic law with the international standards on trademarks; and (3) China should still do more to improve its enforcement of international and domestic rules aimed at protecting trademarks.

I. THE RATIFICATION OR APPROVAL OF TREATIES AND AGREEMENTS IN CHINA (34)

As in the United States and many other countries in the world, international treaties and agreements concluded by the Chinese government must be ratified or approved by the legislature or another government body to become effective. Under Article 89 of the Chinese Constitution ("Constitution"), (35) the State Council (i.e., the Cabinet) is authorized to exercise the power "to conduct foreign affairs and conclude treaties and agreements with foreign states[.]" (36) According to the Constitution, the National People's Congress ("NPC") or its Standing Committee is granted the power to ratify international treaties and agreements once negotiated and signed by the Chinese government. (37) Specifically, Article 67 of the Constitution states that the Standing Committee of the NPC is the organ "to decide on the ratification and abrogation of treaties and important agreements concluded with foreign states." (38)

For many years after 1949, the Chinese government conducted foreign affairs and entered into numerous bilateral and multilateral treaties and agreements covering a wide range of subjects, without following a uniform domestic procedure for treaty practice. (39) However, this situation changed in 1990 when the legislature enacted the Law of China on the Procedure of the Conclusion of Treaties ("LPCT"). (40) In twenty-one short articles, the LPCT defines the roles of government entities that participate in...