Trademark Non-Use Challenges Across China India Italy Vietnam

In the dynamic landscape of intellectual property, the effective management of trademarks is pivotal for businesses seeking to establish and safeguard their brand identities. A crucial aspect of this management involves understanding and complying with the varying regulations on trademark usage in different jurisdictions. This article aims to shed light on the nuanced requirements surrounding the effective use of trademarks, with a particular focus on China, India, Italy, and Vietnam. It is essential for businesses operating across borders to grasp the distinct terms and conditions under which registered trademarks can be retained, especially considering the common provision for invalidation due to non-use.

Join us as we unravel the intricacies of trademark non-use challenges, exploring the legal intricacies that businesses must navigate to ensure their trademarks remain not only registered but also robust and defensible in the face of potential disputes.

China mainland

The actual use of commercial trademarks in China is crucial to prevent potential challenges to the trademarks by any interested party, alleging continued non-use for a period of three years. According to Article 66 of the Implementing Regulations of the Trademark Law of the P.R.C., any interested individual or entity may request CNIPA to cancel a registered trademark that has not been used for three consecutive years without a valid reason. In such cases, the Trademark Owner bears the burden of proving the actual use of the trademarks by providing “material evidence” within the preceding three years from the date of the receipt of the notice from CNIPA. This evidence must be submitted within a mandatory term of two months.

Failure to submit material evidence within the specified time limit or the submission of invalid evidence, without any other justifiable reasons, will result in the cancellation of the registered trademark by the CNIPA.

According to the aforementioned Article 66, the term “material evidence” includes materials proving a trademark registrant’s use of the registered trademark and materials proving that a registrant has licensed other persons to use the said registered trademark. For example, an acceptable form of trademark use includes incorporating the trademark in transaction documents associated with the sale of goods. This encompasses sales contracts, invoices, bills, receipts, certificates of inspection and quarantine for import and export goods, customs documents, and other relevant paperwork.

It is essential to clarify that CNIPA thoroughly examines the proof of use, which must clearly demonstrate the time and date of use and whether such use is attributable to the owner or a licensee. Moreover, it is crucial to emphasize that the proof of use must be directly linked to the specimen of the trademark as registered in China. If the effectively used trademark differs from the registered one, for instance, where the used trademark has altered the main part or distinctive features of the registered trademark, it would not be considered valid.

India

In India, the Trade Marks Act of 1999 (the “Act”) grants registration of trademark for a period of 10 years after which the trademark is subject to renewal. Under Section 47 of the Act, there is a provision for removal of trademark on account of non-usage. Action for removal of registered trademark can be taken by any “person aggrieved” if, for a period of five years from the date of registration of trademark (i.e., the date on which the trademark was registered and entered into the Trademarks Register), and three months prior to date of filling the application for registration therefore a continuous period of 5 years and 3 months, there has been no “bona fide use” of the trademark for the goods and/or services covered under the registered trademark. It is crucial to consider the definition of a “person aggrieved” and the concept of “bona fide use” use.

Although the Act does not explicitly define “person aggrieved”, relevant caselaw (such as Hardie Trading Ltd. and Ors. vs. Addisons Paints & Chemical Ltd., AIR 2003 SC 3377) suggests that a person aggrieved is someone affected by the registration of a trademark in some possible way that he may be damaged or injured if the Trade Mark is allowed to stand.

Regarding “bona fide use”, it can be understood as a genuine and real intention to use the registered trademark (refer to Kabushiki Kaisha Toshiba vs. Tosiba Appliances Co. & Ors., (2008) 10 SCC 766).

It is essential to clarify that the burden of proving non-use during the relevant period rests on the applicant seeking rectification, i.e., the “person aggrieved”. Therefore, it is advisable to submit investigation details along with the cancellation action to demonstrate that the registered proprietor has not used the trademark within the specified period for customers and/or within the relevant trade circle.

Accepted evidence of use include but are not limited to commercial invoices and bills featuring the trademark; or brochures, advertisements, or pamphlets that substantiate the connection between the trademark and the goods/services encompassed by the trademark registration.

Italy

In Italy, the Industrial Property Code (“IPC”), in accordance with the relevant EU directives on the subject, stipulates in Article 24, under the penalty of forfeiture, that the trademark must undergo genuine use by the owner or with their consent for the registered goods or services within five years of registration. This use should not be suspended for an uninterrupted period of five years unless justified by a legitimate reason.

Prolonged non-use beyond the initial five-year period does not automatically result in the forfeiture of the registration. Instead, it must be formally applied for by any interested party through judicial or administrative proceedings before the Italian Patent and Trademark Office (Art. 183 bis and 184 ter, IPC).

Furthermore, also in alignment with European Union regulations, there is a shift in the burden of proof in forfeiture actions for non-use. Essentially, the applicant or plaintiff need only request the revocation for non-use of a trademark, compelling the owner to prove the actual and serious use of the trademark to maintain its registration.

The jurisprudence of the Court of Justice of the EU (CJEU) has clarified the characteristics of genuine use, emphasizing that it must be real and concrete, excluding cases of merely symbolic, sporadic, or episodic use. Sales invoices, coupled with dated catalogs and promotional materials, remain pivotal evidence to demonstrate the actual marketing of products/services.

It is also noted that, according to the aforementioned Article 24 ICP, the use of the trademark in a modified form, even if not registered, is considered equivalent, provided it does not alter its distinctive character. Additionally, the application of the trademark on products or their packaging within Italy for the purpose of exporting them is also deemed as use.

Vietnam

Similarly, in Vietnam, the Law on Intellectual Property No. 50/2005/QH11 (“LIP”) states in Article 95 that if a trademark remains unused by its owner (or the licensee of the owner) without a justifiable reason for five consecutive years before a request for termination of validity (unless use is initiated or resumed at least three months prior to the termination request), the protection title’s validity may be terminated. The provision specifies that the entities filing such requests can be “organizations and individuals” in general.

In cases of non-use claims, the burden of proof rests on the applicant to demonstrate that the trademark has not been utilized in commerce for five consecutive years. This necessitates presenting compelling evidence such as market research, advertising records, and statements from distributors.

Conversely, the trademark owner can counteract these claims by providing evidence of use. Although the LIP does not specify the required extent of use to maintain registration, it is noteworthy to mention that in a recent case, the National Office of Intellectual Property (NOIP) upheld a mark against a non-use cancellation request based on a single sale over a period of 15 years.

According to Article 124.5 of the LIP, the use of a mark encompasses affixing the protected mark on goods, packaging, facilities, means of service provision, or transaction documents in the course of business; circulating, offering, advertising, or stocking for sale goods bearing the protected mark; and importing goods or services bearing the protected mark.

Furthermore, Article 124 of the LIP specifies that the mark in use should be the “protected mark,” which might be strictly interpreted to mean the exact same mark indicated in the registration. However, the NOIP commonly interprets this provision more leniently, considering the use of a trademark by the proprietor in a form differing in elements that do not alter the distinctive character of the trademark as qualified use.

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In the chart below, we will outline and compare key terms and differences among the examined jurisdictions for clarity.