After years of dedicated efforts, the China National Intellectual Property Administration (CNIPA) has significantly curbed malicious trade mark registration behaviours by implementing legislative measures and new practices.
CNIPA’s efforts included releasing a Work Plan for the Systematic Governance of Malicious Trade Mark Registration and Promotion of High-Quality Development (2023–2025)(“Work Plan”) in April 2023. One of the measures of the Work Plan is to improve the monitoring and analysis of trade mark application behaviour data, enhance the early warning indicators and investigation of malicious trade mark registration activities to ensure effective prevention, timely detection, and targeted crackdown on such activities.
This update details the specific initiatives by the CNIPA to effectively implement this measure.
In December 2024, the China Government Procurement Network announced six successful bids to assist the CNIPA with identifying and investigating potential bad faith trademark registration behaviour with the intent to hoard and resell. The project spans diverse industries, such as home appliances, apparel, educational training services, telecommunications services, and also pharmaceuticals and medical devices.
For those in the pharmaceutical industry, this mainly includes:
1) Monitoring of Specific Platforms
Several active general online trade mark trading platforms, including Hao Biao (www.haotm.cn), Zhongxiruan Trade Mark Supermarket (www.gbicom.cn), Yuzhua (www.yuzhua.com), Pin Biao (www.mb.cc), Maihui (www.maihuiipr.com), and Chuangming (www.cmsbw.cn), etc., will be routinely monitored for a twelve-month period. The report will be reviewed by the China Trade Mark Office (CTMO). This monitoring, at a minimum of once a week, specifically targets potential hoarding and resale activities involving pharmaceutical product trade marks listed on these platforms.
2) Identification and Recording of Suspicious Trade Marks
For trade marks where of hoarding and resale activities is suspected, a comprehensive list of indicators will be compiled. This will include all relevant details: the trade mark registration number, trade mark name, complete registrant information (name and address), associated trade mark agency (where applicable), along with captured screenshots of sales pages or other verifiable evidence demonstrating the sales behaviour. This evidence will be summarized every quarter to systematically keep track of potential hoarding and resale activities.
3) Analysis of Data and Disposal Proposals
Using actual trade mark assignment data, the project will evaluate the registration behaviour of relevant trade mark owners and propose appropriate disposal recommendations for the registrants and their associated parties. Based on the provisions outlined in the Examination Operation Guidelines for Malicious Trade Mark Registration Applications without Intention to Use, the review procedure under Article 4 of the Trade Mark Law will be initiated. During the substantive examination, strict scrutiny will be applied to reviewing the submitted evidence of trade mark use or declarations of intended use. A quarterly report will be generated, encompassing the analytical findings, proposed disposal recommendations, and status update on the examinations.
What happens next?
Having followed established investigation protocols and applicable provisions, when a trade mark under investigation exhibits indications of hoarding or resale activities, CNIPA will formally issue an office action in accordance with Article 4 of the Trade Mark Law, requiring the applicant to provide evidence demonstrating either actual commercial use or intent to use the trade mark, or initiate an action to invalidate the registered mark in accordance with Article 44 of the Trade Mark Law. The evidentiary standards for establishing genuine use intent under such circumstances are particularly stringent, and failure to meet these requirements will lead to refusal of the trade mark application or invalidation of the registered mark. Additionally, any applications to assign or pledge marks of this kind will not be approved.
What impact will this have on pharmaceutical trade marks and what should pharmaceutical companies do?
This project demonstrates the CNIPA's continued dedication to combating bad faith trade mark registrations. We anticipate that this twelve-month project will yield meaningful outcomes. Of particular significance, brand owners operating in specialized fields including the pharmaceutical sector will stand to benefit from this project.
For entities considering trade mark acquisitions, conducting comprehensive due diligence is particularly crucial. This step is essential to preempt potential issues arising from the original owner's malicious acts. For instance, such malicious conduct could lead to the CTMO disapproving of the assignment. Even if the assignment is approved, the trade mark may still be at risk of invalidation due to the original owner’s improper conduct.
This article was first published in the May 2025 edition of Law Lore & Practice, the publication of the Pharmaceutical Trade Marks Group.
