Procedures for handling trademark infringement in China

In the context of increasingly vibrant economic integration, trademark rights infringement has become one of the worrying issues that every business must face to protect the rights and maximum benefits for its operations. your business. As a country with a strongly developed industry and market, China has built and enforced a strict and strict system of procedures for handling trademark violations. This article aims to introduce some procedures for handling trademark violations in China so that readers can get an overview of ways to protect their trademarks in the country’s international trade environment in a country of billions of people. 

1. Trademark infringement measures in China and applicable procedures 

Current Chinese law allows the following three main methods to handle trademark infringement, including: 

• Administrative measures 
• Civil measures 
• Criminal measures 

Depending on the object of application, each measure has different characteristics and handling procedures. 

1.1 Administrative measures

Administrative measures are a popular form of handling trademark violations in China thanks to their cost-effectiveness, time efficiency, and relatively high legal binding for relevant parties. One of the main agencies responsible for handling trademark violations in China is the General Administration of Market Supervision (AMR) and its local affiliated agencies. 

In terms of procedure, the party whose rights to the trademark have been infringed submits a request for investigation and apply administrative measures and evidence of rights to the infringed trademark to the local administrative agency. The administrative agency, based on the request, will consider applying/not applying legal measures to serve the investigation, such as: inspect and/or copy relevant documents, seal and/or seize products suspected of being trademark infringing goods. If the investigation results show that a violation exists, this agency will impose sanctions on the violating party (for example, a fine, a penalty prohibiting the production of a certain item in a certain period of time etc.). Requesting administrative measures takes an average of 03 to 06 months and can cost about 20,000 to 50,000 Yuan (equivalent to about 68,000,000 to 170,000,000 VND). 

1.2 Civil measures 

Civil measures, also known as initiating civil lawsuits, are often used to request the violating party to compensate for damages or request competent authorities to apply temporary emergency measures to prevent greater damage from occurring. The process of applying this measure is relatively time-consuming and costly, but the court’s decision is highly enforceable for the party committing the infringement, thereby minimizing the risk of the trademark being infringed in the future. Even if the case does not go to trial, if the court decides to apply temporary emergency measures, the damage will be somewhat minimized. 

In terms of procedures, the process of initiating and resolving civil cases related to trademarks can last about 12 months. Procedures for initiating civil cases are carried out according to civil procedure regulations in China. However, one of the points to note during the lawsuit process is the collection of evidence proving the existence of trademark infringing goods in the market. As mentioned above, evidence is admissible by Chinese courts only if it is notarized/authenticated. 

Therefore, in some cases when there is no/insufficient legal evidence, the litigating party can request the court to issue an Evidence Preservation Order (EPO) to seal and/or take photos of trademark infringing goods at the infringing party’s production facility as evidence, and to collect copies of accounting reports, invoices, vouchers and commercial documents others to help resolve the case. The party requesting application, or the party whose trademark is infringed, will have to bear the security fee from applying the above order from about 20,000 to 1,000,000 Yuan (equivalent to about 68,000,000 to 3,400,000,000 Viet Nam Dong), depending on the requirements of each court and the volume of goods involved. 

On the other hand, in case enough evidence has been collected, the aggrieved party can request the court to issue an Asset Preservation Order (APO) to to seal the bank accounts and/or other assets of the violating party to prevent further damage from occurring. Similar to EPO, APO also requires the infringed party to pay a security fee. This fee will be withheld until the case is resolved. 

1.3 Criminal measures 

When trademark infringement may constitute a crime as regulated in Articles 213, 214 and 215 of the Chinese Criminal Law, criminal penalties may be imposed on the party committing the infringement. This is a coercive measure, but requires a lot of time, human resources and costs to apply. 

Regarding procedures, there are 03 ways to request the application of criminal penalties for trademark infringement, specifically: 

• The subject of Intellectual Property rights reports to the Ministry of Public Security; 

• An administrative agency refers the case to a criminal agency with suspicion that the damage caused exceeds the administrative penalty range; 

• The trademark owner initiates a criminal lawsuit on his own (this case is not common due to insufficient valid evidence). 

At that time, the Ministry of Public Security will decide to approve/disapprove the resolution of the criminal case. In case of approval, the Ministry of Public Security will collect evidence and transfer the case to the prosecuting agency for further resolution. 

 2. Key Considerations for Addressing Trademark Violations in China 

The party whose trademark rights have been infringed may consider applying administrative and civil measures simultaneously to increase the effectiveness of resolving the violation. The court can rely on the decision to sanction administrative violations to make a decision in favor of the violated party. 

Furthermore, if a trademark infringement is discovered and the infringing trademark is registered for protection, the affected party possesses the right to petition the Trademark Dispute Resolution Board of the General Administration of Industry and Commerce of China to render a decision to invalidate the registered trademark. This request must be made within one year from the date of approval of the trademark registration, as stipulated in Article 27 of the Chinese Trademark Law. 

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