By Song Huang
song.huang@haiwen-law.com
Website: www.haiwen-law.com
A popular choice for the brand name of a seller's goods or services is the use of the place name where the seller's business activities are located. For example, the famous brand 'Maotai' liquor (茅台酒) uses the place name where the liquor is produced. Similarly, vendors of restaurants, retail outlets and art galleries located along the Bund (外滩), in Shanghai, choose to use 'Bund', 'Three on the Bund' and 'Eighteen on the Bund' to identify their brand names.
Generally, thePRC Trademark Law (Trademark Law) (中华人民共和国商标法)requires that "trademarks for which application for registration is to be made, should have distinctive characteristics (显著特征) that make them easy to identify" (see Article 9). This requirement must be read in the light of another trademark law principle that prohibits registration of marks that merely describe the general nature, use, function, quality, or other characteristics of the goods or services (see Article 11). The rationale is that trademark law regulates competition by refusing to permit a competitor having exclusivity over a word or phrase, which another competitor may also be entitled to use, to describe or market its goods or services.
A geographical mark is classified as a descriptive mark that merely describes the place where the goods are from or where services are performed. If a mark is a geographically descriptive term that identifies a particular place, sellers or manufacturers from the same place have equal rights to benefit from the use of that place name concerning the product's origin. Although a geographical name is registered as a trademark due to acquired distinctiveness through use, the protection of the mark may be 'thin' given that the registered mark holder does not have the right to prohibit fair use by others of the geographical name (see Article 49 of the Trademark Law's implementing regulations).
Under PRC law, there are no specific criteria available to determine whether a mark that is primarily based on a geographical name may be registered. However, in practice, the following elements may be used to establish a prima facie case for refusing registration of a mark that is primarily a geographically descriptive term:
(i) the significance of the mark is mainly geographic in nature;
(ii) consumers are likely to think that the goods or services originate from the geographic place identified in the mark resulting in a goods-place or services-place association, and
(iii) the mark identifies the geographic origin of the goods or services.
In relation to the first element, the Trademark Law specifically restricts the geographical names to those of administrative regions at county level and above (in China), or foreign place names that are well-known to the public (see Article 10). The implication is that the use of almost any recognizable place name in a foreign country may be treated as geographical in nature but this seems inconsistent with the standard adopted for place names in China; effectively allowing place names below the county level (for example, towns and cities in a county, districts, or neighborhoods) to be registered as trademarks. Not only does this create a double standard for Chinese place names but the rationale for this discrepancy is also unclear. Furthermore, if the Chinese place name is recognizable by consumers and the good/service is likely to be associated with the place, and does in fact originate from that place, then it is arguable that the mark of the good/service is primarily a geographical term and therefore, registration should still be refused on the ground that the mark is merely descriptive.
The determination of the second element is more complicated as it requires the subjective association in the mind of the consumers between the good/service and the place name identified in the mark. The following hypothetical case may provide a useful example. Upon seeing the mark 'The Bund Café', consumers are likely to draw a conclusion that the eatery is a high-end, western-style restaurant by associating the trade name with the Bund; an area that is famous for its western-style architecture and where people go to experience a luxurious and extravagant lifestyle by eating at high-end restaurants and shopping at brand-name retail outlets. Therefore, 'The Bund Café' may be thought to have the same high standard of quality as those restaurants and retail outlets located in the Bund. Accordingly, such a mark may be classified as geographically descriptive as it depicts the nature, quality or other characteristics of the product or service actually originating from this place. On the other hand, if a reasonable consumer would not conclude that the product comes from the place identified in the mark, registration of the mark cannot be refused on this ground alone. A good example is the mark 'Great Wall' for personal computers. There is little likelihood that the use of the mark 'Great Wall' in connection with personal computers would be understood by consumers as indicating that the computers were manufactured at the Great Wall.
The third element is met if the mark identifies the geographical name of the origin of the goods/services. Analysis of this element should not be confused with that of the first element. The test of the first element focuses on whether or not the mark, in and of itself, is a geographical name recognizable by consumers, while the third element must identify the origin of the good/service covered by the mark. For example, the mark 'Philadelphia' for the well-known Kraft brand of cream cheese meets the first element but fails to satisfy the second and third elements, since it is unlikely that consumers will make goods-place association and identify Philadelphia as the product's origin.