Rouse
Fiona Zhang
fzhang@iprights.com

Protection of 3D trademarks in China

Article 15 of the TRIPS Agreement provides the following broad definition of a trade mark: “Any sign, or any combination of signs, capable of distinguishing the goods or services of one undertaking from those of other undertakings, shall be capable of constituting a trademark. Such signs, in particular words including personal names, letters, numerals, figurative elements and combinations of colours as well as any combination of such signs, shall be eligible for registration as trademarks”. This includes both traditional marks, such as word or device marks, and non-traditional marks, such as three-dimensional (3D) marks, colour marks, and sound marks. To comply with this aspect of the TRIPS Agreement, PRC Trademark Law (中华人民共和国商标法) was revised in 2001 to provide for the protection of non-traditional marks.

A 3D mark, also known as a shape mark, is a three-dimensional symbol used on or in relation to goods or services. Subject to PRC Trademark Law and Examination Rules for Trademarks, jointly published by the China Trademark Office and Trademark Review and Adjudication Board in 2005, to be registrable, a 3D mark must be sufficiently distinctive from the common shape of the goods, or packaging in relation to which the mark is used. This is consistent with the registrability requirements that apply to traditional marks.

Applications for the registration of 3D trademarks are examined very strictly by the China Trademark Office and Trademark Review and Adjudication Board (Trab). The mere shape of goods without any distinctive element will not be registrable as a trade mark even though it has been used for a long time e.g. the shape of a fan will not be registrable in relation to fans. If, however, certain creative or distinctive words or devices are added, the shape incorporating those distinctive elements may be registrable as a 3D mark, for example, a common beer with a shape bearing the HEINEKEN logo has been registered as a 3D trade mark in China. Although the mark is registered as a 3D mark, it does not however protect the mere shape of the can: it will be enforceable only against cans that bear the HEINEKEN logo, or a deceptively similar logo.

Limitations on protection

Although shape marks are registrable in China, the recent case of Nestlé SA vs. Master Sauce Co. Ltd suggests both that enforcement may not be straightforward and that there is potential for 3D trademark rights to be abused.

The case involved the shape of a square bottle that had been designed by Julius Maggi in 1886, and subsequently used by Nestlé as packaging for its soya sauce.

In July 1995, Nestlé sought to register the bottle shape as a 3D mark in China. The application was initially rejected by the Trademark Office on the basis of lack of distinctiveness. Nestlé appealed successfully to the Trab, which ruled that the mark had acquired distinctiveness through extensive use and was registrable. A Chinese company, Master Sauce Co. Ltd (Master Sauce), had, however, been using a very similar square bottle in respect of its ‘Master Soya Sauce’ since 1983 – which was 12 years before the date of Nestlé’s registration.

In October 2008, Nestlé sent a warning letter to Master Sauce Co., Ltd. requesting it to cease using its square bottle, claiming that such use amounted to infringement of Nestlé’s trade mark registration. Master Sauce then took the initiative by filing an action for a declaration of non-infringement with the Intermediate People’s Court of Jiangmen City.

The Court found in favour of Master Sauce. It noted that many soya sauce manufacturers in mainland China were using similar brown square bottles before the date of Nestlé’s 3D registration and that use of the Master Sauce bottle did not result in any confusion among consumers. It further held that although Nestlé’s mark had been registered, it was not strongly distinctive. Nestlé appealed unsuccessfully to the Guangdong Higher People’s Court.

In 2008 and 2009, applications for the cancellation of Nestlé’s 3D registration were filed by Master Sauce and Kai Ping Food Industry Association. To date, the cancellation actions are still pending.

Final thoughts

Although the shape of Nestlé’s bottle had been registered as a 3D mark, and Master Sauce had been using a virtually identically shaped bottle without authority, the Court did not find infringement. It required something more. It found that because Nestlé’s mark was only weakly distinctive, and the defendant had been using its bottle in good faith and in conjunction with its own trademark, there was no infringement.

Given the particular facts of this case, there is merit in the Court’s approach. It is important that any protection afforded weakly distinctive marks is limited, and the possibility of trademark laws being abused reduced, in order to ensure the development of a freely competitive and healthy marketplace.

It is to be hoped that the Court’s decision will be supported by provisions in the Third Revision of Trade Mark Law regarding both the recognition of prior rights and the fair use of trade mark registrations, and further amendments to the Anti-unfair Competition Law (中华人民共和国反不正当竞争法).