To facilitate the public and trademark agency practitioners in better understanding the Trademark Examination and Adjudication Guideline (hereinafter referred to as the "Guideline") and to address public concerns, the Trademark Office of China National Intellectual Property Administration has compiled a set of questions and answers on key issues regarding the formulation of the Guideline.

Chapter 2, Part II of the Guideline addresses the examination and adjudication of "bad-faith trademark registration applications not filed for the purpose of use". This Chapter was added to align with the fourth amendment to the Trademark Law and attracted significant attention from various domestic and international stakeholders during the drafting process. Relevant interpretations are now provided as follows:

1. Q: What is the difference between "bad faith trademark registration applications not filed for the purpose of use" and other bad faith registration behaviors such as "free-riding on famous brands" and "capitalizing on trending topics"? How to determine "not for the purpose of use" and "bad faith"?

A: The legal text of China's Trademark Law does not contain a definition of "bad faith". The provisions aimed at combating bad faith trademark applications are scattered across multiple articles, including Articles 4, 7, 15, 19, 32 and 44 of the said law. It is generally believed that bad faith trademark registration behaviors can be broadly categorized into two types based on the interests they infringe upon: The first type is trademark squatting, which includes behaviors such as "free-riding on famous brands", "capitalizing on trending topics" or registering the names of public figures. The core characteristic of such applications is to harm or free-ride on the commercial reputation, civil rights or legitimate interests of others. The second type is "bad faith trademark registration applications not filed for the purpose of use", which includes behaviors such as "filing applications in bulk" or "hoarding trademark resources". The core characteristic of such applications is to disturb or impact the order of trademark registration and administration.

These two types of bad faith trademark registrations are not just distinct, but also interrelated. The Guideline clarifies that "the application for trademark registration that is malicious and not filed for the purpose of use" as mentioned in Paragraph 1, Article 4 of the Trademark Law refers to the "act where the applicant, rather than based on the needs of production or business operations, files a large number of trademark applications without a genuine intent to use the trademarks, thus improperly occupying trademark resources and disturbing the trademark registration order". The term "bad faith" refers to the intent to file a large number of trademark registration applications not for the purpose of use and the intent to profit thereby. It differs from the "malice" involved in "trademark squatting". Bad faith squatting behaviors such as "free-riding on famous brands" or "capitalizing on trending topics", if they only harm the civil interests of particular parties and do not involve harm to public interests, should be regulated under the provisions on relative grounds and do not fall under the regulatory scope of "bad faith trademark registration applications not filed for the purpose of use". However, if a large number of trademarks are squatted on, resulting in the improper occupation of trademark resources and disturbance of the trademark registration order, then Paragraph 1, Article 4 of the Trademark Law should also be applied concurrently for the regulation of such behaviors.

The so-called act of applying for trademark registration "not for the purpose of use" refers to situations where, at the time of application, the applicant has neither the purpose of actually using the trademark nor any preparatory action for its use, or where there is no possibility of actual use based on reasonable inference. The legislative purpose of Article 4 of the Trademark Law is to curb malicious applications, such as trademark hoarding, that improperly occupy trademark resources and disturb the trademark registration order. The intent to file a large number of trademark applications not for the purpose of use and to profit thereby then constitutes the "malice" targeted by Article 4 aforesaid, which is characterized by the lack of intent to use.

2. Q: Is it required to submit evidence of use when filing a trademark registration application? How should I understand the two exceptional circumstances listed in this Chapter to which Article 4 of the Trademark Law does not apply?

A: According to relevant provisions of the Trademark Law, China adopts the principle of acquiring the exclusive right to a trademark through registration, which is not preconditioned on use. Generally, submitting evidence of trademark use or a statement of intent to use is not required when filing a trademark registration application.

The legislative intent of Paragraph 1, Article 4 of the Trademark Law is to regulate bad faith trademark registration applications "not filed for the purpose of use" and trademark hoarding, and to strengthen the obligation of applicants to use their trademarks. The Guideline specifies that Article 4 does not apply to the following two circumstances: where "an applicant files applications for trademarks identical or similar to its own registered trademark for defensive purposes", and where "an applicant files a reasonable number of trademark applications in advance for a realistically anticipated business". The phrase "files applications for trademarks identical or similar to its own registered trademark for defensive purposes" primarily refers to a scenario where a trademark registrant applies to register trademarks identical or similar to its core brand on goods or services beyond its main business. The purpose is to prevent others from free-riding on or tarnishing the commercial reputation already established in its main business and under its core brand. The phrase "files a reasonable number of trademark applications in advance for a realistically anticipated business" mainly considers that in actual commercial activities, there is a certain time lag between the business planning of related goods or services and their actual promotion, marketing, and launch into the market. Some market entities may have the need to arrange trademark registrations in advance to prevent possible trademark squatting or to avoid infringing upon prior rights. Therefore, applicants are permitted to file a reasonable number of related trademark applications.

In particular, it is important to emphasize that although the Guideline provides a certain level of recognition for the aforementioned two types of acts, this recognition is limited. In either scenario, the filing of trademarks must be in reasonable quantities. Excessive defensive or stockpiling acts that file a large number of trademarks without genuine intent to use and beyond reasonable and necessary limits still occupy substantial trademark and administrative resources. Even if such acts are not for the purpose of profiting through assignment, they still disturb the trademark registration order. Consequently, they may still be determined as "bad faith trademark registration applications not filed for the purpose of use" in accordance with the law.

3. Q: What circumstances fall under the category of "bad faith trademark registration applications not filed for the purpose of use"? Why are some circumstances stipulated as mainly applicable to opposition and review procedures?

A: The Guideline specifies 10 circumstances that constitute "bad faith trademark registration applications not filed for the purpose of use", including:

(1) Filing an excessively large number of trademark applications that clearly exceed the needs of normal business operations, lack genuine intent to use, and disturb the trademark registration order;

(2) Copying, imitating or plagiarizing on a large-scale prior trademarks of multiple entities that have acquired a certain degree of reputation or strong distinctiveness, thereby disturbing the trademark registration order;

(3) Repeatedly applying for the registration of a particular trademark belonging to the same entity that has acquired a certain degree of reputation or strong distinctiveness, thereby disturbing the trademark registration order;

(4) Filing a large number of applications to register signs that are identical or similar to the trade names, abbreviations of enterprise names, e-commerce names or domain names of others, the product names, packaging or decoration with a certain influence, or the trademarks of others that are well-known and have acquired distinctiveness such as advertising slogans or appearance designs;

(5) Filing a large number of applications to register signs that are identical or similar to public cultural resources, such as the names of well-known figures, titles of well-known works or characters, or artistic works of others that are well-known and have acquired distinctiveness;

(6) Filing a large number of applications to register signs that are identical or similar to administrative division names, mountain or river names, scenic spot names or building names;

(7) Filing a large number of applications to register non-distinctive signs, such as generic names of designated goods or services, industry terms, or those that directly indicate the quality, main raw materials, function, intended use, weight, quantity or other characteristics of goods or services;

(8) Filing a large number of trademark applications and engaging in large-scale assignment of these trademarks to relatively dispersed assignees, thereby disturbing the trademark registration order;

(9) engaging in acts such as selling trademarks on a large scale, coercing prior trademark users or others into business cooperation, or demanding exorbitant assignment fees, licensing fees or compensation for infringement to obtain improper benefits; or

(10) Other circumstances that can be determined as bad faith trademark registration applications.

The terms "excessively large number" and "large number" mentioned in the above circumstances require comprehensive judgment based on factors such as the applicant's situation and the specifics of the trademarks applied for.

If the act of repeatedly applying for registration under circumstance (3) falls under the bad faith registration scenarios regulated by other provisions of the Trademark Law, such provisions shall apply. For the remaining circumstances, if they violate other provisions of the Trademark Law at the same time, such provisions shall also apply concurrently.

The Guideline stipulates that circumstances (3) and (9) are mainly applicable to trademark opposition and review procedures. The primary considerations are as follows: On one hand, determining circumstances (3) and (9) generally requires assessment based on actual evidence in the case file. Trademark registration examination, however, is typically an ex officio, ex parte procedure conducted based on the application documents, without stages for evidence submission and cross-examination. Opposition and review procedures, to the contrary, can provide the requested party with full opportunity for defense and safeguard the procedural interests of the relevant parties. On the other hand, the phrase "mainly applicable to opposition and review procedures" does not entirely exclude the application of these two circumstances at the examination stage. During the examination of trademark applications, clues discovered in a case can be taken into consideration as well.