By Donnie Dong, Leo Liu & Bowen Dai
The PRC Supreme People’s Court (SPC) released a new set of judicial interpretations (JI) concerning the application of the PRC Anti-Unfair Competition Law (AUCL). The JI comes into force on March 20, 2022.
While the PRC court decisions on individual cases are not automatically binding, the SPC issues codified judicial interpretations to summarize judicial practices from time to time. These judicial interpretations are binding to all subsequent cases.
China amended the AUCL in 2019, which is a response to the “Phase One Deal” settling the trade war between China and the U.S. The 2019 amendments enhanced the country’s legislative protection of intellectual properties. The JI can be regarded as a materialization of such enhancement.
Among others, multi-national business operators should pay more attention to the following provisions of the JI:
– The look and feel of well-known brands’ retailing stores, including their interior decorations, furniture style, and staff uniforms, are now formally protected as trade dress under Art. 6 of the AUCL. [Art. 8 of the JI]
– The trade name of a foreign enterprise can be protected, provided that (i) the name is famous in China, and (ii) it is commercially used in the territory of China. [Art. 9] Meanwhile, the JI confirmed that “commercial use” can be established by advertising materials or materials disseminated in trade show exhibitions. [Art. 10]
– Unauthorized use of a famous person’s name (including pen name and transliteration of a foreign name) can be found liable, provided that the use could misleadingly infer that the unauthorized user is connected to the famous person. The same rule extends to the domain names, website names, unique webpage designs, and trade names. [Art. 11]
– Act of unfair competition intends to cause others to mistakenly believe there is a “Particular Relationship” between the infringer and the infringed. “Particular Relationship” is specified to include commercial association, licensing arrangement, commercial sponsorship, advertising endorsement, etc. [Art. 12]
– Anyone who facilitates unfair competition acts, for example, intentionally providing storage, transportation, business premises, and other facilities, can be found contributorily liable to the unfair competition acts. [Art. 15]
– Unless there is evidence of the legitimate source and lack of infringing intent, retailers can be found liable if they sell unauthorized goods bearing famous trade names, well-known decorations, or popular domain names or website names. [Art. 14]
– Online business operators (including APP developers) shall not (i) force visitors to visit a certain webpage by redirecting a webpage the visitor is browsing, [Art. 21] or (ii) force users to close, uninstall or block applications of other business operators. [Art. 22]
– Jurisdictions: unfair competition complaints shall be filed with courts where the defendant is located or where the claimed infringing activities take place. However, the “place of infringing activities” shall not be interpreted to include delivery addresses for online shopping which the buyers can freely choose. [Art. 26]
– If the alleged act of unfair competition takes place outside of China but has consequences in China, a plaintiff can file the suit with the court where the result of the infringement occurs. [Art. 27]
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Author: Donnie Dong. Admitted to practice in China and the New York State, the author received doctorate law degrees from both common law and civil law systems. He managed a few complex multijurisdictional IP litigations for leading global brands and copyright owners.
Dr. Dong is a Certified Information Privacy Manager (CIPM) by the International Association of Privacy Professionals (IAPP). Dr. Dong is also a member of the steering committee for Digital Asia Hub, a non-profit think tank collaborating with leading scholars and practitioners of digital society in Asia.