Clearly Define Enterprise Name includes the Brand Name and abbreviation
According to "Administrative Provisions on Enterprise Name Registration" (hereinafter referred to as "Registration Provisions"), the brand name is the remaining part of the enterprise name after removing the region name, industry or business nature, or organizational form. For example, "Leroy-Somer" is the brand name of "Leroy-Somer company","Qingfeng" is the brand name of the"Beijing Qingfeng Stuffed Bun House".
When an enterprise name is recognized by the relevant public due to its increasing popularity, its brand name used alone also has an identification function. Therefore,the brand name of the enterprise name that has a certain influence will usually be deemed as the name of the business being protected according to the ACL. The Article 6of the Several Issues Concerning the Applicable Laws in the Trial of Unfair Competition Civil Cases Interpretation by Supreme People's Court states"words forming part of an enterprise name that is famous in the market to a certain extent and known to the relevant public may be deemed as the "enterprise name" as specified in Article 5(3) of the old ACL".
As for the abbreviation of the enterprise name, no specific legal or judicial interpretation has been given to the issue before the new ACL was introduced. The ACL protection of the abbreviation of the enterprise name was established for the first time by the Supreme People's Court in the case of Shandong Crane FactoryCo., Ltd. v. Shandong Shanqi Heavy Industry Co., Ltd. Over in 2009.This case is about disputes over Infringement upon an enterprise's right to its name.
The Supreme Court ruled that whether the abbreviation of the enterprise can refer to the enterprise,depending on whether the company is recognized by the relevant public,and establishes a stable relationship with the business in the relevant community. The abbreviation of an enterprise or an enterprise name,which has a certain market reputation, is well known by the relevant public and actually serves as a trade name,may be deemed an enterprise name.
A particular abbreviation of an enterprise can gain the public approval, a corresponding market reputation and a steady bond with the enterprise in a specific geographical area, and can play the role of a commercial sign in the identification of the operating entity. Any other person's subsequent unauthorized use of this well-known abbreviation will cause market confusion. The subsequent user may infringe on the legal rights and interests of the first user by inappropriately taking advantage of the reputation of the first user. Under these circumstances, Article 5(3) of the old ACL on the protection of enterprise name may apply to the protection of an enterprise's specific abbreviation.
Does the new expression "have a certain influence" raise the standard of recognition?
The ACL prohibits the illegal access to competitive advantage, not simply to protect a specific business identity.
In 2013, the Supreme Court ruled in the case Leroy-Somer Co.and Leroy-Somer Electro-Technique(Fuzhou) Co., Ltd. v. Leroy-SomerMotor (Fujian) Co., Ltd. The court decided that Leroy-Somer company had certain level of recognition in the motor industry. At the time that Leroy-Somer Motor (Fujian) Co., Ltd.changed its enterprise name, Leroy-Somer Co. and Leroy-Somer Electro-Technique (Fuzhou) Co., Ltd. had long used LEROY-SOMER as a brand name.The relevant public had established a fixed correspondence between the two sides. Under these circumstances, Leroy-Somer Motor (Fujian) Co.,Ltd., as a competitor of Leroy-Somer Electro-Technique (Fuzhou) Co., Ltd.in the same industry, coexisted in the same province of Fujian Province. Leroy-Somer Motor (Fujian) Co., Ltd.used Leroy-Somer as the brand name of the enterprise name, and used a similar name "LEROYSOMMER" as foreign enterprise name. It is obvious for Leroy-Somer Motor (Fujian) Co.,Ltd. to use the reputation of Leroy-Somer company in the motor area,which was likely to cause confusion and misconduct of the relevant public. The conduct of Leroy-Somer Motor (Fujian) Co., Ltd. infringed the right of enterprise name of Leroy-Somer Co. and Leroy-Somer Electro-Technique (Fuzhou) Co., Ltd., and constituted unfair competition.
Therefore, the identification of whether the conflict among the trademark uses and among the brand name uses of the enterprise names (i.e. the misunderstanding of the source of goods or services, the relationship of different operators) is sufficient or may lead to confusion by consumers, should be based on the relevant facts when the infringement occurred, and the following factors:
1) Whether the channels and ways of producing and selling goods or providing services are the same or similar;
2) Whether the goods produced or operated by both parties and the services provided by them are similar, and the degree of attention paid by consumers when purchasing them;
It is noteworthy that, once the enterprise name has a certain recognition and influence, it will naturally extend to a new area.However, the company should prove that its name or brand name has greater and wider recognition and influence than those in the same industry or in a direct competitive relationship.
Whether ordinary consumers will misidentify and mistake for purchase with ordinary attention;
The results of whether there is evidence that has caused the actual confusion;
Whether the infringer has the subjective intention of using or damaging the well-known goodwill of others.
To sum up, although the expression of "certain influence" is new, it is also the content of the judicial interpretation of the old ACL. This amendment is consistent with the previous judicial practice.
Effective Convergence of Enterprise Name Registration and Management System
One of the highlights of this revision is that it effectively links with the enterprise name registration management system of the administration for industry and commerce on the rectification measures of the names of enterprises that have been found to be infringing.
The new ACL, in addition to administrative penalties, regulates corrective measures against the name of a registered business company that has copied the trademark of another person. The second paragraph of Article 18 stipulates that where the corporate name is registered by a business operator and is in violation of the provisions of Article 6, the business operator shall promptly go through formalities to change the corporate name. Prior to such a change, the original corporate registration authorities shall use the unified social credit code in lieu of its corporate name. This is also the mandatory rectification measure of unsuitable names proposed in the Opinion of the SAIC on Improving the Registration Efficiency and Promoting the Reform of the Enterprise Name Registration and Management. It requires the enterprise competent registration authorities to actively cooperate with the trademark and competition law enforcement departments to handle enterprise name disputes according to the law.In September 2017, Article 36 of the Provisions on Administration of Enterprise Name Registration (Draft for Comments) promulgated by SAIC also placed clear obligations on the procedure and measures for compulsory de-listing of inappropriate enterprise names.
It can be foreseen that after the implementation of the new ACL, the registration authority will have more legal basis and punishment and will be more operable concerning disputes over the names of various types of enterprises arising from confusion. The efficiency of the registration authority in handling disputes will also be significantly enhanced.
