On November 5, 2017, INTA’s Asia-Pacific-Africa Subcommittee of the Parallel Imports Committee (PIC) co-hosted a seminar on parallel imports (PI) issues with Shanghai University IP College and the Jutra IP Center. Judges from Beijing High Court, Beijing IP Court, Shanghai IP Court, professors from Shanghai University and Tongji University, and more than 60 people, including INTA members and those from local Shanghai companies and law firms, attended the seminar. The PIC was represented by Jason Yao from the law firm of Wan Hui Da. As China does not have consistent jurisprudence on PI, the PIC decided to start a dialogue on this issue in China with this event.
Judge Zhang Lingling from Beijing IP Court gave a presentation on “Trial Practice in Trademark Infringement of Parallel Imports.” She touched upon four cases in which the courts found no infringement, and concluded that courts tend to find no infringement with PI when the products are genuine and legally imported without any amendment to the product or packaging. She then raised a few questions for the judges and audience to consider:
- When the parallel imported products are obviously different in quality with the products sold in China by authorized importers, should the parallel imported products be considered trademark infringing?
- When the parallel imported products are relabeled in Chinese and the Chinese translation is the same as / or similar to the registered Chinese version of the trademark, would the use of the Chinese translation be trademark infringement to the registered Chinese mark?
There were very different views among judges. Some agreed that it would be considered trademark infringement if the product quality/specification of PI is materially different from the authorized imports, or the change of package/label cuts off the connection of the products with the trademark owner. Others founnd it to be non-infringement as long as the products are originally sold by the trademark owner.
The Director of Justra IP Center, Mr. Wang Ze, commented that the following five principles should be considered in PI cases:
- Whether or not the use of trademark in selling PI is necessary for informing consumers whose products they are;
- Whether or not the product quality or commercial reputation of the product has been damaged;
- Whether or not the PI are clearly marked or labeled as parallel or repackaged;
- Whether or not the PI cause any damage to the trademark rights holder; and
- Whether or not the repackaging of PI would cut off the connection with the trademark rights holder.
When judges consider whether or not PI constitute trademark infringement, they should not only consider the likelihood of confusion, but also the possible damages to the trademark rights holder. Mr. Wang’s view was widely agreed by the audience.
Judges and scholars remain divided on this issue. Shining a light on the many other facts that need to be considered in PI cases, the seminar did well to rejuvenate conversation among judges and scholars who do not consider PI to be a form of trademark infringement. INTA always welcomes the opportunity to start a conversation about trademark-relevant topics and thanks the participants and organizers for creating a successful event.
Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.
© 2017 International Trademark Association