To assist enterprises in understanding the legal provisions and processes related to trademark licensing recordation, guide them in applying for recordation in a timely manner and submitting the necessary materials correctly, clarify the validity of trademark licenses, stimulate market vitality, and prevent confusion, adverse effects, or rights disputes due to non-standard trademark licensing practices, these guidelines are formulated.
I. Trademark Licensing Recordation and Its Importance
In their production and business activities, enterprises that require trademark exclusive rights for their goods or services should file an application for trademark registration in accordance with relevant regulations. They can also negotiate with the trademark registrant to sign a trademark licensing agreement to use the registered trademark within the agreed scope of rights.
Trademark licensing refers to the trademark registrant granting part or all of their registered trademark rights to another party for a fee, within a specified period and geographical scope. The trademark registrant is the licensor, while the party using the trademark is the licensee. Trademark licensing differs from trademark assignment, as it does not entail a change of ownership; instead, it is a means for the trademark registrant to fully exercise their rights and better utilize the trademark.
If the licensor permits another party to use their registered trademark, they should file for recordation with the National Intellectual Property Administration (NIPA) during the validity period of the licensing agreement. Applications for trademark licensing recordation that comply with relevant regulations will be published by the CNIPA on the trademark gazette, and the public can query specific information on the "China Trademark Network - Electronic Gazette" section.
The validity of a trademark licensing contract, signed by qualified parties based on genuine intent, is not affected by the recordation of the trademark license. However, an unrecorded trademark license cannot be enforced against good-faith third parties.
II. Types of Trademark Licensing
According to the different rights and obligations of the parties involved, trademark licensing is mainly divided into three types: ordinary trademark licensing, exclusive trademark licensing, and sole trademark licensing. In practice, the parties may freely stipulate the type of license, scope, duration, usage method, range of goods or services, quality assurance, and liability for breach of contract in the trademark licensing agreement, provided that they do not violate legal regulations.
In ordinary trademark licensing, multiple licensees may exist simultaneously. Each licensee can use the registered trademark within the agreed scope, but none hold exclusive rights. The licensor may use the licensed trademark themselves or grant licenses to multiple third parties.
In exclusive trademark licensing, the licensee may use the registered trademark within the agreed scope and has the right to exclude third parties from using it. The licensor can only grant the registered trademark to one licensee and cannot license it to anyone else, although the licensor may still use the trademark within the agreed scope.
In sole trademark licensing, the licensee has the strongest exclusive rights, meaning no one other than the licensee may use the registered trademark within the agreed period and geographical area. The licensor cannot license the same trademark to any other party nor use it themselves within the agreed scope.
In addition to these distinctions, when the exclusive trademark rights are infringed, the licensee of a sole license can file a lawsuit in their own name before the people's court; the licensee of an exclusive license can jointly file a lawsuit with the trademark registrant or file independently if the registrant does not take action; the licensee under an ordinary license can file a lawsuit if explicitly authorized by the trademark registrant.
III. Procedures for Trademark Licensing Recordation
(A) Preparation for Trademark Licensing Recordation
To clarify the ownership of registered trademark rights and avoid ambiguity in agreements leading to unclear rights boundaries, the parties involved in the trademark licensing agreement can specify the following matters:
1. Basic Trademark Information
The parties should explicitly stipulate the registration number, trademark specimen, and other basic information of the trademark being licensed. If multiple trademarks are licensed within the same contract, relevant information for each trademark should be listed.
2. Goods or Services Information
The parties should clearly define the specific categories and items of goods or services for which the trademark is licensed. The licensed goods or services must not exceed the scope approved for the registered trademark, and their names should be the same.
3. Form of Licensing
The parties should specify the specific methods of trademark use, geographical scope, and other related information.
4. License Duration
The parties should specify the duration of the license, which should not start before the trademark is approved for registration and should not exceed the validity period of the registered trademark. It should also not conflict with the duration of the licensor and licensee.
5. Type and Limitations of License
The parties should clearly define the type of trademark licensing and explicitly stipulate the actions and restrictions applicable to the licensor and licensee based on the characteristics of ordinary, exclusive, and sole licenses.
6. Quality Assurance
According to relevant trademark laws, the licensor must supervise the quality of the goods bearing the licensed trademark. The licensee must ensure the quality of the goods using the registered trademark. If using another's registered trademark, the licensee must indicate their name and the origin of the goods on the products. The parties can further specify rights and obligations related to quality assurance.
7. Liability for Breach and Other Matters
The parties can explicitly define the liabilities for breaches of contract, handling methods, and other necessary content.
(B) Basic Requirements for Trademark Licensing Recordation
1. Trademark
The trademark licensing recordation application should be available for registered, valid trademarks. If applying for recordation on trademarks frozen by a people's court, a written document from the court consenting to the license must be submitted. For trademarks with prior pledge registrations, a written document from the pledgee consenting to the license is required. Applications for trademarks that have exceeded their validity period or have lapsed should not be submitted.
The licensee should actively check and monitor the status of the licensed trademark and fully understand that for trademarks undergoing cancellation, invalidation, or related litigation, subsequent reviews or judgments may affect trademark rights, and thus impact the trademark license.
2. Applicant
The trademark licensing recordation application should be submitted by the trademark registrant, and the applicant's name should match the registrant recorded in the trademark register. For co-owned trademarks, the application should be submitted in the name of the representative, with consent from all co-owners. All co-owners must sign or stamp the application (including the first page and any appendices) or power of attorney, and submit copies of identification documents.
3. Material Requirements
To submit a trademark licensing recordation application, the following materials must be provided: the trademark licensing agreement recordation form, copies of identification documents for the trademark registrant and licensee, and a power of attorney from the licensor, if a trademark agency is authorized.
A single recordation form can only permit one licensee to use one registered trademark. Additionally, for special trademarks (e.g., those used on pharmaceuticals, tobacco, etc.), the licensing recordation application must include valid proof that the licensee has obtained approval from relevant authorities to engage in the respective industry or produce related goods.
(C) Trademark Licensing Recordation Process
1. Application Method
The licensor can apply for trademark licensing recordation online or offline.
2. Recordation Procedure
The licensor should apply for trademark licensing recordation after signing the licensing agreement in a timely manner. The CNIPA will review the application and notify the applicant in writing if any corrections are needed. The applicant must make corrections within 30 days of receiving the notification. Failure to do so will be considered a waiver of the opportunity to correct. If the application meets relevant legal requirements, it will be recorded and published on the trademark gazette, and the applicant will be notified in writing. If the application does not meet the requirements, the applicant will be informed in writing. If the applicant disagrees with the CNIPA’s decision of disapproval, they may seek administrative reconsideration or litigation.
In accordance with relevant regulations, if interested parties raise objections during the review process, which necessitates a suspension of the review, the review may be suspended.
3. Payment of Fees
For trademark licensing recordation applications that comply with relevant regulations, the applicant must make timely payments as required; failure to pay will result in the application not being recorded.
4. Recordation Announcement
Upon approval and payment completion of the trademark licensing recordation application, the CNIPA will issue a "Recordation Notification" to the applicant, record the trademark licensing, and publish it. The trademark recordation information will be published in the "Trademark Gazette."
IV. Other Considerations for Trademark Licensing
1. Change of Names of Licensor and Licensee
After recordation, if either party changes their name during the license period, they can submit the relevant name change documentation to the licensor to apply for a change in the recordation.
To apply for a name change, the following documents must be submitted: the name change recordation form, a copy of the licensor's identification documents, and the name change certification issued by the relevant registration authority. If the licensee's name changes, a copy of their updated identification documents must also be submitted. If a representative agency is involved, a power of attorney signed or stamped by the licensor must be included.
2. Withdrawal of Trademark Licensing Recordation
The applicant can request in writing to withdraw the trademark licensing recordation application according to relevant requirements. For applications that have not yet been approved, if the reasons for withdrawal are found to be reasonable upon review, the application will be withdrawn, and the review process will be terminated.
3. Early Termination of Trademark Licensing Recordation
During the validity period of the trademark license, if both parties decide to terminate the license early, the licensor may submit a request for early termination and provide relevant materials.
4. Changes in Trademark License Matters
After the approval of the trademark licensing recordation, if there are substantial changes involving the licensed trademark, the licensed goods or services, the parties involved in the license, the duration of use, or the scope of use, a new application for trademark licensing recordation should be submitted, and the previous licensing recordation should be properly addressed in a timely manner.
5. Cross-Licensing of Trademarks in Co-Branding Partnerships
Co-branding typically refers to a collaborative form where two or more business entities jointly develop or provide a product or service, mutually using each other's trademarks on those products or services. This collaboration can leverage the characteristics of the different partners’ products or services, as well as their brand influence and recognition, to attract new consumer groups and expand into new market areas.
When engaging in co-branding and mutually licensing the use of trademarks, business entities should clarify key issues in accordance with their specific operational circumstances and needs, referencing the relevant sections of this guide. They should proactively conduct trademark licensing recordation in a timely manner to avoid disputes arising from unclear agreements.
6. Other Considerations
Business entities can refer to the directory of registered agencies available on the China Trademark Network for selection. Agencies accepting entrusted representation and conducting trademark license negotiations and recordation must adhere to the principle of good faith, fully explaining the importance of trademark licensing recordation and the related processes to the clients. They should handle the necessary procedures in accordance with regulations and must not engage in illegal activities such as document forgery or disclosure of client information.
