Trade Marks and Trade Secrets in the Service Industry. Alessandra Chies 18 March 2015

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1 Trade Marks and Trade Secrets in the Service Industry Alessandra Chies

2 Welcome to the webinar 2

3 Webinar interaction tools 3

4 Snapshot: Helpdesk services 4

5 Today s speaker Name: Alessandra Chies Occupation: Partner Firm: Ferrante Intellectual Property Location: Beijing, China Speaker s Bio: Alessandra is a partner of FERRANTE INTELLECTUAL PROPERTY. Alessandra has advised and assisted European companies from a wide range of industries on various aspects of IP prosecutions and enforcement in China, evaluating intellectual property rights portfolios and providing guidance on strategies. 5

6 Agenda 1. What is a Trade Mark and How to Protect It 2. What is a Trade Secret and How to Protect It 3. How to Enforce your Trade Mark and Trade Secret in Case of Infringements/Misappropriation 4. Q&A 6

7 Poll 1 Question: Do you think that registering a trade mark when offering services is as important as when offering products? A. Yes, I think it is just as important. B. No, I don t think it s as important. C. I am not sure. 7

8 First things first: what is a trade mark? Do I have to register a trade mark even if I offer services? Trade marks are not just for products but are vital also to identify services A trade mark is a sign (or a sound, or a shape, a color, a sentence ) which distinguishes products or services of a particular source from one another IPRs are territorial rights: they are only protected in the territory/jurisdiction where they are registered. Your trade mark in your home country (or Hong Kong, Taiwan, Macao) is not valid in Mainland China 8

9 Registering your service mark in China as soon as possible is very important China uses the 'first-to-file' system, meaning that you may lose legal protection if a similar/identical mark has already been or will be registered by another party (do not rely on prior-use) The sooner the better! A trade mark owner can be an individual or a legal entity (but foreign entities/individuals have to use a China Registered Trademark Agent for the procedure) 9

10 Cost and timing for trade mark registration The official fees are CNY 800 (EUR 120), per trade mark per class (for a maximum of 10 services). Each service after the 10 th has an extra fee of CNY 100 (roughly EUR 15) It takes about 1 year for a trademark to be registered (if nobody starts an opposition procedure or if your trade mark is not refused for other reasons (i.e. a similar/identical mark has already been registered/filed) 10

11 The Chinese system may be different from that of your home country China uses the Nice Classification but with strict sub-class division The assistance of a professional is very important : they will be able to guide you through the peculiarity of the system 11

12 Poll 2 Question: The Nice Classification has 45 Classes. How many relate to services? A. 5 B. 10 C. 6 D

13 Nice Classification: 45 Classes, 11 for Services (35-45) but with detailed sub-class division 13

14 Practical example Your company offers various repair services for home appliances: boilers repair, wallpapering, painting, electric appliance installation, air condition installation, furniture repairing, etc. and you register the trade mark in Class 37 Class heading of Nice Classification: Class 37: Building Construction; Repair; Installation Services Make sure you evaluate all subclasses of Class 37 otherwise a third party may register the same service mark in the same class but in different subclasses/services (that may be rather similar to yours) 14

15 15

16 continued 16

17 Another example: Class 45 17

18 Better to be safe than sorry Consider at least one service per subclass Consider registration of the trade mark also on certain goods that may be closely connected with your business/used in providing your services Trade fairs participation 18

19 Other important aspects to consider Protection starts from the registration date in China For enforcing an international trade mark extended to China, a further document is required: the confirmation certificate The trade mark can be cancelled if it is not used for 3 years from the registration date in China In China, trade marks shall be used exactly in the way they have been registered Chinese translation/transliteration of the trade mark shall be registered as well 19

20 Monitor the market-place (also online) and CTMO Gazette 20

21 What can I do if someone has applied/registered a similar/identical trade mark? Oppositions China Trademark Office (CTMO) - for not yet registered marks Invalidation actions - Trademark Review and Adjudication Board- TRAB (absolute and relative grounds) Cancellation Actions (CTMO) - Non-use - Generic names 21

22 What can I do if someone is infringing my trade mark (registered in China)? Administrative Enforcement Civil Lawsuits Criminal Enforcement 22

23 What is a Trade Secret? Trade secrets can be technical information but also operational information, such as processes, recipes, marketing/product strategies, customer lists, production processes, pricing information, non-patentable or unpatented technology/processes. 23

24 Trade Secret examples Search Algorithm The New York Times's Best-Seller List: the method for compiling the data is classified as a trade secret 24

25 Definition of Trade Secret in China Article 10 of the China Anti-Unfair Competition Law defines trade secret as: 1. Technical and business information that is unknown to the public; 2. Which has economic value and practical utility and can bring competitive advantages for the right owner; 3. For which the trade secret owner has undertaken measures to keep it secret. Other Laws (i.e. Contract Law), Court Interpretations and State Administration for Industry and Commerce Provisions also address trade secrets protection 25

26 Advantages/disadvantages of Trade Secrets protection Advantages: Through trade secret you can protect non-patentable processes Trade secrets do not have a set term of protection (so can last longer than other IPRs) Disadvantages: Obtaining information through reverse engineering or through research and development efforts is not considered trade secret infringement More difficult to enforce them 26

27 Keep it secret! Once you have information or a process, etc. that is unknown to the public and gives you a competitive advance, you must put in place necessary steps to keep it secret, otherwise you may lose any right over it Training employees is a core part of protecting trade secrets Around 60% of misappropriation cases are related to business secrets infringement and 90% of those infringements are caused by ex-employees 27

28 Prevention is very important!remember that in a lawsuit you have to prove that you put in place the protective measures! Limiting access to trade secrets only to certain personnel Password protection Locked cabinets Stating on the carrier that it encloses classified information (i.e. Confidential- do not disclose) Block possibility of transfer files and adding contacts on chat engines (where files can be transferred) 28

29 more tips Executing carefully drafted confidentiality agreements and nondisclosure agreements (employees/business partners) Enclosing specific clauses in employment contract Put in place and record periodical trainings for employees Sign additional logs when employees access the trade secret Adopt any other suitable measure for ensuring the confidentiality of information 29

30 Poll 3 Question: Have you put in place any of the measures above to protect your Trade Secrets? A. No, I do not have any information/process that is a Trade Secret. B. Not yet, but I will do. C. Yes, I have. 30

31 What can I do if someone is using my trade secret to their advantage? Administrative Enforcement Civil Lawsuits Criminal Enforcement 31

32 Difficulties in Trade Secret lawsuits: burden of proof and evidentiary requirements Plaintiffs in a trade secret misappropriation lawsuit must prove the following three elements (mostly with documentary evidence) : 1. Existence and ownership of the trade secret. Providing evidence of: content of the trade secret its commercial value protective measures taken to keep it secret 2. That the Defendant possesses information that is identical or considerably similar to the trade secret 3. That the Defendant used improper means to obtain the trade secret 32

33 Take-away Messages Always register your trade mark as soon as possible in China Put in place well constructed measures to protect your trade secret Always consult a PRC Lawyer to evaluate how to register and enforce your rights 33

34 Q&A Name: Alessandra Chies Firm: Ferrante Intellectual Property Location: Beijing 34

35 PLAY the Serious Game Interactive training and learning tool Common business scenarios to experience doing business, protecting and enforcing IP in China Available online at: eu/en/serious-game/ 35

36 Thank you 36

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