March 2022
Jane Tsai and Eddie Shih
The Executive Yuan adopted the draft Partial Amendments to the Trademark Law on January 20, 2022 to expand the scope of civil and criminal liabilities and submitted the same to the Legislative Yuan for deliberation to enhance the sales and profitability of trademark rights holders and strengthen trademark protection.
1. Highlights of the draft amendments
To win a chance to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (hereinafter, the “CPTPP”), the Executive Yuan introduced the draft Amendments to Articles 68 and 95-97 of the Trademark Law (hereinafter, the “Draft”) to fall into line with the provisions relating to intellectual property rights in the CPTPP.
(1) Expanding the civil liability for conducts such as counterfeiting of trademark labels (Article 68 of the Draft).
Under the current law, the civil liability for the preparatory or facilitative acts involving manufacturing, sales, possession, display, export, or import (hereinafter, the “Counterfeiting”) of labels, tags, packaging containers, or service-related items (hereinafter, the “Labels”) that contain trademarks “identical or similar” to registered trademarks for the purpose of marketing without the trademark right holders’ consent requires the actor’s “knowing” that the act applies to the goods or services represented by trademarks “identical or similar” to registered trademarks as the constituent element. This provision does not conform to the provisions of the CPTPP. Therefore, the Draft deletes the subjective element of “knowing” and reverts to the general principle of “intention” or “negligence” for civil damages liabilities.
(2) Adding criminal provisions on acts such as the Counterfeiting of the Labels containing trademarks or collective marks (Article 95 of the Draft)
A new criminal liability of up to one year’s imprisonment and/or a fine of up to NT$50,000 is additionally imposed on those preparatory or facilitative acts involving the Counterfeiting by the actor or others of the Labels containing trademarks “identical or similar” to registered trademarks or collective marks for intended use on the “same” goods or services bearing the registered trademarks or collective marks, and the provisions on the offenses of counterfeiting trademark labels, (using) falsifying private documents, and fraud under the Criminal Code are no longer applicable.
(3) Expanding the criminal liability for the Counterfeiting of the Labels of certification marks or (intended) sale of infringing goods made by others (Articles 96 and 97 of the Draft)
Under the current law, the criminal liability for preparatory or facilitative acts involving the Counterfeiting of goods or services bearing the Labels that contain trademarks “identical or similar” to registered certification marks for intended use on the “same” goods or services represented by registered certification marks requires the “knowing” of the actor as the constituent element and does not conform to the provisions of the CPTPP. Therefore, the subjective element of “knowing” is deleted by the Draft, which reverts to the general principle of “willfulness” for criminal penalties (including indirect willfulness with foreseeable infringement) to meet social justice and expectations. (Article 96 of the Draft)
For the criminal liability for selling or intending to sell goods made by others that infringe trademarks, collective marks, or certification marks, the element of “knowing” is also deleted, and the criminal principle of “willfulness” becomes applicable again. (Article 97 of the Draft)
2. Points to note in the future
The Draft expands the scope of civil and criminal liability of infringers in terms of the types of trademark (trademarks, collective marks, or certification marks), types of goods (labels, tags, packaging containers, or service related items), the types of conduct (manufacture, sale, possession, display, export, or import), and the subjective element (intention/willfulness or negligence). In light of the current environment, criminal penalties are also imposed on acts involving the Counterfeiting of the Labels for such trademarks or marks through electronic media or via the Internet and acts of (intended) sales of goods made by others that infringe such trademarks or marks (Articles 95-97 of the Draft). For the sale of counterfeit goods and the Labels on physical channels and online stores, criminal penalties may also be imposed, in addition to civil damages, as a deterrent, which merits trademark right holders’ attention to the progress of the subsequent amendments.