Report Q168

1.

Is there any requirement for use of a mark "as a mark" for the purposes of:

Acquiring a mark (if rights may be acquired by use according to national law)

Under the Japanese Trademark Law, use of a mark is not a prerequisite for registration of the mark, in principle. Although in view of the language of the relevant statute, an intention of using the trademark to be applied for is a requirement for registration (Art.3, Para.1 of the Trademark Law) , practically this provision is hardly be invoked. Before the revision of the Bank Act, banks were prohibited from manufacturing or selling any goods. Accordingly, because there is no possibility of banks using any trademark, no trademark registration was granted in any bank's name. However, regarding containers as three dimensional trademarks, the Patent Office has established a practice by which it rejects a registration under said provision of Trademark Law, if it considers that the trademark cannot be used as a source identifier, even though such practice does not seem to meet the proper interpretation of this provision.

As an exception, even a trademark that is not inherently distinctive would become registrable if you can establish distinctiveness acquired through use (Art.3, Para.2 of the Trademark Law). In order to objectively show that the trademark has been recognized as a sign identifying a specific source of goods, practically it is necessary to establish that the trademark, which must be identical to the trademark applied for in substance, has extensively been used by evidence such as advertising materials. While the Japanese Patent Office and courts examine this requirement very strictly, no criterion concerning the length of use is provided. Under the Japanese Law, there is neither an established law in common law countries where use of the trademark for five to ten years is recognized, nor, a provision like Section 2 (f) of the U.S. Trademark Act (which regards the exclusive use of a trademark for five years as prima facie evidence of acquired distinctiveness). The Japanese trademark system might be improved if continued use of the mark for five or ten years would be deemed as a prima facie standard for granting acquired distinctiveness in view of the experience in common law countries, with exception of the case that an establishment of secondary meaning of a mark could be positively admitted through continued use for less then five years.

Maintaining of a trade mark registration (e.g. against an application for cancellation on grounds of non-use)

The requirement to submit evidence showing the continued use of a registered trademark for renewal was abolished at the time of Japan's accession to the Trademark Law Treaty (TLT).

In order to defend a trademark registration from being cancelled by a cancellation action based on non-use, the trademark owner has to establish use of the registered trademark within the three years preceding the filing of the cancellation action. A cancellation trial based on non-use is a system to cancel a registration of a trademark which has not earned any goodwill yet. In view of the spirit of this system, logically use of a mark by which the user's goodwill would not be recognized, in other words, use of mark in a manner which does not permit it to function as a source identifier, should not be considered "use" of the mark.

Under actual practice, however, it is not usual for it to be asked whether or not the use by the trademark registrant or its licensee is use of a "real trademark" which is capable of distinguishing goods, and the defendant's use would tend to be easily acknowledged as "use" even if it only formally falls under the definition of use (discussed below).

However, in some complicated cases such as those appealed from the Trial/Appeal Board of the Patent Office to the Tokyo High Court, the substance of the use of the trademark could be examined seriously. In the Japanese law, there is no provision like "the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark," as is in the U.S. Trademark Act.

Under the current trademark law, an advertisement showing a trademark in connection with certain goods falls under "use" independently, according to the definition of use of a mark. Therefore, even only an advertisement for goods bearing a trademark without any actual manufacture or sale of the goods could be interpreted as "use" of the trademark. This appears to be improper in theory.

Further, in case a registered trademark consisting of the three letters "ABX" is used as a model sign of goods but, at the same time, it actually functions as a source identifier, practically the registration would not be cancelled.

Establishing infringement

As to "use" concerning a trademark infringement, not only whether the defendant's use falls under the definition of "use" discussed below but also whether such use is use substantially as a trademark in a proper sense (a source identifier) will be examined. In actuality, there are a considerable number of precedents where the defendants' use was found not to be "use as a trademark" and as a result, the infringement was denied. This would become an issue in an infringement action, if the defendant argues that its use is not use as a trademark.

Meanwhile, under the Japanese law, it is not necessary for a plaintiff in a trademark infringement suit to establish use of his registered trademark. Even if the plaintiff has never used his registered trademark as far as it stands in force on the Trademark Registers, he can enjoin the infringer's use on the basis of an unused registered trademark and also can sometimes demand damages corresponding to the amount of royalties to be paid under the normal circumstances (although there was a decision by a district court, which denied such damages sought by a trademark holder who had never used his trademark).

If such non-use continues for three years, however, the trademark registration would become vulnerable to a cancellation action.

In this connection, there has been criticism directed against the current law which allows a trademark registrant to enforce his trademark which has merely been registered without any goodwill.

2.

Is there any definition of what is the use "as a mark" either in statute or case law?

First, Art. 2, Para. 1 of the Japanese Trademark Law provides the definition of the physical attributes of "mark" as follows, whereas it does not define the functional attributes of "mark":

2.(1) "Trademark" in this Law means characters, signs, three-dimensional shapes or any combination thereof, or any combination thereof with colors (hereinafter referred to as a "mark"):

1. which are used in respect of goods by a person who produces, certifies or assigns such goods in the course of trade;

2. which are used in respect of services by a person who provides or certifies such services in the course of trade (other than as in (i) above).

Next, Art. 2, Paragraphs 3 and 4 of the Trademark Law provides a detailed definition of "use of a mark" as follows:

(3) "Use" with respect to a mark in this Law means any of the following acts:

1. acts of applying the mark on the goods or their packaging;

2. acts of assigning, delivering, displaying for the purpose of assignment or delivery, or importing, the goods on which or on the packaging of which a mark has been applied;

3. acts of applying a mark to articles for use by persons to whom the services are provided (including articles assigned or leased -hereinafter the same) when providing services;

4. acts of providing services by use of articles to which a mark has been applied for use by persons to whom the services are provided when providing services;

5. acts of displaying, for the purpose of providing services, articles to which a mark has been applied and supplied for use in the provision of services (including articles for use by persons to whom the services are provided when providing services - hereinafter the same);

6. acts of applying a mark to articles related to the provision of such services belonging to persons to whom the services are provided when providing services;

7. acts of displaying or distributing advertisements relating to the goods or services, price lists or business papers with respect to the goods or articles on which a mark has been applied.

(4) Acts of applying a mark to goods or other articles to which a mark is applied as prescribed in the preceding subsection shall include acts of having goods or their packaging, articles that are supplied for use in the provision of services and advertisements relating to goods or services shaped into a mark.

However, none of the terms used in the above definitions is defined in the Act, and furthermore, the traditionally established interpretation of the terms appears to be becoming slightly altered in conformity with the development of trading environment.

For instance, whether or not "a use of trademark" is always required in the form of traditional way or not is vague. Although traditionally "goods" have been interpreted as being a "tangible substance which can be an object of trade in commerce," the Morisawa typeface case decided by the Tokyo High Court on December 24, 1993, as well as the change of practice by the Patent Office, under which "computer programs" are accepted as an identification of goods in a trademark application, have clarified that even an intangible object can be "goods," and thus the traditional interpretation is being altered.

Also concerning "services," the current court judgements still exclude "retail services" from the category of "services" under the interpretation that "services" must be those for which money is independently paid, not services which are an auxiliary of goods. In view of the international trend, however, it appears likely that the Law or Regulation will be changed before long. In fact, this matter is now being discussed seriously.

Meanwhile, according to the definition of "mark" under the Trademark Law, marks are only those which can be sensed visually and the definition of "use" absolutely requires that a trademark be "attached" physically to something. Therefore, under the Japanese law, presentation of a mark by a voice in a radio advertisement or the like would not fall under "use" of a mark.

3.

Is there any difference in the assessment of use "as a mark" between the acquisition, maintenance and infringement of rights?

As mentioned above, while regarding the use to maintain a trademark registration, relatively formal use, i.e., use which comes formally under the definition of use of Art. 2 of the Trademark Law, would be considered sufficient, in the case of an infringement suit, not only whether the defendant's use falls under the definition of use but also whether the defendant's mark has been used actually as a sign distinguishing goods could be examined.

In this regard, one might feel that the above difference results from the difference in the manner of interpretation of "use of mark" by an administrative agency, which is practically required to keep the balance of public interests in deciding whether the registered trademark may be allowed to maintain or not and that by a judicial organization, which is required to justify the balance of conflicting parties, because the former (a cancellation action based on non-use) is examined by the Patent Office (the administrative agency) and the latter (an infringement suit) by a court. However, since the examination in the Patent Office is rather conducted ex-officio in writing, whereas that by a court is conducted in the manner of party to party principle and in oral hearings where the actual use in question is thoroughly examined, the above difference appears to result from the volume of evidence to be produced, the difference in the level of seriousness and stance of the challenge-defense by the parties and the like, rather than because of a difference in interpretation of law.

4.

Is any of the following considered to be use "as a mark":

4.1

Use on the internet, as a metatag, in linking or framing

There is no statute or case law concerning such use.

However, since a trademark written in a metatag is not visible, and this is not "use of mark" in view of the aforementioned definition, it appears that the writing in a metatag itself would not become the subject under the Trademark Law.

Nevertheless, the result of writing the trademark in a metatag may be considered illegal, such as an unfair act under the Unfair Competition Prevention Law, infringement of a copyright, defamation of character or the like, and in such a case, one could take a legal action against it as the case may be.

4.2

Use by fan clubs or supporters

This manner of use does not meet the requirement under the statutory definition of "mark" that a user must be "one who manufactures, sells, etc. goods as business." Therefore, this type of use does not come under "use" which constitutes a trademark infringement.

Since even this type of use may cause dilution of the capacity of a famous mark and/or the mark to become generic, some legislation against it would be necessary.

Particularly, it is necessary to control any false representation about the mark, such as to control comparative advertisings.

Regarding the matter of making a trademark generic, the following provision in Section 10 of the Community Trademark Regulation is worth referring to:

Article 10

[Reproduction of Community trade marks in dictionaries]

If the reproduction of a Community trade mark in a dictionary, encyclopaedia or similar reference work gives the impression that it constitutes the generic name of the goods or services for which the trade mark is registered, the publisher of the work shall, at the request of the proprietor of the Community trade mark, ensure that the reproduction of the trade mark at the latest in the next edition of the publication is accompanied by an indication that it is a registered trade mark.

4.3

Parody

Whether or not a certain mark is used as a parody would have no legal implication under the Japanese law. That is, irrespective of whether it is a parody or not, if the trademark actually used is viewed as identical to the registered trademark, it would constitute a trademark infringement.

Yet, even a parody could eventually constitute an unfair act or the like depending on the actual manner of use, as above discussed about use in metatags, especially in the case that the trademark is a well-known mark, a parodic use of the same should be undoubtedly considered as an unfair competitive act in most cases.

4.4

Comparative advertising

While it is difficult to imagine that a question of "use" of a trademark would be raised in connection with a comparative advertising, the question here is whether the defendant's act comes under the announcement or circulation of a falsehood under Art. 2, Para. 1, Item 14 of the Unfair Competition Prevention Law or an unfair trade act under Art. 4 of The Law against Unjustifiable Premiums and Misleading Representations.

Unfair Competition Prevention Act

Sec.2 (1)(xiv)

The act of notifying or circulating a falsehood detrimental to the business credit of another person in a competitive relationship.

The Act against Unjustifiable Premiums and Misleading Representations

Sec. 4 [Prohibition of misleading representations]

No entrepreneur shall make such representation as provided for in any one of the following paragraphs in connection with transactions regarding a commodity or service which he supplies:

1. Any representation by which the quality, standard or any other matter relating to the substance of a commodity or service will be misunderstood by consumers in general to be much better than the actual one or than that of other entrepreneurs who are in competitive relationship with the entrepreneur concerned, and thereby which is found likely to induce customers unjustly and to impede fair competition;

2. Any representation by which price or any other terms of transaction of a commodity or service will be misunderstood by consumers in general to be much more favorable to the consumer than the actual one or than those of other entrepreneurs who are in competitive relationship with the entrepreneur concerned, and thereby which is found likely to induce customers unjustly and to impede fair competition; or

3. In addition to those stipulated in the preceding two paragraphs, any representation by which any matter relating to transactions as to a commodity or service is likely to be misunderstood by consumers in general and which is designated by the Fair Trade Commission as such, finding it likely to induce customers unjustly and to impede fair competition.

In addition, interpretation or legislation which might include the matter of 4.2, 4.3, 4.4 above under the category of trademark infringement would run the risk of making the substance of a trademark infringement vague, and they should be discussed separately.

5.

If, under the Group’s national regime, use as a mark is confined to the traditional indications of original or identity, are unconventional uses nevertheless objectionable under trade mark or other laws (e.g. unfair competition or trade practice laws).

As aforementioned in this report, in Japan, the traditional interpretation of trademark use, which is to identify the sauce or quality of goods or services, has been still maintained in principle, with exception of special case, that is use of a trademark for software. However, Unfair Competition Prevention Law will be applicable and useful for prohibiting such an unfair use of other’s trademark that is deemed as new type of trademark use.

6.

If use "as a mark" in the traditional sense is required to establish infringement, are "well-known", "famous", "notorious" or "reputed" marks used on dissimilar goods and services protected?

When any well-known or famous trademark is applied for registration or is already registered by a person other then the true owner thereof, it shall be rejected or cancelled with a positive provision stipulated in the Trademark Law. A well-known or famous trademark is also reasonably protected under the Unfair Protection Prevention Law indeed, in accordance with the degree of its recognized reputation in the market, from any unauthorized use of the same or similar trademark not only for the same or similar goods or services but also for dissimilar goods or services.

We, Japanese Group, are offering the following two proposes to be studied in respect of Question 168:

1. Proposal in relation to "Use of a Mark ‘As a Mark’ "

It is anticipated that the answers to the Question 168 would show the difference of the definition or interpretation of the legal concept of "Use of a trademark" among nations, respecting, but, fundamentally, it is quite natural because a trademark right has been protected by each national law. Meanwhile such difference originated from each independent national law has gradually been decreased as the results of recent effort toward international harmonization of national trademark laws in accordance with the expansion of international business activities. Currently, the harmonization has been limited on the aspect of procedural matters, such as application forms or the like.

But for those who are in charge of international business it is desirable to have fundamental trademark matters harmonized for smooth and swift international trade. The growth of trade through the Internet must facilitate this desire. Accordingly, taking this opportunity Japanese Group would propose to discuss the necessity or feasibility of harmonization on the definition of "the use of trademark", which we believe is one of the most essential points in the trademark protection system. Practically it would be necessary to resolve to the points listed below as early as possible. For the information, in Japan recently it has been discussed how the definition of trademark use should be cleared in the Trademark Law, in order to compliance with the natural expansion of the "e-commerce".

• Feasibility of a cancellation of trademark registration for non-use-Is any use of trademark on Internet (even a taken use) able to avoid a non-use cancellation action?

• For consideration of an infringement-What mode of use on Internet be interpreted as infringing trademark use?

• Proof of trademark use through Internet to be evaluated as established famousness.

• In the trademark use through Internet evaluated as the basis of trademark right under a national law (especially in a common law country)?

2. Observations of interest on the topic above

We often notice the cases where other person’s trademark is used as a reference, without any authorization in market, for example:

1. For parody, other person’s trademark is referred to without consent.

2. For comparative advertising, other person’s trademark is referred to.

3. In case of marketing the parts or components to be assembled to other’s finished product, the trademark of other person’s finished goods is used as a reference.

4. In case of marketing computer software, other person’s trademark for compatible computer hardware is used without consent.

5. In case of marketing finished products (e.g. suits), other person’s trademark is respect of their material (e.g. cloth for the suit) is referred to.

6. As a decay, other person’s trademark is used as a reference.

It is useful to discuss more specifically about the criteria to determine acceptable references of other person’s trademark and unacceptable reference taking into account of various marketing circumstances.

Summary

Under the Japanese Trademark Law, in principle, the use of a mark is not a requirement for it registration. However, as an exceptional case, it is required to prove acquisition of a secondary meaning (i.e. acquired distinctiveness) as a result of the continuous use of a mark that originally lacks a distinctive feature.

While, it is necessary to use a trademark in order to maintain the trademark registration, but a trademark that has not been used for three consecutive years or longer will be revoked when a trial for cancellation of trademark registration is instituted against it and such non-use is affirmed.

In determining a trademark infringement, a use of the registered trademark is not specifically required as long as the plaintiff’s trademark is validly registered on the Trademark Register. With respect to a use of the defendant’s mark, it will be surely argued whether the defendant’s mark is used as a trademark or not. There is a some difference between the decision on the use in a case of a trial for cancellation for non-use and in case of an infringement law suit, because the former system is to keep the balance of public interests and the latter one is to deal with the individual conflict between the parties.

A provision of the Japanese Trademark Law defines "the use of a trademark", and an advertisement is recognized as one mode of the trademark use. However, interpretation of the use has been improved in compliance with the development of trading environment.

There is no special provision regarding a use of a trademark on the Internet, therefore, a definition of the conventional use of a trademark would apply thereto, in principle. As for the use in metatag, any unauthorized use of trademark might be prohibited by the Unfair Competition Prevention Law (hereinafter referred to as the UCP Law) depending on the situation.

As to such use of a trademark as in a Parody or by a fan club, or unauthorized use of a trademark by a person other than the owner of registered trademark in a comparative advertisement or the like, the Trademark Law will be applicable to some cases and the UCP Law will be applicable to some cases depending on the manner of the use, and indeed there are some case where neither Laws will be applicable.

Résumé

Conformément au droit des marques japonais, l’usage d’une marque n’est, en principe, pas nécessaire à son enregistrement. Toutefois, à titre exceptionnel, il est nécessaire de prouver l’acquisition d’une signification secondaire (c’est-à-dire d’un caractère distinctif acquis) découlant de l’usage continu d’une marque qui, à l’origine, n’a pas de caractère distinctif.

Alors qu’il est nécessaire d’utiliser une marque commerciale afin de conserver son enregistrement, le défaut d’usage d’une marque commerciale pendant trois années consécutives ou plus conduira à sa révocation si une action en déchéance de marque commerciale invoquée à son encontre confirme le défaut d’usage.

Lorsque l’on étudie s’il y a contrefaçon de marque, un usage de la marque n’est pas spécifiquement nécessaire si l’enregistrement de la marque de la demanderesse auprès du registre des marques est valide. En ce qui concerne l’usage de la marque de la défenderesse, l’usage ou le défaut d’usage en tant que marque commerciale de la marque de la défenderesse sera sans aucun doute examiné. La décision concernant l’usage est dans une certaine mesure différente si elle est prise dans le cadre d’une action en déchéance pour défaut d’usage ou si elle est prise dans le cadre de poursuites en contrefaçon, dans la mesure où le premier de ces systèmes consiste à maintenir l’équilibre des intérêts généraux alors que le second consiste à régler un litige particulier entre les parties.

Une disposition du droit des marques japonais définissant "l’usage d’une marque" reconnaît qu’une publicité constitue un mode d’utilisation de la marque. Toutefois, l’interprétation de l’usage s’est améliorée au fur et à mesure du développement du milieu commercial.

Dans la mesure où il n’existe pas de disposition spécifique concernant l’usage d’une marque sur Internet, on lui appliquerait, en principe, une définition de l’usage traditionnel d’une marque. Quant à l’usage sous forme de balises méta, toute utilisation non autorisée d’une marque commerciale pourrait être interdite par le droit de protection contre la concurrence déloyale (appelé ci-dessous le droit de PCD) en fonction de la situation.

Quant à l’utilisation d’une marque telle que dans une parodie ou dans un fan club, ou l’utilisation non autorisée d’une marque commerciale par une personne autre que le propriétaire d’une marque déposée dans le cadre d’une publicité comparative ou similaire, on pourra appliquer le droit des marques dans certains cas et le droit de PCD dans d’autres, en fonction de la forme d’utilisation, et il existe en effet certains cas dans lesquels ni l’un ni l’autre ne seront applicables.

En l’occurrence, le droit des marques japonais continue d’être conçu d’une façon telle qu’il adopte l’interprétation de l’usage d’une marque conformément au concept traditionnel, mais une telle interprétation s’est progressivement améliorée au fur et à mesure du développement du milieu commercial. Une marque notoire ou célèbre est protégée de façon efficace et totale par le droit des marques japonais ainsi que le droit de PCD.

Zusammenfassung

Der Gebrauch eine Marke ist im Prinzip nach dem Japanischen Markengesetz nicht Voraussetzung für eine Eintragung. Es ist jedoch im Ausnahmefall nötig, den Erwerb einer zweiten Bedeutung (d.h. erworbene Unterscheidungskraft) aufgrund des stetigen Gebrauchs einer Marke, die ursprünglich kein unterscheidungskräftiges Merkmal aufwies, nachzuweisen.

Es ist notwendig, eine Marke zu benutzen, um die Eintragung aufrechtzuerhalten. Eine Marke, die für drei aufeinanderfolgende Jahren oder länger nicht benutzt wurde, wird für ungültig erklärt, wenn ein Gericht zur Aufhebung einer Markeneintragung angerufen und eine mangelnde Benutzung bestätigt wird.

Für die Feststellung einer Markenverletzung ist die Benutzung der eingetragenen Marke nicht spezifisch notwendig, solange die Marke des Klägers in dem Markenregister rechtsgültig eingetragen ist. Bezüglich der Benutzung des Zeichens durch den Beklagten wird sicherlich in Frage gestellt, ob das Zeichen des Beklagten markenmässig benutzt wird oder nicht. Es bestehen jedoch Unterschiede zwischen der Entscheidung bezüglich der Benutzung im Fall eines Gerichtsverfahrens zur Löschung aufgrund Nichtbenutzung und im Falle eines Gerichtsverfahrens wegen Verletzung, da das erste Verfahren dazu dient, das öffentliche Interesse zu berücksichtigen und das letztere den individuellen Konflikt zwischen den Parteien betrifft.

Eine Regelung des Japanischen Markengesetzes definiert "den Gebrauch einer Marke", und Werbung wird als eine Form der Benutzung der Marke angesehen. Die Auslegung der Benutzung wurde jedoch entsprechend der Entwicklung des Handelsumfelds verbessert.

Es gibt keine spezielle Regelung bezüglich der Benutzung einer Marke im Internet. Die Definition des üblichen Gebrauchs einer Marke würde daher prinzipiell auf diesen Fall angewendet. Bei einer Benutzung im META-TAG kann jegliche unbefugte Benutzung der Marke aufgrund des Gesetzes gegen unfairen Wettbewerb (nachfolgend als UCP-Gesetz) abhängig von der Situation verboten werden.

Bezüglich der Benutzung einer Marke, beispielsweise in einer Parodie oder durch einen Fanclub oder die unbefugte Benutzung einer Marke durch einen anderen als den Eigentum der eingetragenen Marke in einer vergleichenden Werbung oder dergleichen, finden in einigen Fällen das Markengesetz oder UCP-Gesetz abhängig von der Art der Benutzung Anwendung. In einigen Fällen ist sogar keines dieser Gesetze anwendbar.

Ausserdem ist das Japanische Markengesetz immer noch so angelegt, dass es eine Interpretation der Benutzung einer Marke gemäss dem traditionellen Konzept annimmt. Eine solche Interpretation wurde entsprechend der Entwicklung des Handelsfeldes verbessert. Sehr bekannte oder weltbekannte Marken sind unter dem Japanischen Markengesetz und dem UCP-Gesetz effektiv und umfassend geschützt.