Trademark protection for "retailing and wholesaling" services has evolved significantly in recent years. Historically, these types of commercial activities were not widely accepted for trademark registration in many countries. However, the landscape has been changing, with more and more jurisdictions now allowing trademark protection for retailing, wholesaling, and related services.
This shift has led to a substantial increase in the number of trademark applications being filed in Class 35, which covers these types of services. For example, in China as of December 2021, there were 3,679,968 valid Class 35 trademark registrations out of a total of 35,322,797 registrations across all classes, just counting owners from China, Hong Kong, Macau and Taiwan. The data clearly illustrates the growing prominence of Class 35 trademarks in the Chinese market, with a significant number of registrations in this class compared to other trademark classes. This has led to a phenomenon where more and more businesses are seeking to obtain trademark protection in Class 35 to capitalize on the importance of retailing and wholesaling services in China.
One key factor driving this trend is a notable trademark dispute case in China involving the "Baiguoyuan" mark.
TRADEMARK DISPUTES OF “百果园” (Baiguoyuan)
In March 2018, 东方祥麟菜果基地有限公司 (Dongfang Xianglin) a company that grows and sells fresh fruits under the "Baiguoyuan" trademark (No. 1466895 registered in Class 31), sued 深圳百果园实业发展有限公司 (Shenzhen Baiguoyuan) a domestic fruit retail chain that also used the "Baiguoyuan" trademark (No. 6807648 registered in Class 35 for sales, promotion, and advertising services).
The courts in this case made several important determinations:
Dongfang Xianglin's Class 31 registration covered the actual goods (fresh fruits), while Shenzhen Baiguoyuan's Class 35 registration covered retailing and related services, not the products themselves.
Shenzhen Baiguoyuan did not produce any fruits, but rather sold fruits from other suppliers through its retail stores. Its use of the "Baiguoyuan" mark was for promotional and sales purposes, which fell within the scope of its Class 35 registration.
As the trademarks were registered in different classes covering distinct goods and services, and Shenzhen Baiguoyuan had built its own brand reputation, the courts ruled that there was no trademark infringement.
This case set an important precedent in China, demonstrating that the owner of a trademark registered in one class cannot necessarily prevent others from using a similar mark in Class 35, even if it relates to the same underlying goods. This has further incentivized trademark applicants to seek protection in Class 35 to capitalize on the growing importance of retailing and wholesaling services.
Additionally, misunderstandings about the requirements for setting up Tmall and Taobao stores, as well as the scope of Class 35 registrations, have contributed to the perception that a Class 35 trademark is a vital "trump card" for businesses in China. We will explore these nuances in more detail in future articles.
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