Advance with times, meet common challenges

By Stella Yang, China IP,[Comprehensive Reports]

Interview with Steve Rowan, Divisional Director Trade Marks and Designs,

Since the Framework for Cooperation was signed by the United Kingdom Intellectual Property Office (UK IPO) and the State Administration for Industry and Commerce (SAIC) in 2009, the two parties have launched wide and fruitful cooperation in the field of high-level mutual visits, seminars, communication between policy officials etc. The statistics show that in 2013, there were 7,225 trade mark applications by British companies in China which ranks the UK No.5 among foreign countries in China in terms of trade mark applications. The UK IPO and the State Intellectual Property Office (SIPO) have also had a Cooperation Agreement in place since 1996 which includes various cooperation activities in the fields of patents and design rights.

After the visit of Prime Minister David Cameron to China in December 2013, cooperation and communication between the two countries has become increasingly close in the aspects of IP. Over the past several months China IP has interviewed John Alty, Chief Executive & Comptroller General of UK IPO; Neil Feinson, Director of International Policy of UK IPO; and Justice Colin Birss of the High Court of England and Wales. During a recent visit to Beijing, China IP exclusively interviewed Steve Rowan, Divisional Director of Trade Marks and Designs at the UK IPO. This was Mr. Rowan’s first time to China after being appointed as the Divisional Director of Trade Marks and Designs of UK IPO. At the time of the interview he had exchanged ideas with IP relevant departments in China, particularly in the aspect of trade mark system, and was looking forward to his first substantive discussion with SIPO on design rights.

China IP: For IP protection in China, the functions are separated in different administrations, such as SIPO, Trade mark Office of SAIC and National Copyright Administration of China (NCAC). However, the IP protection in UK is all managed by UK IPO. What is the main responsibility of Divisional Director Trade Marks and Designs in the UK IPO?

Mr. Rowan: The Chinese model is typical of many around the world, having patents, trade marks and copyrights managed separately by different administrations. The UK IPO is unusual in that it brings all the main IP rights together into one organization. Thus UK IPO examines and grants trade marks, patents and designs, and also has policy responsibilities for those IP rights and also for copyright.

I was very pleased to be appointed as the Director of Trade Marks and Designs at the UK IPO in September 2013. The Division has responsibility for the examination of trade marks and designs, the processing and determination of opposition and cancellation proceedings, as well as overall policy responsibility for trade marks and designs. From this perspective, the responsibilities of my Division of the UK IPO echo those of parts of China’s Trade mark Office (CTMO), Trade mark Review and Adjudication Board (TRAB) and SIPO.

China IP: In China, it is the patent office responsible for design, and the design patents in the UK are administered by UK IPO. Do the two offices have exchanges and collaborations on design patents?

Mr. Rowan: The UK IPO has a very long history of close collaboration with SIPO. During this visit I will meet my Chinese counterparts in charge of designs from SIPO for the first time since my appointment and I look forward to these discussions. The amount of design applications in the UK is not very high in comparison to China, approximately 6,000 applications every year. The UK IPO has established a special team to look at how we can modernise our processes and procedures for applying for a registered design in the UK. Designs are a very important area of protection for UK companies and we would like to exchange information with our Chinese counterparts on the challenges they are facing regarding the design system in China. I hope to discuss details on the recent changes to the legal framework of designs in both the UK and China and various areas of practice, including the protection of graphical user interfaces. The UK IPO also has cooperation with SIPO on patents. There is a bilateral PPH agreement between the UK and China and many British companies want to protect their inventions in China.

China IP: Could you please introduce your agenda? What are your expectations?

Mr. Rowan: One of the key issues discussed with CTMO and TRAB is the further technical cooperation between our two countries and to make arrangements for activities during the UK-China Intellectual Property Symposium week.

This visit is a fantastic opportunity for me to meet Chinese colleagues and discuss our mutual challenges. For example, the need to keep IP laws up to speed with the economy and technological change. Both the UK IPO and SAIC face common challenges regarding high rates of increase in trade mark filings. I hope that both sides can exchange our experience and professional knowledge on trade marks and designs. Another purpose of this visit is to know more about the recent changes in China’s trade mark system.

The UK, with a strong IP system, is now the leading destination for investment by Chinese companies in Europe, so it is very important for Chinese companies to understand the UK and EU trade mark and other IP systems, so they can protect their innovation, investment and creativity in the UK and European market.

China IP: In your opinion, what are the differences between the UK and Chinese trade mark system?

Mr. Rowan: There are obvious differences between the trade mark systems of the two countries. The UK trade mark system has a long history and was established in 1875. However, the Chinese trade mark system has developed very quickly over a shorter period of time, and the recent consultation on reforms to the Chinese trade mark law was conducted in a very open and transparent way. Compared with the UK IPO, the CTMO deals with huge number of trade marks. The CTMO copes with them incredibly well and efficiently. As part of our cooperation, the UK IPO would like to share the experience of both Offices in ensuring the high quality of examination under the pressure of high numbers of trade mark applications. The UK IPO received our highest number of trade mark filings ever in 2013, up 19% on the previous year. The other area we discussed was the sharing of experience and expertise regarding opposition procedures.

In opposition and cancellation proceedings, the UK has a system that requires a “mandatory counterstatement.” If the applicant for an opposed trade mark does not file a defense, then the UK IPO will make an administrative decision to deem the application withdrawn. This procedure aims to balance the responsibility between the opponent and trade mark applicant. The opponent must set out their case in full when filing the opposition so that the grounds on which the application is opposed are clear. It is then for the applicant to admit or deny those grounds setting out their reasons for refuting any grounds with which they disagree. The UK IPO does not consider that this is burdensome for the applicant.

In the UK 40% of oppositions are not defended. This procedure increases the efficiency of the opposition procedure for all the parties involved and for the UK IPO. We shared our experience of this mandatory counterstatement with our Chinese colleagues as at present it does not appear in your system. One option would be to use it in the cases only of trade mark applications which are suspected of being made without good faith.

China IP: As we know that you have been practicing in the IP industry for many years, in your mind what is the biggest challenge in the UK trade mark system?

Mr. Rowan: One of the biggest challenges related to the IP system both in administrating and in developing policies is that the landscape is constantly changing. In my opinion, the role of policy development and those who administer the system is to make sure that it is accessible and balanced. It is vital for all businesses to understand the importance of IP. The system that protects them must be strong, fair and efficient. The whole IP system is a key driver for growth. It must ensure that creators or innovators who create new products, new services or new contents can get rewarded, and the system is equally fair to all parties.

For me, the biggest challenge in my role is to make sure the system remains up to date. From the aspect of administration, we should make sure that we are able to cope with the increasing demand for trade marks, that the customers in UK IP system can receive the trade mark response in a timely way, and that the quality of trade mark examination remains high. Finally we have to work with the court system to make sure trade mark owners can defend their trade mark in a low-cost way because the court system in UK can sometimes be expensive.

China IP: You have just mentioned that the biggest challenge in the UK trade mark system is to make sure the system keep up to date. The EU Trade Mark system is being reviewed at present. What did the UK IPO contribute to the law adjustment?

Mr. Rowan: The UK has played a full role in the current and ongoing review of the EU trade mark system. The process involves all EU member states working together to agree the changes necessary in meetings in Brussels. But those discussions only set up the framework. How they are implemented is left to individual EU member states. So within the overall framework, it is open to the UK government to make changes to the law if it is necessary.

China IP: In the new amendment of Chinese Trade mark Law, the sound trade mark registration is included for the first time which makes its registration in China boom. It seems that in UK the related provisions have been already established long before. What is your opinion on this phenomenon? What are the experiences on the sound trade mark registration you can share with us?

Mr. Rowan: In fact applications for sound trade marks have been acceptable in UK since 1994, but they make up a very tiny proportion in the total number of trade mark applications. When you hear certain sound trade marks, consumers recognize these certain sounds and associate them with specific businesses. So I think sounds can function as trade marks. But one of the requirements is that they are distinctive for a particular trader. For example, when people hear the sound on an advert on TV, people will immediately associate it with a particular business. It is very important that a sound trade mark should be very clear. Other businesses must be very clear about its scope of protection and know whether they are infringing the trade mark. In the UK applications for sound trade marks must be clear and precise.

With any change of the law, there will be a period of uncertainty, during which CTMO, TRAB and courts will need to work together to establish the criteria and scope of protection of sound marks. A similar situation happened in EU, with various cases being referred to the Court of Justice of the EU to determine the scope of protection on this issue. Up to now, I haven’t heard of a case involving the infringement of a sound trade mark in the UK. And if the infringement happens, I do not think it is so difficult to determine -- the court can listen to the sound to determine whether it could confuse customers. The judgment is similar with that of colour, shape and other types of trade mark elements.

China IP: One of the big breakthroughs in the new Chinese Trade Mark Law is the increase of the legal compensation. What is the calculation method for the legal compensation in UK? What is the limit for the compensation?

Mr. Rowan: In the civil courts in England Wales, damages are compensatory in nature: the parties are put back in the position they would be if the wrong had not occurred. The calculation method for compensation can reflect the damages incurred by the infringed company. Or the compensation may be calculated from the infringer’s profits or be based on lost licence revenues of the right holders. In some copyright cases the courts can award aggravated or additional damages. In general, the costs and damages in UK civil courts are quite high, for example, the damages in a lower court can be awarded up to 5 million yuan, this is the upper limit for compensation in the UK’s Intellectual Property Enterprise Court. In the High Court it can be much higher.


China IP: Could you give some advice to Chinese enterprises that invest in the UK?

Mr. Rowan: The UK is a key market for Chinese enterprises. There are two main routes for trade mark applications if they  are looking for trade mark protection in the UK, either through the Organisation for Harmonisation of the Internal Market (OHIM - the EU trade marks and designs office) or through the UK IPO. Both routes provide very good protection for applicants. It is a business decision for applicants which way they choose to protect their trade marks. Through OHIM, the trade mark can get wide protection in the 28 EU member states; and through the UK IPO, the trade mark can get protection in the UK national market. There are both advantages and disadvantages in both systems. As far as the UK IP system is concerned, trade mark applications from China are the third highest after applications from UK domestic applicants and from the U.S. The UK IP system is very highly rated and I hope that the UK IP system is accessible and understandable for Chinese enterprises.

Whether UK companies look for investment in China or Chinese companies look for investment in UK, the most important thing for both companies is that they understand the IP system well and use it to their IP and trade interests.

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