FAIR TRADE ACT AMENDMENTS ON TRADEMARK COUNTERFEIT

In order to maintain trade order and protect consumers’ interests while ensuring a free and fair competition environments, the Fair Trade Act of Taiwan was enacted and announced on February 4, 1991. It was implemented one year later, followed by several minor amendments in the past years. An overall review on the Act was conducted and thorough amendments were made and promulgated on February 10, 2015 by Taiwan government. The same Act was then again revised on June 10, 2015 to set up an anti-trust fund based on 30% of the fines imposed on violation of the Act to be used for rewarding the report of illegal concerted actions, etc. The important amendments of this Act relating to the protection of trademark counterfeit are summarized as follows:

1. Before the amendments of this Act, the applicant could file a complaint with Fair Trade Committee (FTC) if his registered trademarks on the goods or services were illegally used by a third party. To avoid overlapping protections by Trademark Act and Fair Trade Act on registered trademarks, the government has revised Fair Trade Act to provide protection only for those trademark or symbol (trade dress) which are not registered under Trademark Act. Namely, the protection of registered trademarks should be sought by Trademark Act, not Fair Trade Act anymore.


2. In the past, the applicant could seek protection on counterfeit trademarks by the provisions of this Act which requires “commonly known to the relevant enterprises or consumers” or if they are foreign “famous” trademarks. However these requirements are sometimes difficult to be determined. Thus in the past FTC always adopts a quite rigid examination on deciding whether the filing cases have violated the Fair Trade Act. The recent statistics (see table below) show that there has been no successful cases over the past five years for the complaints filed against FTC in connection with the trademark counterfeit matters. Accordingly the revised Act now combines both requirements into one term as the “famous” trademark or symbol.


3. This Act used to protect only foreign famous trademark but has now been revised to lift restriction on the same, i.e. the unregistered trademark to be protected could be either foreign or domestic famous trademark. Although the term “famous” or well-known trademark is not expressly stipulated in the Act, yet per the practice, it is referred to a trademark which is widely recognized by domestic consumers.


4. Before the amendments of this Act, a trademark or symbol of different goods and services can be protected as long as it could cause any likelihood of confusion to the consumers. However the revised Act has now set a limitation to protect only an unregistered trademark or symbol on the same or similar goods and services.


5. Per the prevailing Trademark Act, the applicant could file civil and/or criminal actions against the third party on infringement. The previous Fair Trade Act also provides both civil and criminal proceedings on counterfeit trademark in addition to the administrative sanction. But the revised Act has abolished the criminal punishment and administrative sanction, i.e. if there is any infringement on the unregistered trademark which has been found to be in violation of the Fair Trade Act, the owner of said unregistered trademark can only seek remedy proceeding based on the provisions of this Act by filing a civil suit with the court.

According to the above, the revised Fair Trade Act has drastically reduced the protection on trademark counterfeit and may not meet the demand of the public interest anymore. Hence, in Taiwan, it is advisable to file a trademark registration for obtaining a better protection under the Trademark Act.

Table: Statistics of complaint cases filed against the unfair competition practice under Articles 20, 21, 22 and 24 of the Fair Trade Act before amendments