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If an unregistered trademark which I used has become famous as it is used by others.(News Letter No. 502)

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KH

Post Date 

2023-04-17

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1. If an unregistered trademark which I used has become famous as it is used by others

- KIPO made regulations to protect a prior user of a famous trademark.

From September 29, 2023, anyone that first uses a trademark which is identical with or similar to another’s trademark which becomes well-known in Korea (hereinafter, referred to as a ‘famous trademark’) is able to continue to use the relevant trademark if there is no unlawful/wrongful purpose.

According to KIPO, the amended unfair competition prevention and trade secret protection laws (hereinafter, referred to as ‘unfair competition prevention laws’) promulgated on March 28, 2023 and will be effective from September 29, 2023.

Before these amended laws, even though a person first used a trademark, the user could not continue to use the relevant trademark from the point of time when another’s identical or similar trademark became famous. The prior user had to bear the economic loss by discarding or replacing the relevant product or business signboard, etc. These amended laws are to improve the previous the unreasonableness and to protect the prior bona fide user.

However, even though these regulations are introduced, a prior user cannot exercise an active right to ban others’ use of the prior user’s trademark. Therefore, in order for a trademark used by a prior user to be recognized as an active right, it is advisable to first file an application for the trademark before others, so that the trademark can be registered.

To prevent a consumer’s misconception or confusion which may occur by the co-existence of a famous trademark and a prior user’s trademark, the amended laws provide regulations that an owner of a famous trademark can request a prior user to present a necessary indication to prevent such a misconception or confusion.

The amended laws explicitly states that the prescription as to a right to prohibit an act of stealing an idea is 3 years from the day when a unauthorized use of the stolen idea is recognized, or 10 years from the day when an unfair competition act starts. Since an idea transaction relationship is stabilized, it is expected to be helpful in utilizing and spreading ideas.

In the administrative investigation of an unfair competition act, a subject to be on-site investigated expands to materials including electronic (digital) files, etc. as well as documents, ledgers and products. When a trade secret-related original certification authority uses state subsidies for the other purposes, it must compulsorily return the subsidies under the amended laws.



2. KIPO starts to solve difficulties in small/medium companies.

-On March 6, 2023, KIPO held an IP meeting for small/medium companies located in Gyeongsangnam-do Province.

As part of a positive administration, KIPO held an IP meeting for small and medium companies located in Gyeongsangnam-do Province.

This meeting was held as part of the ‘on-site communication between the public and companies’ which has been carried forward by KIPO, and it will continue to be held in the future.

KIPO introduced diverse supporting projects for small and medium companies’ IP creation and shared the IP policy current status and results in Gyeongsangnam-do Province.

Small and medium companies of Gyeongsangnam-do Province agreed with the point that IP is necessary for local small and medium companies’ growth and progress, and they presented the suggestions from the relevant industries, such as the unification of a subject to support small and medium companies in the IP field, and the expansion of the support, etc.

The Commissioner of KIPO said that strong IPs should be based for Korean small and medium companies to take the lead in global markets in the world technology hegemony era. She added that KIPO would expand its support such that small and medium companies could grow as global small and medium-sized enterprises by obtaining IP rights, to be successful in overseas markets as well as domestic markets.



3. South Korea took 4th place in world ranking of the number of PCT applications for 3 consecutive years.

-Korean companies’ increase rate in the number of PCT international patent applications filed with WIPO in 2022 was 6.2%, which was highest among the top 10 countries, Japan, China, Germany, etc.

-The rate of increase in the number of the applications filed by Samsung Electronics (taking 2nd place) was 44.3%, which was highest among the top 10 companies.

According to KIPO, the number of PCT international patent applications filed by Korean companies (including Samsung Electronics, LG Electronics, etc.) with WIPO in 2022 increased by 6.2% (22,012) compared to 2021 and held the third place in the world ranking for 3 consecutive years.

Notably, the rate of increase in the number of the PCT applications compared to the previous year was indicated as the highest (6.2%) among the major top 10 countries despite the difficulties due to complex economic crisis.

Whereas, the number of PCT applications filed by US in 2022 decreased by 0.6% compared to the previous year, the numbers of PCT applications filed by China, Japan and Germany increased by only 0.6%, 0.1% and 1.5%, respectively.

The number of PCT applications has been used as a measure to evaluate each country’s innovation ability in Bloomberg Innovation Index (South Korea taking world 1st place in 2021) and WIPO Global Innovation Index (South Korea taking world 6th place and Asian top in 2022).

The number of the world PCT applications filed in 2022 was 278,100, showing an increase of 0.3% compared to the previous year. China filing 70,015 took 1st place in world ranking for 4 consecutive years.

The number of PCT applications filed by China in 2021 increased by 0.6% compared to the previous year. The gaps in the number of PCT applications filed between China and US taking 2nd place were 1,694 in 2019, 10,446 in 2020, 10,201 in 2021 and 10,959 in 2022.

Chinese company, HUAWEI, filed 7,689 applications, taking 1st place in world ranking in the number of PCT applications for 6 consecutive years starting in 2017. Samsung Electronics holding the 2nd place recorded the highest increase rate (44.3%) in the number of PCT applications among the top 10 companies.

Among the top 10 companies in the number of PCT applications, 2 Korean companies, Samsung Electronics (2nd place) and LG Electronics (9th place), were included, showing that South Korea has been a strong country in filing PCT applications.

The total of international trademark applications (Madrid applications) was about 69,000 in 2022, decreasing by 6.1% (which was the biggest drop since 2009), compared to 2021. However, the number of these applications filed by Korean companies rather increased.

Although the number of Madrid applications filed by Korean companies in 2022 was 2,021 which held the 11th place in the world, an increase rate thereof was 9% in 2019, 13% in 2020, 24% in 2021 and 2.1% in 2022 which was very high compared to the increase rate in the total number of Madrid applications.

French company, L’OREAL, filed the most Madrid applications for 2 consecutive years, and among Korean companies, Hyundai Motor was recorded as 5th by filing 108 applications with an increase of 250% compared to 2021.

KIPO has supported Korean small and medium companies, etc. which have entered or are to enter overseas to secure international IP rights. KIPO also continues to carry forward a plan to attract a regional office of WIPO in South Korea, so that Korean companies, etc. could be in real time provided with consultations on WIPO’s international application services.



4. KIPO responds strongly to counterfeit products, to prevent export damages of Korean products.

- KIPO published a plan to strongly respond to counterfeit products of K-trademarks (brands).

◈ (advanced prevention) 쭯 KIPO strengthens the support for advance prevention, such as warning to high-risk industries or countries relating to counterfeit products, monitoring of unauthorized preoccupancy of trademarks, providing a customized legal consulting and a technology to prevent counterfeit and falsification, etc.

◈ (damage relief) 쭯 KIPO conducts a regular inspection of counterfeits to 1,604 online distribution networks (platforms) over more than 100 countries around the world and newly carries forward an intensive program, such as damage investigation, filing of a lawsuit, etc.

◈ (response basis) 쭯 KIPO newly forms and operates a ‘private-public joint response council’ against counterfeits of K-trademarks (brands) and carries forward the improvement of the relevant law and system, to strengthen the responsibilities of Korean online distribution networks (platforms).


In an emergency economic minister’s meeting, KIPO published a plan to strengthen countermeasures to counterfeits of K-brands, to expand the overseas expansion of Korean innovation companies and to enhance the export competitiveness thereof.

For a pan-ministerial level response to the K-brand counterfeits which have done massive damage to Korean companies’ export and job expansion, the Korean Government prepared 3 promotion strategies and 10 promotion tasks in terms of an advanced prevention, damage relief and response base relating to counterfeits.

(A) Support is strengthened for an overseas expansion company’s advanced prevention of counterfeits.

1) A company voluntary prevention of damages due to counterfeits is induced through a risk alert to 10 businesses and 10 countries relating to counterfeits of K-trademarks (brands), and an IP expert is to provide a customized consultation for a company with a counterfeit risk.

2) A company damaged due to counterfeits is continued to be provided with information of an overseas unauthorized trademark preoccupancy act of filing an overseas application for a trademark of a Korean company, without permission, and registering the trademark abroad. In addition, information of businesses (items) where trademarks are frequently preoccupied without permission is newly provided.

3) Research and development of anti-counterfeiting technology, which is used to distinguish an original product and a counterfeit product, to track a counterfeit distribution history and to prevent counterfeiting and falsification, etc., are continuously carried forward, together with civilian supply.

(B) Support is expanded and advanced for a company damaged by foreign counterfeits.

1)Monitoring and blocking of counterfeits are expansively supported from China and Southeast Asia to the world online distribution networks (platforms*) by using a private company specialized in monitoring counterfeits. [*(currently) 8 countries 19 e-commerce platforms ∪ (improved) maximum 114 countries 1,604 online platforms]

2) A customized counterstrategy consultation is consistently (within 1 year) supported for a company damaged due to overseas counterfeits, and an intensive support program (more than 2 years) for groups and organizations by industry where counterfeits are frequent is to be newly carried forwarded.

3)In Korea, investigation is strengthened by specifying the specific industries and companies damaged due to counterfeits, by a close cooperation with major groups and organizations by industry. To strengthen overseas crackdown on counterfeits, an IP registration support and a presentation to distinguish counterfeits are expansively operated to overseas customs.

(C)Domestic and overseas countermeasure systems to counterfeits are replenished and the relevant law and systems are improved.

1)A ‘private-public joint response council’ is formed with groups and organizations frequently damaged due to counterfeits, to share know-how to respond to counterfeits and to collect opinions.

2)To strengthen the overseas IP response system, the expertise of a person in charge of IP is enhanced, a business cooperation with an IP main official residence, an overseas IP center (IP-DESK), and a copyright overseas office, etc. is also strengthened for a rapid response.

3) An amendment to the Korean Trademark Act is to be carried forward to strengthen the responsibilities of Korean online distribution networks (platforms) in blocking counterfeits and providing the relevant information, etc.

4)A legal basis is to be strengthened to continuously and stably the work responding to the damages due to the counterfeits of K-trademarks (brands).



5. 9 of 10 disputes for adjudication are settled in Korea Intellectual Property Trial and Appeal Board (IPTAB).

-Taking an opportunity of the 25th anniversary opening of IPTAB (March 1st), an analysis of patent trials over 25 years has been prepared.

According to IPTAB (President: Myungseob KIM) of KIPO, as a result of analyzing the trials relating to IP disputes which were processed over the last 25 years (1998~2022), celebrating the 25th anniversary opening, 253,718 of a total of 277,160 trial cases were settled at the IPTAB stage, without any additional procedures of going to the court, etc. and thus, the case closure rate was recorded as 91.5%.

In addition, the trial process period which had reached to 13.5 months (in 1997) before IPTAB started was shortened to 7.9 months (in the end of 2022), improving more than 40%.

The rate of filing a complaint to the Korea Patent Court against a decision of IPTAB had been 23.9% at the beginning of IPTAB (March 1998~December 2002) but it dropped by more than half to 10.7% over the last 5 years (January 2018~December 2022).

Of the number of IPTAB’s decisions (145,879) which could be appealed to the Patent Court over the last 25 years, 23,442 cases led to actual lawsuits, recording an average complaint rate of 16.1%.

As to 17,680 (75.4%) of 23,442 cases which were brought to the Patent Court, the decisions made by IPTAB were maintained at the Patent Court, showing that the accuracy and speed of patent trails have increased.

The above-mentioned outcomes are considered as resulting from the increase in the number of judges which was only 26 at the beginning of IPTAB, and the efforts to secure the parties’ procedural rights by expanding an oral hearing and to improve the quality and expertise of a patent trial by operating a judgement quality assessment committee and conducting the job training and research of a judge.

In addition, from 2022, a special tribunal has been operated to be in charge of a case with complex legal and technical issues and a great social impact, thereby enhancing the faithfulness of a trial and the accuracy of a trial decision.

In this year, in the case of a trial with both parties, the accuracy of the trial will be enhanced by in principle holding an oral hearing and actively conducting an examination of evidence, witness examination during the trial, on-site inspection, etc.

After starting a meeting of Korea and China IPTAB presidents (2012) and a meeting of Korea and Europe IPTAB (2019), Korea IPTAB has expanded the global cooperation by establishing a meeting of IPTAB presidents of IP5 (Korea, US, Europe, Japan and China) in 2021.

Korea IPTAB plans to increase the predictability of a result of global IP disputes which have rapidly increased through the international comparison and study of a trial system and the exchange of information of trial trends and strengthen the competence of a trial.

Further, Korea IPTAB has strengthened support for the socially weak by operating the accelerated trial to be rapidly processed rather than other trials (2015), if a small/medium company wants it in a trial dispute between a small/medium company and a big company, and the public representative system (2019) such that the low-income group, the disabled or a small company is able to get, without cost, an attorney’s assistance in a patent trial.
 

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