Tongwang Attention丨The Supreme People's Court issued judicial interpretations on the Anti-Unfair Competition Law (with full text + Q&A with reporters)
Time:
2022-03-18
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The Supreme People's Court
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On March 17, the \"Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Anti-Unfair Competition Law of the People's Republic of China\" (hereinafter referred to as the \"Interpretation\") was released and implemented on March 20, 2022. The \"Interpretation\" has 29 articles, which, according to the revised Anti-Unfair Competition Law, focuses on Article 2 of the Anti-Unfair Competition Law, imitation and confusion, false advertising, and online unfair competition behaviors.
The \"Interpretation\" is an important measure taken by the Supreme People's Court to thoroughly study and implement Xi Jinping's thought on the rule of law, give full play to the functions of intellectual property adjudication, and respond to the judicial needs of new fields and new business forms in a timely manner. The implementation of the \"Interpretation\" is of great significance for strengthening anti-unfair competition justice, strengthening the basic position of competition policy, and promoting the formation of an efficient, standardized, and fair domestic unified market.
The \"Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Anti-Unfair Competition Law of the People's Republic of China\" was adopted at the 1862nd meeting of the Adjudication Committee of the Supreme People's Court on January 29, 2022, and is hereby promulgated and shall be implemented as of March 20, 2022.
Supreme People's Court
March 16, 2022
Fa Shi [2022] No. 9
Supreme People's Court
Regarding the Application of
Anti-Unfair Competition Law of the People's Republic of China
Interpretation of Several Issues
(Adopted at the 1862nd Meeting of the Adjudication Committee of the Supreme People's Court on January 29, 2022, and effective as of March 20, 2022)
This Interpretation is formulated in accordance with relevant laws and regulations such as the \"Civil Code of the People's Republic of China\", the \"Anti-Unfair Competition Law of the People's Republic of China\", and the \"Civil Procedure Law of the People's Republic of China\", in combination with judicial practice, in order to correctly hear civil cases arising from unfair competition.
Article 1 Where a business operator disrupts the order of market competition, harms the legitimate rights and interests of other business operators or consumers, and falls under circumstances other than those in violation of Chapter 2 of the Anti-Unfair Competition Law and the provisions of the Patent Law, Trademark Law, Copyright Law, etc., the people's court may apply Article 2 of the Anti-Unfair Competition Law for determination.
Article 2 A market entity that has a relationship with a business operator in production and operation activities that may involve competing for transaction opportunities or harming competitive advantages may be recognized by the people's court as an \"other business operator\" as stipulated in Article 2 of the Anti-Unfair Competition Law.
Article 3 Behavioral norms that are generally followed and recognized in a specific business field may be recognized by the people's court as \"business ethics\" as stipulated in Article 2 of the Anti-Unfair Competition Law.
The people's court shall, in light of the specific circumstances of the case, comprehensively consider factors such as industry rules or business practices, the operator's subjective state, the transaction counterparty's willingness to choose, and the impact on consumer rights, market competition order, and social public interests, to determine whether the operator violates business ethics in accordance with the law.
When a people's court determines whether a business operator has violated business ethics, it may refer to practice norms, technical specifications, self-discipline covenants, etc. formulated by industry authorities, industry associations, or self-regulatory organizations.
Article 4 A logo that has a certain market awareness and has significant characteristics that distinguish the source of goods may be recognized by the people's court as a \"well-known\" logo as stipulated in Article 6 of the Anti-Unfair Competition Law.
When a people's court determines whether a logo stipulated in Article 6 of the Anti-Unfair Competition Law has a certain market awareness, it shall comprehensively consider the degree of awareness of relevant public in China, the time, region, amount, and object of commodity sales, the duration, degree, and geographical scope of publicity, and the protection status of the logo.
Article 5 If a logo stipulated in Article 6 of the Anti-Unfair Competition Law falls under any of the following circumstances, the people's court shall determine that it does not have significant characteristics that distinguish the source of goods:
(1) The generic name, graphic, or model of the goods;
(2) A logo that only directly expresses the quality, main raw materials, function, use, weight, quantity, and other characteristics of the goods;
(3) A shape that is only generated by the nature of the goods themselves, a shape of the goods that is necessary to obtain technical effects, and a shape that gives the goods substantial value;
(4) Other logos lacking distinctive features.
If a logo stipulated in the first item, the second item, or the fourth item of the preceding paragraph has acquired significant characteristics through use and has a certain market awareness, and the parties request protection in accordance with the provisions of Article 6 of the Anti-Unfair Competition Law, the people's court shall support it.
Article 6 If the parties claim that the following logos are legitimately used for objective description or explanation of goods and fall under the circumstances stipulated in Article 6 of the Anti-Unfair Competition Law, the people's court shall not support it:
(1) Contains the generic name, graphic, or model of the goods;
(2) Directly expresses the quality, main raw materials, function, use, weight, quantity, and other characteristics of the goods;
(3) Contains a place name.
Article 7 If a logo stipulated in Article 6 of the Anti-Unfair Competition Law or its significant identifying part is a mark that shall not be used as a trademark as stipulated in Article 10, Paragraph 1 of the Trademark Law, and the parties request protection in accordance with the provisions of Article 6 of the Anti-Unfair Competition Law, the people's court shall not support it.
Article 8 The overall business image composed of the decoration of the business operator's business premises, the style of business equipment, and the clothing of business personnel that has a unique style may be recognized by the people's court as the \"decoration\" stipulated in Article 6, Item 1 of the Anti-Unfair Competition Law.
Article 9 The enterprise name registered by the market entity registration management department in accordance with the law, and the overseas enterprise name used for commercial purposes in China, may be recognized by the people's court as the \"enterprise name\" stipulated in Article 6, Item 2 of the Anti-Unfair Competition Law.
The name (including abbreviation, trade name, etc.) of a well-known individual industrial and commercial household, farmer professional cooperative (joint venture), and other market entities stipulated by laws and administrative regulations may be recognized by the people's court in accordance with Article 6, Item 2 of the Anti-Unfair Competition Law.
Article 10 The act of using a well-known logo in China on goods, commodity packaging or containers, and commodity transaction documents, or in advertising, exhibitions, and other commercial activities to identify the source of goods may be recognized by the people's court as the \"use\" stipulated in Article 6 of the Anti-Unfair Competition Law.
Article 11 If an operator uses an identifier similar to the name of an enterprise (including abbreviations and trade names), social organization (including abbreviations), name (including pen names, stage names, and translations), domain name main body, website name, webpage, etc., which has a certain influence on others, without authorization, leading people to mistakenly believe that it is another person's product or that there is a specific connection with another person, and the party claims that it falls under the circumstances stipulated in Article 6, Paragraph 2 or 3 of the Anti-Unfair Competition Law, the people's court shall support it.
Article 12 When a people's court determines that an identifier is the same as or similar to an "influential" identifier as stipulated in Article 6 of the Anti-Unfair Competition Law, it may refer to the judgment principles and methods for trademarks that are the same as or similar to each other.
The "leading people to mistakenly believe that it is another person's product or that there is a specific connection with another person" as stipulated in Article 6 of the Anti-Unfair Competition Law includes mistakenly believing that there is a specific connection with another person such as a business alliance, licensed use, business naming, or advertising endorsement.
Using the same or visually indistinguishable product name, packaging, decoration, and other identifiers on the same product shall be deemed sufficient to cause confusion with identifiers that have a certain influence on others.
Article 13 If an operator commits any of the following acts of confusion, which is sufficient to lead people to mistakenly believe that it is another person's product or that there is a specific connection with another person, the people's court may determine it in accordance with Article 6, Paragraph 4 of the Anti-Unfair Competition Law:
(1) Using an "influential" identifier without authorization other than those stipulated in Article 6, Paragraphs 1, 2, and 3 of the Anti-Unfair Competition Law;
(2) Using another person's registered trademark or unregistered well-known trademark as the trade name in the enterprise name, misleading the public.
Article 14 If an operator sells goods bearing identifiers that violate the provisions of Article 6 of the Anti-Unfair Competition Law, leading people to mistakenly believe that they are another person's goods or that there is a specific connection with another person, and the party claims that it constitutes a situation stipulated in Article 6 of the Anti-Unfair Competition Law, the people's court shall support it.
If the seller does not know that the goods are infringing goods as stipulated in the preceding paragraph, can prove that the goods were legally obtained by themselves and explain the provider, and the operator claims that they are not liable for compensation, the people's court shall support it.
Article 15 If a party intentionally provides convenient conditions such as warehousing, transportation, mailing, printing, concealment, and business premises for others to carry out confusing acts, and the party requests confirmation based on Article 1169, Paragraph 1 of the Civil Code, the people's court shall support it.
Article 16 If an operator provides untrue information about the goods in the course of commercial promotion, deceiving and misleading the relevant public, the people's court shall determine it as a false commercial promotion as stipulated in Article 8, Paragraph 1 of the Anti-Unfair Competition Law.
Article 17 If an operator commits any of the following acts, deceiving and misleading the relevant public, the people's court may determine it as a "misleading commercial promotion" as stipulated in Article 8, Paragraph 1 of the Anti-Unfair Competition Law:
(1) Making one-sided publicity or comparison of goods;
(2) Using scientifically unsettled views, phenomena, etc. as conclusive facts for product promotion;
(3) Using ambiguous language for commercial promotion;
(4) Other commercial promotion behaviors that are sufficient to mislead people.
The people's court shall identify misleading commercial promotion behaviors based on factors such as daily life experience, the general attention of the relevant public, the facts of misunderstanding, and the actual situation of the objects being promoted.
Article 18 If a party claims that an operator has violated the provisions of Article 8, Paragraph 1 of the Anti-Unfair Competition Law and requests compensation for losses, it shall provide evidence to prove that it has suffered losses due to false or misleading commercial promotion behaviors.
Article 19 If a party claims that an operator has committed commercial defamation as stipulated in Article 11 of the Anti-Unfair Competition Law, it shall provide evidence to prove that it is a specific victim of the commercial defamation.
Article 20 If an operator disseminates false or misleading information fabricated by others, damaging the commercial reputation and product reputation of competitors, the people's court shall determine it in accordance with Article 11 of the Anti-Unfair Competition Law.
Article 21 A target jump that occurs directly without the consent of other operators and users shall be identified by the people's court as a "forced target jump" as stipulated in Article 12, Paragraph 2, Item 1 of the Anti-Unfair Competition Law.
If only a link is inserted and the target jump is triggered by the user, the people's court shall comprehensively consider the specific method of inserting the link, whether there is a reasonable reason, and the impact on the interests of users and other operators, and determine whether the behavior violates the provisions of Article 12, Paragraph 2, Item 1 of the Anti-Unfair Competition Law.
Article 22 If an operator does not clearly prompt and obtain the user's consent in advance, and maliciously interferes with or damages the network products or services legally provided by other operators by misleading, deceiving, or forcing users to modify, close, or uninstall, the people's court shall determine it in accordance with Article 12, Paragraph 2, Item 2 of the Anti-Unfair Competition Law.
Article 23 For unfair competition behaviors stipulated in Articles 2, 8, 11, and 12 of the Anti-Unfair Competition Law, if the actual losses suffered by the right holder due to the infringement and the profits obtained by the infringer due to the infringement are difficult to determine, and the party claims to determine the amount of compensation based on Article 17, Paragraph 4 of the Anti-Unfair Competition Law, the people's court shall support it.
Article 24 If the people's court has already determined that the same infringer has committed infringement of copyright, patent rights, or exclusive rights to use registered trademarks against the same subject in the same time and geographical scope and ordered them to bear civil liability, and the party requests the same infringer to bear civil liability on the grounds that the behavior constitutes unfair competition, the people's court shall not support it.
Article 25 In accordance with the provisions of Article 6 of the Anti-Unfair Competition Law, if the party claims that the defendant should be ordered to stop using or change its enterprise name, the people's court shall order the defendant to stop using the enterprise name if the litigation request should be supported according to law.
Article 26 A civil lawsuit initiated due to unfair competition shall be under the jurisdiction of the people's court at the place where the tort occurs or where the defendant is domiciled.
The people's court shall not support the party's claim that only the place of receipt arbitrarily selected by the online buyer can be used as the place where the tort occurs.
Article 27 If the alleged act of unfair competition occurs outside the territory of the People's Republic of China, but the result of the infringement occurs within the territory of the People's Republic of China, the people's court shall support the party's claim that the people's court at the place where the result of the infringement occurs has jurisdiction.
Article 28 For civil cases of unfair competition accepted by the people's court after the implementation of the decision to amend the Anti-Unfair Competition Law, the pre-amendment Anti-Unfair Competition Law shall apply to acts that occurred before the implementation of the decision; the amended Anti-Unfair Competition Law shall apply to acts that occurred before the implementation of the decision and continue after the implementation of the decision.
Article 29 This Interpretation shall come into force on March 20, 2022. The Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Civil Cases of Unfair Competition (Fa Shi [2007] No. 2) shall be repealed simultaneously.
This Interpretation shall apply to cases that have not been finally concluded after the implementation of this Interpretation; this Interpretation shall not apply to retrials of cases that have been finally concluded before the implementation.
Q&A
1. Q: Could you please introduce the background and process of formulating the 'Interpretation'?
A: Since the 18th National Congress of the Communist Party of China, the Party Central Committee with Comrade Xi Jinping at its core has placed intellectual property protection in a more prominent position. With rapid economic development, a substantial expansion of market entities, and accelerated integration of online and offline markets, the competitive relationships of market forces have undergone profound changes. A large number of new types of legal disputes have emerged, the difficulty of fact-finding and law application has increased, and the boundaries of rights and the determination of responsibilities in new fields and new business forms have continuously placed new demands on the judiciary.
The promulgation of the 'Interpretation' is a powerful measure for the people's court to conscientiously implement the major decisions and deployments of the Party Central Committee on strengthening anti-monopoly and anti-unfair competition work, and is of great significance for deeply implementing the fair competition policy, improving the fair competition system, and promoting the construction of a high-standard market system. In the drafting process of the 'Interpretation', opinions were widely solicited from relevant central departments, academia, practitioners, and the general public.
2. Q: Could you please introduce the overall idea of formulating the 'Interpretation'?
A: First, adhere to serving the overall situation. A complete intellectual property law and regulation system and an efficient law enforcement and judicial system are important guarantees for strengthening intellectual property protection. The formulation of the 'Interpretation' aims to strengthen the basic position of competition policy, further improve the adjudication rules for competition cases, improve the quality and efficiency of trials and credibility, and promote innovation and sustained and healthy economic development.
Second, respond to social concerns. The 'Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Civil Cases of Unfair Competition' is aimed at the pre-revision Anti-Unfair Competition Law and can no longer meet the ever-changing practical needs. The 'Interpretation' focuses on stimulating innovation vitality, regulating market competition behavior, and responding to social concerns, and further clarifies and refines unfair competition behaviors such as counterfeiting and confusion, commercial defamation, and online unfair competition, and strives to properly handle the relationship between development and security, efficiency and fairness, vitality and order, and create a fair, transparent, and predictable good competitive environment for various market entities to invest and start businesses and develop in a standardized and healthy manner.
Third, strengthen rule guidance. The formulation of the 'Interpretation' is an important legal measure for the people's court to implement the legislative spirit of the revised Anti-Unfair Competition Law, summarize judicial practice experience, and unify adjudication rules and standards. By fairly hearing various unfair competition cases, clarify protection rules, clarify the boundaries of rights, encourage innovation and creation, and prevent and resolve the risk of disorderly competition.
3. Q: We have noticed that the 'Interpretation' has refined the application conditions of Article 2 of the Anti-Unfair Competition Law and emphasized 'business ethics'. What is the main consideration?
A: Since the implementation of the Anti-Unfair Competition Law, the general clause (Article 2) has become one of the main legal bases for the people's court to identify new types of unfair competition behaviors, and has played an important role in maintaining a fair and competitive market order. However, the phenomenon of inconsistent adjudication standards occurs from time to time. To this end, Article 1 of the 'Interpretation' stipulates that if an operator disrupts the market competition order, damages the legitimate rights and interests of other operators or consumers, and falls under circumstances other than those that violate Chapter 2 of the Anti-Unfair Competition Law and the provisions of the Patent Law, Trademark Law, Copyright Law, etc., the people's court may apply Article 2 of the Anti-Unfair Competition Law for identification. In this way, it not only clarifies the applicable relationship between the general clause and the specific behavior clause, and the provisions of the intellectual property special law, but also clarifies the supplementary applicable status of the general clause to the Anti-Unfair Competition Law and other intellectual property special laws such as the Trademark Law.
The core of the people's court's use of the general clause to determine whether market competition behavior is legitimate is to judge whether the operator has violated business ethics. According to the provisions of Article 3 of the 'Interpretation', the 'business ethics' in the Anti-Unfair Competition Law cannot be simply equated with daily moral standards, but should be the behavior norms that are generally followed and recognized in a specific business field. The 'Interpretation' also stipulates that the people's court shall comprehensively consider industry rules or business practices, the operator's subjective state, the transaction counterparty's willingness to choose, and the impact on consumer rights and interests, market competition order, and social public interests, etc., in light of the specific circumstances of the case, and legally judge whether the operator has violated business ethics.
In addition, considering that online business behaviors are intertwined with traditional business behaviors, and may not have formed a generally observed and recognized rule bottom line, the 'Interpretation' stipulates that when the people's court determines whether an operator has violated business ethics, it may refer to the practice norms, technical specifications, self-discipline conventions, etc. formulated by industry authorities, industry associations, or self-regulatory organizations, so as to mobilize industry associations, chambers of commerce, and other organizations to guide operators to be honest and trustworthy by signing industry self-discipline agreements and issuing self-discipline charters.
4. Q: The 'Interpretation' has multiple provisions related to the identification of 'counterfeiting and confusion' behaviors. Could you please introduce the relevant content?
A: In 2021, courts at all levels across the country concluded a total of 8,654 unfair competition dispute cases, and the number of counterfeiting and confusion behavior cases accounted for a large proportion. The 'Interpretation' uses 11 articles to focus on refining the provisions of Article 6 of the Anti-Unfair Competition Law on 'counterfeiting and confusion' from the following three aspects: First, Article 4 of the 'Interpretation' clarifies the meaning and identification considerations of the 'certain influence' logo. Second, Article 7 of the 'Interpretation' clarifies that logos that fall within the scope of prohibited registration of the Trademark Law cannot be protected by the Anti-Unfair Competition Law. Third, with reference to the provisions of Article 2 of the 'Regulations on the Registration and Management of Market Entities', the scope of market entities whose names can be protected is refined.
5. Q: In recent years, online unfair competition disputes have been increasing. What provisions has the 'Interpretation' made in this regard?
A: People's Courts regulate market competition order in cyberspace by hearing cases of unfair competition involving e-commerce platforms such as 'choose one from two', 'online fake traffic', and blocking browser advertisements; adjudicate voice command cases of intelligent products, and sanction malicious confusion and misleading public behavior in the artificial intelligence product market; hear cases of unfair competition in data rights of group control software, reasonably divide data rights ownership and boundaries, and protect users' data rights and privacy. Resolutely sanction excessive collection and use of personal information, and use algorithms to implement price discrimination, price fraud and other behaviors; properly hear cases of data confirmation, transaction, service, and privacy protection, explore and improve data intellectual property protection rules, guide operators to form benign competition through technological innovation and other methods, purify the market environment, stimulate market vitality, and regulate market order.
Article 12 of the Anti-Unfair Competition Law (Unfair Competition in the Internet) is a new clause added after the revision of the law. Considering the characteristics of the Internet industry's rapid updating and development of technology and business models, Articles 21 and 22 of the 'Interpretation' do not further list new forms of behavior, but strictly grasp the legislative spirit and competition policy, timely summarize judicial practice experience, make appropriate refinements to the conditions for the application of the law, provide necessary rules and guidance for judicial adjudication, and at the same time leave room for market self-regulation and technological innovation.
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