Thailand’s landmark ruling on trademark non-use cancellation: a welcome change from a conservative trend
Kritsana Mingtongkhum and Shantanu Ajit Tambe of Satyapon & Partners review crucial Thai case law which indicates a long-awaited departure from a conservative approach to trademark non-use cancellation
Trademark cancellation petitions in Thailand based on the ground of non-use are quite common; however, actually succeeding in cancelling the registered trademark due to its non-use is a massive challenge faced by petitioners. There is a plethora of reasons for an extremely low percentage of successful non-use cancellation decisions, including proving that the petitioner is an interested person, stringent evidentiary hurdles for the petitioner, as well as the conservative nature of the Trademark Board in cancelling registered marks.
The legal provision for non-use cancellation is provided under Section 63 of the Thai Trademark Act, stating: “Any interested person or the Registrar may petition the Board to cancel a trademark registration if it is proved that, at the time of registration, the owner of the trademark had no bona fide intention to use the trademark with the goods for which it was registered and there was no bona fide use whatsoever of the trademark for such goods or that during the three years prior to the petition for cancellation there was no bona fide use of the trademark for the goods for which it was registered unless the owner can prove that such non-use was due to special circumstances in the trade and not to an intention not to use or to abandon the trademark for the goods for which it was registered.”
In order to successfully cancel a registered trademark, the petitioner needs to prove the following:
That the petitioner is an interested person; and
At the time of registration the registrant had no bona fide intention to use the trademark with the goods for which it was registered and there was no bona fide use whatsoever of the trademark for such goods; or
During the three years prior to the petition for cancellation there was no bona fide use of the trademark for the goods for which it was registered.
The first and foremost challenge for a petitioner in a non-use cancellation in Thailand is to prove that they are an interested person. Even before examining the merit of the arguments and the evidence, the Trademark Board reviews whether the petitioner is entitled to file the non-use cancellation petition in the first place. The Thai trademark law does not define an “interested person”, but the authorities generally interpret this term to include any person whose rights are or will be affected if the registered trademark is not cancelled from the record.
After the Trademark Board is convinced that the petitioner is an interested person, it examines the evidence submitted by the petitioner. Unlike other jurisdictions, Thai law does not require the registrant to submit any affidavit or other evidence to prove that they have put their trademark into use after registration. Consequently, the onus of proof of non-use of the registered trademark is on the petitioner. A key piece of evidence is a market investigation report, which can help strengthen the arguments that despite extensive investigation in relevant online and offline channels covering the registered goods or services, no use of the trademark was found. If the registered goods are related to drugs or cosmetics, the petitioner may also submit a letter from the Thai Food and Drug Administration (FDA) to confirm whether the registrant had obtained the necessary approval before using the registered trademark for the goods.
The registrant is entitled to raise the defence of existence of “special circumstances in the trade” which prevented them from using the trademark, and that such non-use was not an intention not to use or to abandon the trademark. Broadly interpreted, these special circumstances may include trade restrictions, poor market or economic conditions, war or epidemic situations etc. However, generally, the conservative trend indicated that if the registrant simply indicated that they did not have an intention not to use or to abandon the trademark, the Trademark Board would dismiss the petition, without considering if any special circumstances existed which prevented the registrant from using their trademark.
Central Intellectual Property and International Trade (CIPIT) Court’s ruling on non-use cancellation
In this case, the petitioner, a renowned Japanese company engaged in the manufacturing and sale of beauty and healthcare products, intended to obtain registration for their trademark in Thailand for cosmetic goods in Class 3. However, the petitioner’s trademark application was refused due to the registration of a prior mark comprising the same word (in a different style) in the name of a Thai company. The prior mark was registered in Thailand since 2009. Prior to filing the non-use cancellation petition, the petitioner conducted market investigations in 2015 and 2017 to discover whether the registrant had used their trademark in relation to the registered goods. Along with conducting the investigations, the petitioner also received an official response from the Thai FDA that the registrant had not obtained FDA approval for the goods covered under the registered trademark.
Consequently, the petitioner filed a non-use cancellation petition with the Thai Trademark Board in February 2018. In their response to the non-use cancellation petition, the registrant merely stated that they had not begun using the registered mark as they were finalising their marketing management and production plan. Expectedly, the Trademark Board dismissed the cancellation petition and decided in favour of the registrant. The petitioner filed an appeal to the CIPIT Court against the Trademark Board’s decision.
While deciding the case, the CIPIT Court outlined that the key issue was whether the petitioner proved that at the time of registration, the registrant had no bona fide intention to use the trademark with the goods for which it was registered, and in fact there was no bona fide use of the registered trademark for such goods, or that during the three years prior to the petition for cancellation, there was no bona fide use of the trademark for the goods for which it was registered.
After reviewing the market investigations, the FDA confirmation letter and the registrant’s response admitting that they had not begun using the trademark, the CIPIT Court issued its decision in November 2021. It ruled that the registrant had not provided any justifiable reason for not putting their registered trademark to use, despite registering the mark since 2009 up until the non-use cancellation petition was filed in 2018. The CIPIT Court rejected the registrant’s argument of preparing the marketing plan prior to using the trademark and held that they had not used their trademark in a bona fide manner, nor proven any bona fide intent to use the trademark in respect of the registered goods, as required under the law. Further, the registrant had not submitted evidence of any actual use of the registered trademark within the three year period immediately preceding the date on which the non-use cancellation petition was filed.
Importantly, in their defence, the registrant had also stated that they did not intend to abandon the trademark or not use it in respect of the registered goods. But the CIPIT Court rejected this argument, ruling that according to the legal provision, the registered owner must satisfactorily prove both conditions that:
The non-use of the trademark was due to special circumstances in the trade; and
Not due to an intention not to use or to abandon the trademark for the goods.
Thus, the registrant could not simply state they did not intend to abandon the trademark or not use the trademark, without showing that special circumstances existed in the trade which prevented them from using the trademark. The CIPIT Court also interpreted the term “special circumstances” to mean conditions which affect the overall business activities in the country, such as import restrictions, or any prohibition orders by the government, and not the personal decisions taken by individual registrants such as a delay in marketing or manufacturing plans.
Based on the above grounds, the CIPIT Court overturned the Thai Trademark Board’s decision and allowed cancellation of the registrant’s trademark on the ground of non-use.
Though the registrant filed an appeal against this decision to the Court of Appeal for Specialized Cases, the Court of Appeal affirmed the CIPIT Court’s decision in October 2022, confirming cancellation of the mark based on non-use. The matter is currently pending at the Supreme Court level and a final decision on this issue is expected in the near future.
These judgments clearly indicate that the courts will not allow parties to sit on their registered trademarks with no proof of use and no intention to use, especially if it affects the rights of third parties genuinely wishing to use their trademark in Thailand. The court gave solid legal reasoning and refused the registrant’s frivolous claims of having an intention to use the trademark and not abandon their trademark, without submitting any evidence to support the claims or proving existence of special circumstances to prevent use.
However, a key question still lingers. Would the courts have issued the same decision in the absence of a letter issued by the Thai FDA? It remains to be seen whether the ruling will be maintained and abided by the courts in future cases involving non-medical or non-cosmetic products as well.
Hopefully, the court judgments reverse a traditionally conservative trend on non-use cancellation matters, where the Thai Trademark Board rarely grants a non-use cancellation and rules in favour of trademark registrants. The judgments set an important precedent that if the registrants wish to continue enjoying the rights over their registered trademarks, they must actually use the trademarks, and not simply claim “having an intention to use” or “having no intention to abandon the trademark”.
Brand owners are therefore well-advised to start using their registered trademarks and collect evidence on record to keep their trademarks valid and enjoy protection in Thailand.