Resources
Oct 07,2019
Chinese Court renders the First Criminal Ruling on Geographical Indication Collective Trademark
Case Brief
A Bordeaux wine is any wine produced in the Bordeaux region of France. The
Bordeaux appellations, recognized by the Appellation d’Origine Controlée (AOC),
was created by the French Government to grant select areas official status for
their agricultural products, due to the specific terroir and soil of the area.
Conseil Interprofessionnel du Vin de Bordeaux (CIVB) is a French interest group
representing nearly 10,000 Bordeaux wine producers and growers, and 400
wineries.
On July 14, 2012, CIVB registered with the China Trademark Office the
geographical indication (GI) collective trademark in Class 33, designating
wines. The collective trademark is used by the CIVB members, provided certain
requirements are met: the chateau and vineyards must be located inside the
geographical boundaries of the region; the chateau must agree to follow the
specific rules and regulations set forth by the appellation for vineyard
practices, allowable grapes, minimum and maximum yields, minimal sugar and
alcoholic levels, as well as established practices for vinification.
In March 2016, the Shanghai Public Security Bureau (PSB) raided a local wine
dealer suspected of being engaged in selling counterfeit wine. The Bordeaux
wine offered for sale by the dealer were confirmed by CIVB to be not from the
Bordeaux region. Given that the sales turnover totaled around RMB 5 million,
far beyond criminal threshold for counterfeiting registered trademarks, the
case was transferred by the PSB to the local Procuratorate for public
prosecution.
On December 8, 2017, the Xuhui District Court of Shanghai found the dealer
firm, its Legal Representative and an employee guilty of selling the
commodities bearing counterfeit registered trademarks, pursuant to the
provision of Article 214 of the Criminal Law.
The court ruled that:
● The defendant firm is fined RMB
400,000;
● The Legal Representative of the
defendant firm is put on four-year probation, sentenced to imprisonment of 3
years, together with a fine of RMB 400,000;
● The employee of the defendant firm
is put on three-year probation, sentenced to imprisonment of three years,
together with a fine of RMB 200,000.
● All the counterfeit wines seized
will be forfeited.
Wanhuida Peksung represented CIVB at the court hearing.
Comments:
The Shanghai Court made a welcome ruling in granting the same level of
protection over the registered GI collective trademark as an ordinary
registered trademark.
The criminal enforcement of GIs has been somewhat difficult in China. Without
explicit provisions addressing the matter in the Criminal Law, the GI registrant
has little to fall back on except an Official Reply from the Second Criminal
Tribunal of the Supreme People’s Court in 2009, confirming that collective
marks fall under the protection of the Criminal Law and counterfeiting
collective marks shall be governed by the provisions of Article 213-215 of the
Law.
In China, forgery of place of origin is an old trick used by counterfeiters and
infringers. Authorities, including police, the Procuratorate, and the courts,
tend to find that such acts constitute a civil infringement of private rights,
rather than a crime that is detrimental to public interests. They conclude that
the Criminal Law shall not apply to cases of counterfeiting GI collective
trademarks.
This is the first criminal ruling ever awarded by a Chinese court on
counterfeiting “Bordeaux” GI collective trademark, which may serve as precedent
in the future.
Contributors: Mr. ZHANG Yan & Mr. CAO Jin