Trademarks in Japan 2024

Trademarks in Japan 2024

Trademarks in Japan 2024

TRADEMARKS 2024

JAPAN

Satoko Yokogawa, Masayuki Yamanouchi

Anderson Mōri & Tomotsune

LEGAL FRAMEWORK

Domestic law

  1. What is the primary legislation governing trademarks in your jurisdiction?

The primary legislation is the Trademark Act (Act No. 127 of 13 April 1959, last amended in 2022).

International law

  1. Which international trademark agreements has your jurisdiction signed?

The relevant agreements are as follows:

  • the Paris Convention for the Protection of Industrial Property;
  • the Madrid Agreement and Protocol;
  • the Nice Agreement;
  • the Agreement on Trade-Related Aspects of Intellectual Property Rights;
  • the Trademark Law Treaty; and
  • the Singapore Treaty on the Law of Trademarks.

Regulators

  1. Which government bodies regulate trademark law?

The Japan Patent Office (JPO) is a Japanese governmental agency responsible for the protection of trademark rights. The JPO is an external agency under the Ministry of Economy, Trade and Industry.

REGISTRATION AND USE

Ownership of marks

  1. Who may apply for registration?

Any Japanese individual or legal entity that uses or will use a trademark in respect of goods or services in connection with its business may apply, as well as:

  • a foreign individual domiciled or resident in Japan;
  • a foreign legal entity with a place of business in Japan; or
  • an individual or legal entity from a country that allows Japanese nationals to register their trademarks, provided that such foreign nationals have a representative in respect of the said trademark in Japan.

Scope of trademark

  1. What may and may not be protected and registered as a trademark?

Under an amendment to the Japanese Trademark Act introduced in 2015, non-traditional marks, such as colors and sounds, can be registered as trademarks. Under the Trademark Act, a trademark should be recognizable by human perception and is defined as ‘any character, figure, sign, three-dimensional shape) or any color, or any combination thereof, sounds or other marks provided by Cabinet Order’. In particular, motion marks, holograms, colors without profiles, position marks and sound marks are to be protected in addition to the traditional trademarks. Scent and smells are not eligible for trademark protection.

There is no provision for certification marks in Japan while collective marks are protected under articles 7 and 7-2 of the Trademark Act.

A trademark to be used in respect of goods (trademarks) or services (service marks) in connection with the applicant’s business can be registered, unless such trademark is generic, customary for the business, non-distinctive, or against good morals or public order.

Unregistered trademarks

  1. Can trademark rights be established without registration?

The Unfair Competition Prevention Act (Act No. 47 of 1993) protects well-known trademarks without registration. Other trademarks are not protected without registration.

Famous foreign trademarks

  1. Is a famous foreign trademark afforded protection even if not used domestically? If so, must the foreign trademark be famous domestically? What proof is required? What protection is provided?

Article 4(1)(xix) of the Trademark Act provides a ground for rejecting an application for a well-known mark filed by a third party. It reads:

“Notwithstanding the preceding article, no trademark shall be registered if the trademark is identical with, or similar to, a trademark which is well-known among consumers in Japan or abroad as that indicating goods or services pertaining to a business of another person, if such trademark is used for unfair purposes (referring to the purpose of gaining unfair profits, the purpose of causing damage to the other person, or any other unfair purposes, the same shall apply hereinafter).”

According to the Examination Guideline for Trademarks provided by the Japan Patent Office (JPO), ‘trademarks well-known among consumers abroad’ are explained as follows:

“The trademark must be well-known in one country other than Japan but is not necessarily required to be well-known in several countries. In addition, when the trademark is well-known abroad, the fact as to whether or not the trademark is well-known in Japan is disregarded.”

Thus, if the mark is well-known abroad and there are unfair purposes, the mark is protected under article 4(1)(xix) even if the mark is not used or well-known within Japan.

The fame of the mark will be estimated through information and materials such as:

  • any materials proving volume of use of the trademark (e.g, an amount of production or sales); and
  • any method, period, areas and scale of advertising (e.g, newspapers, magazines, catalogues, leaflets and television commercials, etc).

The benefits of registration

  1. What are the benefits of registration?

The major benefits of registering a trademark include that a trademark owner:

  • enjoys an exclusive right to use the mark on designated goods or services;
  • may claim an injunction against unauthorized trademark use;
  • may claim damages caused by trademark infringement, in which case, the infringer’s intent or negligence will be presumed to exist under the Trademark Act;
  • has the right to license third parties to use the registered mark; and
  • may file an application for customs seizure based on the trademark registration.

Filing procedure and documentation

  1. What documentation is needed to file a trademark application? What rules govern the representation of the mark in the application? Is electronic filing available? Are trademark searches available or required before filing? If so, what procedures and fees apply?

On the application form, the following information will be needed:

  • the mark;
  • the applicant’s name and address; and
  • classes and specific goods or services to be covered by the application.

No other documents such as power of attorney are required for filing purposes. Electronic filing is available. It is recommended to conduct trademark searches before filing. No official search is provided by the JPO and there is no official fee for conducting trademark searches.

Registration time frame and cost

  1. How long does it typically take, and how much does it typically cost, to obtain a trademark registration? When does registration formally come into effect? What circumstances would increase the estimated time and cost of filing a trademark application and receiving a registration?

It usually takes from six to 10 months from the filing of an application for registration with the JPO before the JPO determines the registrability of the trademark (assuming there are no major issues in respect of the application). After issuing the decision of registration, a certificate of trademark registration will be issued upon payment of registration fees in approximately one month. A trademark registration formally comes into effect upon registration by the JPO.

As for cost, an applicant or owner of a trademark should pay the official fee for filing upon filing and registration tax when the application is determined registrable. The official fee for filing one application is the total sum of ¥3,400 plus the result of ¥8,600 multiplied by the number of designated classes. Registration tax is the sum of ¥32,900 multiplied by the number of designated classes. There is no legally binding standard for attorneys’ fees in Japan. Usually, attorneys charge flat fee rates agreed with clients.

Attorneys’ fees for filing and registration (excluding translation costs) are difficult to estimate, but they would, on average, be approximately ¥120,000 per application covering one class, provided that there are no reasons for rejection. Filing an application in more classes can increase the estimated time and cost of filing a trademark application, and receiving a registration.

Classification system

  1. What classification system is followed, and how does this system differ from the International Classification System as to the goods and services that can be claimed? Are multi-class applications available and what are the estimated cost savings?

The JPO follows the latest version (12th edition) of the International Classification of Goods and Services (the Nice Classification). Any goods or services listed in the Nice Classification may be claimed, as long as goods or services are specifically designated. The wording of the class headings is not always acceptable for the designation of the goods or services. Multi-class applications are available. Filing such an application will be more cost-efficient than filing one application per class.

Examination procedure

  1. What procedure does the trademark office follow when determining whether to grant a registration? Are applications examined for potential conflicts with other trademarks? Are letters of consent accepted to overcome an objection based on a third-party mark? May applicants respond to rejections by the trademark office?

The JPO examines all applications for conflicts with prior registrations and applications.

The similarity between the trademark applied for and prior registrations or applications of trademarks is determined by the examiners of the JPO according to the examination standard published by the JPO, considering three factors: sound, appearance and meaning.

If an objection is raised based on a third-party mark, under the current Trademark Act, a letter of consent may be acceptable to overcome the objection only if the holder of a cited prior trademark and the applicant are in a controlling relationship (e.g, the holder of the prior trademark is a parent company or subsidiary of the applicant). In this regard, the amended Trademark Act will become effective in 2024, and under the amended law, the JPO will introduce a procedure for accepting letters of consent, and examine the existence of a likelihood of confusion along with a letter of consent.

Applicants may respond to preliminary rejections by the examiners of the JPO and may request further examinations in an appeal against a final rejection. An English translation of the examination guidelines for similar goods and services can be downloaded from the JPO’s website.

Use of a trademark and registration

  1. Does use of a trademark or service mark have to be claimed before registration is granted or issued? Does proof of use have to be submitted? Are foreign registrations granted any rights of priority? If registration is granted without use, is there a time by which use must begin either to maintain the registration or to defeat a third-party challenge on grounds of non-use?

No. The use of a trademark or service mark is neither a requirement for the application or registration of a trademark nor a requirement for the maintenance of the registration, although lack of an intention to use can be grounds for the rejection of registration. Accordingly, in principle, proof of use does not have to be submitted.

If the registered trademark has not been used for three consecutive years, any party may ask the JPO to cancel the registration. In such a case, the trademark will be canceled unless the trademark owner shows proof of use of its registered trademark.

Markings

  1. What words or symbols can be used to indicate trademark use or registration? Is marking mandatory? What are the benefits of using and the risks of not using such words or symbols?

Marking is not mandatory for registered trademarks. In general, ™ is used as a marking of a trademark and ® is recognized as the marking of a registered trademark. Any person who affixes false or misleading marking shall be punished by imprisonment with work for a term not exceeding three years or a fine not exceeding ¥3 million.

Appealing a denied application

  1. Is there an appeal process if the application is denied?

Yes. In the course of an application examination, the JPO examines the completeness of the basic formalities and the substance of the applications, and absolute and relative grounds for refusal. If the examiners find any problems, the JPO issues a notice of rejection, in which case the applicant can submit an opinion or amend the application. If, after the applicant’s amendment or opinion, the JPO decides that the requirements remain unsatisfied, it will issue a decision of rejection.

If the applicant is dissatisfied with the decision of rejection, the applicant may appeal to the Trial and Appeal Department (TAD) of the JPO. Further, the applicant can appeal to the Intellectual Property High Court seeking cancellation of the TAD’s refusal decision. If the court renders a judgment canceling the refusal decision of the JPO, the applicant can have the trademark in question registered based on such a judgment.

Third-party opposition

  1. Are applications published for opposition? May a third party oppose an application prior to registration, or seek cancellation of a trademark or service mark after registration? What are the primary bases of such challenges, and what are the procedures? May a brand owner oppose a bad-faith application for its mark in a jurisdiction in which it does not have protection? What is the typical range of costs associated with a third-party opposition or cancellation proceeding?

Japan adopts a post-registration opposition system and, therefore, applications are not published for opposition. Any third party may oppose a trademark or service mark only after registration.

An opposition may be filed with the JPO on the grounds that the trademark or service mark is unregistrable within two months from the publication of the Gazette that shows the trademark or service mark. The examination of the opposition filing shall be conducted by documentary examination. In addition, any party may seek invalidation or cancellation of the registration of a trademark or service mark with the JPO. The primary bases of opposition or invalidation include:

  • that a mark is generic or descriptive;
  • that a mark is similar to another party’s mark that has been registered, filed for registration or is well-known in Japan;
  • that a mark is similar to another party’s mark, which is well-known in a foreign country, and has been filed for registration by an applicant for the purpose of deception; and
  • that a mark includes another party’s image, full name, or famous abbreviation or stage name.

Certain major reasons for invalidation must be filed within five years after registration.

A brand owner may oppose a bad-faith application regardless of whether its mark is registered with the JPO if the mark is famous in Japan or a foreign country.

In the opposition proceedings, the trademark owner is required to submit a counterargument only when the JPO considers that a third party’s argument is reasonable and issues a notification of the reason for revocation.

The typical range of costs associated with a third-party opposition would be from approximately ¥200,000 to ¥400,000 when filing a counterargument.

Duration and maintenance of registration

  1. How long does a registration remain in effect and what is required to maintain a registration? Is use of the trademark required for its maintenance? If so, what proof of use is required?

The term of a trademark is 10 years from the date of the registration. An owner of a trademark desiring the renewal of the registration shall submit a request for renewal to the JPO within six months prior to its expiry. Even after the expiry of the term, the owner may make a request for renewal within six months from the date of expiry. No proof of use is required for renewal.

However, where a registered trademark has not been used in Japan by an owner or its licensee for three consecutive years, any person may file a request for a trial for rescission of such trademark registration. As a defense against such request for a trial for rescission, the trademark owner must file proof of use, such as copies of catalogues, advertisements, publications, websites and trade documents that bear the trademarks and indicate the issuance dates.

Surrender

  1. What is the procedure for surrendering a trademark registration?

Registration of the trademark will be canceled by filing an application for abandonment with the JPO. It is possible to request a partial abandonment of the goods or services covered by the trademark registration.

Related IP rights

  1. Can trademarks be protected under other IP rights?

A device mark and a three-dimensional mark may be protected as design rights if the design has not lost its novelty. Non-traditional marks, such as motion marks and position marks, may also be protected as design rights. If the design has already been disclosed, an application can be filed within a one-year grace period with requests for ‘exceptions to loss of novelty’.

In addition, a device mark, three-dimensional mark and sound mark may be protected under the Copyright Act. Copyright is an unregistered right in Japan and creativity is required for the work to be protected as a copyrighted work.

Trademarks online and domain names

  1. What regime governs the protection of trademarks online and domain names?

The Unfair Competition Prevention Act (the UCP Act) provides protection for domain names. Under article 2(1)(xix) of the UCP Act, the following constitute unfair competition:

“acts of acquiring or holding a right to use a domain name(s) that is identical or similar to another person’s specific indication of goods or services (which means a name, trade name, trademark, mark, or any other indication of a person’s goods or services), or the acts of using any such domain name, for the purpose of acquiring an illicit gain or causing injury to another person.”

A person who infringes on the business interest of another person by unfair competition shall be liable for an injunction and a person who intentionally or negligently infringes on the business interests of another person by unfair competition shall be liable for damages.

As to country code top-level domain .jp, the relevant Domain Name Dispute Resolution Policy is ruled by the Japan Network Information Centre and it is possible to request that a .jp domain name registered or used in bad faith be transferred to a complaint, or canceled. The Japan Intellectual Property Arbitration Center is the institution that conducts dispute resolution proceedings.

If a domain name is identical or similar to a registered trademark and functions as the indication of origin of goods and services, use of the domain name may be considered ‘trademark use’ and the trademark owner may claim for trademark infringement.

LICENSING AND ASSIGNMENT

Licenses

  1. May a license be recorded against a mark in the jurisdiction? How? Are there any benefits to doing so or detriments to not doing so? What provisions are typically included in a licensing agreement?

A license may be recorded in the register of the Japan Patent Office (JPO) in respect of each registered mark. There are two types of registration of license: the registration of an exclusive license and the registration of a non-exclusive license. If either registration of a license is made, a licensee is able to use its right to the licensed mark as a licensee against a party that is subsequently assigned the licensed mark from a licensor or a bankruptcy trustee subsequently appointed by a court for a licensor. Further, if the registration of an exclusive license is made, then the licensee has standing to sue against infringers for both injunctive and monetary relief.

For the purpose of recording a license with the JPO, a license agreement typically includes the following information:

  • type of license(exclusive or non-exclusive);
  • trademark (registration number); and
  • scope of license, such as territory, duration, and licensed goods or services.

Assignment

  1. What can be assigned?

In Japan, a trademark can be assigned either with or without goodwill, and either with or without other business assets. When several goods or services are designated for registration, a trademark may be divided into each class and can be assigned separately.

Assignment documentation

  1. What documents are required for assignment and what form must they take? What procedures apply?

For the registration of the assignment of a trademark, a deed of assignment is required. Notarization is not necessary. If the deed includes a provision where an assignor agrees to an assignee’s filing application for recording the assignment, then the assignee may file an application for recording of the assignment without the cooperation of the assignor.

Validity of assignment

  1. Must the assignment be recorded for purposes of its validity?

The assignment of a trademark shall be of no effect unless it is registered with the JPO, except those transferred by inheritance, merger or other general succession.

Security interests

  1. Are security interests recognized and what form must they take? Must the security interest be recorded for purposes of its validity or enforceability?

A trademark may be the subject of pledges, provided that such creation of pledges over trademarks is registered with the JPO. Registration of the pledges is a condition for the pledges to be valid and enforceable. For the purpose of creation of pledges, a deed of pledge must be filed with the JPO. The deed does not need to be notarized.

ENFORCEMENT

Trademark enforcement proceedings

  1. What types of legal or administrative proceedings are available to enforce the rights of a trademark owner against an alleged infringer or dilutive use of a mark, apart from previously discussed opposition and cancellation actions? Are there specialized courts or other tribunals? Is there any provision in the criminal law regarding trademark infringement or an equivalent offence?

Both civil and criminal proceedings are available. There are two types of civil proceedings. One is the main lawsuit, by which a trademark owner may seek both a permanent injunction order and damages, and the other is a proceeding for preliminary injunction, by which a trademark owner may seek a preliminary injunction order. There is no specialized court for trademark cases; however, the Tokyo District Court and Osaka District Court have specialized divisions dealing with cases relating to intellectual property.

For criminal proceedings, a trademark owner may file a criminal complaint with police officers or public prosecutors; in practice, however, it depends on the discretion of police officers or public prosecutors as to whether a substantial investigation is made. Criminal proceedings are governed by the Code of Criminal Procedure, which is applied to all criminal proceedings in Japan. There are no specific procedural provisions related to trademark enforcement in criminal law. In addition, as an administrative proceeding, it is possible for a trademark owner to file an application for customs seizure.

Procedural format and timing

  1. What is the format of the infringement proceeding?

The infringement proceedings begin with the filing of a complaint for a main lawsuit or petition for a preliminary injunction. No US-style discovery is allowed in Japan. However, an order for document production with limited scope under certain conditions is available. Live testimony can be used under the Code of Civil Procedure, although judges usually prefer to dispense with live testimony for trademark infringement cases.

Affidavits from experts are often submitted to prove important facts, such as the pronunciation of foreign words, the likelihood of confusion, the fact that the mark is well-known and the amount of the damages. The proceedings for a preliminary injunction typically take several months, and the proceedings for a main lawsuit typically take one to one-and-a-half years at the district court level and another year at the high court level.

For criminal proceedings, a trademark owner may file a criminal complaint with police officers or public prosecutors; however, in practice, it depends on the discretion of police officers or public prosecutors as to whether a substantial investigation is made. After the investigation, only the public prosecutors may commence the prosecution in court and the decision of whether to prosecute is at the sole discretion of the public prosecutors.

Live testimony is commonly used. Upon the request of the public prosecutor, the trademark owner may submit affidavits to prove important facts, such as the likelihood of confusion, the fact that the mark is well-known and the amount of the damages. Criminal proceedings typically take less time than civil lawsuits, unless the accused (trademark infringer) denies the offence.

Burden of proof

  1. What is the burden of proof to establish infringement or dilution?

A trademark owner has the burden of proof to establish that its mark has been registered with the Japan Patent Office (JPO) or is well-known in Japan, and that marks used by an alleged infringer are similar and cause confusion of source. The alleged infringer has the burden to prove the facts supporting its counterarguments.

Standing

  1. Who may seek a remedy for an alleged trademark violation and under what conditions? Who has standing to bring a criminal complaint?

A trademark owner or a licensee who has been registered as an exclusive licensee with the JPO has standing to seek injunctive relief or compensation for damages. A licensee who has not been registered as an exclusive licensee with the JPO does not have standing to seek injunctive relief, although there are a few precedents where an exclusive licensee who has not been registered with the JPO was awarded compensation for damages.

A trademark owner or a licensee who has been registered as an exclusive licensee with the JPO may file a criminal complaint with police officers or public prosecutors. However, only the public prosecutor has standing to bring a criminal complaint to the court under the Code of Criminal Procedure. Whether to prosecute is at the sole discretion of the public prosecutor.

Border enforcement and foreign activities

  1. What border enforcement measures are available to halt the import and export of infringing goods? Can activities that take place outside the country of registration support a charge of infringement or dilution?

As to border enforcement, trademark rights holders can file an application for import suspension for goods suspected of infringing trademarks with the customs authority. The customs authority will examine the application and record the trademarks. The customs authority has the authority to seize goods suspected of infringing trademarks. During border seizure proceedings, both trademark rights holder and importer will be provided with opportunities to submit opinions, and the customs authority will then determine if suspected goods constitute a trademark infringement.

As to foreign activities, activities taking place outside Japan cannot support a legal charge because the activities to be judged in Japanese courts must be those made within the territory of Japan. However, activities that take place in foreign countries are often cited to prove facts, such as the fact that the mark is well-known worldwide and the fact that the alleged infringer had the intention to infringe. Further, judges sometimes wish to know about judgments rendered by courts of foreign countries, especially those of the United States and the European Union. In addition, an act of importation from foreign countries into Japan constitutes infringement taking place within Japan.

Discovery

  1. What discovery or disclosure devices are permitted for obtaining evidence from an adverse party, from third parties, or from parties outside the country?

Under the Code of Civil Procedure, each party may file a court petition for an order of document production against an adverse party or a third party, as long as:

  • the requesting party can identify the document to be produced;
  • there is necessity to obtain an order for document production; and
  • the adverse party or the third party has no statutory grounds of immunity from production.

Further, there is another proceeding by which each party may request a court to request a third party to produce documents voluntarily. To obtain evidence from third parties outside the country, a party should request a foreign court through a Japanese court to provide judicial assistance and obtain evidence in accordance with the Convention Relating to Civil Procedure or bilateral international agreements.

Timing

  1. What is the typical time frame for an infringement or dilution, or related action, at the preliminary injunction and trial levels, and on appeal?

After the filing of the complaint, the court clerk will examine whether the correct form for the complaint has been used and whether the correct stamp value has been affixed to the complaint. The clerk will then contact the plaintiff or his or her attorney and, depending on his or her availability, will decide the date of the first oral hearing.

The court will then send a summons and the complaint to the defendant by post. The first oral hearing will typically be held 40 to 50 days after the filing date. Before the hearing, the defendant must file a defense, which will deny or accept each claim and the factual information relied upon in the complaint. At each key event in the proceedings, the judge will ask the parties whether they have an intention to settle the case.

Following the first hearing, there will be a court hearing of (on average) 10 to 15 minutes once a month for about eight to 12 months. In addition, the judge may hold a preparatory court hearing, at which the judge and both parties will discuss the issues at hand for a relatively long time in chambers.

The examination and cross-examination of witnesses will follow, although judges tend to dispense with the examination of witnesses in relation to trademark cases. After this, each party will file its closing brief. The oral proceedings will close, and the court will issue its judgment. On average, judgment is rendered from one to one-and-a-half years following the filing of the complaint.

The proceedings for a preliminary injunction typically take several months or more. The proceedings for appeals typically take about one year.

Limitation period

  1. What is the limitation period for filing an infringement action?

In Japan, the limitation period for filing an infringement action is three years from the time when the trademark owner becomes aware of the damages and the identity of the infringer. The same shall apply when 20 years have elapsed from the time of infringing act.

Litigation costs

  1. What is the typical range of costs associated with an infringement or dilution action, including trial preparation, trial and appeal?

The fee to be paid to a court upon filing depends on the economic scale of the case. For example, if the trademark owner seeks ¥100 million as damages, it must pay approximately ¥300,000 to the district court and, if it appeals, ¥500,000 to the relevant high court.

As for attorneys’ fees, there is no legally binding standard in Japan. Usually, attorneys representing foreign clients charge on an hourly basis and their rates vary from ¥30,000 to ¥60,000, although some attorneys charge certain amounts as initial and contingent fees. Under Japanese law, a plaintiff can recover the full amount of the fee paid to the court and a part of the attorneys’ fees, which is usually up to 10 per cent of the amount of the damages awarded as compensation for infringement.

Appeals

  1. What avenues of appeal are available?

The judgment of a district court can be appealed to a high court. There are 50 district courts and nine high courts in Japan. Since April 2005, trademark cases that used to be subject to the jurisdiction of the Tokyo High Court are now heard by the Intellectual Property High Court. The grounds for appeal from a district court to a high court are that the first judge made an error in a factual finding or in the application of the law.

The Supreme Court will hear appeals from a high court on grounds of error in interpretation and other violations of the Constitution. In addition, violations of the civil procedure rules, such as an error in jurisdiction or lack of reasoning, will also give rise to a right of appeal to the Supreme Court. A system of petitions to the Supreme Court has been introduced that gives the Supreme Court discretion to accept cases if the judgment being appealed is contrary to precedent or contains significant matters concerning the interpretation of laws and ordinances.

Defenses

  1. What defenses are available to a charge of infringement or dilution, or any related action?

In defending a charge of infringement or dilution, an alleged infringer often alleges, inter alia:

  • no similarity of the marks;
  • no similarity of goods or services;
  • no likelihood of confusion;
  • prior use that caused an allegedly infringing mark to become well-known;
  • that the term is generic;
  • that the registration is invalid;
  • that the registration should be canceled as a result of non-use of the registered mark;
  • that the mark is not well-known or famous in Japan;
  • the exhaustion of rights by first sale; or
  • parallel importation.

In addition to a defense before the courts, an alleged infringer may file a petition for invalidation or cancellation of registration as a separate proceeding before the JPO. Filing a petition for invalidation or cancellation with the JPO does not necessarily stop litigation proceedings before a court, but judges sometimes prefer to await the outcome of a JPO decision.

Remedies

  1. What remedies are available to a successful party in an action for infringement or dilution, etc? What criminal remedies exist?

Permanent injunctions and monetary relief are available through the proceedings for a main lawsuit, and a preliminary injunction is available through the proceedings for a preliminary injunction. As to monetary relief, the amount of damages is limited to actual damages (punitive damages are not allowed in Japan).

The amount of damages is usually determined by:

  • the profit gained by an infringer;
  • the number of infringing products multiplied by the amount of profit per unit gained by the trademark owner that sells competing products; or
  • a reasonable or established royalty rate.

To obtain injunctive relief, the trademark owner does not have to establish any fact other than an existing, or the threat of, infringement for a permanent injunction through a lawsuit on the merits, but must establish the necessity for a preliminary injunction if they request one. However, in practice, courts do not require a high level of necessity to be established. Further, as a condition for a preliminary injunction order, the trademark owner is ordered by judges to place a bond with the court, the amount of which is determined by judges on a discretionary basis (e.g, as an amount equivalent to 20 per cent of the annual sales of infringing products).

As for criminal remedies, imprisonment not exceeding 10 years or a fine not exceeding ¥10 million (in the case of a corporation, ¥300 million), or both, may be imposed on the trademark infringers, depending on the maliciousness of the conduct, the amount of the damages, etc.

ADR

  1. Are ADR techniques available, commonly used and enforceable? What are the benefits and risks?

Arbitration is available in Japan as long as both parties agree to arbitrate disputes. The Japan Commercial Arbitration Association and the Japan Intellectual Property Arbitration Centre are active institutions that administrate arbitration proceedings in relation to disputes related to intellectual property. However, the number of arbitration cases relating to intellectual property is small – except for domain name disputes – and the number is presently far lower than the number of litigated cases.

The benefits of arbitration are that the parties may agree to use the English language, that confidentiality can be kept and that the enforcement of the decision is easier if the decision needs to be enforced in foreign countries, etc. The risk of arbitration is that no appeal is available.

Further, mediation is also available provided that both parties agree. The benefit of mediation is that the proceedings are not necessarily adversarial. The risks of mediation are that it is very difficult to locate good and experienced mediators, and that the proceedings may become redundant, as mediation is not binding.

UPDATE AND TRENDS IN TRADEMARKS IN JAPAN

Key developments of the past year

  1. Are there any emerging trends, notable court rulings, or hot topics in the law of trademark infringement or dilution in your jurisdiction?

An amendment to the Trademark Act was promulgated on 14 June 2023, and the amended law will become effective within one year of the promulgation (namely, by 14 June 2024).

Currently, the Japan Patent Office (JPO) does not accept a letter of consent as a way of overcoming a likelihood of confusion refusal unless the holder of a cited prior trademark and the applicant are in a controlling relationship (eg, unless the holder of the prior trademark is a parent company or subsidiary of the applicant). One of the purposes of the amendment is to introduce a procedure for accepting letters of consent, regardless of the shareholding relationships between parties.

Under this amendment, the JPO will still examine the existence of a likelihood of confusion over the source of goods or services along with a letter of consent issued by the holder of a cited prior trademark. It is expected that the JPO will publish examination guidelines on letters of consent and decisions on the likelihood of confusion cases before the effective date.

* The information in this chapter was accurate as at July 2023.

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