INTELLECTUAL PROPERTY

No. Trademark and patent rights granted in your home country have no effect in Taiwan. You need to file separately in Taiwan. Trademark rights, patent rights and copyright are territorial. Their existence, scope and enforcement in Taiwan are governed by Taiwanese law. For trademarks and patents, only the rights granted in Taiwan can be asserted in Taiwan. A foreign company that already holds a registered trademark or patent abroad still needs to file in Taiwan to obtain and enforce the corresponding right in Taiwan. A foreign company files with the Intellectual Property Office, Ministry of Economic Affairs (TIPO) to register a trademark or a patent, and acquires a right enforceable against third parties only after TIPO approves the registration or grants the patent. Copyright works differently. Under the principle of automatic protection, copyright arises upon creation in Taiwan: the author holds copyright from the moment the work is completed, and no registration is required. What the author asserts in Taiwan is the protection granted by the Copyright Act of Taiwan.

The owner acquires trademark rights only after TIPO approves the registration and publishes it, and those rights run for ten years. The applicant acquires patent rights only after TIPO examines the application, grants the patent, and publishes the grant. Copyright requires no registration. When a dispute arises between private parties, a Taiwan court determines who the author is and when the work was completed on the basis of the evidence the rights holder produces.

1. Start the trademark filing before the product goes on sale. First search whether an identical mark is already registered in the same class, then allow time to prepare and submit the application. From receipt to approval, TIPO generally takes about six to seven months in practice. That figure reflects practical experience, not a statutory deadline. 2. Your trademark filing strategy should extend beyond your core class. A competitor may file first for an identical or similar mark in a different class, so the portfolio should cover your core products together with related services, which keeps the scope of protection reasonably complete. 3. When filing a patent application, check whether you can claim priority based on your first foreign filing. The basis is Article 28, Paragraph 1 of the Patent Act. If your home country and Taiwan recognize priority rights reciprocally, or your home country is a member of the World Trade Organization, you may file in Taiwan for the same invention within twelve months of that first filing and claim priority. When examining the Taiwan application, TIPO uses that first filing date to assess novelty and inventive step over the prior art. As a result, even if the invention has been publicly used or has become known to the public during those twelve months, TIPO does not reject your application on that ground. This mechanism lets you build the widest possible patent portfolio at a relatively low cost, and it also answers the problem of not yet knowing, early in development, which country will be your main market and therefore where to file first. 4. For research results that matter, use the dual filing strategy: on the same day, file one application for an invention patent and another for a utility model, both covering the same creation. TIPO conducts a substantive examination of an invention patent, checking the technical content item by item, which takes a long time, and the R&D output remains exposed to copying during that period. A utility model patent goes through a formality examination only, which checks the format and the required entries rather than the technical content, and in practice you generally obtain the right within six months. Once the substantive examination of the invention patent is complete and there are no grounds for rejection, TIPO notifies you to choose one of the two within a set period and give up the other. Taking this route gives the applicant the most complete patent protection. 5. Keep records from the moment development begins. The copyright holder should retain materials on the creative process, on publication, and on other matters related to the right, as the basis for establishing that right, covering at least four points: (1) evidence of who the author is. (2) evidence of when the work was completed. (3) evidence that the work is an independent creation and not a copy of someone else's. (4) evidence that the work contains your own creative contribution and does not merely rework material in the public domain, that is, material that is no longer protected by copyright and that anyone is free to use. Where infringing goods appear on the market, the copyright holder can also ask Customs or the police to seize them. Case: A well-known brand found counterfeit goods on the Taiwan market and decided to sue the infringer, seeking an order to stop the infringement and an award of damages. The brand had to assemble four things on its own: (1) evidence of how the infringement occurred, such as photographs of the counterfeit goods. (2) evidence of how long the infringement lasted, such as the period during which the counterfeits were sold. (3) an infringement assessment report explaining how the goods infringe the brand's trademark rights and copyright. (4) an assessment of the damages caused by the counterfeit goods, used to quantify the amount claimed.

Not necessarily. If the contract does not settle the question, the copyright economic rights in the work belong to the party that created it, and you obtain only a right to use the work within the purpose for which the work was commissioned. Taiwan draws a line between two situations. 1. For a work created by an employee in the course of employment, the employee is the author, and the economic rights belong to your company unless the contract provides that they belong to the employee. 2. For a work you commission from an outside studio or a freelancer, both authorship and the economic rights belong, as a default, to the commissioned creator, that is, the person or entity that took the job and did the work. When you hire an employee directly, you need no special contract term, because the economic rights are yours from the start. When you commission work from an outside contractor and the contract does not determine ownership in advance, the economic rights do not belong to you.

For commissioned development, where the contract says nothing about ownership, the Copyright Act leaves the economic rights with the commissioned creator. You paid for the work, and what you obtain is a right to use it. How far that right to use extends depends on what you were paying for and on what the contract was meant to achieve. Within that scope you may reproduce the work, that is, make copies of it, and you may adapt it, that is, revise it, release new versions, and build derivative versions. To determine the scope, a court examines what the parties intended and agreed at the time. Their agreement is not limited to the written contract; records of their communications and dealings may also be taken into account.

If you want the copyright in commissioned work to be yours, four points are worth noting. 1. In practice, where the contract states that the copyright belongs to the commissioning party, that is, the party paying for the work, this is generally treated as an agreement that the commissioning party is the author. 2. Deal with the economic rights in a separate clause. Even without an agreement that you are the author, you still need a contractual provision if you want to hold the economic rights, and that provision has to include an express assignment. The economic rights are the rights to reproduce the work, to adapt it, and to license others to use it. By contrast, moral rights belong only to the author and include the right to publish the work, the right of attribution, and the right to prevent improper alteration, protecting the author's personal interests such as reputation. These rights cannot be assigned, inherited, or licensed; the contract can at most provide that the author will not exercise them. 3. Contract with the person or entity that actually undertakes and is responsible for creating the work, rather than only with an intermediary. If you contract solely through an intermediary and have no contractual relationship with the individual or entity responsible for the work, the law may not treat you as the commissioning party, preventing you from asserting these rights directly. 4. Alternatively, leave the economic rights where they are and define what you will use the work for. If all you need is to use the work within the purpose for which it was commissioned, the contract is drafted differently from an assignment of economic rights. Case: A company purchased a set of electrical control equipment from a supplier, and the two sides agreed that the supplier would hand over a full data backup once installation was complete. The equipment later failed, and the company found that it could obtain neither a backup of the modified program nor the password the supplier had set. It claimed that its right to use the work had been infringed and sought damages. When a court handles this kind of dispute, it examines what the commissioning party was paying for and what the parties intended the contract to accomplish, and decides on that basis how far the commissioning party may use the work. In this case the contract had not defined the scope of use, so the dispute over the right to use went all the way to the Supreme Court. The Supreme Court held that the lower court had moved too quickly in finding no license on the basis of a single line in the description column of a purchase order, set that judgment aside, and remanded the case for a new hearing.

Generally, no. If the contract merely grants you a right to use the work, you are presumed not to have obtained the right to sublicense it to a third party. Taiwan recognizes two forms of copyright license: exclusive and non-exclusive. If what you hold is the non-exclusive kind, you may not sublicense the right to a third party without the consent of the economic rights holder. Because your contract says only that the work is licensed for use, without stating whether the license is exclusive, the first thing to do is establish which of the two you actually hold.

An exclusive license goes further than most people assume. Once you hold one, within the licensed scope you may exercise the licensed rights with the status of the economic rights holder, and if an infringement occurs you may bring a lawsuit in your own name. Within the exclusively licensed scope, the licensee brings the lawsuit; the original economic rights holder may not do so. Within that same scope the original economic rights holder may not exercise those rights, and may not grant another license covering the same scope. Article 37 of the Copyright Act provides that the territory, term, scope of application, and methods of exploitation are determined by the parties' agreement, and that any part left unclear is presumed not to have been licensed. That presumption, however, is the last step rather than the first. When a dispute arises, a court first looks at what the parties set out to achieve together through the contract, and determines from that which rights you obtained and how you may use them. Points the contract left unwritten, but on which the two sides clearly shared an understanding at the time, are taken into account as well. Only where none of this can be established does a court find the terms unclear and presume that no license was granted. If your goal is to own the economic rights outright and exclude others from using the work, what you need to negotiate is an assignment rather than a license. A license has only in personam effect, meaning that it operates between you and the licensor. An assignment changes who holds the right: you become the new economic rights holder, which is the more complete route.

1. Check whether the word exclusive appears in the contract. If the contract refers only to "distribution" or describes the arrangement as "sole," without expressly stating that the license is exclusive, the law will readily presume it to be non-exclusive. The consequence of that presumption is that you cannot exclude infringement by others, and you cannot bring a lawsuit in your own name. 2. To sublicense to companies in your group, the contract needs an express sublicensing clause. Other companies in your group remain separate legal entities and count as third parties for this purpose. Where you hold only a non-exclusive license, you may not sublicense the right to a third party without the consent of the economic rights holder. 3. Specify all four elements of the licensed scope: territory, term, scope of application, and methods of exploitation. Anything left out is presumed, as a matter of law, not to have been licensed to you. 4. Decide whether you want use or ownership before you negotiate the terms. If you need to use the work within a defined scope and to be able to exclude others, the contract should provide for an exclusive license. If you want the economic rights transferred to you outright, the contract should provide for an assignment. The two are drafted in entirely different ways.

A: Without an agreement made in advance, the patent belongs to the party that actually made the invention. When you fund research and development carried out by someone else, ownership of the patent follows the joint development agreement the two sides signed beforehand. If the agreement is silent, the patent belongs to the inventor. As the funding party you may exploit the invention, that is, make, use, or sell it yourself, but the right is not yours. The safest approach is to set out patent ownership clearly in the agreement. If the agreement provides for joint development and joint ownership of the patent, you need to know in advance the restrictions that joint ownership entails.

Patent ownership starts with the relationship between the inventor and the party funding the work: 1. For an employee you hire in Taiwan, where the invention is an employee invention made in the course of employment, the resulting patent rights belong to your company. Taiwan's Patent Act also requires the employer to pay reasonable remuneration to the employee who made the invention, and that is a cost to budget for in the development plan. 2. Where the inventor is a partner you have contracted with in Taiwan, the position is different. To claim that you are a joint inventor, you have to show that you or your team genuinely took part in conceiving the technology. In deciding patent ownership, Taiwanese courts look in practice at who prepared and submitted the technical specification document, and who determined the technical approach, equipment and research process. If you only supplied the requirements, paid the fees, and handled administrative liaison while the other side determined the technology, establishing that you are a joint inventor is difficult. If you decide to go with a jointly owned patent, you also need to understand the restrictions that come with joint ownership: 1. The first is licensing. Unless the co-owners have expressly agreed otherwise, licensing a jointly owned patent to a third party requires the consent of every co-owner. If your partner objects, you cannot license the technology to your own group companies, to subsidiaries, or to any third party. This situation is known as a licensing deadlock. 2. The second concerns disposition of your interest. Your share in a jointly owned patent is what the law calls an undivided interest. Without the other co-owners' consent, you may not pledge your undivided interest as collateral for financing or transfer that interest. There is one more thing to watch, and that is copyright. When two companies develop something together, they produce both source code and a technical solution: the source code is protected by copyright, the technical solution by patent. Jointly owned economic rights in a work cannot be exercised without the consent of all the owners, so even using the work yourself requires the other side to agree. The agreement should deal with the two kinds of output separately.

1. Settle patent ownership in the agreement before the work starts. You may provide that it belongs to you alone, or that it is jointly owned while spelling out who may license it on their own. The point is to write it down. If you do not, the statutory default may not match either side's assumptions. 2. If you go with joint development, keep the evidence. Three items at a minimum: research notebooks, development logs, and emails discussing technical details. They serve to show that your employees took part in conceiving the core technology. 3. Decide whether you want sole ownership or joint ownership before you negotiate the terms. If you accept joint ownership without securing, in the agreement, the authority to license on your own, licensing to a third party afterwards will require the other side's consent. Whether the other party is prepared to give that consent should be determined during negotiations.

The clock runs from the day the other party's trademark registration is published. You have three months to file an opposition; once that window closes, the route is invalidation, and there you have five years. If the other party registered a well-known mark in bad faith, even the five-year limit does not apply. In Taiwan a trademark goes to whoever files first and obtains registration on publication. Even if your brand has been in use for years, if the other side files for the same mark first and secures registration, the trademark right is theirs. Once someone has registered ahead of you, there are two routes. One is to keep using your original mark in Taiwan by claiming prior good faith use. The other is to ask the Intellectual Property Office to cancel the other party's registration, through opposition or invalidation.

The first route is prior good faith use, and it comes with four limits: 1. Only a party that has already used the mark within Taiwan can make the claim. That means you are already in Taiwan and already using it. Years of prior use in your home country cannot be brought over to support a claim of prior good faith use here. 2. At the time you began using the mark, you did not know that someone else had registered it, nor that another party had used it earlier, and your purpose was not unfair competition. 3. Your prior use has to have continued without interruption. 4. You may keep using the mark only on the goods or services you were already using it on. If your claim succeeds, the trademark owner on the other side may still require you to add a suitable distinguishing indication so that consumers can tell the two apart. The second route is to cancel the other party's registration. Two grounds in Taiwan's Trademark Act are particularly valuable to foreign companies: 1. A well-known trademark may not be registered. Even if your mark was not registered in Taiwan first, as long as it enjoys substantial reputation in Taiwan or abroad and is recorded as a well-known mark in the Intellectual Property Office's list and casebook of well-known trademarks, or has been held to be well known by a court, anyone may file an opposition. 2. A mark filed in bad faith may not be registered either. Where the party who filed knew of your mark through a contract, a geographical connection, business dealings, or another relationship, and applied with the intent to imitate it, anyone may likewise file an opposition. Beyond the Trademark Act, the Fair Trade Act offers two further lines of defense: 1. Your indication is already well known but is not registered in Taiwan. This is exactly what Article 22 of the Fair Trade Act covers, since anything for which a trademark right has been registered goes back to the Trademark Act and falls outside that article. Protected indications include the particular design of a product's appearance, and what the provision protects is fair competition rather than technical function. Where someone closely imitates a distinctive feature and consumers are misled into confusion, the conduct violates Article 22. 2. Your indication does not yet reach the level of well known. Article 25 of the Fair Trade Act keeps a general line of defense open here: a company that deceives the parties it deals with, or acts in a plainly unfair way, and affects order in the market, may violate the Fair Trade Act. Suppose someone uses an earlier collaboration with you to obtain materials or a license, and then runs an event under a name that closely resembles yours. Exploiting the fruits of another party's efforts and free-riding on them is commercially blameworthy and may be treated as plainly unfair conduct affecting trading order.

1. Work out the timing. Count forward from the day the other party's registration was published: an opposition within three months, and invalidation once that period has passed. 2. Assemble the evidence that your mark is well known. In deciding whether an indication is well known, courts look at four things: how distinctive it is, how long it has been marketed and how much has been spent, how much media coverage it has received, and what awards it has won. A design that has been used over a long period, advertised, and widely reported on, to the point that consumers connect that appearance with you, qualifies as a well-known indication. 3. Protect what you are doing now at the same time. If you were already using the mark in Taiwan, check that you meet all four limits above before deciding whether to claim prior good faith use. 4. Be clear about what you actually want. If you want the trademark in your own name, your route is cancelling the other party's registration. If you only need to keep selling, your route is prior good faith use. The two call for entirely different evidence: the first requires proof that your mark is well known or that the other party acted in bad faith, the second requires proof that you had used the mark first in Taiwan and that the use continued without interruption. Case: Company A applied to register a mark in the restaurant services class and the registration was approved. Company B filed an opposition on the ground of a bad faith filing. After examination the Intellectual Property Office agreed and cancelled the registration. Company A disagreed and brought an administrative appeal and then administrative litigation. The court upheld the cancellation. The point turned on how the term "another relationship" should be interpreted: the court held that even without business dealings between them, where companies in the same or a competing line of business in Taiwan know through the way business operates that another has used a mark earlier, that too counts as another relationship. Company A and Company B were competitors in the same line of business, Company A should have known that Company B's mark existed, and it applied to register a design with a considerable degree of similarity, which points plainly to an intent to imitate.