How Global Retail Company TARGET Preserves Trademark Rights in Taiwan

Date: 22 November 2024

【Volume 146】

Subsequent to global e-commerce companies obtaining trademark rights in various countries, related legal protections are thereby secured. However, due to the unique nature of e-commerce, it is necessary to develop plans to preserve the trademark rights in advance. For instance, it is necessary to prevent competitors who are well-versed in local regulations from revoking the registered trademarks of multinational corporations. The cut-throat competitors exploit global e-commerce companies’ unfamiliarity with the regulations, further sabotaging corporations’ dominant position or branding strategies. This article focuses on two rulings from the Intellectual Property and Commercial Court (hereinafter “IP Court”) as examples to introduce the evidence and details that global e-commerce companies should attend to when protecting trademark rights in Taiwan.

Case Facts

The American retail chain corporation, Target Corporation, through its subsidiary TARGET BRANDS, INC. (hereinafter “TARGET”), obtained registration for the "Bullseye Design" trademarks (hereinafter “Trademarks”) in Taiwan, and used the trademark on its online platform target.com. Nonetheless, in 2020, the German furniture company POLIPOL POLSTERMOEBEL (hereinafter “POLIPOL”) filed the non-use cancellations against the Trademarks with the Taiwan Intellectual Property Office (hereinafter “TIPO”).

After examination, TIPO rendered the decision to revoke the remaining services of Trademark No. 1 and the “shopping mall services; online shopping (electronic shopping) services; etc.” of Trademark No. 2. POLIPOL filed an appeal, but it was rejected. POLIPOL then continued to file an administrative lawsuit with the IP Court. The IP Court overruled the decisions of both the TIPO and the Petition Reviewing Commission regarding Trademark No. 1, resulting in a ruling that the trademark should be revoked (IP Court 2022 XingZhuanSuZi No. 2 Judgment); whereas, regarding Trademark No. 2, the IP Court upheld the decision to maintain its registration (IP Court 2021 XingZhuanSuZi No. 94 Judgment).

	Trademark No. 1	Trademark No. 2
Trademark Specimen
Trademark Holder	TARGET BRANDS, INC.	TARGET BRANDS, INC.
Applicant of Non-use Cancellation	POLIPOL	POLIPOL
Registration Number	01720657	01198911
Registration Date	2015/08/01	2006/03/01
Designated Services	Class 35 Retailing of bread, retailing of food, business organization consulting, providing convenience store, supermarket, hypermarket, shopping mall, and department store services, online shopping (electronic shopping) services, etc.	Class 35 Providing convenience store, supermarket, hypermarket, shopping mall, and department store services, online shopping (electronic shopping) services.
TIPO’s decision	Cancellation overruled	Cancellation overruled
IP Court’s judgment	Cancellation sustained	Cancellation overruled
Screenshot of target.com

Summary of the Intellectual Property and Commercial Court’s Judgment

(A) The IP Court’s judgment related to the Trademark No. 1

(1) “Trademark use” must be for marketing purposes, not merely for consumer recognition

According to the legislative intent of Article 5 of the Taiwan Trademark Act regarding "trademark use", the use of preserving the trademark rights places greater emphasis on whether there is frequent and economically significant use within Taiwan. If the trademark is only used for image marketing but does not actually offer the designated goods/services in the context of economic activity within Taiwan, the trademark clearly lacks economic significance in the Taiwanese market and does not constitute genuine use of trademarks.

(2) Evidence submitted by TARGET is insufficient to prove the genuine use of Trademark No. 1:

The evidence of use submitted by TARGET neither shows the source nor displays Trademark No. 1. Additionally, according to the shopping website information provided by TARGET, the text is all in English and the currency is in USD, making it difficult to determine whether Taiwanese consumers are able to purchase products from its website. Without concrete evidence of Taiwanese consumers placing orders on the website within the country, the use of Trademark No. 1 in Taiwan cannot be verified.

(B) The IP Court’s judgment related to the Trademark No. 2

(1) Evidence submitted by TARGET is sufficient to prove the use of Trademark No. 2:

According to news reports in Taiwan, non-American consumers can specify their delivery country and choose their preferred currency on the Target website. The checkout page also displays information in the consumer’s local language. Additionally, according to correspondence sent to consumers by Borderfree, a company partnered with TARGET, Trademark No. 2 is shown, and the ordering or shipping information is provided in Traditional Chinese. Furthermore, after the IP Court sent an inquiry to Taiwanese consumers shown in the aforementioned materials, it was confirmed that one consumer did indeed purchase products from the Target website in 2017.

Wisdom Suggested Strategies

In terms of the genuine use of trademarks, merely claiming to provide global services is not sufficient. The key is to prove whether the trademark is used for designated goods/services within a specific country/region. In this regard, the first judgment pointed out that trademark use must offer the designated goods/services in the context of economic activity within Taiwan to meet the legislative intent of Article 5 of the Trademark Act.

The business models of e-commerce companies, whose users may be spread across various countries, differ from those of offline physical stores. Thus, it is crucial to pay special attention to trademark use within the domestic market.

Taking the first judgment as an example, whether a portion of the transactions on the shopping website occurred within Taiwan could be one of the key factors in deciding the outcome of the lawsuit. Evidence submitted by TARGET in the first case indicated the website not only lacked a Traditional Chinese interface and pricing in New Taiwan Dollars but also did not show logistics data for shipments to Taiwan. As a result, the IP Court ultimately determined that there was no use of Trademark No. 1 in Taiwan.

In contrast, in the second judgment, TARGET submitted sufficient evidence of use, including website language, currency, logistics, and Taiwanese consumer data, and the IP Court ultimately recognized that there was genuine use of the trademark in Taiwan.

From our point of view, regarding the genuine use of trademarks in Taiwan, global e-commerce companies should not only pay attention to trademark displays, webpage languages, product currencies, and shipping information on their websites but also actively retain evidence of any transaction activities occurred within Taiwan for each order. If there are doubts concerning whether the evidence of use meets practical requirements, it is advisable to consult a professional agent in a timely manner to effectively protect the interests in potential dispute cases.

Keywords: Trademarks Case Studies Goods & Services Taiwan

[1] Taiwan Intellectual Property and Commercial Court 2022 XingShangSuZi No. 13 Administrative Judgment and Taiwan Intellectual Property and Commercial Court 2022 XingShangSuZi No. 62 Administrative Judgment.