Trademark License: Concept, System And Competition

The trademark license system is closely related to the market competition.Academia research the trademark license system by Right Standard Theory or SocietyStandard Theory. This paper interprets both the concept and the system of trademark licensebased on Resource-Based Theory. This paper is divided into five parts:Part I, as one kind of license trade, the licensing use of trademark is a commercialactivity under which the trademark owner allows the licensee exclusive or ordinary use oftrademark and charges licensing fees. Trademark licensing can be divided into two types: oneis Traditional Trademark Licensing, the other is Trade-mark Merchandising (PromotionalTrademark Licensing). The relationship in trademark licensing should be regulated bycompetition policy. The target value of trademark license is order and fair competition basedon a whole efficiency.Part Ⅱ，this part mainly uses Historical Analysis Method and Case Analysis Method.This part reviews the history of American trademark license law and points out thedevelopment of American trademark license are of a character of competition law. Thelicensing use of trademark originated from market competition on purpose of pursuingcommercial benefits. In early twentieth century, the licensing use of trademark was illegalbecause it was treated as a type of fraud to consumers. It was recognized by the Lanham Actin1946. Besides, the process of China’s trademark license law was a shift from passiveaccepting to active adopting. This part finally comments how the commercial reality andexpansion of trademark authority influence the trademark license.Part Ⅲ, this part mainly talks about the approach to understanding the licensing use oftrademark through Resource-Based Theory under the perspective of competition policy. InIPR laws, Resource-Based Theory concerns on the efficiently distribution of trademarkinformation resource. Also, Resource-Based Theory fights against external diseconomyarising from unreasonable use of trademark information resource. All above attitudes aretowards goals of weakening trademark authority, encouraging sharing of IPR benefits andprotecting public welfare. Resource-Based Theory can overcome the weakness of RightStandard Theory or Society Standard Theory and should be introduced to the constructive of trademark license system.Part Ⅳ, this part is comparative analysis of different countries ‘trademark license lawunder perspective of competition policy. Typically, under these countries’ trademark licenselaw, the trademark holder is entitled to perform quality control obligation and any violation ofthis obligation would be treated as a naked license, which would definitely leads to losingtrademark rights. China has a similar rule, but it is a mistake because it confuses the limitbetween trademark law and product quality law. The reasonable practice is to abandonsection1article43of trademark law. Meanwhile, in a trademark infringement lawsuit, the factthat the trademark holder failed to perform his quality control obligation in his previoustrademark license should be a defense with which the defendant can get immunity. Secondly,under that circumstances party in interest should be entitled to make a request of trademarkrights revocation to China’s trademark office.Part Ⅴ, this part is the conclusion part. The licensing use of trademark system rooted inthe market economy and originated from competition law. The institutional design should notonly maintain the credit system of the trademark but also make the most optimal use oftrademark information resource.