THE REGISTRATION OF ‘SHADOW’ COMPANIES JURISDICTION REPORT: HONG KONG
Kenny Leung Wenping & Co
In Hong Kong, company name and trademark registrations are governed by two separate pieces of legislation: the Companies Ordinance, Cap 32 and the Trade Marks Ordinance, Cap 599. Accordingly, there are two separate and independent registration systems for company names and trademarks in Hong Kong.
It has been a trend for many years in Hong Kong that companies have adopted names which are very similar to some famous trademarks or names. Te following are examples of these ‘shadow’ companies in the Companies Register:
BASF Chemical (China) Limited (Company No.1437601)
France Dunhill Int’l Limited (Company No.1229181)
France L’Oreal Cosmetics Int’l Group (HK) Limited (Company No.1292493)
France Siemens Lighting Share Limited (Company No.1323082)
Germany Baoma (English transliteration of the mark ‘BMW’ in Chinese) Finery Limited (Company No.1300900)
While the exact reasons for these companies having adopted their respective company names are not known, such names are likely to give the impression that they are connected with the owners of the respective marks at issue. If no such connection exists, these trademark owners will be damaged and the public is likely to be misled as a result.
Trademark owners may take legal proceedings against these shadow companies for trademark infringement in Hong Kong. Costs for these proceedings are inevitable and it is unlikely that costs can be recovered from the shadow companies even if the lawsuits are successful.
As an administrative approach, one may address the problem of shadow companies by lodging an objection with the Registrar of Companies, who is empowered in some circumstances to issue direction to a company to change its name under the Companies Ordinance, Cap 32. By virtue of Section 22(2) of the ordinance, the registrar may, within 12 months of the registration of the company in question, direct it to change its name within a specified period. In other words, a claimant is required to lodge an objection within the statutory period of 12 months from the date of registration of the company name in question.
It is important to note that one of the criteria for the registrar to exercise his power under Section 22(2) of Cap 32 is that the company name in question is “the same as” or “too like” a name appearing in the registrar’s index of company names. Tat means the claimant must be a company on the Companies
60 World Intellectual Property Review July/August 2012
“A CLAIMANT IS REQUIRED TO LODGE AN OBJECTION WITHIN THE STATUTORY PERIOD OF 12 MONTHS FROM THE DATE OF REGISTRATION OF THE COMPANY NAME IN QUESTION.”
Register of Hong Kong. In order to trigger the Section 22(2) provision it is not sufficient that he or she merely owns a registered trademark in Hong Kong.
According to the guidelines issued by the Companies Register of Hong Kong, when considering whether two company names are “too like” the registrar will take into account all factors which suggest similarity and may lead to confusion between the names of two companies. Tese include any of the following factors:
Te names are visually and/or phonetically identical or similar; or
Tere is only a slight variation in the spelling of the two names and the variation does not make a significant difference between the names; or
Te names contain a word or words which might be regarded as a distinctive element, unless that element is qualified in such a way as would minimise risk of confusion.
By virtue of Section 22AA of Cap 32, if a company fails to comply with the registrar’s direction to change its name within the prescribed period, the registrar may replace it with a new name consisting of its company numbers. Te following are examples of such companies:
3M Internation Limited changed to Company Registration Number 1486449 Limited.
Abbott Pharmacy Co Limited changed to Company Registration Number 1208165 Limited.
Adidas Int’l Bathroom Limited changed to Company Registration Number 1360058 Limited.
Crocs (China) Co Limited changed to Company Registration Number 1565105 Limited.
Dunhill (HK) China Co Limited changed to Company Registration Number 1552954 Limited.
Kenny Leung is an in-house counsel at Wenping & Co. He can be contacted at:
kenny@wenping.com.hk
www.worldipreview.com
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