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Beyond safe harbour: secondary trademark liability of online auction sites in China

Dong Zhu

Keywords: safe harbour; trademark; secondary liability; online auction sites; China

These days, most courts in China tend to immunize online auction sites from secondary trademark liability by putting them directly into a mode known as ‘safe harbour’ (a mode similar to that used in Tiffany v eBay in the USA). However, safe harbour is criticized for diminishing the incentive for the online auction sites and trademark holders to co-operate in dealing with online counterfeit goods. As an exception, in Yinian v Taobao, the courts moved beyond the safe harbour and sought to strengthen the liability of online auction sites by focusing on the operator's state of mind and the necessity of the anti-counterfeit measures. In the sense that the courts were more speculative on the application of safe harbour to the online auction sites, Yinian v Taobao resembles the EU case of L'Oreal v eBay. The more demanding line of reasoning in this case seems to be in accordance with the ‘Internet+’ Action Plan, which was launched by the Chinese government in 2015 to encourage a healthy e-commerce environment. However, for practical reasons, until now the line of reasoning in Yinian v Taobao has not been well accepted in China. Moreover, because this case could not be reconciled with contributory infringement theory, it might cause debates about the foundation of secondary trademark liability of online auction sites.

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