Is it legal for agricultural product associations to charge brand usage fees?

——Rural Revitalization Compliance

? Liu Yanmin Jiangxi Zhiqiao Law Firm

Case

Yangmei planting is a traditional industry in City A , in order to promote the development of characteristic agricultural industries, the government's agricultural and rural departments promoted the establishment of the Bayberry Association of City A, and approved the registration of the "City A Bayberry and Picture" certification trademark. Cooperative B has been engaged in bayberry cultivation in City A for many years and has stable local customers. It has applied to register its own trademark and obtained a green food certificate from the China Green Food Certification Center.

In order to expand the overseas market, Cooperative B applied to the Bayberry Association of City A to use the "City A Bayberry and Picture" certification trademark. After receiving the application, the Bayberry Association of City A assigned experts to cooperate with B for an on-site inspection. After checking the product quality test reports of the past 2 years, they signed the "City A Bayberry and Picture" Geographical Indication Certification Trademark Use License Contract, stipulating that B The cooperative has used the geographical indication certification trademark "Yangmei and Pictures of City A" for five years, and regularly pays annual management fees to the Yangmei Association of City A at the end of each year.

After using the geographical indication certification mark "Yangmei and Pictures of City A" for one year, Cooperative B failed to successfully promote the bayberry to markets outside City A. For this reason, Cooperative B refused to pay the annual management fee.

Question: Does the Bayberry Association charge management fees to merchants who use geographical indication certification trademarks? Does it have a legal basis?

Analysis

The Bayberry Association can collect membership fees.

First of all, from a legal perspective, the state allows industry associations to set reasonable membership fees. According to the "Regulations on the Registration and Management of Social Groups" issued by the State Council, the "Notice of the General Office of the State Council on Further Regulating the Fees of Industry Associations and Chambers of Commerce" and other regulations, Guobanfa [2020] No. 21 allows social groups to legally obtain group funds. The collection of membership fees must be approved by voting through legal procedures. If the membership fee standards are not formulated or modified in accordance with regulations, they shall not be collected.

Secondly, from a practical perspective, the existence and operation of industry associations require financial support. Geographical indication trademark registrants, such as the Yangmei Association of a certain city, are non-profit organizations. The organization's activities require a lot of money, such as trademark registration, trademark monitoring, trademark expiration and renewal, trademark rights protection, product quality control, member training, etc. Therefore, it is in line with practical needs for industry associations to charge reasonable membership fees or management fees to members and eligible merchants.

Compliance Suggestions

1. The collection of membership fees or management fees should meet legal conditions

Industry associations and chambers of commerce should be reasonable and in accordance with the requirements of laws, regulations and their own charters. Independently determine the standards and grades of membership fees, and clarify the basic services enjoyed by members. It is strictly prohibited to only charge but not provide services or to charge multiple parties. Membership dues standards must be approved by a secret ballot at the general meeting of members (representatives). If membership dues standards are not formulated or modified in accordance with prescribed procedures, no membership dues shall be collected. Administrative agencies may not force adjustments to the membership fee standards determined by decoupled and directly registered industry associations and chambers of commerce through administrative means. Industry associations and chambers of commerce are not allowed to use branches (representatives) to collect membership fees from multiple sources, and are not allowed to adopt methods such as "fee-based returns" to attract members and collect membership fees.

2. Charges should be reasonable

Business service charging projects with certain monopolistic and mandatory nature carried out by industry associations and chambers of commerce should be implemented by relaxing access conditions and introducing diversified service entities. To break the monopoly and achieve marketization of service prices through other methods; if the monopoly cannot be broken temporarily, the charging standards should be determined in accordance with the principles of being legal and reasonable, covering costs, and making a slight surplus, and shall be approved by a secret ballot at the member (representative) conference or the board of directors. . For other operating service charging items whose prices can be adjusted by the market, industry associations and chambers of commerce are guided to determine charging standards based on factors such as service costs, market demand, and local economic development levels on the premise of being legal and reasonable, and make them public to the public.

3. Prohibition of abuse of rights

First, as a collective trademark, the registration conditions for geographical indication trademarks are obviously regional, and the law also clarifies the legal users of special signs for geographical indications. regulations. Therefore, trade associations do not have the authority to license and collect membership or management fees from merchants outside a specific area. Second, merchants who are not members of an industry association can also legitimately use the geographical indication, and the group, association or other organization has no right to prohibit it.

Third, the fair use of a geographical indication refers to the fair use of the place name in the geographical indication. As long as the merchant's products meet the conditions for using the geographical indication, the merchant can legitimately use the place name in the geographical indication without joining an industry association.

Legal links

"Social Group Registration and Management Regulations"

Article 26 The assets of social groups must be from legal sources and no unit or individual may misappropriate them , privately distribute or misappropriate the assets of social groups. The funds of social groups, as well as the legal income obtained from carrying out activities stipulated in the articles of association in accordance with relevant national regulations, must be used for the business activities stipulated in the articles of association and shall not be distributed among members. When social groups accept donations and funding, they must comply with the purpose and business scope stipulated in the charter, and must use it according to the time limit, method and legal purpose agreed with the donor or sponsor. Social groups should report to the competent business unit the relevant information on the acceptance and use of donations and funding, and should announce the relevant information to the public in an appropriate manner.

Notice of the General Office of the State Council on Further Standardizing the Charges of Industry Associations and Chambers of Commerce:

(6) Continue to standardize the standards and procedures for collecting membership fees.

(7) Reasonably set operating service charging standards.

"Measures for the Administration of the Use of Special Signs of Geographical Indications (Trial)"

Article 5 Legal users of special signs of geographical indications include the following entities:

(1) ) Producers who have been announced and approved to use the special mark for geographical indication products;

(2) Collective members of registrants whose geographical indication has been announced as a collective trademark;

(3) Licensees of geographical indications registered as certification trademarks that have been announced and filed;

(4) Other users registered and filed with the State Intellectual Property Office.

"Registration and Management Measures for Collective Trademarks and Certification Trademarks"

Article 4 When applying for collective trademark registration, documents proving the qualifications of the subject shall be attached and the names of the members of the collective organization shall be specified in detail and address; when applying for registration of a geographical indication as a collective trademark, a document proving the subject's qualifications should be attached and a detailed description of the professional and technical personnel, professional testing equipment, etc. possessed by it or the institution entrusted by it should be provided to show that it has the ability to supervise use The specific quality of the geographical indication goods.

Groups, associations or other organizations that apply to register a geographical indication as a collective trademark shall be composed of members from the region indicated by the geographical indication.

Article 7 Where a geographical indication is registered as a collective trademark or certification mark, the following content shall be stated in the application:

(1) The product marked by the geographical indication Specific quality, reputation or other characteristics;

(2) The relationship between the specific quality, reputation or other characteristics of the commodity and the natural factors and human factors of the area marked by the geographical indication;

Article 18 Anyone who meets the conditions stipulated in the management rules for the use of certification trademarks may use the certification mark after completing the procedures stipulated in the management rules for the use of certification marks. The registrant shall not refuse to go through the procedures.

The fair use of the geographical indication in paragraph 2 of Article 6 of the Implementing Regulations refers to the fair use of the place name in the geographical indication.

"Regulations on the Implementation of the Trademark Law of the People's Republic of China"

Article 4 Geographical indications specified in Article 16 of the Trademark Law may be registered in accordance with the provisions of the Trademark Law and these Regulations , apply for registration as a certification mark or collective mark.

If a geographical indication is registered as a certification mark, a natural person, legal person or other organization whose goods meet the conditions for the use of the geographical indication may request to use the certification mark, and the organization that controls the certification mark shall allow it. If a geographical indication is registered as a collective trademark, a natural person, legal person or other organization whose goods meet the conditions for the use of the geographical indication may request to join the group, association or other organization that has registered the geographical indication as a collective trademark. The group, association or other organization The organization shall be admitted as a member in accordance with its articles of association; groups, associations or other organizations that are not required to register the geographical indication as a collective trademark may also use the geographical indication legitimately, and the group, association or other organization has no right to prohibit it