Patent & Trade Mark
Attorneys
Publications

Trade marks in China

Date: 13 January 2011
Author:
    RSS
Introduction
If you are doing business or selling a product in China under a particular trade mark (brand name or logo etc), it is important to consider what form or version of your trade mark is best to register in China.
 
Although Chinese trade mark registration procedures are similar to the Australian system, a major difference in China is that it has a "first-to-file" system.  This means the first person to file an application for trade mark registration will have priority over first person to use that trade mark.
 
This impacts on the timing and strategy for protecting trade marks in China, and can lead to ownership problems if you do not file an application for registration of your trade mark as soon as practicable.
 
In terms of the enforcement of trade mark rights, copyright and other IP rights, there are administrative and judicial options, both at provincial and national levels.
 
Recommendations

  • Register your trade mark in China sooner than later due to the "first to file" system.
  • Seek our advice in regard to strategy and costs for trade mark protection in China:
- what route to use to file (via Madrid International Registration system or direct with Chinese national application) and
- what form of the mark to register (word mark and Chinese character mark?).
  • Enforcement strategy – use local administrative IP Offices for immediate results or the courts for a long term solution?
What form of trade mark should be registered in China?
Registering the word mark or the stylised or logo version is preferable, as it is in any country.
 
However, the corresponding Chinese (Mandarin) character mark should also be registered if it is to be used on or in relation to your product or service.
 
Much depends on how the brand is to be marketed in China, and so it is important to show us the brand artwork to help determine which version of the trade mark to register.
 

A trade mark myth?

It has been said ‘if you do not register your trade mark in China, someone else will’. Is this fact or fiction?
 
It may have an element of truth.  This is partly due to China’s ‘first to file’ trade mark registration system, and partly due to the local business culture where your partner or licensee may ask you to register your trade mark and if you do not, may do so in their own name. 
 
Ownership of the trade mark (whether wholly or partly) by the Chinese entity is often of critical importance to your local partner.
 
Also if your trade mark is widely publicised around the world, a Chinese third party may seek to capitilise and apply to register the mark in China before you do.

An unlucky case:
Pfizer did not register the literal translation of VIAGRA, “” (‘WEI GE’ meaning ‘great brother’), which quickly became the popular nick- name for the product in China as a result of worldwide publicity about the drug. 

 
A local pharmaceutical company leapt in and applied for ‘WEI GE’ first.  Pfizer eventually opposed this application, but failed to stop the local company registering the mark despite appealing twice.
 
Pfizer had originally adopted ‘’ or WAN AI KE (meaning ‘ten thousand-love-possible’), but was too late to also claim ownership of what became the recognised name for the product.
Registration of your mark by a third party can even happen if you are only manufacturing in China for export elsewhere.  Although the risk of this is low and largely depends on your business and brand, it could hold up your goods at the border and cause a bureaucratic nightmare.
 
Trade mark registration system
As mentioned, China’s system is very similar to developed countries’ systems, i.e. a trade mark application is filed at the Chinese Trade Mark Office (CTMO), and it is then examined, accepted (if approved), advertised for opposition purposes, and registered.
 
For some time there were lengthy delays of up to three years to register trade marks, but this has now been reduced to 18 months or less due to a major efficiency drive at the CTMO.
 
China uses the International Classification of Goods and Services, i.e. Classes 1 to 45. China has strict requirements here - specific items must be selected from an official classification list, and fees are charged if for more than 10 items per class are selected.
 
Snapshot - the huge numbers of trade marks in China
  • In 2008 – 670,000 applications filed in China - 295,000 applications filed in USA
  • The CTMO currently administers 7.7 million trade mark applications and 4.9 million registrations
  • 1.4 million trade mark applications were processed in 2009 by the CTMO.
Trade mark administration
The government body called the SAIC (“State Administration of Industry & Commerce”) administers the CTMO and the “TRAB” (The Trade Marks Review and Adjudication Board where CTMO decisions are appealed).
 
There is also a government-run AIC (“Administration for Industry & Commerce”) office in each State, province, county and city. The AICs have both administrative and enforcement roles.
 
Enforcing trade mark rights
Three main options for enforcement of trade marks and copyright:
  • Administrative enforcement in cooperation with a local AIC.
  • Civil action - trade mark and copyright infringement action in Intermediate and District Courts – preliminary injunctions and awards of damages are available.
  • Criminal enforcement – fines and imprisonment, but this is really only for major counterfeiting and other serious infringements.
Enforcement strategy
  • The AIC have the power to conduct raids on counterfeiters & other infringers
  • An AIC will confiscate & destroy infringing products and tools for making the products, and issue fines
  • AIC fines are not always a deterrent for determined infringers – they are actually seen by infringers as ‘a cost of doing business’
  • If no permanent success with AIC action, the judicial system should be used.
To enforce your trade mark rights, it is critical to choose the right route, the right AIC, and if required, the right court.
 

Accordingly before commencing action against any infringer, your advisers should thoroughly investigate and determine the strategy best suited to your needs.
 

If you have any questions or require any assistance in relation to protection of your trade marks in China, please email David Franklin.
 
 
Subscribe via Email
Your email:
Submit