China Trademark Challenges: Protect Your Brand In China
China has been notorious for intellectual property protection despite being the global production hub for hundreds of international brands and companies. International companies leveraging Chinese manufacturing capabilities and economies of scale have never been satisfied with the China trademark enforcement.
One reason for this dissatisfaction is the brief history of Chinese trademark law and its practice.
China had no trademark law before 1983. Regardless of the short-lived China trademark enforcement history and enforcement issues, how Apple, GE, and AT&T are sustainably getting the manufacturing done in China?
The big international players have secured their position just because of having China Trademark registration and enforcement.
You might have already started a contract with Chinese manufacturers to produce your brand’s product. Or otherwise, you might still be at the stage of sourcing and finding good suppliers.
Discover why China trademark registration is important and how to ensure China trademark enforcement to protect your brand.
Why Is China Trademark Registration Important?
Some statistics from HG experts showed that foreign businesses initiated at least 15% of trademark infringement applications in China. It further supports the fact that China is targeted as the hot spot for intellectual property theft.
However, the government and China Trademark office has been making constructive efforts to eradicate infringements and IP theft. It will bolster the trust of international firms in the Chinese manufacturing industry.
According to some detailed statistics issued by the Chinese Trade Mark Office, 150,000 applications for trademarks or trademarks have been rejected since 2018. It has been done as a part of the country’s and government’s faith in protecting intellectual property.
The biggest issue most non-Chinese brands face is any online retailer or the Chinese manufacturer registering the trademark as their own. Since the China Trademark Office and the regulations follow the first come first serve principle, it often puts original trademark holders at a disadvantage.
Due to the thriving OEM (Original equipment manufacturer) industry in China, more international brands are looking toward Chinese manufacturers for production. The international brands provide the local OEM with trademark authorization to manufacture products.
The products are manufactured, inspected by the agents, and shipped to the destination country. However, the international brand may or may not have a trademark for the product in China. As a result, some exploitative OEM registers the trademark in China before the original brand.
Later on, even if the international brand chooses to register in China, they would be rejected by the China Trademark Office. Therefore, it is a best practice to get your trademark in China as well.
Understanding The China Trademark System & Its Challenges
We’ve already discussed why the First-to-file system of China trademark issuance is a problem for the international entrepreneurs relying on Chinese manufacturers. Here are some important aspects about the China Trademark Office to further emphasize the importance of registering your trademark in China from an international perspective.
International And National Trademark Registration
The China Trademark Office (CTMO) allows the entrepreneurs to register their brand trademark in China in two ways:
#1 The national registration system
#2 The international registration system
For entrepreneurs of non-Chinese origin, the international registration is a feasible option. There is a requirement for filing the trademark application in the Chinese language. Therefore, international entrepreneurs can find a local Chinese counsel and file their trademark applications in their native language. The application is filed in the name of the entrepreneur. The counsel just acts as an agent to the entrepreneur.
Trademark In Chinese Characters
There is another important aspect of registering your brand trademark in China. China has the largest population globally, and most Chinese do not speak English and prefer Chinese or Madrid. Therefore, the China trademark law has specified registration of trademark in the Chinese language(trademark should be in Chinese characters).
The international or western entrepreneurs can adopt translation or transliteration for converting their original international trademark into Chinese and get it registered. This requirement is set with a perspective of the Chinese market. When the brand gets a trademark in its native language, consumers will easily remember and recognize it. Starbucks has transliterated its trademark in china as “xing ba ke”(星巴克).
Multiple Classes System
China trademark office follows the International NICE Classification as defined in Nice Agreement(1957). There are a total of 45 trademark classes with 11 services classes and 34 goods classes. Besides these broader categories, the trademark law of China has outline subcategories known as sub-classes. it is a unique classification system to further clarify for the entrepreneurs when choosing which class to apply for a trademark.
Non-Use Based Cancellation
In China, the law for trademark specifies that the China trademark office can cancel the trademark if it has not been used in 3 years after registration. The cancellation proceedings can be initiated even if the trademark has not been used continuously for three years without any specific reason.
Filing Appeal Against China Trademark Infringement
During the China Trademark Office Search, the entrepreneur might find out that his trademark or similar trademark has already been registered. Even the trademark infringement might be highlighted after applying for registration.
The process of appealing to the China National Intellectual Property Administration can be initiated within three months of trademark application publication. After the registration has been granted, any party can appeal to cancel a trademark to a business or manufacturer. However, necessary proofs of trademark infringement, misleading the consumers, or getting a trademark in bad faith must be furnished.
Chanel, the international brand, started an appeal against a jewelry store for selling jewelry with double-C shape. However, the Supreme court gave a ruling in favor of jewelry store after finding that jewelry store owner was not misleading consumers that they’re purchasing Chanel product. Therefore, infringement was not proved.
Challenges Of China Trademark Enforcement In China
Here are some challenges that entrepreneurs will face when trying to get a trademark in China.
As discussed earlier, the first-to-file system gives the upper-hand edge to the manufacturer or entrepreneur who files the application first. The provision of a trademark is based on the date of application and not the date of registration.
Therefore, no matter how big an international brand is, it might have to face difficulties in China if not applied for registration before time.
Use Of SubClasses
Uses of sub-classes can become a challenge for the international entrepreneurs trying to get their trademark in China. International entrepreneurs often get confused with the system of sub-classes within classes. Sometimes, similar goods might be classified in different classes, and dissimilar goods might be placed in the same class.
For instance, ‘smart watch’ is placed in class 9 and ‘movements for clocks and watches in class 14 despite being similar products. An example of dissimilar goods in the same class is ‘hosiery and ‘shoes placed in class 25.
Therefore, the international entrepreneurs seeking to obtain China trademark must perform China Trademark Office Search before starting the application.
Manufacturing Or Not Selling In China: Trademark Registration Needed?
Most western entrepreneurs often ask,
‘How to protect my brand?’
When I answered that you should get registered in China, the next question is,
‘If I’m not selling in China, do I still need to register my trademark?
Therefore, it is worth answering this burning question of many entrepreneurs.
Either you’re selling in China or not, it is preferred to have your trademark in China. However, it is not mandated to have the trademark if you’re just manufacturing your products in China. However, a recent ruling of the Chinese Supreme court in a trademark infringement case suggests having a trademark is preferable.
A local manufacturer, Chongqing Heng Sheng Group Limited, contracted with Meihua Company Limited, based in Burma, to manufacture 220 sets of motorcycle parts under the trademark ‘HONDA KIT.’
The Honda Motor Co. Ltd(Honda) has had its three trademarks in class 12 since the 1980s. the company filed civil litigation against the OEM manufacturer selling the products under trademark ‘HONDAKIT’ with the size of characters in ‘HONDA’ larger than ‘KIT.’
After a continued struggle and fighting, Honda won the litigation, and SPC issued a ruling that Meihua was using trademark in bad faith for the following reasons:
- Wing devise on the product
- H was the initial letter
- Size of characters in ‘HONDA’ bigger than ‘KIT.’
This ruling further suggested that despite the products not being sold in China, it was misleading for the consumers of China. It is because Chinese consumers have access to international products in the era of eCommerce and the internet.
Tips on‘How To Protect My Brand?’ & ‘How To Register My Trademark?’
Here are some practical tips for international entrepreneurs to start their brand and leverage the Chinese manufacturing industry without fear of intellectual property theft.
Leverage China Trademark Search
It is important to start with the China trademark search to have a quick and convenient trademark registration process. You can use the free china trademark search tool of the Chinese trademark office. However, a trustable and reliable report for trademark search china leads to successful registration.
GlobalTQM is a China Trademark Expert, and you can leverage their expertise to protect yourself from trademark rejection. The trademark search and registration package will cover the Trademark search china, preparing a reliable report with similar trademarks, and help you through the registration process.
GlobalTQM will be your counsel in China to file the registration, modify the trademark if similar to existing trademarks, translate in Chinese, etc. Our experts will also guide you about sub-classes, choosing single-class or multiple-class trademark, and matters related to non-use cancellation or opposition appeals. Once registered in China, your trademark cannot be infringed or malignly used by copycats or immoral manufacturers in China.
Always Apply Well Within The Time
Always file the trademark applications well within the time. Keeping the first-to-file system in mind, protecting your trademark, patents, and other intellectual property against copycats is better. Although the China trademark office search report will minimize the chances of any trademark dispute in the future. However, keep a record of your documents for future disputes. You must have proof of trademark validity in the destination country to avoid any future customs holds or disputes.
Choose Trustable Local Counsel To Cover You
Being a non-Chinese entrepreneur, you might have difficulty filing your trademark registration, sourcing, product inspection, sample checking, etc. Therefore, the global entrepreneurs must choose a local counsel in China to handle all the hassle for you.
GlobalTQM is an expert in covering the global entrepreneurs who want to leverage China’s economic manufacturing costs and start their brand. We will be your counsel and agent from the process of registration to the shipment of goods to the destination country.
Once you’ve got the China trademark, you’ll start to find reliable manufacturers or suppliers for the manufacturing or import of goods to your destination country.
For international entrepreneurs, dealing with matters related to sample checking, order management, sourcing, etc is time-taking as well as costly. GlobalTQM believes in acting on your behalf and safeguard the interests of international entrepreneurs.
You can partner with us and we’ll cover everything for you. With our 30 Days Sourcing Service, a dedicated expert manager will act on your behalf and will virtually take you to different manufacturers and suppliers. You can ask until you’re not satisfied.
You can also leverage our Sample Concierge Service to save your time and money on the samples that often arrive late and are not in good condition. We can receive the samples in 24 hours and share pictures, videos, and documentary proofs. In this way, you can inspect more samples in less time and speed up the process of launching your product in the international market.
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