Bolstering your armoury against trade mark squatters in China

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It is a problem that, as trade mark attorneys, we come across all too often – trade mark owners find that someone has pre-empted their entry in to the Chinese market by registering their trade mark. As China operates a first to file trade mark system, this practice is perfectly legal under Chinese law. Whilst there are several different courses of action available to a trade mark owner to try and obtain ownership of their brand from these ‘trade mark squatters’, these can be costly and time consuming.

However, there are a number of steps that a trade mark owner can take to secure the broadest protection possible and to bolster their rights against the trade mark squatters in China.

Register your trade mark in China

It goes without saying that as soon as you start thinking about China as a possible market of interest you should apply to register your trade mark in China. If your first filed application for the trade mark in a different country is still within the six month priority period, then utilise this period to secure the same earlier filing date for your Chinese trade mark. As China operates a sub-class system, when registering your mark we also recommend that you include one item from each sub-class of your class (or classes) of interest so as to secure rights in the whole class. If you intend to extend your product range to other goods or services at some point in the future then we would recommend that you also take steps to secure a registration for those additional goods or services at the same time so as to block any pre-emptive applications that the trade mark squatters might file in those classes.

Register a Chinese translation of your trade mark

In addition to registering the English version of your mark, it is also advisable to register a Chinese translation of your mark. Contrary to popular belief, many Chinese consumers do not understand English and so will create a ‘Chinese version’ by which they will refer to your mark. This translation may not always necessarily have the right connotations that you would want associated with your mark. In addition, although you may have the English version of your mark registered, this would not block a third party from registering the Chinese translation of your mark and then stopping you from using it. We therefore recommend, if you do not already have a translation, that you seek the assistance of a translation company who can create some favourable Chinese translations for your mark. Once a translation has been agreed upon we recommend that you register the translation as a trade mark in China and then use the Chinese translation in conjunction with your English mark in the Chinese market place.

Certificate of Recordal of Copyright

If you have a distinctive device mark, logo, stylised word mark or label, it is also advisable to register the copyright in that work in China. China is one of the few countries where copyright can be recorded. You can secure a Certificate of Recordal of Copyright if you can show that your mark is a work of fine art, that you own the copyright in the logo and that the copyright work was accessible in China and therefore accessible to third parties. Copyright recordal in your work of art can be a particularly useful tool where a third party has adopted the identical or a highly similar mark to your own but where they are using and/or have registered the device mark or logo in relation to a different class of goods or services to your trade mark registration. Whilst the Chinese Courts will still make an assessment of similarity between your recorded copyright and the third party mark, the grant of a Certificate of Recordal of Copyright can prove a powerful tool in proving the existence of the copyright, the date that the copyright was created, and the owner of the copyright.

Design registration

If you also have a new design, shape, pattern or combination of colours associated with your product, you may also wish to consider a design registration in China. As China is one of the world’s leading manufacturing countries, it is perhaps not surprising that many counterfeit and copycat products can be found on the market. However, you can strengthen your rights and stop these infringing designs by seeking a design registration. Such protection is available to both two dimensional and three dimensional designs and lasts for ten years from the date of application. Like trade mark protection, design registrations are granted on a ‘first to file’ basis. Novelty is however the key issue for a design registration in China and the design cannot be ‘known to the public both domestically and abroad before the date of the application’. Therefore, the item cannot be on sale, advertised, or otherwise known to the public anywhere in the world before a design application in China is filed, or it will be invalid. However, there is an exception if the design has been filed in another territory within the six months prior to the application in China, this prior filing date becomes known as the ‘priority date’ and therefore advertisement and sales within this six-month period will not destroy novelty for the purposes of the design application in China.

Evidence & record of use

In addition to securing registered rights through trade mark, copyright and design protection, it is important to keep detailed records of your use in China. Many businesses will have used their trade marks and designs in China for a number of years but will have not kept detailed records and evidence of their use as proof of the same. Extended and significant use of your trade mark and design in China can however assist you in gaining the status of a ‘well-known’ trade mark which is another powerful tool against trade mark squatters. A well-known trade mark can only be afforded recognition by the Courts in China through either an administrative or judicial procedure. However, once a well-known status has been afforded to your trade mark, such rights will give you even broader protection than the protection given to registered trade marks. It will afford you priority over other third parties who have filed your trade mark before you, and also allow you to block third party applications in both identical and similar classes but also in some dissimilar classes of goods or services. If you have licence or manufacturing agreements in place in China, ensure that your licensees and manufacturers periodically send you evidence of the use of your trade marks in China to keep on your records as such evidence will all assist in building up the requisite amount of proof to secure the well-known status.

Recordal of rights within GAC

Finally, once you have taken steps to protect your Intellectual Property Rights in China, it is advisable to apply for recordal of your rights with the General Administration of Customs (GAC) in order that they can keep a watch for potentially infringing goods being exported from China and to notify you of the same. If the goods are found to be counterfeit then, in exchange for a payment of a bond, it is possible to ask the Customs Authorities to detain the goods. If the goods involved relate to trade mark infringement which the Customs Authorities can easily judge and recognise, then the Customs Authorities can dispose of the goods. If, however, the goods relate to patent or design infringement, then the Customs Authorities will usually request that you launch litigation proceedings before Court within a stipulated timeframe whilst you pursue the infringement. It is then possible to ask the Court to preserve the goods detained by Customs until the litigation case has been determined. Making a Customs application allows you to track potentially infringing goods being exported from China into other markets and enables you to take appropriate action where necessary.

China can often be seen as a difficult market to protect your intellectual property rights in. However if you act early and protect your rights broadly then you will be putting yourself in the strongest position to be able to promote and reap the rewards of your rights in China whilst also putting a stop to the trade mark squatters impinging on the brand that you have worked so hard to create.

Please do not hesitate to contact the author of this article or your usual trade mark attorney should you require any additional information, or email info@barkerbrettell.co.uk