If you’re looking to expand your brands online and/or reach into the lucrative market in China then you need to know that trade mark protection in China is very different to here in Australia. Using your trade mark in Australia does not automatically mean you can use it in China.
Here are five top tips to trade mark success in China.
1. First to file - so be quick!
In Australia, the owner of a trade mark will be the first user of the mark for the relevant goods or services. If another trader tries to register that mark, action can usually be taken to prevent this, or to cancel or revoke the resulting registration.This is called a ‘first to use’ system.
China, however, has a ‘first to file system’. This means whoever first applies for a trade mark will generally then own the trade mark, regardless of who first used or developed it.
For example, there are many trade marks which appear on the Register of Trade Marks in China for “Louis Vuitton”. Some of them are owned by Louis Vuitton Malletier (the owner we, in Australia, would expect to see). However, there are a number which are owned by other entities. These other entities have been first to file for the particular logo trade mark.
This system leaves the door open to trade mark squatters. These opportunists register trade marks which they think will be valuable to another entity with a view to selling it to that other entity in the future. These bad faith filings are commonplace in China.
2. Which goods and services classifications should you use?
It is important that you register your trade mark with respect to any goods or services you want to exclude others from using your trade mark.
In China classes of goods or services are broken down into numerous subclasses, which can make this a complex process.
Registration in one subclass will not always prevent someone else registering in a different subclass. For example, a registration in subclass 2507 (Shoes) may not prevent someone else registering an identical trade mark for subclass 2512 (Belts).
3. Maintaining trade mark registrations
If a trade mark in China is not used for a period of three years since registration, a third party can apply to have it removed for non-use. The trade mark owner must then provide evidence of use of the trade mark in China. This is often where the trade mark squatters come unstuck. It is extremely unlikely that a squatter has any evidence of use and therefore their registration will be vulnerable to a non-use removal action.
Once your trade mark achieves successful registration it is wise to store evidence of the use of your trade mark in China. Alternatively, if you have not used your trade mark in China, you can consider re-filing your trade mark application so that requisite “use” date is pushed back.
4. Chinese Language Brands
It is important to consult with an expert who can assist you in developing an appealing Chinese language brand. These are sometimes a transliteration and sometimes a simple translation or a combination of the two.
Mistakes can be made here so it’s important to get this right. My earlier article highlights some key considerations when creating a brand name for the Chinese market, and some mistakes made in the past which can provide lots of amusement for some but perhaps not for the brand owners.
In any event, you need to be sure that you protect your branding by registering your trade marks. Do this before you disclose your Chinese language brand to others. If not, you risk distributors or other business associates commencing using your branding and it is possible that another trader may jump in quickly to register your branding before you.
5. ® symbol in China
It is illegal for a trade mark to appear with the ® symbol in China unless that trade mark has been registered in China. A trade mark registration in Australia or another jurisdiction does not permit use of the ® symbol in China.
Misuse of the ® symbol in China may attract fines or other penalties. Australian traders can reduce this risk by removing or covering up the ® symbol which may appear with their Australian registered trade mark.
What to do now?
Secure protection of your valuable branding in this profitable market. If only a tiny percentage of the population in China chooses to pay for your goods or services, then you are on a winner. Your brand could be the next big thing in China. Don’t lose it to another trader.
Use an expert to provide you with advice and guidance in this tricky area. A trade mark registration is valid for ten years in China and can be renewed indefinitely. So, get in first, get it right, use your registered trade mark in China and remember to renew.