June 25, 2016
You may be aware of registered trade marks. You may have even registered some in the UK or Europe. But have you registered any in China? If you make and sell footwear then there is a good chance that your manufacturing is done in China. You might even sell in the country. If you do, you really should protect your brand there.
In the UK, you develop unregistered rights in your brand even before you have registered it. China, on the other hand, has a ‘first-to-file’ rule for obtaining trade mark protection. This means that the first person to file a trade mark application will, by and large, get the rights. This has, unfortunately, been taken advantage of by opportunists who have made a business of spotting successful western brands and registering them in China before the true owners have thought to do so. When the time comes for that brand to expand into China, the trade mark owner cashes in by demanding massively inflated prices to buy the marks back. If this happens, there isn’t much that can be done, other than fighting a long and costly legal battle or stumping up the cash.
A well-known footwear designer was unlucky enough to suffer at the hands of the Chinese system recently, when a company registered her brand there. Luckily, Briffa were able to negotiate a good price to buy the mark back from the hijacker, but this was an expensive and time consuming way to obtain brand protection in China.
Trade mark law in China changed this year to prevent distributors, agents and others who have business contacts with a particular trade mark owner from registering that owner’s marks in bad faith. However, it still seems that there is a gap if you, as rightful trade mark owner, have no obvious business connection to the rogue applicant. It also appears that in order to argue “bad faith”, you will need to show that the mark has a reputation within China. That is all very well for established brands, but will be problematic for those taking their first steps in the country.
It is advisable to file trade mark applications in China as soon as you can and certainly before you launch in the country or have any products manufactured there. In addition to registering your mark in the Latin alphabet, you should also consider applying for the equivalent translation in Chinese characters because the majority of China’s 1.35 billion population does not read or speak English. Many famous brands have alter egos in the Chinese language. Creating one can be something of an art form in itself. Do you translate the phonetic sounds, the name, the meaning, or create something new altogether? Coca Cola managed quite a nice translation visually, aurally and conceptually by using ‘Kekou Kele’ which roughly means ‘Delicious Happiness’. Slightly more obscure is Porsche’s ‘bǎo shí jié’, meaning something along the lines of ‘guaranteed quick victory’.
You should also give some thought to the goods and services that you register your trade mark against in China. Using the same specification as your UK trade mark may not protect you sufficiently because of China’s sub-classification system. A product or service that falls into one sub-class will not be deemed similar to one which is listed in a different sub-class, even if in the UK, the goods would be in the same class. Conversely, the Chinese authorities will automatically deem items within the same sub-class similar, rather than considering whether this is actually so in practice.
China is an increasingly important territory in the retail world and should be on the radar of all brands who manufacture or sell there, as well as any that plan to do so in the future. Briffa can help with brand protection advice in China and works with clients to propose a cost effective strategy. To find out more, please contact Josh Little on 0207 288 6003 or firstname.lastname@example.org.
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