Don’t Let Someone Else Own Your Trademark in China

By: Adam Brookman

China has a “first to file” trademark system. This means that in China, unlike the United States, your use of a trademark does not give you any trademark rights. Instead, the first person who files to register a trademark can obtain the right to use that mark in China to the exclusion of the legitimate user of the trademark! While it is possible to challenge an application or registration that was acquired in bad faith or claims rights in a well known mark, such challenges are expensive and the outcomes not certain. Consider the following two scenarios.

Scenario 1

You have goods manufactured in China by a first supplier. You find a better supplier and move all your business to that supplier. The first supplier, seeking to obtain leverage (or revenge), unbeknownst to you, files and obtains a trademark registration on your mark that you place on all your goods before they are exported. The first supplier then goes to court and obtains an injunction against your current supplier stopping the export of all your goods. Because you have no time to challenge the trademark registration, you are forced to negotiate with your ex-supplier to get your goods released or try to find a way to remove your mark from the goods.

Scenario 2

You open negotiations with a Chinese company to manufacture your product for export and sale into the domestic Chinese market. The negotiations fall through. Unbeknownst to you, the Chinese company files for and obtains a trademark registration on your mark. You finally complete a deal with another Chinese company and then discover that goods bearing your mark are being sold in China and exported out of the country. You are forced to either negotiate with the first company, forego your plans in China until you are able to challenge their registration on the grounds of bad faith or pick another name to use on your product.

The above two scenarios are not farfetched. They occur with startling regularity. However, these situations can be easily avoided by filing for trademark registrations in China before you even begin negotiating an arrangement in China. Such filings are not overly expensive and can be done by filing direct national applications or by exploiting international treaties that leverage pre-existing U.S. applications or registrations. Boyle Fredrickson has extensive experience in protecting trademarks in China and can assist you in pursuing Chinese registrations for your marks.

Read more about patent protection in China.