China: Reflections On The Status Of Protection Of Trademarks In China

Why We Cannot Always Blame It On China
Last Updated: 19 March 2014
Article by Paolo Beconcini

Foreign brand owners perceive the Chinese trademark system as unjust, and the trademark law as inadequate to protect foreign brands – all to the advantage of younger and aggressive Chinese companies and individuals. There are indeed reasons for such a negative perception of the trademark and, more generally, the legal and enforcement systems in China. For years, inadequate legislation has allowed unfair practices such as trademark grabbing. The strict "first to file" principle in intellectual property prosecution in China, the lack of specific provisions on bad faith and preventive registrations, the lack of any legal relevance of prior use of a trademark, together with an often inconsistent jurisprudence, have offered to throngs of Chinese competitors, individuals and criminal organizations a free ride on foreign trademark rights that were left unregistered in China. The problem is that, until now, there have not been effective remedies to prevent or even solve the problem of trademark grabbing in China.

Legal Changes in the immediate future

This situation seems about to change. The new Trademark Law that will enter into force in May 2014 and the most recent jurisprudence have introduced a series of provisions and interpretations of the law which at first look seem finally to provide remedies against the plague of trademark grabbing. Most remarkable deterrent against trademark grabbers will be the resort against them to cancellations for bad faith registrations. In particular, the judgment is setting a standard for the practical definition of bad faith in article 7 of the new Trademark Law: not using a registered trademark and trying to sell it away, is evidence that the trademark registration (the act of grabbing) had been done in bad faith and with illicit intent. This principle, taken in its broadest sense seems indeed to constitute the best deterring tool in case of trademark grabbing. Grabbers or squatters, are not normally involved in the stolen brand's business, therefore will unlikely use that brand for the goods or services on the designated classes. Making money is their major goal and selling the stolen pray is the most direct way for the grabbers to earn a profit. This judgment is indeed a very positive development.

Can't always blame it on China

Therefore, not all the alleged shortcomings of trademark protection in China are attributable to a malicious political will, as many foreign companies seem to believe. Many other factors have contributed to the perception of the trademark system as faulty.

Some of these factors are not related to legal inadequacies, but rather to profound conceptual differences as to the protection of IP rights in the Chinese legal system and therefore on lack of proper knowledge of the Chinese legal system. For example, China does not recognize protection of trade dress. Therefore, signs, patterns and three-dimensional designs or marks must be registered either as trademarks (if distinctive and functioning to identify a product's origins), design (if their esthetic value is the object of protection) or both. By virtue of the "first to file" rule in both patent and trademark laws in China, failure to secure both such rights will result in the complete lack of IP protection. Even securing a trademark but not a design may, in some cases, result in an inefficient protection scope or even in legally improper use of the right and its surprising loss, as we have seen in the recent cancellation of the Haymarket trademark of Burberry due to non-use as a trademark.

Another factor to be considered is the speedy evolution of commercial practices due to use of the Internet, which has often put the whole legislative and judicial system under the heavy pressure of adapting quickly to these continuous and rapid changes. In this respect, it must be acknowledged that since 2001, the year of China's accession to the WTO, the field of IP in China has seen one of the largest proliferations of new legislation and has rapidly adapted its laws and legal practices to such changes. China has taken its WTO/TRIP obligations seriously and has started enacting laws and regulations which comply with the required international standards of legal protection. At the same time courts' IP chambers have set up their own websites where their jurisprudence is publicly available, judges have joined in educational activities and information exchanges with the public, and exchanged experience with other judges from foreign jurisdictions. This allows the Supreme People's Court to collect knowledge and experience, and issue interpretations and opinions each year addressing disputed legal issues, thus allowing courts to interpret the trademark law in an evolving way. The result is that amendments to the law have somewhat been, in most cases, anticipated by the judicial practice. Though some gray areas remain—inasmuch as real life business practices and technology normally outpace the law—the Chinese legal system now has the instruments and the cultural means to adapt the written law to the evolving forms of infringement and enforcement.

Conclusion of our reflection

In summary, blaming the Chinese legal system for failing to protect their trademarks in China is only part of the story, and often becomes an excuse for managers to divert attention from their own responsibilities. A review of many trademark cases that have gained notoriety abroad shows how unprepared the foreign company actually was, and how ill-considered its actions in China. If there is indeed reason to put some blame on China's real political will to protect foreign companies' IP rights, there is as much reason to criticize foreign companies for their poor performance.

The best way to cure all these ills is to develop and share knowledge among foreign companies and their management. Knowledge and education are a key factor in improving the performance of foreign companies IP exploitation strategies in China. This does not mean however, that foreigners must learn more about Chinese legal and business thinking, but also that their Chinese staffs, especially in MNCs should well learn the thinking of their foreign colleagues to better adapt and implement them in a successful business strategy in China.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Paolo Beconcini
Similar Articles
Relevancy Powered by MondaqAI
CCPIT Patent & Trademark Law Office
HFG Law & Intellectual Property
CCPIT Patent & Trademark Law Office
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
CCPIT Patent & Trademark Law Office
HFG Law & Intellectual Property
CCPIT Patent & Trademark Law Office
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions