Most Read Contributor in Hong Kong, September 2016
Originally published 9 July 2010
Keywords: Hong Kong, shadow companies, brand
names, brand owners, Companies Bill 2010, amendment, Companies
The Hong Kong legislature passed the Companies (Amendment) Bill
2010 on 7 July 2010 to introduce measures which enhance enforcement
efforts against shadow companies which hijack other people's
In recent years, there has been an increasing number of shadow
companies set up in Hong Kong which, though totally unrelated to
the brand owners, adopt household brand names as part of their
company names. There have been strong calls for changes to the
company names system from overseas and local mark owners. The Hong
Kong government proposed changes to the Companies Ordinance in 2008
to tackle the problem. Mayer Brown JSM has closely followed the
development and actively participated in the consultation exercise
(see Legal Updates:
Consultation Conclusions on Proposed Reform of Company Names
Law - 9 January 2009;
Latest Legislative Developments on "Shadow Companies"
- 8 March 2010).
The Companies (Amendment) Bill 2010, passed by the legislature
on 7 July 2010, empowers the Companies Registrar to act upon orders
by Hong Kong courts to direct a shadow company to amend its company
name to one not including the prohibited brand name(s). If the
shadow company fails to comply, the Companies Registrar can go on
to replace the company name with its registration number on its own
initiative. This remedies the situation where the trade mark owner
cannot compel the change of name because the Companies Registrar is
not a party to the court proceedings.
The amended law will come into effect on a date to be published
in the gazette.
Over the years, we have represented trade mark owners in over
350 company name cases against shadow companies, very often with a
cross-border element as the responsible individuals of those shadow
companies are mostly situated in Mainland China. One of our
successful stories was recapped in our Legal Update
"PRC: Two recent judgments against trade mark infringement and
unfair competition - 29 February 2008". We envisage that
the latest legislative movements will strengthen the right
owners' position and enable us to devise an even more thorough
action plan for our clients.
Copyright 2010. JSM, Mayer Brown International LLP
and/or Mayer Brown LLP. All rights reserved. Mayer Brown is a
global legal services organization comprising legal practices that
are separate entities ("Mayer Brown Practices"). The
Mayer Brown Practices are: JSM, a Hong Kong partnership, and its
associated entities in Asia; Mayer Brown International LLP, a
limited liability partnership incorporated in England and Wales;
and Mayer Brown LLP, a limited liability partnership established in
the United States. The Mayer Brown Practices are known as Mayer
Brown JSM in Asia.
This article provides information and comments on legal
issues and developments of interest. The foregoing is not a
comprehensive treatment of the subject matter covered and is not
intended to provide legal advice. Readers should seek specific
legal advice before taking any action with respect to the matters
discussed herein. Please also read the JSM legal publications Disclaimer.
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