In an increasingly globalized market, trademark squatting remains a significant threat for foreign brands expanding into China. A recent opposition case involving the U.S. tanning skincare brand illustrates how in-depth investigation and targeted legal arguments can successfully counter an application rooted in bad faith — even when the brand in question has yet to enter the Chinese market.
Background
In early 2024, our client discovered that an individual applicant had filed a Chinese trademark application, covering a broad range of goods including perfumes, shampoos, and cosmetics. At the time of the application, the clients' brand had not launched in the Chinese market and had limited online exposure in China, making the case particularly challenging.
Complicating matters further, the applicant had only this single trademark application under her name — insufficient to prove the bad faith of trademark squatting under the current standards of the China National Intellectual Property Administration (CNIPA).
Legal Strategy: Targeting the Trademark Agency, Not the Applicant
Given the limited information available on the individual applicant's background, our team shifted focus to the trademark agency representing the applicant. Through systematic research, we identified the following key findings:
- Irregular Trademark Agency Practices: The trademark agency has been involved in trademark activities since 2019 and, by 2024, has filed over 400 applications on behalf of more than 200 applicants. Notably, all of these applicants are individuals, which is unusual given the typically low demand for trademarks from individual businesses.
- Copying and Preemptive Registration: Despite each applicant having only one or two applications, almost all trademarks filed under the name of these individual applicants appear to involve copying or preemptively registering foreign brands that have not yet entered the Chinese market.
- Overlapping addresses: The addresses provided by many individual business applicants show significant overlap or are located in close proximity, suggesting a coordinated effort in the filing process.
- Frequent Transfers of Trademarks: Many trademarks filed by the agency were later transferred to the original owners of the brands after preliminary examination or registration. Some transfers even occurred during the opposition proceedings.
By focusing on the agency's systemic squatting behavior — rather than the isolated conduct of the applicant — we were able to build a compelling argument that the agency is a professional trademark squatting organization. Their strategy involves creating a network of seemingly unrelated individual applicants to target foreign brands, with the ultimate goal of profiting through trademark assignments. By dispersing applications across numerous individual applicants, the agency seeks to circumvent the CNIPA's increasingly stringent scrutiny of bad faith registrations.
In light of the findings regarding the agency's bad faith intentions, the burden of proving the client's prior mark's significant fame is somewhat reduced. To support our case, we have collected the following evidence from outside China to demonstrate the prior use of our client's mark:
- Screenshots of the client's official U.S. website and TikTok page;
- Media coverage demonstrating international recognition of the brand, including cosmetic industry awards;
- Proof of the brand's use on skincare products before the filling date of the target mark.
Outcome
The CNIPA ruled in favor of our client, recognizing their trademark as a prior-used mark with certain high fame among relevant consumers. It determined that the opposed mark covered similar goods and could mislead consumers into believing the products were associated with or originated from the rightful owner. The trademark application was successfully rejected on grounds of likelihood of confusion and improper intent.
Key Takeaways
This case offers a valuable reference for global brands facing similar challenges in China: how to effectively protect multinational brands that have not yet entered the Chinese market — provided evidence of international use and reputation.
Investigating trademark agencies can reveal organized squatting behaviors, which can be used to support opposition arguments even in the absence of direct bad faith by the applicant.
Strategic use of evidence from global platforms (e.g., TikTok, brand websites, media coverage) is increasingly persuasive in showing brand recognition and consumer reach. Linking seemingly independent filings to coordinated trademark squatting may offer a novel and effective angle for opposition success in China.
This case underscores the importance of proactive trademark monitoring and swift action when potential squatting is identified. For foreign brands eyeing the Chinese market, thoughtful legal strategy can help secure fair protection — even against sophisticated registration networks operating behind seemingly benign applicants.
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