China Tackles Trademark Squatting: What Does This Mean For You?

Updates to China’s trademark law enter into force on 1 January 2027, offering international registrants the opportunity to take stricter action against trademark squatting, bad-faith applications and misleading trademark use. For companies with trademarks in China, this is a crucial moment to critically review their trademark portfolios, as Annerie Beentje explains.  

As of 1 January 2027, international companies with trademarks in China will have the opportunity to act more effectively against trademark squatting, bad-faith applications and misleading trademark use.

What is trademark squatting and why is it such a major issue in China?

Like most countries, China operates a ‘first-to-file' system. This means that the party that successfully files for a trademark first is deemed to hold the rights to that mark. 

In practice, this has led to problems where trademarks have been registered specifically to exert pressure on brand owners. The new law empowers China’s National Intellectual Property Administration (CNIPA) to take action against this practice.

For international companies active in China – or those planning to expand there – timely and strategic trademark registration remains essential to benefit from the new provisions. These include: 

• Greater emphasis on genuine use  

One of the key changes is the increased emphasis on genuine use. CNIPA will have the power to cancel trademarks ex officio if they have not been used for three consecutive years and there is no valid reason for the non-use. 

Until now, the initiative to challenge unused trademarks largely rested with third parties through non-use cancellation proceedings. Under the new rules, the authority will play a more active role in clearing out the register. 

• Online use gains importance as evidence  

The revised law aligns better with digital business practices. The use of a trademark via online channels, such as e-commerce platforms, websites and social media, can be explicitly recognised as evidence of use.

• Stricter action against misleading trademark use  

The new law also includes measures to combat the misleading use of trademarks. These cover situations in which the use of a trademark or designation could give consumers a false impression regarding, for example, the characteristics, quality or origin of products. 

Other key changes to China’s trademark law

The revision also introduces several practical changes that may be relevant for trademark owners: 

• Motion trademarks will become eligible for registration;
• The scope of protection for well-known trademarks will be further strengthened;
• The opposition period is being reduced from three to two months;
• Stricter rules are being introduced for trademark offices and representatives; and
• Provisions for damages and enforcement options are being tightened.

For trademark owners, this means that deadline monitoring, evidence gathering and trademark watching are becoming even more critical. 

What does this mean for your trademark portfolio? 

Companies with registrations in China are recommended to assess the following before 2027: 

• Which trademarks are being used;
• Whether sufficient evidence of use is available;
• Which registrations are strategically relevant;
• Whether additional applications are required for future activities;
• How online use is being documented; and
• Whether trademark watch and opposition strategies have been implemented effectively.

—>Our recommendation: Does your company have trademarks registered in China, or do you plan to enter the Chinese market? If so, now is an excellent time to review your trademark portfolio. 

Novagraaf supports companies with international trademark registration, end-to-end portfolio management, trademark watching, and monitoring and enforcement. We can help you identify which registrations are strategically important, where proof of use is required, and the actions you should take before the new rules come into effect. We can also introduce you to a new tool, UZ.IP, where you can conveniently store and classify your trademark evidence of use.