Can you really protect your trademark in China? This is an important question to ask. The reason is that if you’re sourcing products from China, or manufacturing goods in China, you must protect your Intellectual Property (IP) even if you don’t intend to sell your product in the Chinese market. Why is this important? For many reasons. One of them is because trademark squatter are everywhere?
How can trademark squatters harm you?
Trademark squatters are people scouting countries around the world, snapping pictures of cool and trendy brands, with the intention of coming back to China and registering those brands as their own. You will probably see some of them walking around international trade shows taking pictures of booths and their products. The purpose is not always to use those brands, although they can. But the real purpose of a trademark squatter is to sit on that trademark and wait. They will emerge the day your brand gains traction overseas and you decide to enter China. They then can sell it back to you in China for a hefty premium. You might think today that “selling to/in China has never been part of our strategy. We only manufacture in China on OEM basis. Why should I care if someone wants to register our brand in China and use it there?” You should!
China as a first-to-file country
Intellectual Property is, as its name indicates, a property. And as such, you need to protect it, especially when you’re operating in a market considered as a “first-to-file country”.
Let me explain. China, very much like many other countries in Asia is a “first-to-file country.” In other words, the first person or entity to file for a trademark, owns it. You can register your trademark in Europe or in the US, use it for some time, but still not being considered as its owner in China. If someone else had registered it before you in China, then it’s theirs. This is different from the US for example that uses a “first-to-use” system. Those who are not aware of this difference and its implications stand to lose their IP in China.
In the 2nd part of this article, I’ll share a real case where a foreign manufacturer lost their trademark in China. I’ll break down the process so you understand how it did happen, and what you can do to protect your trademark in China, or recover it.