Expansion of my online legal marketplace to China was a way to contribute to the development of the country’s legal industry.

China has witnessed an exponential increase in trademark applications from foreign applicants. The National Intellectual Property Administration (states that China received 450,000 trademark applications in 2020 from foreign applicants, and this number is anticipated to grow.

This trend has made trademark disputes more common in the country, requiring businesses planning to operate in China or those already doing so to understand China’s trademark laws to avoid legal issues.

The trademark registration process

Companies must comprehend the trademark registration process to prevent trademark disputes in China. Unlike other countries, China operates on a “first to file” system, which implies that the first person or entity to file a trademark application will have priority over others.

This challenges foreign businesses that have established brands but have not yet registered their trademarks in China. Companies must register their trademarks in China soon to avoid potential issues.

They should conduct a trademark search to ensure that their trademark is available for registration and engage the services of a reputable trademark attorney to navigate the complex process and ensure their application meets all the requirements.

Navigating Trademark Disputes in China

Cultural differences and translations are other factors that businesses need to consider when operating in China. It is crucial to ensure that a brand name or logo does not have any negative or offensive connotations in Chinese and that the Chinese name does not infringe on other companies’ trademarks or individuals. Partnering with a local business can help businesses understand the Chinese market and avoid cultural or regulatory challenges.

Enforcing trademarks is critical in China to prevent trademark disputes. If a business becomes aware of potential trademark infringement, it should act immediately, including sending cease-and-desist letters, filing a complaint with relevant authorities, or taking legal action. This is essential in protecting the business’s intellectual property rights and maintaining the brand’s reputation.

Protect intellectual property rights

The high volume of trademark applications in China presents business opportunities and challenges. To protect intellectual property rights and avoid potential trademark disputes, companies should understand the trademark registration process, be mindful of cultural differences and translations, partner with a local business, and enforce their trademarks.

Businesses can establish and protect their brands in China by taking these proactive measures and working with reputable trademark attorneys.

The Chinese legal market is only around forty years old, whereas we have had a legal market in Canada for over 100 years.

Preventing Trademark Conflicts in China

With a large population and a developing market, I saw an opportunity. To make things even more interesting, Chinese people are starting to spend more money on law firms.

According to a Legal Market in China report, Chinese companies spend 32% less than the global average on legal fees. This is most likely because many companies don’t use contracts.

With increased wealth in China, many lawyers in Beijing have told me that the number of lawsuits filed in the courts has increased. More lawsuits will mean more lessons learned, and companies will start using contracts. Having a robust legal system is essential. Equally important is the country’s general population knowing the law and how to avoid trouble.

Canada and China continue to do a lot of trade. Savvy CEOs know that they need contracts and to register trademarks, but a lot of Chinese people feel uncomfortable signing paperwork. This social barrier must be overcome. Without a contract signed, there is no deal. It’s as simple as that.

Protect Your Copyright In China

You might have advanced knowledge of China with either in-market experiences or a long-term China-desk career. You might think that you know how to avoid trademark litigation.

Registering a trademark is a great first step, and I assume most people reading this will do so properly through a law firm in China. To own a trademark, you must register it in China (not just Canada.)

But many CEOs go wrong when it comes to protecting copyright. Since copyright is often referred to as intellectual property, you don’t register it, so you must protect it via contracts and lawsuits. If you are stressed by trademark litigation in China, get legal advice.

A Case Study About Trademark Litigation In China

There is currently a case where one of our trademark lawyers is representing a client in Vancouver in a three-million-dollar lawsuit. The Vancouver company agreed with a company in Changzhou, China. The agreement was that the Canadian company would supply their proprietary technology, and the company in Changzhou would manufacture it.

The company in Changzhou would also help with local distribution and sales. While I can’t go into details, the CEO of the Vancouver company has extensive experience in the Asian market. However, the agreement he used was created in Canada, not in China.

His company is suing the Changzhou company for $3M, and they are countersuing for $500,000. Do not assume that this knowledge replaces legal advice because you have experience in the Chinese market.

Managing Trademark Issues in China

There are countless stories of China’s joint partners stealing a foreign company’s intellectual property. This often happens when a Canadian or European company wants to sell its products in China.

It is also possible that Western companies hire factories in China to produce products for the Chinese market. This is done to cut down on shipping costs.

Many people contact us looking for an attorney after they have been ripped off in China. Expanding to China without contracts, trademarks, or copyright protection will fail. Don’t spend more time (or money) on the expansion because it is a waste.

Trademark Litigation In China

If you have decided to use a distributor or factory for your expansion, you need a firm contract. This contract will hold the other company liable for damages if they do something terrible that ruins your brand or gets your company (or you) banned from the country.

For example, your company makes natural baby milk powder in Vancouver, Canada. You ship the natural products to China so that your Chinese joint venture partner can combine them and ship them. Your company splits the profit with the Chinese company.

Get Your Damages Back Using a Lawsuit

Unfortunately, your business partner in China has filled the products with non-natural ingredients to increase profit margins. The word gets out, and customers no longer trust your brand.

To make matters worse, you and your company are the subject of a criminal investigation. Now, you can’t go back to China. Let’s say you spend $5 million on your Chinese business expansion. The contract should make your joint venture partner responsible.

If you hire a lawyer in China, they should be able to take the contract to court and collect damages. If you need help with trademark litigation in China, contact us.

Feel free to reach out on Wechat, username: alistairvigier