A comprehensive explanation of the trademark system in China from the perspective of a Japanese intellectual property person and patent attorney. We will explain the procedure flow from trademark application to registration, registration requirements and classification system, opposition/invalidation system, duration and renewal of rights, non-use cancellation system, system comparison with Japan (mainly Japan), and practical points to note (measures against filing in bad faith, measures to prevent pre-emption, utilization of the Madrid Protocol, consideration of local language trademarks, etc.).
In China, a first-to-file system (first-to-file system: first-come, first-served) is adopted, and as in Japan, the person who files the application first obtains trademark rights, regardless of whether or not they are using the trademark. Therefore, it is important toapply earlyto avoid being preempted by others. The general flow from application to registration of a Chinese trademark is as follows.
Flowchart showing the standard procedure flow from Chinese trademark application to registration (application, examination, public notice, registration). Note that the difference with the Japanese system is that registration is not immediate after examination, but there is a 3-month public notice and opposition period.
Application (submission/acceptance): Submit the trademark application to the China National Intellectual Property Administration Trademark Office (CNIPA). The application form must be written in Chinese, and the applicant's name and address must also be written in Chinese. After submission, the format requirements will be checked, and if there are no problems, aNotice of Acceptance will be issued. This acceptance usually takes about 1 to 2 months. In China, the "application date" is the day the application documents arrive at the trademark office (arrival principle; in Japan, transmission principle).
Formal examination (formal examination): Examines the application form and whether there are any document deficiencies. If there are any deficiencies in the documents, a notice of correction will be issued and corrections will normally be made within30 days (+15 days for online applications). If there are no defects, an application fee payment notice will be issued, and once the prescribed fee is paid, the application will be officially accepted.
Substantive examination: Once the formal requirements have been cleared, an examiner will examine the trademark registration requirements (whether it has distinctiveness, does not conflict with previous trademarks, etc.). China's Trademark Law stipulates that the examination should be completedwithin nine months of receiving the application, but currently there is a tendency for the preliminary examination results to be notified inabout four months on average (examinations are becoming faster, but there is no accelerated examination system like in Japan). As a result of the substantive examination, if it is determined that the registration requirements are met, the application will proceed to "Initial registration assessment (preliminary assessment)". On the other hand, if there are reasons for refusal, previously the decision of refusal would have been made immediately, but after the 2014 revision, the examiner may issue a ``request for explanation or amendment'' at the discretion of the examiner. This corresponds to Japan's opportunity to submit and amend written opinions, and counterarguments and amendments can be made within15 days. If the matter is not resolved, a Decision of Refusal (notice of refusal) will be issued.
Response to examination results: If a decision of refusal is issued, the applicant can request an appeal (reexamination) within 15 days from the date of receipt of the notification. It is also possible to submit specific arguments and evidence within 3 months after filing this appeal. In the trial (retrial), the Trademark Review and Adjudication Board hears the case, and it may take approximately 6 to 8 months to reach a conclusion (depending on the case). If registration is still not possible, you will have to file a lawsuit with the **Beijing Intellectual Property Court (Beijing Intellectual Property Court)** and seek a judicial decision.
Publication (Application Publication): If there are no reasons for refusal and the trademark is determined to be eligible for registration after examination, it will not be registered immediately but will be published in the official gazette in the form of Application Publication. This public notice period isfor three months and is a period forobjections from interested parties. Japan does not have an application announcement system, and the process is to pay the registration fee immediately after the registration decision is made, but it should be noted that in China there is a public announcement period. A trademark will only be officially registered if no opposition is filed within three months of publication, or if an opposition is ultimately unsuccessful (rejected).
Registration/Certificate Issuance: If there are no problems after the opposition period, the trademark registration will be approved and a Registration Publication will be issued. Unlike Japan, China does not have a system for paying registration fees after the registration decision is made (registration certificates are issued only with the government fees paid at the time of application). Finally, a "trademark registration certificate" will be issued, and trademark rights will be valid for 10 years from the date of registration (= date of rights origination). The period from filing the first application to receiving the registration certificate is generally expected to be around 15 to 18 months, even in the best case. In Japan, it takes about one year on average to achieve registration, whereas in China it takes a little longer due to the large number of examinations and the existence of a public notice period.
Supplementary: In the case of international trademark registration applications (Madpro applications) based on the Madrid Protocol, the basic process is the same, but the application data is reported from WIPO to the China Trademark Office and examination begins. If China does not notify the refusal within 18 months of the WIPO notification, it will be deemed that protection has been granted (*Details will be described later).
Registration requirements: In China, the main requirements for trademark registration are that the trademark be distinctive and not conflict with the existing trademark rights of others. Specifically, signs that can be visually or audibly identified, such as symbols, letters, figures, three-dimensional shapes, color combinations, and sounds, are eligible for registration. With the revision of the law in May 2014,sound trademarks can now be registered. On the other hand, color-only trademarks, motion (video) trademarks, holograms, and scent (olfactory) trademarks, which are recognized in Japan, cannot be registered inChina. In addition, three-dimensional trademarks consisting only of the functional shape of the product itself, trademarks that violate public order and morals, commonly used names or descriptive marks, illegal imitations or translations of other people's famous trademarks, those that include the portrait or name of another person without permission, and those related to public symbols such as the national flag or national emblem are also prohibited from being registered (as stipulated in Articles 10 and 11 of the Chinese Trademark Law).
Trademarks that lack distinctiveness (for example, only extremely simple topographical figures, only words describing the product, etc.) will generally be rejected. However, if a trademark becomes famous through long-term use and has acquired distinctiveness, registration may be approved by claiming "secondary meaning" (provisions for protection of famous trademarks apply). In addition, trademarks that are identical or similar to another person's well-known or famous trademarks and are filed for fraudulent purposes are subject to rejection or invalidation. For example, trademarks that cause confusion by copying or translating someone else's well-known trademark, or trademarks that include geographical indications that may lead to misidentification of the country of origin, cannot be registered.
Classification System (Nice Classification): China classifies goods and services based on the international Nice Classification (Class 1 to Class 45). With the 2014 revision, it is now possible to file multiple categories (multi-category application) in one application. Therefore, one application can cover multiple classes of designated goods and services. However, it should be noted that, in principle, division after filing is not allowed in China (divisional applications can be filed only in the case of partial rejection).
When filing an application, it is necessary to specifically describe the designated goods and services. Inclusive claims (e.g. "Category 25 All Clothing" etc.) are not permitted; each item must be listed using its specific name. The China Trademark Office annually publishes the Similar Goods and Services Classification Table, which is the Chinese version of the list of eccentric goods and services. It is recommended that you specify the notation in this list whenever possible. Using the terms listed will make the review process smoother and avoid requests for corrections due to incorrect terminology.
In addition, If the number of designated goods/services is 11 or more, an additional fee will be charged for each additional item from the 11th item onwards. For example, you can apply for up to 10 products with the basic fee, but from the 11th product onwards, government fees will be added for each item (therefore, you will need to select the items you want to specify depending on the balance with the application cost). In this respect, in Japan, there is a flat fee for each category, but in China, the fee increases based on the number of points.
Differences in classification with Japan: Particular attention should be paid to the same kanji name often has a different connotation range (similarity range) in Japan and China. For example, in Japan, specifying "Category 25 Clothing" covers all clothing (including hats, etc.), but in China, specifying "Clothing" does not include hats. In China, "clothing" refers to clothing worn on the upper and lower body, and "hats" worn on the head are treated separately, so even if you obtain trademark rights for "clothing", it does not apply to hats. Furthermore, in Japan, "surfactants" and "industrial chemicals" have the same similar group code (01A01) and are considered to be similar products, but in China they are considered dissimilar products. In other words, if you register only "surfactant" as a trademark in Japan, you can prevent someone else from registering the same trademark for "industrial chemicals," but in China, even if you register "surfactant," that does not stop someone else from registering the same trademark for "industrial chemicals." In fact, in Chinese court precedents, there are cases where products that are treated as dissimilar under the examination standards are determined to be similar in litigation, so there are some things that are not straightforward. In this way, the standards and classification code systems for similar products are different in Japan and China. Therefore, when filing an application in China, it is not enough to simply translate and convey the designation of the application in Japan. It is important to reconsider the classification and designated scope in China with experts based on the products and services actually handled locally.
Similar group code: China also has a "similar group code" for examination (a code for determining whether goods and services are similar or not). In Japan, it is a 5-digit (number + alphabet) similar group code, but in China it is managed using a 3- to 4-digit numeric code. At the screening stage, products with the same similar group code tend to be judged as similar products. However, Courts may make judgments without being bound by the Similarity Group Code; for example, products that were determined to be dissimilar in examination may be determined to be similar in court. In practice, we should consider a wide designation that is as risk-free as possible, keeping in mind the discrepancy between examination standards and judicial decisions.
Other notes: China does not have a standard writing system like Japan. Even when applying for a word trademark, there is no concept of obtaining rights based on a uniform font format, and the font and design submitted are registered exactly as they are. However, in the case of alphabets and kanji, if an application is filed in a non-decorative typeface, the letters themselves will essentially be protected as trademarks. On the other hand, please be aware that if you apply with characters that are not found in China, such as hiragana or katakana, the application will be treated as a graphic trademark (logo) during examination. For example, if you submit a katakana trademark, it will be recognized as a design rather than a language, so if the fonts are different even though they have the same reading, they may be determined to be different trademarks. Consideration may be given to the local name and other strategies, such as applying for a trademark written in Chinese characters if necessary (*Chinese trademarks will be discussed later).
China also has an opposition and invalidation system before and after trademark registration. In order to protect your company's trademark, be aware of this as a means to counter inappropriate trademark registrations by others.
As mentioned above, in China, the application is published before the trademark is registered (after the preliminary examination), and a third party can file an opposition (filing for opposition) within three months from the date of publication. This system is called the "pre-grant objection system," and the timing is different from Japan's post-registration objection system. When an opposition is filed, the Trademark Office will examine the claims and evidence of both the petitioner and applicant and decide whether or not to register.
Subject of opposition (eligibility to file): Due to the 2014 amendment to the Trademark Law, certain eligibility requirements have been established for those who can file an opposition. Before the amendment, ``any person'' could file an opposition, but after the amendment, only the holder of the prior right or an interested party can file an objection if the applied trademark conflicts with another person's prior rights (relative grounds). This is a measure to prevent unrelated third parties from raising objections for harassment purposes. On the other hand, if the trademark itself has a public interest issue (falling under an absolute ground for refusal), it is understood that anyone can object regardless of their interest (for example, it is said that anyone can object if it violates public order and morals). In practice, most objections are filed byprior trademark owners.
Results and aftermath of opposition: If the opposition is approved, the trademark application will benot registered and rejected. If the opposition is unsuccessful (opposition dismissed), the trademark remains registered. In Japan, if a decision on an opposition is dissatisfied, both the opponent and the trademark owner can appeal to the Intellectual Property High Court. On the other hand, in China, if the opponent loses (i.e., the trademark is registered), there is no system to directly appeal the decision itself. Instead, the dispute will continue by filing a request for invalidation trial after registration. In other words, the two-step approach is **objection → invalidation** (on the other hand, if an objection is accepted and the application is refused, the applicant can request an appeal).
The number of appeals has been increasing in recent years. Statistics show that there were 176,000 oppositions in China in 2021 (31.1% increase from the previous year), indicating that competition and disputes in trademark applications are intensifying. This is an order of magnitude higher than the dozens of cancellations per year in Japan (46 cancellations in 2020). This reflects the situation in China where there are many cases of pre-emption of trademarks of others, and many oppositions have been filed against them.
An invalidation trial (request for declaration of invalidity) is equivalent to a registration invalidation trial in Japan, and is a procedure for extinguishing trademark rights that have arisen after the decision to register is made. Not only interested parties but also anyone can request invalidation in certain cases. Under Chinese Trademark Law, filing deadlines and requirements vary depending on the reason for invalidation (reason for request).
Absolute grounds for invalidity (defined in Article 44 of the Trademark Law): If the trademark itself was registered in violation of the law (for example, violation of Articles 10 and 11: national flag/national emblem, descriptive name, violation of public order and morals, etc.), there is no limit on the deadline for filing. You can apply for invalidation at any time. In addition, if the registration was obtained by fraudulent or other illegal means (for example, by submitting false documents), this will also be an absolute ground for invalidation, and invalidation can be claimed without any time limit.
Relative grounds for invalidity (as stipulated in Article 45 of the Trademark Law): If the registration is in conflict with the prior rights of another person (for example, the same or similar trademark was previously registered by another person, or another person's famous trademark was fraudulently registered), an invalidation petition (dispute petition) must be filed within five years from the registration date in principle. There is a disqualification period after which it is no longer possible to dispute the trademark (even in Japan, there is a provision in which it is no longer possible to request an invalidation trial based on a prior trademark after five years have passed since trademark registration). However, there are exceptions for trademarks applied and registered in bad faith. Specifically, if someone else's well-known trademark is registered as a usurpation, the true right holder (famous trademark owner) can request invalidation even after five years have passed. In other words, the application of time limits is excluded for bad faith registrations of well-known trademarks (*Even as of 2023, it will be difficult to remedy bad faith registrations that are not "famous trademarks," and there is an argument that this point should be further improved.)
Invalidation trials are first filed by filing a petition with the Trademark Office or the Trademark Review and Adjudication Division (formerly the Trademark Review and Adjudication Board). If the parties are dissatisfied with the decision, they can file a suit for cancellation in court (Beijing Intellectual Property Court). If the reasons for invalidity are recognized, the trademark registration will be invalidated (cancelled) retroactively to thefirst date.
Comparison with Japan: Japan also added a provision in the 2015 amendment that allows invalidation claims for trademark registrations made in bad faith even after five years have passed (grounds for invalidation of trademark registrations made for fraudulent purposes). Similarly, China has also made progress in developing its system in recent years. The important thing isIf someone else registers your property first, your rights will become fixed unless you take action within a short period of time (5 years). If 5 years have passed and the other party's trademark has not been used at all, you may consider deleting it using Cancellation of non-use described below, but if the other party is actually using it, this will be difficult and you may end up giving up. Therefore, if your brand has been pre-registered by a third party, you need to consider filing an opposition or filing an invalidation trial as soon as possible.
The duration (validity period) of Chinese trademark rights is 10 years from the date of registration. The past 10 years have been the same as in Japan, and there are also similarities in therenewal system. Registered trademarks can be renewed any number of times every 10 years, and there is no upper limit on the number of renewals. As long as you wish to maintain your rights, you can maintain semi-permanent protection by renewing your rights every 10 years.
Renewal procedure: Before the trademark right expires, you must apply for renewal within 12 months before the expiration. For example, if the expiration date is May 1, 2025, submit a renewal application between May 1, 2024 and April 30, 2025. Even if you inadvertently fail to renew by the deadline, there is a 6-month grace period (extension period) in which you can renew by paying an additional late fee. The grace period will applyautomatically and no separate extension application process is required. However, once the grace period (six months after expiration) has passed, the trademark will become **expired (deregistered)** and cannot be revived. In that case, you will need to apply for a trademark all over again, but there is also the risk that your trademark will be taken over by a third party.
Cost: The government fee for trademark renewal in China is about 500 yuan per category (equivalent to about 7,500 to 8,000 yen as of 2023). The price was reduced in July 2019, and before that it was about 1,000 yuan, but it is now about half the price. This amount isvery cheapcompared to the renewal fee in Japan (43,600 yen per category). In China, there is no need to pay a registration fee at the time of initial registration (only the application fee), but in Japan, after passing the examination, you need to pay a separate registration fee (17,200 yen for each category, 28,200 yen for 10 years all at once). In terms of total costs, trademark maintenance costs in China can be said to be considerably lower than in Japan.
Others: During the renewal procedure, there is no requirement to submit evidence of use in China (Japan also does not have a declaration of use system like the United States). Therefore, even if you are not using a trademark, you can formally maintain your rights by simply applying for renewal. However, if you do not use a trademark, there is a risk that a third party will request a cancellation of non-use (discussed below), so it is not necessarily a good idea to maintain it blindly. In the case of international registrations (Madopro), renewals are done via WIPO. Please note that the record date for international registration is 10 years from the date of international registration (for example, if China is specified based on Japan, it will be 10 years from the date of international registration, not the date of registration in Japan). Even if you renew, the Chinese side will receive an "International Registration Renewal Notification" and perform the renewal process internally, so it will continue in the same way as a domestic application.
China has a system to cancel the registration of a registered trademark if it has not been used for a certain period of time. This is equivalent to Japan's "Non-use Cancellation Trial." Specifically, ifanyone has reason to believe that a registered trademark has not been used inChina for three or more consecutive years,anyone can request the Trademark Office forcancellation for non-use (cancellation of registration). In Japan, only an interested party (for example, a business that wants to use the same trademark) can request cancellation of non-use, but in China, even a third party with no relationship with the use can make a request. Therefore, even if you hold a large number of trademarks for defensive purposes, if you do not use them, you run the risk of being attacked by a third party.
Procedural Overview: Once a non-use cancellation request is filed, the Trademark Office will issue a notice to the trademark owner and require him or her to provide "evidence of use" or justifiable reasons for non-use for the trademark within two months from the date of receipt of the notice. Within this period, the rights holder must submit evidence such as product sales records for the past three years, advertising materials, transaction evidence (invoices, shipping slips, etc.), usage status at the licensee, etc. If evidence of use is notsubmitted within thetime limit, or if it isnot recognized by the Trademark Office as 'use' or valid reason, the trademark will becancelled. In principle, the Trademark Office will decide whether or not to cancel within 9 months from the date of the request.
Procedure after cancellation decision: A trademark right owner who is dissatisfied with the cancellation decision can file a Request for reexamination with the Trademark Review and Adjudication Board (currently the relief department within CNIPA) within 15 days from the date of receipt of the notification. Furthermore, if you are dissatisfied with the retrial decision, you can file a lawsuit with the Beijing Intermediate People's Court (Intellectual Property Court) within 30 days and seek a judicial decision. Although there are step-by-step remedies like this, you should basically think that it is difficult to maintain a trademark that has not been used for three years or more.
Scope of "use": "Use" here is defined under the Trademark Act as "the act of using a trademark to indicate the origin of goods (or services)." The point is that simply using the same character string as the registered trademark does not mean that anything is fine. For example, simply exporting a product from China tooverseas is not considered trademark use inChina. Therefore, if a Japanese company attaches a trademark to a product manufactured in a Chinese factory and exports it to Japan or other countries, there is a risk that the product will be judged as "not sold in the Chinese market = not used in China." Similarly, exhibiting products at exhibitions is not enough; actual sales and transactions are important. Additionally, if the trademark is used in a manner different from the registered trademark (for example, a registered word trademark is actually used as a logo), it may not be considered a use of the registered trademark itself. Although some font differences are allowed, it is dangerous to use them so differently that they are considered separate trademarks.
Measures against the risk of non-use cancellation: After acquiring a trademark, it is important to establish a track record of its use in China as soon as possible and accumulate evidence of use. For example, even if there is no sales plan for the category, you can produce small quantities and sell it on an e-commerce site, or find a licensee and have them use it. Additionally, when filing a claim for damages for trademark infringement, if the trademark has not been used in China within the past three years, the defendant will be entitled to a "defense of non-use." In fact, in China, even if a rights holder files a lawsuit for a trademark that is not in use, the other party may argue that the trademark is invalid because it is not used, and the rights cannot be enforced. Therefore, once you have obtained trademark rights, it is important to regularly check the status of use and save the evidence. On the other hand, if another company's registered trademark is unused, it is possible to have it sorted out by taking advantage of this cancellation of non-use. In addition, if you wish to use the trademark in your own company after the trademark has been canceled due to a cancellation request, you must remember to immediately applyin your company's name. This is because anyone can reapply for a trademark that has disappeared due to cancellation, so there is a risk that a third party will steal the trademark and reapply.
Finally, we will summarize the main differences between the Chinese trademark system and the Japanese trademark system. Although the basic framework (first-to-file system, examination before registration, 10-year protection period, etc.) is common, the details of operation and procedures differ. Here are some points that intellectual property managers who are familiar with the Japanese system should be aware of.
Handling of examination and notification of refusal: In Japan, when reasons for refusal are found during examination, a ``notification of reasons for refusal'' is first sent, giving opportunity for written opinions and amendments. However, in China, if there are reasons for refusal, a ``decision of refusal (final refusal)'' may be notified immediately. Although a simple amendment request system has been introduced since 2014, the opportunity to respond at the examination stage is still limited. From the examiner's point of view, if there is a clear precedential conflict or lack of distinctiveness, there are many cases where the application is immediately rejected, and the Japanese attitude of ``Let's submit it first and respond if there is a deficiency'' does not work. It is important to carefully conduct preliminary research and apply with a high probability of being able to register. The period for filing an appeal after a decision of refusal is very short, at 15 days, so filing applications in China requires speedy judgment and cooperation with local agents.
Partial registration and division: In Japan, if there is a reason for refusal for even a part of the designated goods or services for which the application has been filed, the entire application will be rejected (unless the applicant makes an amendment to delete the unnecessary part, the entire application will be unregistered). On the other hand, in China, it is possible to reject only the parts for which there are reasons for refusal and proceed with the registration procedure as isfor the rest. In other words, even if one product out of 10 has a similar conflict, unless the seller takes special action, only that one product will be rejected, and the remaining nine products will proceed to registration assessment and public notice. This is called thePartial Rejection/Partial Registration system. With the 2014 revision, it is now possible to divide the application only if you receive this partial rejection notice (the rejected parts can be divided and examined independently, and the non-problematic parts can be registered first). In Japan, the divisional application system is freely possible as long as the application is pending, but in China, it is limited to only when a partial rejection occurs. Therefore, the policy for responding to notices of reasons for refusal is different, and in China it can be said that it is easier to adopt a strategy of obtaining rights as soon as possible even if there are no problems.
Timing for opposition: As mentioned above, in China there is a three-month opposition period before registration. In contrast, Japan has an opposition system after registration (within two months from publication). In China, if there are no objections, the application will be registered as is, but there is a tendency for registration to take longer due to the waiting period for public notice. In Japan, if the application passes the examination, the registration fee is paid and the establishment is registered immediately, so it takes an average of 8 to 12 months from application to registration, but in China it takes an average of 15 months or more. From a business standpoint, it is important to take into account that it will take time to obtain rights. On the other hand, the handling in the event of an objection is different; in Japan, the process may take a long time, including the trial decision and judgment, but in China, as mentioned above, the system is to expedite the vesting of rights through the process of registration and then proceeding to invalidation trial.
Registration fee and maintenance fee: In Japan, rights only arise after the registration fee (10 years in one lump sum or 5 years x 2 terms) is paid after appraisal. If this is delayed, the rights will not be established. In China, there is no registration fee payment procedure, and if your application passes the examination, you will be automatically registered and issued a certificate (the government fee has already been paid at the time of application). Maintenance renewal fees are also very cheap in China (approximately ¥7,000 per category), which is significantly lower than in Japan (¥43,600/category). For this reason, in China, there is a low cost hurdle formulti-category/wide-ranging applications, and conversely, there are some cases in which patents are carelessly filed and rights are compromised. However, because maintenance costs are low, it is easy for fraudulent applications and large numbers of speculative trademark applications to occur, leading to an increased burden on examiners.
Differences in the types of trademarks (objects of protection): In China, sound trademarks can be registered, but color only, movement (animation), holograms, scents, etc. are not allowed. In 2015, Japan lifted the ban on non-traditional trademarks (color, movement, hologram, sound, location trademarks, etc.), and now almost everything except smell can be registered. Therefore, there are some types of trademarks that can be registered in Japan but not in China. For example, even if you have trademark rights for colors only in Japan, you cannot have the same protection in China. In such cases, it is necessary to take measures such as protecting the logo or package design with a graphic trademark. Furthermore, Japan's "standard character" system does not exist in China, and the font and shape used at the time of application are printed on the registration certificate as is. There is a pitfall when thinking from a Japanese perspective that ``word trademarks = cover any typeface.''
Protection of prior use rights and well-known trademarks: In Japan, even unregistered well-known trademarks are protected under the Unfair Competition Prevention Act, and under the Trademark Law, an unauthorized application for a trademark that is well-known in a foreign country is grounds for refusal (Trademark Law Article 4, Paragraph 1, Item 19: Provisions for the Protection of Foreign Well-Knowed Trademarks). In China, there are certain protection provisions for "unregistered well-known trademarks" (Article 13 of the Chinese Trademark Law), but the hurdles for application are high, and in the past there have been many cases in which unfamous foreign trademarks have been pre-registered by third parties. In the 2019 revision, China also added a clause stating that ``bad-faith applications without a purpose of use must be rejected'' (Article 4 of the Trademark Law), strengthening its stance to exclude malicious applications, regardless of whether they are well-known or unknown. In fact, more than 16,000 bad faith trademark applications were rejected due to this provision before and after the revision came into effect. On the other hand, in Japan, there is basically no way to prevent someone else's trademark that is not well-known or famous from being applied for, and even if your company files a new application, it will be blocked by the registration principle. In this respect, it can be said that China is trying to crack down on bad faith applications more strictly than Japan**. However, in reality, there are still many malicious applications, and the Chinese government is also strengthening its countermeasures.
Entity of non-use cancellation request: As mentioned above, in China, anyone can request non-use cancellation. In Japan, trademarks are limited to interested parties only (Article 50 of the Trademark Law), and completely unrelated third parties cannot make requests based on interest. Because of this difference, in China there are many cases in which agents are requested to file cancellation requests for the purpose oftrademark clearance. Furthermore, in China, revocation proceedings are conducted through administrative procedures (Trademark Office - Review Board - Court), while in Japan, the procedure is from the Patent Office to the Intellectual Property High Court.
As mentioned above, there are differences between the two countries in terms of examination/objection procedures, procedural costs, and scope of registration. Overall, in China, it is important to ``respond with a sense of speed,'' ``acquire broader rights,'' and ``early defensive measures.'' On the other hand, it also has advantages such as "low cost" and "partial registration". In the next chapter, we will explain points that should be particularly noted in practice based on these points.
Finally, we will introduce practical points when acquiring and maintaining trademark rights in China. These are the challenges that Japanese companies tend to face when developing trademarks in China, as well as their countermeasures and considerations.
In China, there are no end to the cases of preemptive applications (preemptive registrations) for other people's brands. There are cases where famous tourist destination names and product names are trademarked by third parties.For example, ``Amanohashidate'' (a scenic spot in Kyoto) and **``Muji'' (a famous Japanese brand) were registered as trademarks by a third party in China, causing problems. In addition, there has been a rampant business in China in which brokers apply for foreign brands in bulk that are likely to become popular, seize the rights, and later sell them to authorized brands at high prices. To protect your brand from such malicious trademark filings, you need strategies from both an offensive and defensive standpoint.
Early filing (first move wins): If there is a possibility of selling your products or services in China, it is a golden rule tofile a trademark application before you go on sale. It is too late to think about it after it becomes a hit, and there are many cases where someone tries to apply after it becomes popular, but it has already been taken by someone else. As mentioned earlier, China has a first-to-file system, so the best defense is to submit your application as soon as possible. Especially when announcing your entry into the Chinese market or exhibiting your product at an international exhibition, be sure to obtain your trademark information. Even if you cannot apply in time, it is important to take measures such as taking advantage of the Paris Convention's priority rights (within 6 months).
Coordination and monitoring with local agents: Foreign companies and individuals cannot directly apply for trademarks in China, but must go througha trademark agency (agent) approved by the Chinese government. It is helpful to select a reliable local agent to monitor trademark publications on a regular basis. If you can discover applications for similar trademarks by others early, you can block them by filing an oppositionat the publication stage. Additionally, even if the registration has already been made, countermeasures such as an invalidation trial or a lawsuit under the Unfair Competition Prevention Act can be quickly considered. Make sure you have a smooth communication system with your local agent.
Use of legal amendments to apply in bad faith: The 2019 amendments to the Trademark Law made it clear that ``bad-faith trademark applications that are not intended for use'' will be rejected. In addition, there are provisions for penalties for unintentional applications and penalties for agents accepting such applications. Based on these, it is now possible to refuse trademarks that are clearly speculative or harassing at the examination stage, or to have them canceled due to violation of Article 4 through opposition or invalidity. For example, cases where a single applicant has filed hundreds of applications are more likely to be excluded by this revised provision. In practice, a tactic is used to gain the approval of the authorities by claiming in a notice of opposition or request for invalidation that the other party is a trademark broker and has filed the application without any intention of use. However, since proof of bad faith requires evidence of the other party's application status and actual business operations, expert support is essential.
Defense by contract: Trouble often arises when Chinese business partners (agents, distributors, production subcontractors, etc.) apply for or register their own trademarks without permission (Article 15 of the Chinese Trademark Law prohibits fraudulent applications by agents or business associates, but in practice this is a clause that often causes disputes). To prevent this, when concluding a contract with a local company, it is important to clearly state ownership of trademarks and other intellectual property rights, and include a clause prohibiting the other party from filing trademark applications. Even if the contracted party files an application first, they may be able to claim invalidation based on this clause. Additionally, when establishing a joint venture company, it is necessary to clearly negotiate the ownership of trademarks and the scope of usage permission, and to formulate a strategy in advance, such as whether the trademark will be acquired in the name of the joint venture company or the name of the head office.
In addition to filing directly in China, there are other ways to obtain a trademark in China: Filing for international registration based on the Madrid Protocol. Both Japan and China are member countries of this system, and it is possible to designate China via WIPO based on Japanese trademarks. We will summarize the points regarding the use of Madpro.
Advantages: With MadPro applications, you can seek protection in multiple countries at the same time with a single application. The procedure is simpler than requesting each country's representatives individually, and costs can be managed all at once. In particular, if you have designated more than 10 items, filing directly in China will incur additional costs, but if you are filing internationally, you can designatemore than 10 items without additional government fees. In addition, although it may take an average of nearly three years to register a domestic application in China, in the case of MadoPro, protection will automatically occur if there is no notification of refusal within 18 months, so there is a possibility that the registration effect will be obtained sooner as a result (*However, as described below, there is still a possibility of filing an opposition even after 18 months).
Disadvantages/Points to note: International registration is based on the content that has been applied for and registered in Japan, so the designated products in Japan are also applicable to China. As mentioned above, the scope and description of similar products in Japan and China are different, so there is a risk that the designation in Japan alone may lead to lack of protection in China. For example, if Japan only specifies "clothing," there may be a problem where hats are not covered when China is designated. In international applications, the specifications cannot be changed for each country, so in order to make the specifications suitable for China, it is necessary to make some efforts from the time of application on the Japanese side. In some cases, it may be possible to consider a strategy of trying to file a basic application in Japan and adapting it to Chinese protection. On the other hand, if this is difficult, you should consider filing a separate direct application for China only. With international registration applications, there is less flexibility in correcting document deficiencies than with direct applications, and there is a time lag in communicating with Chinese examiners via WIPO.
Rejection/Objection Handling: If the Chinese Trademark Office finds a reason for refusal, even if it is done via Madpro, a Rejection Notice will be sent via WIPO. In that case, you will need to arrange for a local representative to handle the matter, and the final burden will be the same as when applying directly. It should also be noted that even after18 months have elapsed and the registration takes effect, there is a possibility that separate public notices and objections may be filed. In other words, ``18 months of no news = peace of mind'' is not the case, but if an interested party raises an objection during the subsequent three-month public notice period, it will eventually lead to a dispute. Furthermore, international registrations are at risk of becoming invalid if the underlying Japanese trademark lapses within five years (central attack). Please consider using it on a case-by-case basis, taking into account the advantages of being able to manage trademarks other than China as well as the risks if something happens to your home country's trademarks.
What Japanese companies tend to overlook when developing their brand in China is the Chinese brand name. Although there are cases where the English or Japanese (kana/kanji) brand name is used as is, Chinese consumers and media often refer to it by Chinese name that is easy to pronounce locally. If acompany does not have an appropriate Chinese brand name, a third party may give it a name and spread it around without permission, or it may be registered as a trademark. Below are the key points.
Importance of Chinese names: In the Chinese market, names in the local language have a significant impact on product image and penetration. For example, ``Coke'' is the Chinese name for Coca-Cola, which means ``very delicious and fun'' and has contributed to improving the brand image. Additionally, Starbucks has adopted the kanji trademark ``星巴格'' (singbaku), which cleverly combines sound and meaning (star). These are good examples of companies devising their own local names and registering Chinese trademarks as well as English trademarks. On the other hand, when foreign companies start business without worrying about Chinese names, there are cases where consumers and the media give them their own nicknames, which are then registered as trademarks by third parties. Companies were able to capture theapples and thedianke (Nike) at an early stage, but if they are late, they will be in trouble.
Kanji trademark preemption: In the case of Japanese companies, brand names are often in alphabets or katakana, but there are cases in which someone else takes over a trademark that is translated or transliterated into kanji. For example, the Japanese clothing brand ``MUJI'' uses its own kanji logo, but in China, another company registered the ``MUJI'' kanji trademark in some product categories first, which later led to a dispute (such as a case in which MUJI was sued for trademark infringement in bedding and lost the case). In this way, confusion may occur where the kanji notation is the same but the rights holders are different. As a countermeasure, it is important to decide on a Chinese name for your brand early and register kanji trademarks in major categories. How to decide on a kanji name is: 1) A transliteration with an emphasis on pronunciation (e.g. "Toyota" → "Toyota/Kuda"), 2) A literal translation with an emphasis on meaning (e.g. "Kaguchi 可乐" = Coca-Cola), 3) A combination of sound and meaning (e.g. "resistant" = There are strategies such as Nike (sound similar to ``Nike'' and meaning positive like ``durability''). Consult with your local marketer to choose the best name.
Securing peripheral trademarks: In addition to the brand name itself, counterfeiters may also obtain trademarks using slightly changed kanji or different characters with similar pronunciation. Starbucks and Coca-Cola have registered and defended all major similar names. If your resources allow, it's a good idea to research possible alternatives, abbreviations, and colloquial names for your brand and block them as much as possible. In particular, in Chinese, there are many cases in which the pronunciation is the same but the font is different (so-called homonyms), so the main homonyms are also subject to consideration (e.g. KAKUKUKA-YU vs. 口KA口郎 etc.). However, if you blindly cover a wide range of names, the risk of non-use being canceled increases, so a balance is necessary, such as narrowing down to names that are expected to be used within 5 years.
Non-trademark measures: In China, domain names (e.g. .cn domains) and social media account names are also problematic in terms of brand protection. In addition to a trademark, it is desirable to secure major domains and SNS accounts as soon as possible. Considering such acomprehensive brand protection strategyfrom the early stages of expansion into China is the key to success.
The above is a comprehensive explanation of China's trademark system. China is a market with a huge number of applications and fierce competition, but if you understand the key points of the system and respond appropriately, you can firmly protect your brand. Please acquire rights early and manage them continuously, and make use of them for your business in China. Collaborate with local experts as necessary and keep an eye on the latest legal reform trends and precedents. !
AUTHOR
Takefumi SUGIURA （杉浦 健文）
EVORIX Intellectual Property Law Firm Managing Patent Attorney
Supports clients across IT, manufacturing, startups, fashion, and medical industries, covering patent, trademark, design, and copyright filings through trials and infringement litigation. Specialized in IP strategy for AI, IoT, Web3, and FinTech. Member of the Japan Patent Attorneys Association (JPAA), Asian Patent Attorneys Association (APAA), and Japan Trademark Association (JTA).