By Elodie Dellavolta, Foreign Qualified Lawyer
China has its own Intellectual Property (“IP”) rules so you need to learn these quickly!
Here are 10 “Key Rules” to enable you to properly protect your IP in the PRC and so reduce your business risk.
1. Rule No.1: Registration of your Trade Mark in your country of origin gives you no similar Protection in the PRC.
Trade Mark rights are territorial and the ownership of a Trade Mark in one country generally provides no advantage when seeking to enforce that Trade Mark in another country. You must register your Trade Mark without delay in the PRC, and ideally within the 6 months of its application in another country, to possibly back date the PRC application.Protection by registration in the PRC does not cover Hong Kong, Taiwan, Macau. So, registration of your Trade Mark in Hong Kong, Taiwan and Macau does not give you any protection in the PRC. You must separately register your Trade Mark in each of those separate legal jurisdictions.
2. Rule No.2: Be the first to file in the PRC. There is no substitute for this.
Unlike in the US where the Law tends to favour the user of a Trade Mark, China’s IP Law favours the first party to file. There is no effective protection without registration in the PRC. Also remember never to rely on others to register your Trade Mark; indeed if another party registers a Trade Mark in its own name, it may even be able to claim against you!
3. Rule No.3: Check your Trade Mark is available for registration and use
Take professional advice on the registrability of your Trade Mark before making any application. Conducting a comprehensive search on the availability of the Trade Mark in the PRC is recommended.
4. Rule No.4: Enforcement of your Trade Mark can only be effected, once your Trade Mark is registered in the PRC.
You don’t have recourse to the different methods of enforcement in the PRC until you actually have a PRC Trade Mark Registration Certificate. However, be aware that the turnaround time to obtain Trade Mark registration in China (PRC) is 12 to 24 months, from application.
If entering into any collaboration with a Chinese partner, do ensure that the relevant contract protects your Trade Mark rights and do ensure that there is a clear written agreement as to who owns what IP.
5. Rule No.5: Registration of your western language Trade Mark does not protect the Chinese character version of the same Trade Mark.
English is still not widely spoken in the PRC and so Chinese consumers often find that a Chinese name is much easier to pronounce and remember. The Chinese characters version of your brand name may have even more value than the original foreign-language name.
If you do not protect the Chinese language version of your Trade Mark, a third party could register such and prevent you from using it, as recently experienced by HERMES, the French luxury brand company, which lost an appeal to trademark the Chinese language version of its name in China.
So, consider filing a translation and or transliteration of your Trade Mark, in addition to its English character version.
6. Rule No.6: Apply for the Trade Mark for your existing goods/services and also for goods/services to be developed over the next 3 years
Note that the protection of your Trade Mark is limited to the relevant goods/services that the registration covers.
The Chinese system divides each 45 international classes of goods/services into subclasses. To efficiently prevent others from registering/using the same or a similar Trade Mark in the PRC without your prior consent, it is very important that the specifications of goods/services under the registered Trade Mark is appropriately sub classed. The Chinese Registrar appreciates the similarity between the goods/services (E.g: protection of a trade mark for “jeans” will not enable you to prohibit registration/use of a similar Trade Mark for “socks” by a third party), since they fall within different sub-classes.
7. Rule No.7: Monitor your Trade Mark
We recommend you to subscribe to a “watch service” so that you receive a report of all similar Trade Marks once advertised.
Also proactively record your Trade Mark with the PRC General Administration of Customs (GAC) to access a 7-years period of PRC Customs protection in the course of the import and export of goods bearing the Trade Mark.
8. Rule No.8: Use your Trade Mark within 3 years of registration
Use your Trade Mark to prevent your right being cancelled for non-use. Ask for our advice to keep your registration alive before it is challenged by a third party.
9. Rule No.9: Protect your Trade Mark through domain name registration under the Chinese top level domain “.cn”
10. Rule No.10: Adjust your Trade Mark licensing agreements to fit into the PRC legal system
Remember, certain clauses of any IP licence may be considered invalid under the Chinese legal system, so again, take legal advice in advance!
IP protection is a critical part of ensuring your business success, so get it right. Mistakes can be time-consuming and expensive to resolve.
IP protection is a complex legal area, so obtain professional advice as early as possible.
For enquiries related to this, please contact Vera Sung (firstname.lastname@example.org) or Elodie Dellavolta (email@example.com).