Hermès, Apple, Land Rover and Pfizer: the list of IP owners who have suffered trademark registration woes in China includes some A-list brands. The lessons they have for foreign companies seeking a slice of the China market is clear: register a local language version of your mark before a trademark squatter gets the chance to.
But while registering a trademark in the local script is a crucial step for IP owners who want to do business in China, it’s only the first. Once a mark is on the trademark office’s books, the owner needs to understand how it must use it to maximize the protection that registration offers. This is an issue being explored by a session today: RM50—Regional Update: China, Japan, South Korea. In it, panelists from China and Japan and South Korea will explain how brand owners should use their trademarks to minimize the risk of third-party challenges.
Practical lessons
“We want this to be a very practical session where we use real examples to show the requirements of the local trademark laws,” says Beijing-based Chris Shaowei of NTD Patent & Trademark Agency Ltd., who is moderating the session. Shaowei will consider the rules in China, with Jinsang Jeong of Jeong & Park explaining how trademark law is applied in South Korea and Nami Togawa from Japan’s Seiwa Patent & Law outlining the position in Japan. Despite the common linguistic heritage, each jurisdiction has distinct rules when it comes to mandating how trademarks must be used in practice.
In Japan, for example, Togawa says that applicants should register exactly the same mark that they plan to use in the country. They do not need to file a corresponding Japanese mark if they plan only to use the English-language mark, as long as the Japanese transliteration is similar to the native English pronunciation of the mark. “This is because the scope of the trademark protection will extend to its similar marks (in terms of sound),” he says. Where the transliteration is too dissimilar to the original mark, Togawa recommends the IP owner file two applications, one for an English mark and one for a Japanese mark: “If you file a trademark application indicating an English mark and Japanese mark in two lines, there is a risk of non-use cancellation if you use only the English mark or the Japanese mark in Japan.”
File widely in China
In China, however, the country’s first-to-file trademark rules mean that IP owners should consider filing as widely and often as the IP budget allows. Shaowei recommends IP owners apply to protect their original foreign language mark, a pinyin version (a transliteration) and a character trademark. They should also consider filing their word mark and any logo separately, including an additional application for the calligraphic version of a plain text character mark. Once the marks are registered, IP owners should take care how they use them on their goods. Making a change, even if only a small one, can lead to big problems.
That’s because Chinese officials are particularly strict about ensuring that marks are used as registered. In practice, trademark owners can find it very difficult to enforce an English-language trademark registered in capital letters on a black and white background if they use it in a different way on their products.
“If you change the way you use the mark then it may not be considered ‘continual use’,” warns Shaowei. “That means that another party can file a cancellation request.” In China, unlike many jurisdictions, anyone can ask for the mark to be revoked, not just a party with an interest in the brand. “It’s cheap to lodge a cancellation request for non-use and the burden of evidence to show continual use lies with the trademark owner,” he says. Shaowei will look at the problems companies have experienced, including a company that used the mark HAGGAI on its product but had the trademark canceled because the original registration was for the word HAGGAI plus a stylized outline of a letter H. Similarly, a tool-manufacturing company with a registered trademark that included a logo, the transliteration of DANGONG and the two characters Dangong lost its rights because the mark appeared on the tools without the two Chinese characters.
Shaowei says it is vital to understand how marks should be used in China. “Many foreigners still consider China to be like the Wild West and think that people don’t understand IP,” says Shaowei. “But local people are getting sophisticated and some of them understand exactly how they can use the system to get a free ride.”
RM50 Regional Update: China, Japan, South Korea takes place in room 207 AB at 3:45 pm today
