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How to Lose Your Trademarks in China (and how not to)

By Maarten Roos

In a recent case, a potential client asked for our advice. Their Chinese registered trademark had been cancelled because a competitor had filed a non-use cancellation application, and the client’s local trademark agent had failed to notify the client thereof in time. So the client did not have the chance to submit evidence of use in China, and the trademark was cancelled.

Many large international companies file their trademarks through their international trademark service provider. This provider will often appoint a local Chinese trademark agent to handle applications and other filing work (such as renewals, oppositions) locally. In the Chinese trademark database, this local company will then be registered as local agent, and any communication from the Chinese trademark office will go to this local agent.

Responding to Non-Use Trademark Cancellations

One of the key risks to a trademark registered in China, is that can become the target of a non-use cancellation application. As long as the trademark has been registered for at least three years, any party can apply to the CNPIA (Chinese National Intellectual Property Administration) for cancellation based on the allegation that the mark has not been used in the past three years. Such an application only requires very basic evidence, and the burden to prove use in China on relevant products or for relevant services lies completely with the trademark owner – which has two months to file a response including evidence. If no such proof is submitted, then the trademark will be cancelled – giving room for another party to apply for and obtain exclusive rights to that trademark.

Proving use can be big a challenge, especially for classes or products / services that are only ancillary to a client’s business. So while applying for broad protection makes sense from a protection and enforcement perspective, it does increase the risk of non-cancellation applications. Some of our clients will decide to gather use evidence in advance; or even devise use strategies to ensure that they have the right evidence ready if targeted. But in any case, it is crucial to have a trademark agent that informs you immediately if an application for non-use cancellation is made.

Trademark battles are often exhausting and can be extremely costly. The lesson for all trademark owners: always make sure that your trademark information as registered with the CNPIA is up to date, and that you have appointed a reliable agent to be your government contact for your important intellectual property rights in China.

For support to build and protect your trademark portfolio in China, contact me at [email protected] or your usual contact at R&P. Our IP team focuses on portfolio management and disputes, and the enforcement of trademarks and other intellectual property rights in China.

This was originally published on LinkedIn as an edition of Maarten's China Law Focus Newsletter. Subscribe here to get regular updates.