Fashion brand owners entering China are generally well aware of the myriad of brand protection challenges awaiting them. One such challenge is China’s rigid first-to-file trademark system which is blamed for the problem of brand piracy in China, where unrelated third parties register trademarks which are copies or imitations of well-known brands. One of the most effective ways to combat this scourge is for the brand owner to register first in China.
Republished from Law A La Mode
Online retail presents unparalleled opportunities for reaching new consumer markets and collecting consumer data. With such opportunities, however, come heightened regulatory scrutiny, compounded by high-profile consumer data security breaches in the US, Germany and elsewhere. Not surprisingly, there have long existed specific requirements for the collection and use of consumer data in the context of online retailing, for example in the US. Other countries, notably China, are now also regulating consumer privacy, and there are more changes to come, particularly in the EU.
WHEN WILL THINGS CHANGE
On June 6, 2014, the fourth draft version of the new PRC Copyright Law (New Law) was published for public comment, having first been published in 2010. The period for public comment ended on July 5, 2014 meaning the implementation of the New Law is drawing ever closer.
The overall aim of the New Law is to rationalize the existing PRC Copyright Law (Existing Law), bringing it in line with other developed copyright laws around the world. This update focusses on the key changes the New Law will introduce and the practical consequences for rights owners, assuming that the New Law is implemented as currently drafted.
China’s eagerly anticipated amendments to its trademark law come into force on May 1, 2014. This new legislation aims to modernize the trademark process, strengthen trademark enforcement and make trademark squatting and counterfeiting more difficult. But it can also yield opportunities for trademark hijackers.
Here are the Top 5 steps to take now to protect your trademarks:
1. Do a trademark audit
The new law makes opposition difficult. It removes the opponent’s right to file a review against the China Trademark Office (CTMO)’s decision in an opposition if the initial opposition does not prevail. China’s application system is a purely first-to-file, unlike in the US. Any gaps in a portfolio could allow hijackers to acquire your marks.
By Edward Chatterton and Ann Cheung
After two decades on the basketball court, Michael Jordan, one the greatest basketball players of all time, is currently learning the rules of defence and offence in a different game: the Chinese legal system. Qiaodan Sports Company Limited (“Qiaodan Sports”), a Chinese sportswear company, are throwing their legal dispute with him back into his court.
Michael Jordan’s fame in China is long-standing. He was first seen on Chinese television playing for the 1984 gold medal-winning US basketball team at the Los Angeles Olympics. Since then, he has become hugely famous in China, both under his English name but also under his Chinese name “乔丹” which is the Chinese equivalent of the name “Jordan”. This Chinese name is shown in pinyin, the official system which is used to transcribe Chinese characters into Latin script, as “Qiaodan”. Whilst Michael Jordan registered trademarks for “Jordan” in English in China as far back as 1993, he never applied for any registered trademarks for “乔丹” nor for the pinyin representation “Qiaodan”.
Unlike many countries, it is not possible to register trademarks for retail services in China. This position has recently changed with the implementation on January 1, 2013 of the revised Chinese Trademark Office (CTMO) trademark classification which now recognizes retail and wholesale services, albeit in a limited way. The CTMO’s revised classification now recognizes seven new items of services in Class 3509 covering “retail and wholesale services for pharmaceutical, veterinary and hygienic preparations and goods for pharmaceutical purposes.” These new service specifications will protect the sale of pharmaceutical, veterinary, and hygienic preparations across all points of sale, including traditional “brick and mortar” stores as well as online retailers.
It is not difficult to understand why China is viewed by businesses around the world as an indispensable market. Its size alone is staggering (1.3 billion people). Its purchasing power is equally impressive (on a purchasing power parity basis, it is already the second largest economy in the world).
What attracts most prospective sellers of goods and services, of course, is China’s astonishing growth rate. Even during the recession which has plagued the rest of the world China has continued its remarkable trajectory, with retail spending increasing steadily by 15 percent and more.
For franchisors, there are some aspects of China which make it especially attractive. The size of the middle class, while smaller as a percentage of the population than in some other countries, is a powerful magnet; within a generation it will be roughly 4 times the size of America’s, for example.
Another measurement by which China is almost uniquely attractive is its number of large cities. Since franchisors (or their multi-unit developers or master franchisees) seek out concentrations of population, so as to make it possible to reach their target markets in an economic and logistically feasible fashion, the number of cities in China with more than 1 million population is eye-popping: 94, compared to 9 in the United States.
A new opportunity is on the horizon for brand owners seeking to expand their online presence in China. Starting September 15, 2012, owners of a valid trademark registration will be able to register .中国 (or “.CHINA”) domain names corresponding to their registered marks.