Alibaba is inviting you to do business in China. But, don’t forget to register your trademark in China before anything!
Beijing time on June 21s morning, Jack Ma made a speech to over 3000 American SMEs on Alibaba SMB Forum held in Detroit, US. Ma said that, in the past three decades, American economy was the engine of global economic growth that means if you would have not exported your products to European and America market you had missed the chance of development. So right now, if any global entrepreneurs miss China, he will miss the future.
The speech promoted all Chinese who are proud of the development of their homeland. Jack Ma said that,” In 1990, last 30 years ago, Shanghai was nothing. It was just a piece of, you know, a farmland. But within 30 years, China made the city like Shanghai, we have a lot of cities like that, developing last 30 years, grow so tremendously. ” Ma mentioned that, “we from nobody, today, become the second largest economy.”, “China is going to be the world largest consumption place, and that engine is going to drive the world economy.”
However, companies from all over the world, do you get ready to enter markets in China? Apart from everything else, have you applied for protection of your trademarks in China? Each foreign entrepreneurs entered into China has realized the importance of trademark as the medium of a brand. But among millions of companies, only few of them have entered. You might think that it is never too late to apply for trademark protection unless you are ready to. For such opinions, I have to say, you know nothing about trademarks in China. It is to meet a fatal company disease.
Advanced tips for trademarks registration in China:
1.The application principle of earlier, the proliferation of trademark registration
Different from America’s “First to Use Principle”, the application follows the real practice. But for China’s “Application Principle of Earlier”, it means the trademark belongs to the one who apply for it first. It is preciously because this, the proliferation of trademarks application arises. And because of such low requirements, trademarks overflowed, and almost all names which are short, or easy to remember, have been registered.
According to a combination of statistics, the national trademark applications amounted to 3.691 million in 2016, rising by 28.4% and the growth rate over the previous year increased by 1.5 %. Till the end of 2016, national trademarks available registration amounted to 12.376 million and per million market ownership of the main body amounted 1422, with growth of 6.5% comparing with the amount of 1335 at the end of 2015. Numerous trademark application will be a stumbling block in the way that your brand enters into China.
Not any entrepreneur is willing to be forced to rename because he cannot register when he wants to make his own brand enter into China’s market. Of course, you can also choose to buy a trademark. Just like the Chinese trademark “IPAD” belongs to Apple purchased for USD 60 million.
The above-mentioned problems happened because lacked of clear understanding of trademarks in China. Here, I have to appreciate the President of US, Mr. Trump who has admirable IPR protection awareness.
2.Irreversible risks in trademark registration
With high risks, the application of trademarks cannot completely success all the time. You can only reduce risks even though there were professional application agents.
One is similarity and the other is subjectivity.
Those trademarks applied within 6 months before querying cannot be searched through Chinese Trademark Net. In that case, all trademarks applied within 6 mouths that are similar with yours will be treated at the same. It can be a great trouble. And obviously, there might be numerous trademark applications within 6 months.
With fixed subjectivity in trademark examination, successful or not in registration sometimes depends on the examiner’s specific judgment. At the same time, the examiner has discretionary power in the principles of law and standards of review because there are so many factors that you might fail to apply if the examiner disagrees with you.
3.Lengthy registered period
Time is precious for a company to enter into a new market. But the cycle to register a trademark in China is truly time-costly. It will take at least one and half years from application to receiving the trademark certificate. It would lead to the delay of trademark registration if there were any errors, such as rejection and reexamination, etc. It is normal to delay about a year.
Most businesses always ignore their strategic layout of trademarks and make their products available before trademarks. However, after the consumers’ acceptance, an awkward situation like suing for trademarks ownership always follows. For example, lessens can be drawn from the mistakes of Case IPAD and Case TESLA.
Trademarks move first and then the market. Entrepreneurs must make an excellent layout of trademark market first. Advanced registration is rather advised whether you have decided to enter into China or not yet. If you do not think about it until you have already entered, you will find your company are not able to wait for so long and take such risks.
4.Rush-registered Cases being still vivid in our minds
Relative to unregistered, a rush-registered case is more fatal. Most of you must know of the trademark disputes between Michael Jordan from USA and Qiaodan Sport in China. Qiaodan Sport in its trademark case might be aggrieved but it never be the only. Apple, Starbucks and the incumbent President Donald Trump have met law disputes because of their Chinese name having been registered as trademarks. For example, in May 2016, the sneaker producer from USA, New Balance was prosecuted and demanded compensation for CNY 98 million for infringement of trademark “新百伦” Zhou Lelun having registered. Though the final court decision was to compensate 5million RMB, but after spending such time and energy, they did not get back their trademark.
China is a big economy, but before joining it, you should prepare to apply for a trademark. The earlier you get the trademark protection, the fewer risks you will take. Only after getting a trademark can your company get profits in China’s market.