China has arguably become an important market for many foreign brands since it joined the WTO in 2001. China has adopted the first-to-file principle [1] which makes trademark registration a big deal. However, the differences of trademark practice and culture give rise to some misunderstandings for foreign applicants.
In this article, I selected some typical misunderstandings which I encountered in my years of practice, and am trying to propose proper countermeasures thereof. Due to the limitation of sample collection base, the conclusions might inevitably be over generalized, and are for reference only.
Misunderstanding One: Lack of distinctiveness
Let us see the examples [2] below (Table I):
| Samples |  |
 |
 |
| Designated Goods | Hand tools, hand-operated | Cooking utensils, electric | Lotions for cosmetic purposes |
|
Nationality of Applicant |
Indian | American | French |
Despite the difference of the applicants’ nationality, they shared a common preference for using generic names/features of the industry/product as part of the trademark. These trademarks seem to have registered in their own countries, and the applicants have been using for quite a while; thus the applicants are therefore reluctant to make changes to the constituent elements of their trademarks when entering the Chinese market. However, these applications were all subjected to refusal for being descriptive.
As for the requirements of distinctive characteristics, Article 11[3] of the Trademark Law has clear stipulations. Before filing trademark application in China, foreign applicants shall ask a Chinese trademark agent to check if the trademark has distinctiveness according to Chinese standards, and if not, the following measures may be taken: On one hand, to subtly modify the reproduction of the trademark, such as making special designs on the first letter of a descriptive word, using its abbreviations or reformulating it with other letters. On the other hand, if the trademark has long been used in China, then applicants shall carefully organize the relevant evidence which can be presented to the Trademark Office during the review in support of the distinctiveness argument.
Misunderstanding Two: Non-standard and narrow specification
Non-standard specification in goods/services which the applicant selected are not in accordance with the Chinese Classification[4], and this may result in following consequences [5]:
- The application cannot be filed through the e-filing system, which usually delays the application date;
- A Notice of Rectification is most likely be issued by the Trademark Office, in which case the applicant will practically have no choice but to modify the specified goods/services to standard ones. This process takes time, i.e. at least two months, and money.
It is advisable for the foreign applicants to consult a local agent to properly convert the non-standard specification to standard ones before filing. If equivalent wording cannot be found in the Chinese Classification, the applicant may illustrate the goods/services in greater detail to try to avoid being refused when responding to the Notice of Rectification.
Some jurisdictions adopt the first-to-use principle and are quite strict on partial cancellation of a trademark if the registration is not used across a broad range of goods. Therefore, many foreign applicants designate only one or two items (even with limitation to specific area) when registering in their countries. In practice, it is of less conflict and easier registration with designating only one or two goods/services. However, when it comes to post-registration stage, especially when the trademark enjoys its brand awareness, it could be quite troubling an issue for the applicants to deal with the trademark squatting in different classes/subclasses in which they did not file in the first place.
With the first-to-file principle in mind, foreign applicants should not have the specification limited merely to their current business scope, but shall include those in which they are likely to engage as well.
For example, if the applicant’s main product is “fairy lights for festive decoration”, I would advise it filing for the following items:
| Class | Subclass | Section | Goods/Services |
| 7 | 0720 | / | Manufacture bulb machine |
| 7 | 0906 | / | Signal lanterns |
| 0909 | / | Flashlights [photography] | |
| 0911 | / | Lanterns (Optical –) | |
| 0913 | Four | Dimmers [regulators] (Light –) [electric] | |
| 11 | 1101 | One | Chinese lanterns |
| Two | Lighting apparatus and installations | ||
| Three | Germicidal lamps for purifying air | ||
| Four | Curling lamps | ||
| 43 | 4306 | / | Rental of lighting apparatus |
Misunderstanding Three: Chinese Pinyin versus English
In an effort to stop their own brands from being diluted, some big companies are very keen on trademark monitoring and opposing. In most cases, this monitoring work is not handled by local agents.
Due to cultural differences, some trademarks are deemed to be dissimilar by a Chinese person, while it could easily be the complete opposite to a foreigner. For example (Table II) [6]:
| Cited Trademarks |  |
 |
| Trademarks being Opposed |  |
 |
From the above cases, we can see the average foreigners, including applicants and trademark attorneys, could not understand the Chinese Pinyin well. According to the Chinese reading practice, in a trademark combined by Chinese characters and Pinyin, the Chinese characters will be the major part, while the Pinyin will only be a reference for pronunciation. Besides, homophone is very common in Chinese language, i.e. a Pinyin, performing the pronunciation function, will refer to different Chinese characters. For instance, the trademark “咖蓝西+KALANXI” and “卡兰西+KALANXI” will not be considered as similar ones, even though they share the same Chinese Pinyin[7].
Misunderstanding Four: Use evidence
Although China adopted the first-to-file principle, use evidence is required in trademark proceedings such as reviews of refusals, oppositions, invalidation and non-use cancellations, etc. Foreign applicants tend to either provide no evidence or a large amount of evidence, both of which are not good. I will pass the no evidence scenario as we all know the likely outcome. For the latter scenario, actually, the examiners do not expect a large amount of use evidence, but they do expect sound evidence. Below we will give some examples to illustrate what is sound use evidence according to the “already in use and enjoys substantial influence”, standard, which is found in Article 32 of the Trademark Law[8].
Literally speaking, “already in use” requires that use evidence must take place before the filing date of the application of the trademark at issue. Although the laws do not stipulate the place where the evidence is incurred, there is an implied prerequisite that it must be in Mainland China. The term “Substantial influence” refers to the duration and geographic reach of sales of the trademark.
In conclusion, sound evidence should suggest the time and place of the use and should meet the requirements stipulated by the laws. At the same time, it should include critical information, such as the applicant’s name, trademark logo, designated goods/services, etc. Practically, it is rare for a single piece of evidence to meet all requirements. Therefore, applicants are often required to provide a chain of evidence which consists of a plurality of carriers and supports one another in order to make it admissible to examiners or judges.
Common evidence of use of a trademark could be[9]:
For use on goods:
- use of trademarks on the products, product packaging, containers, labels etc. by attaching, stamping, imprinting or knitting, etc., or use of trademarks on attachments, product specifications, handbooks, price lists, etc.;
- use of trademarks on the trading documents concerning sales, including use on sales contracts, invoices, notes, receipts, inspection and quarantine documents for import and export, customs declarations, etc.;
- use of trademarks on media such as broadcast, television, etc., or publications, and advertisements or promotions for products where the trademarks are used by billboards, mailing advertisements, etc.;
- use of trademarks at exhibitions and fairs, including use of trademarks on printing documents and other materials provided in exhibitions and fairs; and
- other uses of trademarks which is in conformity with laws.
For use on services:
- use of trademarks on the places where the services are provided, including use of trademarks on the manuals of the services, billboards of the services, decoration of the places, clothes of the staff who provide the services, posters, menus, price lists, coupons, stationery, letter paper, etc.; and
- use of trademarks on the documents concerning the services, including use on invoices, bank slips, agreements on the services, documents for maintenance, etc.
No. 3, 4 and 5 for use on goods are also applicable for use on services.
In addition, materials endorsed by a third party are stronger than those of provided by the applicants themselves. For example, invoices, inspection and quarantine documents for import and export, customs declarations, advertisements via media provided by the third party will be of greater strength than product packages and brochures provided by the applicants themselves.
Conclusion
Trademark practices are more or less different from one to another in different countries and regions. As such, misunderstandings are inevitable and I clearly could not exhaust them all in this article.
As a result, it is advisable for foreign applicants to consult a local agent to better form their trademark protection strategy in China.
Notes:
[1] The first-to-file principle, compared with first-to-use principle, is the establishment system of trademark rights. In China, exclusive right for use of the trademark will not be given to mere use of the trademark. The only way to obtain exclusive right for use of the trademark is registration.
Any natural person, legal person, or other organization desirous of acquiring the exclusive right to use a trademark for the goods produced, or services and activities offered by it or him shall file an application for the registration of the goods or service mark with the Trademark Office. Article 4 of Trademark Law of the People’s Republic of China.
No trademark application shall infringe upon another party’s existing prior rights. Nor shall an applicant rush to register in an unfair manner a mark that is already in use by another party and enjoys substantial influence. Article 31 of Trademark Law of the People’s Republic of China.
[2] Trademark application numbers are 13825305, 13595386 and 13370723 respectively.
[3] The following marks are not permitted to be registered as a trademark:
1) Names, devices, or designs that are generic to a class or group of goods;
2) Marks that merely indicate the quality, principal raw materials, function, use, weight, quantity or other features of the goods in respect of which the marks are used;
3) Other marks that lack distinctive characteristics.
A mark to which the above provisions are applicable but which has acquired distinctiveness through use and is readily distinguishable may be registrable as a trademark.
[4]Chinese Classification is adjusted based on the Nice Classification provided by the WIPO.
[5] The filing date of an application for trademark registration shal1 be the date on which the Trademark Office receives the application documents．
Where the formal requirements of the application are fulfilled and the application form filled out according to the relevant rules, the Trademark Office will accept the application and notify the applicant in writing. Where the formal requirements are not fulfilled or the application form not filled out according to the relevant rules, the Trademark Office will not accept it, and it shall notify the applicant in writing and explain the reason. Where the formal requirements are basically fulfilled or the application form filled out basica1ly according to the relevant rules, but amendments are required, the Trademark Office shall notify the applicant to make the amendments and require him to do so according to the contents prescribed and re-submit it to the Trademark Office within thirty days from the date on which he receives the notification. Where the application is amended and re-submitted to the Trademark Office within the time limit, the date of filing shall be retained. Where the application is not amended within the time limit, the application shall be deemed to have been abandoned, and the Trademark Office shall notify the applicant in writing. Article 11 of Trademark Law of the People’s Republic of China.
[6] Cited trademarks are No. G867267 and No. G700271, opposed trademarks are No. 15220267 and No.16129497.
[7] No. 15, Page 69 to 71, of Standards for Trademark Examination and Trial.
[8] No trademark application shall infringe upon another party’s existing prior rights. Nor shall an applicant rush to register in an unfair manner a mark that is already in use by another party and enjoys substantial influence. Article 32 of Trademark Law of the People’s Republic of China.
[9] No. 5.3.2 and 5.3.3, Page132, of Standards for Trademark Examination and Trial.
Zio Zhihao Deng is a senior trademark attorney with Jiaquan IP Law. He’s been practicing trademark laws for more than ten years, mainly focusing on trademark application, review, invalidation, opposition, cancellation and trademark administrative litigation.
Besides, Mr. Deng is especially familiar with domain name dispute, customs protection, online marketplace enforcement as well as agreement issues. With his professionalism and rich practical experience, his strategies for IP protection are highly comprehensive.