Pitfalls of registering a trademark in China

China is one of the strongest economies in the world and a huge market, entry into which is the desired stage of business development for a large number of entrepreneurs from all over the world, including from Russia. The number of trademark applications filed in this country increases every year.

Thus, according to the China Patent Office (CNIPA), as of the end of June 2022, the number of registered trademarks by copyright holders from more than 200 countries exceeded 40 million, and this number continues to grow.

With such a large number of applications, China has no choice but to more demandingly “filter” the designations submitted for registration, while simultaneously increasing the quality and efficiency of their examination.

Currently, the trademark registration process in China is regulated through the Trademark Law, which is amended periodically to meet the needs of the times and the rapidly developing Chinese economy.

There are two procedures available to an applicant in China for registering a trademark - an international procedure under the Madrid Agreement and its Protocol and a national procedure.

An application under the Madrid system is submitted on the basis of a Russian certificate or application, while the type of mark and list are similar to the Russian mark, and adjustments to the list are possible only in the direction of narrowing it. The advantage of an international registration is that it allows all the Madrid Agreement and Protocol member countries of interest to be included in one application. At the same time, a convenient procedure for making changes and renewing registration, as well as its expansion to other countries of the Madrid system, is provided in the future. An international application is submitted to WIPO through Rospatent.

National registration means registration directly in China. The national application can only be submitted through Chinese attorneys. If there is no interest in registration in other countries, in relation to China, filing a national application has a higher priority, since working directly with Chinese attorneys allows you to take into account the specific requirements of CNIPA when preparing and filing an application , as well as to process incoming requests/objections faster, without delays associated with international sending documents. In addition, the national procedure for registering a trademark is faster than the international one, since the application is submitted directly to the Patent Office.

When filing a national application in China, it is important to consider the following points:

1. In China, multiclass is available, that is, filing an application in several classes of the ICGS. However, it is advisable to submit a separate application for each class. This recommendation is due to the fact that if, as a result of the examination of any class of a single application, obstacles to registration are identified, consideration of the entire application is suspended. In this case, it is impossible to select classes not affected by the failure. In addition, even if a single application is filed, the fee and typically attorney's fees are charged separately for each class;
2. China is guided by the Nice Agreement regarding the list of goods and services, but imposes its own requirements on it: for each item in a class over 10 in China, an additional fee is charged. Therefore, applying for a complete list can be quite costly;
3. Copyright holders of trademarks whose verbal element is written only in Latin or Cyrillic alphabet are poorly protected from violation of their exclusive rights in China. To increase the chances of registration and the degree of protection of the exclusive right to a trademark, we recommend adding hieroglyphs to it, the translation of which corresponds to the verbal element of the designation. It is advisable to carry out the translation of hieroglyphs by Chinese attorneys. Independent translation can distort the meaning inherent in the sign and mislead consumers;
4. If the trade name of a legal entity is used in a mark, it must completely coincide with the information about the applicant for this mark, otherwise it will lead to misleading consumers.

The procedure for registering a trademark in China includes the following stages: application filing, formal examination (1 month), substantive examination (6 months), publication of the application in the official gazette and opposition period (within 3 months, third parties can file an opposition to the registration designation as a trademark, which can be considered by the Patent Office for up to 12 months), issuance of a trademark certificate. Currently, China is moving towards reducing the time required for registering a trademark - in 2023, corresponding amendments were proposed to the Trademark Law.

As examination requirements for both international and national applications become more stringent, the PRC Patent Office has recently issued preliminary refusals quite often.

Trademark registration in China may be refused on absolute and relative grounds.

Absolute grounds under Article 10 of the Trademark Law include marks similar to the symbols of the People's Republic of China; another state; an international intergovernmental organization (if there is no appropriate consent for registration); Red Cross or Red Crescent; official insignia; signs that are discriminatory against any nationality; misleading regarding the quality, place of production or other characteristics of the goods; harmful to socialist ethics or consumers, or otherwise having an adverse effect.

Geographical names, as well as designations that do not have distinctiveness, cannot be registered as a trademark (Article 11 of the Trademark Law). The latter include signs that have a descriptive meaning, as well as indicating the quality, material, functionality, method of use, weight, quantity and other characteristics of goods and/or services. The exception is cases where the designation has acquired distinctiveness as a result of long-term use.

In addition, from our experience, specific goods and/or services related to activities prohibited in China (slot machines and gambling, etc.) are refused on absolute grounds; having a negative social connotation, for example, associated with military operations or having sexual overtones; goods whose turnover is in the PRC (ivory goods, etc.); goods that can potentially harm health (clothing for weight loss, etc.). The Patent Office also does not accept services of class 35 of the ICGS related to retail and wholesale trade.

A preliminary refusal on relative grounds may be issued due to the fact that, in the opinion of the examination, the designation applied for registration is confusingly similar to well-known, either previously registered or filed for registration trademarks with an earlier priority date in relation to similar goods and /or services.

In our opinion, it is generally more likely to overcome a preliminary refusal for a mark on relative grounds than on absolute grounds, since in the latter case, as a rule, it is necessary to prove the long-term use of the mark in China, the acquisition of distinctiveness by it and/or the absence of that effect in the mark (for example, negative social connotation), which is imputed to the applicant.

Refusal on absolute grounds in relation to specific goods and/or services, as a rule, is not overcome: in the absence of a response from the applicant, the refused items are simply removed from the list and the mark is registered in relation to the remaining items.

Regarding overcoming a preliminary refusal on relative grounds, we note an important nuance: the Patent Office of the People's Republic of China has actually stopped accepting letters of consent from the copyright holders of opposing trademarks. Thus, there are several working methods by which one can try to overcome the negative decision of the department: 1) cancellation of the opposed marks due to their non-use in China, if the deadlines allow this (at least 3 years must pass from the date of registration of the mark); 2) alienation (assignment) of opposing marks (important: if the copyright holder has other similar marks, it is necessary to assign all marks at the same time); 3) limitation on the application list in terms of goods and/or services that are similar to the goods and/or services in respect of which opposing marks are registered/submitted for registration.

It should be borne in mind that in China there is a short period during which the applicant can submit a response to a preliminary refusal - 2 weeks, but at the same time there is no procedure for extending the period. If you fail to provide a response to a preliminary refusal for a trademark in China, it is highly likely that your application will be refused.

If the examination is successful, the application is published in the official gazette, and a period of opposition begins, after which, if there are no objections, the designation is registered as a trademark.