In the rush to capitalise on China’s burgeoning economy, many businesses tend to overlook the implications of failing to attain adequate brand protection.
In Australia, entitlement to use and registration of a trade mark is generally determined by the earlier of the first to use the trade mark, or the first to file an application to register the trade mark. In contrast, China (excluding Hong Kong) is a ‘first-to-file’ jurisdiction. In short, this means that entitlement to a trade mark is based upon the first person to register the trade mark in China, not the first apply or the first to use it.
This means that a party unrelated to an Australian trade mark holder, could and would be within its rights to, register a trade mark in China that is identical or similar to an Australian trade mark. Once a third party has attained registration in China, the owner of an identical or similar Australian trade mark would have no right to use or register the mark in China. If the Australian trade mark owner were to apply the trade mark to the goods in China for which the Chinese trade mark is registered, that application would amount to trade mark infringement.
The ramifications of failing to attain Chinese trade mark protection can be far reaching. The owner of a registered Chinese trade mark could potentially request that Chinese customs authorities seize and detain branded goods that infringe their trade mark. So even if the Australian trade mark owner only manufactures its products in China and applies the trade mark to the goods in China as part of the manufacturing process, the entire manufacture and supply chain could be disrupted.
Given that it can take several years before a trade mark is formally registered in China, it is essential that Australian businesses looking to manufacture or sell goods in the country apply to register their trade marks in China at the earliest opportunity – ideally, prior to commencing trade, or at the latest, immediately upon doing so.
One of the most common mistakes made by owners of Australian trade marks is to assume that an Australian trade mark registration provides a monopoly to use that trade mark around the world. Registration of a trade mark in Australia only grants the owner of a trade mark a monopoly to use that trade mark in relation to the goods and services listed in the trade mark specification in Australia. If goods are manufactured or sold, or services provided, under a trade mark in jurisdictions other than Australia, Australians should consider seeking trade mark protection in those specific jurisdictions.
For further information on how to protect your trade marks in China (or anywhere else for that matter) please contact DibbsBarker’s Trade Marks Team.
