Trade Mark Alert - Chinese Trade Marks & Australian Business in China

As the attention of the world focuses on China during the 2008 Beijing Olympic Games, it is an opportune moment for Australians trading with China to be reminded of the importance of protecting their trade marks in the People’s Republic.

In Australia, entitlement to use and registration of a trade mark that is identical or similar to an Australian 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.  China (excluding Hong Kong), on the other hand is a ‘first-to-file’ jurisdiction.  This means that entitlement to a trade mark is based upon the first person to register in China, not the first to use.

Accordingly, 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 the unrelated third party registers such a trade mark in China, the owner of an identical or similar Australian trade mark would have no right to use or register the mark in China.  The Chinese trade mark owner would have the exclusive right to apply the trade mark to goods in China as part of the manufacturing process.  Any attempt by the Australian trade mark owner to apply the trade mark to the goods in China for which the Chinese trade mark is registered would amount to trade mark infringement.  It is therefore extremely important for Australians trading with China to protect their trade marks/brands if possible prior to commencing trade or 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.

Given that it can take several years before a trade mark is formally registered in China, it is imperative that Australians that manufacture or sell goods in China seek to register their trade marks in China without delay and at the earliest opportunity.

The predominant risk in delaying application for trade mark protection in China is that an unrelated party may succeed in registering the trade mark for the same or similar goods and services, thus preventing the Australian trade mark owner from attaining trade mark protection in China.  The ramifications of failing to attain Chinese trade mark protection can be far reaching.  For instance, the owner of a registered Chinese trade mark can request that Chinese customs authorities seize and detain branded goods that infringe their trade mark.  If the Australian trade mark owner 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 may be disrupted.