November 19, 2018
Originally posted 2018-11-19 11:18:31
By Diana Chan | amdlawgroup.com
Because of the sheer number of people (and potential consumers), businesses are often drawn to the idea of expanding their brand and marketing their products in China. But businesses should be wary when taking their brand to China especially if they have not yet registered their trademark in China.
Several big name companies such as Apple, Pfizer, Hermès, Burberry and more recently, Tesla, have struggled to successfully win trademark disputes in China. China, unlike the United States, follows a “first to file” system. Recently, the car manufacturer, Tesla, has encountered several issues because someone else, Zhan Baosheng, had registered the name in China before Tesla. Zhan had wanted Tesla to halt all sales and marketing in China and to pay him $3.9 million although Tesla now reportedly claims that it has come to a resolution with Zhan over the Tesla trademark dispute. In the past, Apple was involved in a trademark dispute over the iPad trademark with Proview International Holdings Ltd., a company that applied to block local shipments of the tablet. After two years, Apple paid $60 million to settle the dispute. Hermès is another example of a well-known company battling to protect its brand. Although Hermès had registered “Hermès” in 1977 and thereafter had been using 爱马仕(“Ai Ma Shi”), the Chinese language version of Hermès, it failed to immediately register “Ai Ma Shi” as a trademark in China. Instead, another company, Dafeng Garment Factory, had registered a similar sounding “Ai Ma Shi” in 1995. Since then, Hermès has struggled in the fight to cancel Dafeng Garment Factory’s registration of the mark.
Here are just a few of the many factors to consider:
If expanding your brand to China is in the future for your business, don’t wait to register your brand as a trademark. Otherwise, someone else could swoop in and register your brand as a trademark—and you could end up tackling trademark disputes that could hurt your brand and leave a hefty financial dent.