How much use is enough?

15th May 2016

Defending your defensive marks in China.

The bad news. Trade mark squatters and pirates have not gone away in China. They are still there and getting bolder. They are still filing for every permutation of your mark that they can get, because China is a “first to file” jurisdiction.

The good news. Savvy foreign rights owners are filing widely in China as a defensive measure to block squatters in non-core classes (such rights owners would generally already have protection in their core classes).

More bad news. The infringers are getting clever too and are using China’s relatively simple non-use cancellation system to cancel vulnerable marks that have been on the Register for three years but have not been used in China.

The solution. Foreign rights owners need a plan to ensure a sufficient minimum amount of “use” evidence is generated to defeat any non-use cancellation filed by the knowledgeable infringer or the aggressive competitor.

The questions. What use will be considered by the Chinese authorities? How much “use” is enough?

The Answer

There is no one size fits all solution but here are some tips:

1. The use must be genuine use. But this doesn’t mean that you necessarily need extensive (or any) sales.
2. The use must relate to the goods/ services covered by the defensive mark. Use relating to other goods / services will not be taken into account.
3. The use must relate to or target China – examples of use outside China, including Hong Kong or Taiwan (even if in the Chinese language) will be ignored.
4. Physical advertising in China can be sufficient, particularly if you keep evidence of the advertising contract from the Chinese newspaper / magazine, etc.
5. Use at trade shows, in China, can be sufficient.
6. Recruitment ads have been held to be insufficient as they do not relate to the goods or services in question.
7. Merely relying on your ‘international’ website or Facebook page will not work. If the international website doesn’t target China it will be ignored. As for Facebook ….it’s banned in China so there is no point trying to rely on that!
8. BUT targeted websites and China specific social media can be a good solution. Does your targeted website use simplified Chinese characters? Does it list prices in Chinese currency? Can Chinese consumers purchase online? Do you have a Chinese social media presence, e.g. Weibo or WeChat?

Summary

A defensive ‘use’ strategy should be considered shortly after obtaining registration of a defensive mark. It is too late to try and “engineer” sufficient use after a non-use cancellation has been filed against you. As noted above, there are many types of use that either alone, or in combination, may be sufficient to protect your defensive marks. However, it is crucial to put a plan in place at an early stage.

Otherwise…Even more bad news: your defensive marks will be cancelled and the trademark squatter may charge you a significant premium to buy ‘your’ mark back from them.

Originally published in BrandWrites 6th Edition.  Co-authored by Rieko Michishita.