9 March 2016
Intellectual Property Rights of Foreign Companies Entering the China Market
First of all, trademarks. For foreign companies importing goods and services into China, their trademarks are usually synonymous with the brands of their goods and services. For example, the trademark of International Business Machines is “IBM”. To consumers, this trademark represents world-renowned IT products with particular qualities. In China, although companies may use an unregistered mark (provided it does not infringe other people’s lawful rights), exclusive right of use is only given to those marks that are registered with China’s Trademark Office. In other words, only the owner of a registered mark has the right to request the relevant administrative or judicial authorities to stop unauthorised use of the mark by others. For unregistered marks, only those that have gained a fairly high degree of reputation in China may be afforded some protection by virtue of provisions on well-known marks in the Trademark Law or the provisions in the Anti-Unfair Competition Law. For instance, in 2011 the trademark of Sotheby’s had not been registered in China, but the Chinese court held that the trademark “Sotheby” was an unregistered well-known mark and trade name. As a result, Sichuan Su Fu Bi Auction Company Limited was found to have committed trademark infringement and unfair competition because “Su Fu Bi” (蘇富比) in Chinese represents the same characters as used by Sotheby’s.
Copyright. Foreign companies entering the China market can also be protected by copyright. As an illustration, Disney’s cartoon characters Mickey Mouse and Donald Duck are protected under copyright in China. These characters are very well-known and popular on the mainland and associated with their creator, The Walt Disney Company. For Disney, such association is an invaluable asset.
Patent right. Patent covers inventions, utility models and designs. While invention and utility model patents grant protection to product technologies, design patent refers to the appearance of a particular product. Technology patents protect the inventions, research and development achievements of an enterprise and prevent them from being used illegally. Rights owners can produce and sell patented goods or transfer patented technologies on the market for economic gain. When consumers identify the design of a product with a brand, the design is deemed to be an intellectual property warranting protection.
Trade name rights. Every enterprise is identified by its trade name. A trade name with a certain reputation may be protected by the Anti-Unfair Competition Law. In addition, since a trade name directly indicates the identity of an enterprise, many use their trade names as brands to attract consumers to choose their goods or services.
Domain names. A domain name (e.g. xxx.com) is actually a symbol used to indicate an address on the Internet. Every domain name is unique globally. With the development of the Internet, it is increasingly necessary for brand owners to use it to reach out to their customers and potential customers. Therefore, domain names are also important intellectual property for companies.
Apart from the above, civil rights such as rights of personal names and portrait rights are sometimes connected to brands imported by foreign companies into the Chinese mainland market. For example, the use of one’s name or portrait as a brand is regarded as an exercise of a person’s right in his name or portrait.