September 26, 2023

Our Worldwide IP attorneys are all the time preaching how overseas firms should register their logos in China if they’ll be doing enterprise in or producing product in China (see, for instance, China Logos — Do You Really feel Fortunate? Do You?). And usually, firms ought to register their logos in China now. Proper now.

China is a primary to file nation. Which means that — with few exceptions — whoever information for a selected trademark in a selected class will get it. So if the title of your organization is XYZ and also you make footwear and you’ve got been manufacturing your footwear in China for the final three years and somebody registers the XYZ trademark for footwear, that different firm will get the trademark. After which, armed with the trademark, that different firm has each proper to cease your XYZ footwear from leaving China as a result of your footwear violate that different firm’s trademark.

However saying an organization should register its trademark if it’s going to do enterprise in China does, not less than to a sure extent, beg the query as to when that firm ought to register the trademark. I all the time inform our purchasers and potential purchasers that they need to register their logos straight away. My pondering on that is that in the event that they know they should register their model title or emblem as a China trademark, they need to do it straight away in order to ensure no person beats them to it.

However what in case you are a overseas firm pondering of introducing your product into China in a few years? What do you do? Nicely in case you are an enormous firm with some huge cash, you go forward and register your trademark proper now. However in case you are a small firm, spending the cash now might or might not make sense. The place and the way do you draw the road? There isn’t a one reply right here; it’s extra a case of realizing it if you see it.

I thought of all this lately as a result of I obtained a name from a small firm that was referred to me by a China sourcing firm we signify. The China sourcing firm had the foresight to inform this different firm (let’s name it Firm A) that it wanted to register its trademark in China earlier than the sourcing firm began going out and looking for producers for Firm A’s product. However after I spoke with Firm A, it instantly turned clear to me that its funds have been very restricted and that it was uncertain if it could have the ability to discover a Chinese language producer at a value that may make sense, and if it did discover that producer, whether or not its product would catch on or not.

Firm A’s not unreasonable plan was to make a restricted amount of its prodcut as a check run after which, if that labored, safe financing to ramp issues up. My dialog with this firm went like this:

Firm A: Is a trademark actually vital in China?

Me: It’s vital if you wish to be sure you shield your self from somebody taking your model title from you. How necessary is your title to you? If somebody takes it, might you stamp a unique title in your product for the subsequent go spherical?

Firm A: I actually like our title, however I might all the time provide you with a brand new one if that have been to occur. Do you actually suppose somebody goes to register our trademark straight away in China?

Me: You simply by no means know. We have now seen firms lose their model title earlier than they’ve even chosen a producer and we’ve seen firms go years with out anybody taking their model title. Quite a bit is dependent upon the trade and the model title and your success. When you have a scorching product in a scorching trade, you could be fairly sure your model title can be taken for those who don’t register it. However since your organization just isn’t identified and your product is an industrial product not but out available in the market but, you possibly can contemplate ready till after you see in case your product can have legs.

Firm A: I would like to try this. Am I taking an enormous threat?

Me: I believe your dangers are fairly low, however they’re undoubtedly greater than zero. Quite a bit is dependent upon whether or not the worst case situation of getting to provide you with a brand new title is horrible for you or not.

You’ll by no means get me to say something aside from how necessary it’s to register your trademark in China straight away (as a result of I don’t want anybody to have the ability to blame me if “their” trademark is registered by another person), however clearly the choice on when to register is typically a bit extra sophisticated than that.