Trademark squatting: Brands beware


Trademark squatting: Brands beware


Brand owners that are not keeping tabs on events in China are vulnerable to the phenomenon of trademark squatting, and the law may not be that much help. WIPR reports.

The opening up of China’s economy in the past few decades has created a lot of opportunities for Western brands to target a whole new group of consumers. Technology, car and pharmaceutical companies are some of those that have entered the market and they found varying degrees of success with China’s growing middle class.

As the economic wind continues to blow east, many more brands are expected to follow in an assembly line of big Western names looking to reach a new audience. But while that line could continue at an unstoppable pace, there are interruptions and roadblocks that are causing brands headaches. Apart from the logistical difficulty of creating a presence in a new jurisdiction, brand owners have had to contend with the problem of protecting their intellectual property.

China’s trademark system operates on a first-to-file basis and that has meant brands that are not watching events in China too closely are vulnerable to a phenomenon called trademark squatting. This is defined as a party registering a brand as a trademark in bad faith.

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