Protecting your intellectual property in China

Protecting your intellectual property in China

Safeguarding your IP is critical in China. Specific areas you’ll need to consider are trade marks, patents, trade secrets and copyright, along with non-disclosure agreements and registering Chinese character marks.

This information was compiled with input from NZTE Beachhead Advisor George Chan, a partner at Simmons & Simmons law firm and head of its Beijing Intellectual Property Agency.

Work with an expert

You should always seek the advice of a professional trade mark or patent expert. When working with an IP specialist on your global and China IP strategies, ask about their expertise in advising on the China market. If they don’t have their own team in China, find out what specialist law firms or agencies they partner with in-market to ensure they can provide the most appropriate and up-to-date advice and service. 

Trade marks and patents

China is a first-to-file jurisdiction for trade marks through CNIPA, the National Intellectual Property Administration (Chinese Patent Office). It's important to note that the party that first applies for a trade mark is presumed to be the legitimate owner of the mark. Registering your trade mark at the earliest opportunity will facilitate your entry into the Chinese market. For total peace of mind, you should apply for the registration of your trade mark rights in China before meeting with or discussing any business with a potential partner, service provider or client.

During clinical trials and regulatory approvals, you might want to start using product names in agreements and application documents with the proper indicia, i.e. ® or ™ to show that you are using your trade mark. Early registration will ensure that these product names can be registered as trade marks before they’re used in this way.

Trade mark basics

What can be filed?

Any text, graph, alphabetic letter, number, three-dimensional symbol, colour combination, sound or any combination thereof, that is able to distinguish the goods of a natural person, legal person or other organisation from those of others.

What documentation is required?

  1. A scanned copy of a Power of Attorney (POA).
  2. A copy of the Certificate of Incorporation/Certificate of Good Standing of the client issued by the relevant governmental authorities.

Note: neither notarisation nor legalisation is required.

How long will it take?

If the specifications are accepted by the CNIPA, the official receipt with the application number may be assigned in as little as 1 – 2 months. A straightforward application (i.e. with no obstacles to registration) takes approximately 6 – 9 months to be examined and published, for opposition purposes, and a further 3 months to be registered. The certificate of registration is usually issued within two months from the registration date.

Unique sub-classification system of goods and services

When applying for a trade mark registration, the trade mark application must list what goods or services will be used in association with a trade mark. If there are multiple goods or services offered under one trade mark, then multiple trade mark applications are required to cover the various goods and services you plan to offer in Mainland China.

To simplify the trade mark application and examination process, China has adopted standard terms for all available goods and services under 45 classes. These are further divided into sub-classes. For goods these sub-classes are based on the function and/or raw materials, and on the sales channels; while services are divided based on their content and target consumers.

All goods/services applied for must comply with the goods/services listed in the Chinese Sub-classification Book. Anything not specifically listed (i.e. ‘standard terms’) is likely to be rejected.

Patent rights

Patent rights provide a right to exclude others from making, using, offering for sale, selling or importing the patent in China. As with trade marks, patents also follow the first-to-file principle.

According to PRC Patent Law, the following three ‘invention-creations’ can be granted for protection:

  • Invention: any new technical solution pertaining to any, or all, of a product or process or the improvement thereof.
  • Utility model: any new technical solution relating to the shape, the structure, or their combination, of a product that is fit for practical use.
  • Design: any new design pertaining to the shape, the pattern, or their combination, or the combination of colour and shape or pattern, of a product that creates an aesthetic feeling and is fit for industrial application.

If you’re seeking a patent for an invention or utility model, to be granted, it must be novel, creative and have a practical application. For a design patent to be granted, it must not be attributable to any existing design; and no entity or individual can have previously filed an application for that design.

The patent rights for the inventions, utility models or designs are effective from the date of announcement. A patent right is valid for 20 years from the filing date for inventions and 10 years for utility models and designs.

Copyright recordal

Copyright and trade mark rights differ considerably, yet they also have some overlap when it comes to trade mark logos. Copyright is a legal right that protects original, independent expression in the form of works of art, musical compositions, and other types of expression. A trade mark is a legal right used to identify the source of goods. In general, word trade marks are too simple to qualify for copyright protection because simple words (e.g. IBM, Microsoft, Google) do not constitute original expression. However, trade mark logos can be treated as both a trade mark and as a work of art, such as the Microsoft logo or McDonalds’ Golden Arches, which provides two types of protection for logo trade marks: copyright protection and trade mark protection.

China is a signatory to the Berne Convention, so any copyright work that is created independently and first published in another Berne signatory country will receive automatic copyright protection in China. Copyright registration is optional in this case, but it’s wise to record your copyright in China as the copyright recordal certificate will serve as preliminary evidence of ownership of a copyrightable work. If a Chinese competitor were to copy your logo, software, artistic work or literary work, a copyright recordal certificate will help you to prove ownership of a copyrightable work and the date of creation. In this way, it can also be used to prevent other parties from registering your company’s logo trade marks.

Copyright applies to any works created in any of the following forms in the domain of literature, art, natural sciences, social sciences, engineering or technology:

  • Writings
  • Oral works
  • Musical, dramatic, choreographic and acrobatic works as well as works of quyi (Chinese folk art)
  • Works of fine arts and works of architecture
  • Photographic works
  • Cinematographic works and works created by a process analogous to cinematography
  • Engineering design plans, product design drawings, maps, schematic drawings and other graphic works and models
  • Computer software.

Find out more about the registration and filing of copyright applications at the Copyright Protection Center of China.

Customs recordal benefits

China Customs has the power to seize and detain counterfeit and infringing goods imported or exported from China. If they discover goods they suspect are counterfeit, China Customs will notify the legal owners. It’s recommended to record your intellectual property rights with China Customs so they can help monitor and prevent infringement of your IP rights.

Registering Chinese character marks

You should protect not only your English, but also your preferred Chinese language trade marks, and prepare to immediately register and use these Chinese versions in China. While this will cost more in filing fees, it’s worth it to ensure that your brand can easily be recognised by Chinese consumers.

Pre-filing clearance searches

Before you commit resources to adopting and developing your proposed Chinese mark, have an IP specialist conduct clearance searches to make sure you can use it. From the outset, a clearance search will help you identify and avoid any potential conflicting trade mark rights that have an earlier filing date. With around 32 million prior trade mark rights on file at the China National Intellectual Property Administration, the refusal rate for new applications is more than 38%.

Non-disclosure agreements

As part of your planning to enter the Chinese market, you’ll inevitably disclose confidential and non-confidential information to potential Mainland China investors, partners, creditors, clients, distributors or suppliers. An important step before you talk to potential partners or begin any exchange of information is to get a non-disclosure, non-compete and non- circumvention (NNN) agreement prepared by a China-experienced IP lawyer. This can prevent others from using any information exchanged against your company, including filing trade mark applications for your trade marks.

Make sure that:

  • the agreement accurately refers to the registered Chinese name of the local company (plus registration code),
  • the correct legal company representative is named, and
  • it is chopped using the correct company seal (in Chinese).

An English language-only document with a dispute resolution clause that stipulates the NNN agreement is subject to a New Zealand court will very likely be unenforceable in China.

 

Disclaimer: This article is provided by New Zealand Trade and Enterprise (NZTE). Although we intend the content (including advice, templates and other tools) we provide to be helpful, NZTE makes no warranty or representation about its accuracy, completeness or suitability for your business. It is your responsibility to decide how and whether to rely on that content and you rely on it at your own risk.  The content is not, and is not intended to be, expert legal, financial, investment, tax or professional advice and in many cases it will be prudent for you to seek expert advice before making a decision. We are not responsible for any loss or damage arising from the use of this content.

Also please note that the information is only valid at the time of first publication.

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