In the western part of the world, China is notorious for the manufacturing and sales of counterfeit branded products. This raises the question of whether it makes sense to register a trademark in a country like China.

A trademark is primarily used to market products and services. It can consist of a word, sentence, symbol, design, letter, number or a combination of these factors. Trademark rights are territorial rights. If, for example, a trademark is registered in the USA, then this trademark is protected exclusively in the USA. The owner of the trademark must go through a new, separately regulated trademark application procedure in order to obtain protection for the trademark in other state territories. Without trademark registration, a company cannot legally defend itself against imitations and counterfeits.  Registering a trademark can be very time-consuming, but in most cases, it is highly recommended. Only recently the New York fashion label Supreme felt the effects of an unregistered trademark.

Supreme vs. Supreme Italia

The original brand SUPREME (Chapter 4 Corp. DBA Supreme), founded in New York City in 1994, focuses on streetwear and currently operates 11 stores worldwide. There are no stores in China. The counterfeit brand Supreme Italia (also known as Trade Direct Srl.), which is just four years old, claimed to be planning at least 70 new stores around the world. These included flagship stores in Beijing and Shanghai. [1]

At the end of last year, the American fashion brand Supreme told the imitators, who sell products under the “Supreme Italia” label, that they were fighting for trademark rights. The lawsuit was triggered by a marketing campaign of the mobile phone manufacturer Samsung. In December 2018, Samsung announced the launch of a series of products on the Chinese market in cooperation with Supreme Italia. As a result, the American original publicly pointed out that this cooperation did not exist between Samsung and the American brand Supreme. Subsequently, Samsung terminated its cooperation with Supreme Italia. [2] Since then, both clothing manufacturers – Supreme Italia and the original Supreme – have tried to register the brand with the Chinese Trademark Office (CTMO [3]).

The imitator Supreme Italia had filed a total of two trademarks with CTMO, following which the original trademark Supreme filed an action for annulment against the marks applied for. The Chinese Trademark Office decided in favor of the original brand Supreme and canceled the trademarks registered by the illegitimate competitor. However, the trademark rights were not transferred directly to the original Supreme brand. Instead, Supreme was asked to separately register the trademark rights in China. As a rule, the CTMO takes between 6 and 9 months to review documents and make decisions. 85 trademark applications by the New York brand Supreme are currently pending at the Chinese Trademark Office. In order to avoid further disputes, Supreme had applied in China not only for the trademark itself but also for the rights to various advertising slogans, logos, and related brand names.

The Supreme case clearly shows how important it is to register your trademark in all jurisdictions where you operate. We are happy to help with the preparation and implementation of trademark applications in China. Read more about trademark registration in China: https://ecovis-beijing.com/do-not-trust-the-madrid-system-when-you-register-a-trademark-in-china/.

For more detailed information and an assessment of your trademark situation in China, please contact us to arrange a consultation with one of our legal experts.

 

Brad Liu – Legal Manager 

Brad Liu has more than 10 years’ experience in the corporate and legal field. Prior to joining ECOVIS, Brad headed the Beijing corporate services team of a mid-tier international accounting and business advisory firm. He has been advising international SMEs from US, Europe and ASEAN countries in doing business in China.

For more information, please contact:
Mail: brad.liu@ecovis-beijing.com

 

Ecovis Beijing

Ecovis Beijing is the trusted tax and legal advisor to several embassies and official institutions in China. It specializes in mid-sized international companies and is focused on tax & legal advisory, accounting and auditing. If you’re interested in finding out more about tax and legal, don’t hesitate to sign up for our  Newsletter, give us a call +86 10-65616609 or contact us directly via service@ecovis-beijing.com.