IPR Protection Strategies for Foreigners Doing Business in China

Registering your IPRs

China implements the system of trademark registration. According to China Trademark Law, “registered trademarks” refer to trademarks that have been approved and registered by China Trademark Office (CTMO). Only a trademark is “registered” can the registrant enjoy the exclusive right to use this trademark and be protected by law. So a trademark owner shall apply to CTMO for registration if he wants the trademark used in business to be fully protected by the law. Another kind of right that closely relates to trademark is domain name. It is widely known that some Chinese domain squatters would register right owners’ trademarks/trade names as domain names before these right owners begin to develop their business in China. So you shall file trademark/domain name registration in China as early as possible when you decide to conduct business in China.

As for copyright registration, given China has already been a member of Berne Convention, the creator can automatically enjoy copyright protection in China once a work is created. Even though, a copyright registration certificate could be regarded as a preliminary proof of ownership in court proceedings. Therefore, you should strongly consider registering your copyright, especially for copyrights that are particularly important to the livelihood of your business.

Pursuant to China Patent Law, three types of patents can be protected in China, they are patent for invention, patent for utility model and patent for design. You may apply for a patent in China through a licensed patent agency in China.

Taking appropriate actions against IPR infringements

Chinese laws present IPR owners with several ways of protecting their lawful rights and interests. In addition to their own internal protection efforts (including requesting take-downs of counterfeit or infringing goods, sending cease and desist letters, etc.), IPR owners may, depending on the circumstances, enlist the help of competent administrative and judicial authorities to protect their IPRs through the following ways.

A. Administrative complaining

Administrative complaining is unique tool for IPR owners to protect their rights in China. According to China Trademark Law, China Copyright Law and China Patent Law, IPR owners are entitled to request competent authorities to deal with IPR infringements when they think their IPRs are infringed by others. If the competent authorities determine that the infringement have indeed occurred, they would generally order the infringers immediately to cease the infringements, confiscate and destroy the infringing goods and the tools used to manufacture the infringing goods, and may also impose a fine.

In practice, IPR owners who are familiar with China IPR-related laws will, in many circumstances, generally tend to choose this option. Compared with judicial recourse, administrative complaining is a time-saving and cost-saving way and often yields quick results, especially for cracking down infringing products within a defined area.

B. Customs protection

An IPR owners that has registered its IPR in China may opt to file that kind of IPR, as well as the names of the entities/persons licensed to use it, with the General Administration of Customs(GAC) for the record, so as to secure fuller customs protection. If a local customs authority discovers that there are suspected infringing products to be exported or imported through customs, it will temporarily seize the goods and ask the IPR owner to confirm the nature of the suspected goods. If the IPR owner believes the suspected goods to be infringing goods, the local customs will generally confiscate and dispose of these goods, and may impose a fine on the infringer.

Through customs protection, an IPR owner can quickly discover the infringement and stop exporting/importing infringing products, in particular for famous international brands or products.

C. Civil infringement suits

With respect to serious or large-scale infringements, IPR owners may have consider instituting a civil infringement suit in the competent people’s court, demanding that the infringer cease the infringement, or pay damages. What should be paid attention to is that the court civil proceeding is usually complex and time-consuming. However, an effective court judgment is final and can be used to warn potential infringers, and may compensate the IPR owner to some extent, though the compensation could not be very high in current China judicial practice.

D. Criminal investigation

This method is applied to serious IPR infringements that meet the criteria for a criminal case only. Once any serious IPR infringement is found, the IPR owner my lodge a report with, and provide leads to the competent public security bureau (PSB). The PSB will investigate the leads that IPR owner provided and determine whether a criminal IP case is constituted; If this is the case, the case will be transferred to prosecutorial authority for public prosecution. In practice, the IPR owner needs to cooperate closely with PSB and prosecutorial authority in a criminal case, for these authorities sometimes have difficulties in investigating IP crimes.

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