| Focus: | Brand protection in the People's Republic of China for Australian businesses |
| Services: | Commercial, Intellectual Property & Technology |
| Industry Focus: | Energy, Resources & Infrastructure, Financial Services, Medical & Pharmaceutical, Property, Insurance |
As Australia's largest trading partner, the importance of the People's Republic of China to the Australian economy is beyond dispute. Yet despite this clear reality and an eagerness on the part of Australian business to engage with China, many Australian businesses fail to take the basic and essential steps required to protect their trade mark rights in China.
This article identifies the key branding considerations for Australian companies engaged, or intending to engage, in business with China.
- Know your limits
One of the more frequent mistakes made by Australian trade mark owners is to assume that their Australian trade mark registration provides a monopoly to use of that trade mark around the world.
Registration of a trade mark in Australia only grants the owner of a trade mark a monopoly to use that trade mark in relation to the goods and services listed in the trade mark specification in Australia. Accordingly, if goods are manufactured or sold, or services provided, under a trade mark applied in China, Australian businesses should seek trade mark protection in China.
- Act early
China is a first to register jurisdiction so seek registration as early as possible.
Given that it can take years to obtain a trade mark registration in China, it is crucial that Australian businesses that manufacture or sell goods in China, apply to register their trade marks in China at the earliest possible opportunity – ideally, prior to commencing trade.
- Beyond English
As some of the world's most well-known brands have discovered, the consequences of failing to attain Chinese trade mark protection can be significant and costly. Not only could a business' entire manufacturing and supply chain be disrupted, but a business could be prevented from using its trade mark in China.
Should a third party obtain registration of the trade mark in China, the owner of the Chinese trade mark registration could request that Chinese customs authorities seize and detain branded goods that infringe their trade mark, preventing their import or export.
Australian businesses should also consider seeking trade mark registration in Chinese characters. Many Australian businesses assume that the trade marks that should be protected in China should be the same (being in English) as those marks protected in Australia.
While in some cases seeking protection in English will be the logical way to proceed if the business is manufacturing in China and importing goods back to Australia, if the intention is to sell to Chinese consumers, then seeking protection for a badge of origin directed towards a Chinese audience is likely to be more productive than seeking protection in English.
Although there are a number of different approaches to formulating a trade mark in Chinese characters, the most common methods include:
- transcribing the Chinese characters according to the English pronunciation of the relevant trade mark
- translating the meaning of the relevant trade mark or providing a favourable meaning that consumers will ascribe to the goods/services provided by the Australian business, or
- combining the two methods to develop a wholly unique identity.
Experience has established that if the owner of a product or service does not provide a Chinese name for the trade mark, Chinese consumers and the Chinese market will allocate a name to the goods. If this is allowed to occur, a business may lose control over the allocated name given it did not formulate it.
To avoid missing out on the significant growth and emerging spending power of the Chinese middle classes, Australian businesses should also consider whether products, marketing and advertising literature is appropriately labelled so as to be understood by Chinese consumers.
For instance, the quality of Australian wine is especially well-regarded in China which has led to many Australian wine producers targeting Chinese consumers by including dual English/Chinese labelling on the wines exported to China.
With the advent of China's revised Trade Mark Law scheduled to come into force in May 2014, if your company is already engaged or is soon to be engaged with China and has yet to seek protection in the People's Republic, 2014 is the year to consider protecting your trade marks in China.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
