IPR Protection in China’s Textile Industry

Posted on 20-Nov-2017 by Helika Jurgenson

Two weeks ago we were discussing IP protection in South-East Asia’s textile industry, in today’s blog post we are taking a closer look at the IP protection in China’s textile industry, which is still offering many promising business opportunities to European Businesses. The blog post will offer advice to textile producers, to the producers of yarns and fabrics as well as to the producers of textile machinery. In this blog post you can get further information on trade mark, patent, copyright and trade secret protection.

China’s textile industry is both an opportunity and threat to European businesses. It is a major market for those supplying production technologies and a key supply base for textiles and finished goods. However, foreign technologies and brands that are not adequately protected often fall victim to infringement by Chinese competitors. This article addresses IP issues across subsectors of the textile industry, including textile machinery, yarns and specialty fabrics, finished fabrics and brand apparel & accessories. The areas of IP most relevant to the above sectors will be discussed, as well as smaller IP issues specifically affecting makers of brand apparel & accessories.

Trade Marks Protect Your Brand

Trade marks provide protection against use of identical or similar marks on similar goods. China uses the ‘first-to-file’ system, meaning that companies may lose legal protection in China and take the risk of infringing others’ trademark if the same or similar mark has already been registered in China by someone else. It currently takes two-three years from application to registration of a trademark in China, providing no opposition is filed against the application upon publication.

Because China uses the ‘first-to-file’ system, it is common for unscrupulous parties to register other’s trade marks first. It can be a difficult and expensive process to cancel, oppose or buy back a trademark that has already been registered. It is not uncommon that import agents or distributors register trade marks on behalf of the principal. It is recommended that the trademark is either registered in the name of the principal or transferred back to the principal to avoid later disputes. In addition to registering the trademark in the original language, it is advisable to register a distinctive Chinese language trademark, even if this is not the primary mark used. Without a well-promoted Chinese mark, the market may create a Chinese nickname for a product, and this nickname may be registered by unscrupulous parties to exploit the reputation of your brand. Continue reading “IPR Protection in China’s Textile Industry” »

China IPR SME Helpdesk External Expert Charles Feng Interviewed by South China Morning Post regarding Intellectual Property Protection for Foreign-invested Companies in China

Posted on 23-Oct-2017 by Helika Jurgenson

Today we would like to share with you an interview with China IPR SME Helpdesk external expert Mr. Charles Feng from East & Concord Partners that was published in South China Morning Post. You will find the link below following the interview summary kindly drafted by East & Concord Partners.

In August 2017, US President Donald Trump executed an administrative order to initiate an investigation against China in accordance with Section 301 of the Trade Act of 1974, on the basis that “China has stolen plenty of intellectual properties from American companies as well as forced American companies which plan to enter Chinese market to build unfair joint venture relationship with Chinese companies”. Thereafter, on September 8, 2017, twelve Chinese government authorities related to intellectual property protection, including State Intellectual Property Office (“SIPO”), Ministry of Public Security (“MPS”), State Administration for Industry and Commerce (“SAIC”), Supreme People’s Court (“SPC”) and Supreme People’s Procuratorate (“SPP”), jointly issued the Action Plan on Intellectual Property Protection for Foreign-invested Companies, initiating a four-month nationwide campaign from September 2017 to December 2017 to combat infringements and criminal violations against intellectual property rights of foreign-invested companies. Whether a coincidence or not, the above two news may seem a little opposite, which draws much attention on the intellectual property protection for foreign-invested companies in China.

In preparation for its recent article Lessons from Donald Trump and Michael Jordan on Trademarking in China focusing on current status and strategies of trademark protection in China for foreign-invested companies, South China Morning Post (“SCMP”) interviewed several well-known experts in this field, including Charles Feng, partner of East & Concord Partners, and Liao Fei, partner at international law firm King & Wood Mallesons. Continue reading “China IPR SME Helpdesk External Expert Charles Feng Interviewed by South China Morning Post regarding Intellectual Property Protection for Foreign-invested Companies in China” »

Basics of Manufacturing Non-disclosure Agreements in China

Posted on 17-Oct-2017 by Helika Jurgenson

In today’s blog post we are going to take a closer look at different contracts and agreements that help European companies to protect their precious IP in China. In particular, you will learn more about non-disclosure agreements and non-use, non-disclosure and non-circumvention agreements.

Introduction: contracts in China

Many SMEs view Chinese manufacturers as cheap, technically-skilled, attractive options for manufacturing their products and as such pursue partnerships with them. While Chinese manufacturers can be the key to the products needed to give your company worldwide reach, China—like all countries—can be home to unscrupulous merchants with a taste for IP theft. As such, tailoring contracts to suit your intellectual property rights (IPR) is an important way to ensure that your company’s specific intellectual property assets are adequately protected when dealing with Chinese manufacturers. In particular, this article will address use of so-called NDAs (non-disclosure agreements) and NNNs (non-use, non-disclosure, and non-circumvention agreements) to protect an SME’s trade secrets—“any non-public technical or business information with commercial value that is guarded by confidentiality measures.”

What are NDAs and NNNs?

At its core, a non-disclosure agreement (NDA) between an SME and a Chinese manufacturer is an agreement which states that once the SME reveals its trade secrets to the Chinese manufacturer, the manufacturer will refrain from disclosing those secrets to anyone else. Once a secret loses its secrecy—once it is revealed to the public—it no longer has any kind of legal protection and, most likely, will lose its economic value. That is why NDAs are go-to contracts for any SME which seeks to use a Chinese manufacturer. Otherwise, the manufacturer could reveal the SME’s trade secrets, making those secrets impossible to protect and capitalise on. Continue reading “Basics of Manufacturing Non-disclosure Agreements in China” »

The Next Vintage: The Future of Wine Anti-Counterfeiting; Advice from our Experts

Posted on 25-Sep-2017 by Helika Jurgenson

Today’s blog post will sum up our Wine series that we have been running for the past couple of weeks and discusses the future of IP protection in the wine industry.

Wine counterfeiting in China is at a critical stage for the European wine industry. In recent years we have had a taste of what Chinese consumption means to the European producers, with over a quarter of a billion litres of European wine consumed annually by what represents only a fraction of the potential market in China. As the market moves from commodity and gift wines to drinking ‘table’ wine, so do the counterfeiters, flooding supermarkets and restaurants with wines bearing (often validly registered) appellation marks which have no connection to the liquid inside the bottle.

Chinese palates are at a crucial developmental stage, and exposure to poor quality counterfeits of European wine not only damages profits, but also poisons the reputation of European producers in the Chinese marketplace. Competition with domestic producers is already fierce, and Europe’s wine industry can no longer afford to stand by and let this threat go unchallenged.

As we saw in our ‘Terroir IPR’ articles, producers do not stand alone in the fight against counterfeiting, and national agencies such as INAO, as well as regional regulatory bodies such as the CIVB are in working to register GIs and combat the most obvious fraudsters. These two organisations are a minority however, and their pockets alone are not deep enough to fund a comprehensive campaign. Without support of more organisations, and ultimately the producers they serve, they can only do so much to slow the poisonous effects of counterfeiting in China. Continue reading “The Next Vintage: The Future of Wine Anti-Counterfeiting; Advice from our Experts” »

An Introduction to Intellectual Property Protection and Enforcement in China and South-East Asia

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Posted on 20-Sep-2017 by Federica La China

This article is written by our China IP Expert, Ms Alessandra Chies, on the occasion of the Texworld Trade Fair, the No.1 European Trade Fair for Worldwide Apparel Sourcing which this year took place in Paris on 18-21 September. It gathered over 600 international suppliers, companies and EU SMEs, as well as about 950 fabrics manufacturers from 27 countries. This article provides a concise yet comprehensive introduction to Intellectual Property protection and enforcement in China and South-East Asia, and summarizes the main talking points discussed by Alessandra Chies at Texworld on 18 September 2017.

Intellectual Property (IP) protection is a primary method for securing a return on investment in innovation, offering to IP owners a competitive edge that others will not have. SMEs invest a tremendous amount of time, passion and monetary efforts in R&D and marketing, but often fail to consider that, in most countries, the only way to enjoy exclusive rights over their creative efforts and their business identity (trademark) is through IPRs registration. Considering that in the textile sector one single product can brilliantly encompass almost all form of IP rights, understanding and defending them is a paramount objective: a Patent for the new man-made yarn, the Design for an innovative texture of the fabric, the Copyright for the drawing painted on it, the Trade-secret for the dying procedure and the Trademark as representation of the business identity, all in one small piece of cloth.

The point is that Trademarks, Designs, Patents, are territorial rights and most countries adopt the first to file principle: this means in practice that the IPRs belong to their creator only if their creator was the first one to register it in that Country. And each Country in the world has its set of rules, its peculiarities, its advantages and pitfalls. Without being secured through registration, with the assistance of lawyers, expert in the jurisdiction, your IPRs can be freely exploited by anybody else. Considering the importance of the China market and the wonderful opportunities it offers in terms of production abilities, raw and semi-processed materials and the growing purchasing power and awareness of Chinese consumers, SMEs cannot afford to put-off investments in IP registration and enforcement in China and in the South-East Asian countries that are slowly but steadily emerging. Continue reading “An Introduction to Intellectual Property Protection and Enforcement in China and South-East Asia” »

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