We get a lot of foreign clients seeking to register their Trademarks in China, only find those marks, or something similar have already been registered by a Chinese company. Sometimes this is a Chinese company the client had done business with in the past.
When client’s ask what to do, we advise an examination of the market, to determine if filing a non-use cancellation action may be appropriate. When a Trademark has been registered but has not been used for several years, the mark is susceptible to cancelation.
Any party may file a cancellation action at the China Trademark Office (CTMO); there are no particular requirements that the party have any interest in the mark in China or in any other country.
The cancellation action is essentially an allegation made to CTMO that the Trademark in question has not been used in the marketplace for at least three years. The application may be comprehensive, covering all registered classes, or only targeted to a select group of classes if required.
After a cancellation action has been filed, the burden of proof, to show use of the mark within the previous three years, rests solely with the owner of the registered mark. In most cases if the Trademark holder cannot demonstrate evidence of use, the mark will be cancelled. Alternatively, if the Trademark holder is able to provide some kind of legitimate justification for non-use, the CTMO may choose not to cancel the Trademark. The timeline for an initial decision by CTMO is about one year.
“Use” under Chinese law includes display of the Trademark on goods, packaging, and containers of products, on trading documents, and use in advertisements, exhibitions or other commercial activities. In the case of licensing of a Trademark, a proper chain of evidence must be provided to demonstrate the licensee is using the Trademark with the express permission of the Trademark holder.