Significant changes to China’s trade mark law will be implemented from 1 January 2027. This will affect how trade marks can be protected and enforced in China.

The changes should help to deter bad faith actors but also mean that trade marks of legitimate businesses could be subject to greater scrutiny.

We recommend New Zealand businesses operating in China should review their trade mark portfolios, filing strategies, and trade mark use in anticipation of these upcoming changes.

Summary of key changes

With around 50 million current trade mark registrations and approximately seven million trade mark applications filed in China each year, China’s trade mark register is becoming increasingly cluttered. This can make it difficult for businesses to select brands that do not infringe other parties’ rights and that can be adequately protected through registration. This is significant because China is a “first to file” territory where securing trade mark registrations is important for acquiring strong protection and can be necessary for satisfying local regulatory and business requirements.

Significant changes to China’s trade mark law will come into force from 1 January 2027 and are expected to deter trade mark squatting, provide more ability to clear up the register, and improve the ability to protect well-known brands. However, the changes also mean that trade mark applications could be subject to increased scrutiny, and the use of trade marks should be carefully managed.

While the changes to China’s trade mark law are numerous, summarised below are some of the key changes that New Zealand businesses should be across:

1. Stricter rules for misleading trade marks: Fines could be imposed on applicants who knowingly file applications to register trade marks that are deceptive or likely to mislead the public. Trade mark is used in misleading ways could also face fines, and the failure to correct misleading uses could result in cancellation of relevant trade mark registrations. Businesses should therefore ensure that their trade marks are not likely to mislead consumers about the quality, ingredients, or other characteristics of goods or services sold under the mark.

2. Tougher penalties for bad faith filings: The prohibition against bad faith trade mark applications will be extended to include trade marks “not intended for use, and clearly exceeding normal production and business needs”. Businesses should not file applications without a genuine intention to use the trade mark and should not cover goods or services that clearly exceed “normal production and business needs”. Fines could be imposed on applicants for intentional bad faith filings.

3. Shorter timeframe to file oppositions: The period for filing oppositions against trade mark applications will be shortened from three months to two months from the date of publication. Businesses will, therefore, need to pay close attention to third-party trade mark applications of concern and promptly file oppositions.

4. Stronger protection for well-known brands: Well-known unregistered trade marks could be used to block third-party trade mark applications for dissimilar goods and services. It will also be possible to seek confirmation of the well-known status of trade marks in Anti-Unfair Competition Law proceedings.

5. Cancellation actions by the local authority: The local authority in China will be able to initiate its own cancellation actions against trade mark registrations that have become generic or have not been used for three years or longer. Businesses should therefore ensure that they maintain appropriate records of use of their trade marks and take steps to avoid the trade marks becoming generic.

6. “Dynamic” marks will be registrable: It will be possible to register “dynamic” trade marks such as animations. However, functional features relating to the relevant goods will not be registrable as “dynamic” marks.

7. Litigation improvements: Rights owners will have more flexibility for electing types of damages in infringement cases. The courts will also have stronger powers to address malicious trade mark litigation brought in bad faith.

What New Zealand businesses should do

In light of the upcoming changes, New Zealand businesses who are operating in China should:

1. review their trade mark portfolios for China and consider filing trade mark applications to fill any gaps in protection before the stricter rules come into force on 1 January 2027;

2. review trade mark filing strategies for China to manage the risk of registrability objections;

3. ensure that their trade marks are not used in ways that are likely to mislead or deceive the public;

4. maintain records of the legitimate business reasons for filing trade mark applications in case they are challenged on the basis of bad faith;

5. maintain records of trade mark use for defending against potential non-use cancellation actions;

6. monitor the marketplace and take appropriate steps to prevent their trade marks becoming generic; and

7. monitor third-party trade mark applications and promptly take action to oppose applications of concern.

Get in touch

Our team regularly assists New Zealand businesses with protecting and enforcing their trade marks in China. Please get in touch with one of our experts if you have any questions about these changes and how they may affect your business.

Special thanks to Julia Wynands for her assistance in writing this article.