What Next After Registering Trademark in China?

China’s trademark regime follows a first-to-file system and so does not recognize international trademarks if they are not registered in the mainland. Once a trademark right is granted in China, the trademark owner enjoys the exclusive right to use the sign in relation to the goods or services covered by the trademark, and may prohibit others from using it without prior consent. Like many other countries, China uses NICE classification.

However, a key difference in Chinese trademark practice is subclasses. Chinese Classification Table for Similar Goods and Services (Classification Table) is the main criteria that examiners in China adopt in determining whether goods/services are similar. The Classification Table is mainly based on NICE Classification, but also includes nearly 2,000 items of goods and services that are commonly used in China but not included in the NICE Classification.

Foreign applicants without residency or place of business in China are required to submit trademark applications through a local Chinese trademark agent who will deal directly with the CTMO. The China Trademark Office, or CTMO has issued requirements that must be met in order to approve your trademark application in China. Before you begin the process to register your mark, be sure that you have met the following requirements to obtain a trademark registration in China:

  • The mark must be available to use.
  • The mark must be easily differentiated from other registered trademarks.
  • The mark cannot be descriptive of the goods or services provided.
  • The mark should have a positive connotation.

Cancellation on the basis of non-use

The authority of mainland China stipulated that a registered trademark, including a trademark for goods, a service mark, a collective mark and a certification mark, refers to a trademark that has been approved and registered by the Trademark Office. Chinese trademark law states that if in the three years following the mark’s registration the mark has not been used for a continuous period of at least three years without due cause, it might be subject to cancellation proceedings.

It can take years of painstaking effort for a trademark owner to develop a strong brand. A trademark owner, however, must be vigilant in protecting the brand or the goodwill associated with the brand can be lost.

Two important requirements after your trademark is registered in China

First: Keep a close eye on the possible infringement of your trademark. Closely monitor third party applications for similar trademarks.

Second: Separately register the trademark with China customs. Unless your trademark is registered in China customs, they will not seize allegedly counterfeit products under your trademark.

Nevertheless, Chinese trademark law provides foreign companies in particular with two essential legal remedies to take action against an unlawful trademark application in China. Registered trademarks shall be so distinctive as to be distinguishable and shall not conflict with any prior right acquired by another person. trademarks mean signs which are controlled by organisations capable of supervising certain goods or services and used by entities or individual persons outside the organization for their goods or services to certify the origin, material, mode of manufacture, quality or other characteristics of the goods or services.

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China’s Preferential Tax Policies Become More Favorable to Foreign Businesses

etter cope with potential difficulties.The novel coronavirus epidemic (“COVID-19”) affects all parts of the economy, including the operation and investment activities of foreign-invested enterprises (“FIE”) in China. In such context, the Chinese government has issued a series of preferential policies in order to help businesses to better cope with potential difficulties. The following is a summary of the key preferential policies that companies may be interested in and should pay attention to. On May 29, 2020, the Ministry of Finance (MOF) and the State Taxation Administration (STA) released the Announcement on Extending the Deadline for Preferential Tax and Fee Policies to Support Epidemic Prevention and Control and to Ensure Medical Supply.

The three documents introduce new deductions, tax exemptions, and subsidies to stimulate action in three critical areas related to fighting the coronavirus outbreak. These are:

>> Supporting the production capacity of businesses;

>> Encouraging cash or material donations to fight the epidemic; and

>> Supporting the medical staff and anti-epidemic workers.

Exemption on The Social Security

Circular of the Ministry of Human Resources and Social Security, the Ministry of Finance and the State Taxation Administration on Provisionally Reducing and Exempting the Social Insurance Contributions Borne by Enterprises (Ren She Bu Fa [2020] No.11), entering into force on February 20, 2020.

Beginning from February 2020 medium enterprises, small enterprises and mini enterprises in provinces, autonomous regions, municipalities (except Hubei Province) and the Xinjiang Production and Construction Corps (collectively referred to as the provinces below) can be exempted from the payment of three social insurance borne by enterprises according to the impact of the coronavirus outbreak and fund affordability, the exemption period shall not exceed 5 months; the payment of three social insurance for large enterprises and other units (excluding government agencies and institutions) can be halved, and the reduction period shall not exceed 3 months.

Corporate Income Tax

The income tax on enterprises with foreign investment is levied at the rate of 33 percent. The income tax on enterprises with foreign investment located in special economic zones, state new- and hi-tech industrial zones, or economic and technological development zones is levied at the rate of 15 percent. Already, the State Taxation Administration has extended the period of tax declaration in February and the General Administration of Customs has temporarily extended the deadline for tax payments. Further, regional tax measures have also been released in Shanghai, Beijing, Guangzhou, Hunan, and Shandong, among others, that complement the newly released national measures. Foreign investors are advised to contact their local professional adviser to determine the exact tax preferential policies that may apply to them and their business. Tax exemption for imported equipment: Equipment imported for foreign-invested or domestic-invested projects that are encouraged and supported by the state shall enjoy tariff and import-stage value-added tax exemption.

Labor Policy

The finance ministry cut social insurance payments by RMB 1 trillion to incentivize companies to retain employees. In late January the ministry announced that workers ‘compensation would be subsidized for infected medical workers, and local finance departments rolled out daily stipends for them.

Deferring the payment of social security contributions (and in some cases refunding contributions already made).

The novel coronavirus epidemic (“COVID-19”) affects all parts of the economy, including the operation and investment activities of foreign-invested enterprises (“FIE”) in China. In such context, the Chinese government has issued a series of preferential policies in order to help businesses to better cope with potential difficulties.

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