Know the Best Possible Ways to Avoid Trademark Violation Lawsuit in China

Trademark violations in China are often result in lengthy, expensive and resource-intensive lawsuit. Accurate China trademark search is the most important starting point of your business. Before you start using the trademark, it is vital to conduct trademark availability assessment and clearance. Only after doing this, a China trademark attorney can advise you whether the mark is legally safe to use or not. In this blog, we are trying to give you a complete picture on how you can easily avoid damaging and costly trademark violation lawsuit in China.


Know What Counts as Trademark Infringement in China

In the opinion of China trademark lawyers, foreign businesses need to know what exactly trademark infringement means in China. Only after knowing the proper nature of trademark infringement, one can take right actions. Trademark infringement is when a business uses the name, logo, or domain name of another business without authorization, or uses one that is similar enough to potentially confuse consumers. Trademark owners can take legal action if they believe their marks are being infringed. If infringement of a trademark is proven, a court order can prevent a defendant from using the mark, and the owner may be awarded monetary relief. Unlike the United States and other European countries, in China there is no prior-use or intent-to-use requirement needed before registering a trademark nor are common law rights recognized. China recognizes a “first to file” system, which generally means that the trademark right belongs to the first person who properly registers the mark in China. In other words, any party, whether it intends to use the mark in the stream of commerce, may register a trademark in China. Quick registration of trademark in China offers you strategic advantage.


Perform a Flawless China Trademark Search

When considering a new trademark, perform online China trademark search to determine whether others use that mark, registered that mark, or applied for a registration. Before you settle on a name, logo, or domain name, make sure it is not already trademarked. Check for the exact name you want to use, as well as similar names.


Always Keep China Trademark Attorneys by your Side-

Instead of doing anything by yourself, it is always safe to seek advice from the expert China trademark lawyers. Specialist trademark attorneys have better resources and efficiency to perform a flawless China trademark search. It will also likely cost you less to pay a professional to do a search than it is to defend an infringement that may result in expensive legal battle. If you decide to adopt a proposed trademark, but then obtain a cease and desist demand or threat of lawsuit, work with litigation counsel to understand litigation and potential damages risk. There is no algorithm to determine infringement. It is subjective. The subtleties in this subjective test are not always intuitive and going it alone may only add to the likelihood of confusion.

Trademark has a value not only to the owner due to its distinctiveness but also to customers who associate this trademark to a specific product or service. That’s the reason before you invest in a new brand, have a trademark attorney perform a trademark availability assessment or trademark clearance analysis for you.

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Key Aspects of China Employment Contract

The employment law in China offers compact rules and regulations. From appointing an employee to termination, every aspect of employment is clearly defined in it leaving a little room for the parties in an employment relationship to create new mechanisms in it. China is not an employment at will jurisdiction and terminating a Chinese employee is generally very difficult. Foreign employers are advised not to take an employee beyond an initial term unless you are certain you wish to continue employing that person. That’s why having a well-defined China employment contract is one of the most important parts of doing business over here.

Opening a legal entity in China is extremely process-intensive. The continuous changes in relevant laws, normally several times a year. If a company is qualified to hire employees directly and decides to do so, it should be noted that employers are required to sign a written contract with their employees within one month starting from the employee’s first day of work at the company. An employee contract that is efficient for regulating the relationship between overseas employers and their China employees will basically require to have three characteristics:

>> Clarity

>> Compliance with obligations

>> Threat of litigation

In China, if foreign companies wish one of their employees to be bound by a non-compete provision, they must pay them consideration for their not competing during the entire term of the post-termination non-compete period. A non-compete that comes into force after termination of employment and the consideration for this non-compete is the promise of employment works in the USA but not in China. If an employer fails to execute a valid employment contract with an employee within a month, the employer will be required to pay that employee double the employee’s monthly salary. Where an employer fails to enter into a written contract with an employee within one year or more of their commencement, an open-term employment contract will be established.

According to the article 4 of Labor Contract Law of the People’s Republic of China, employers shall establish and perfect labor bylaws so as to ensure that workers can enjoy labor rights and perform labor obligations. An employer may in some circumstances amend an employment contract, but amendment of significant issues such as an employee’s salary or work position should be done through mutual consultation. The law also states that under ordinary circumstances an employee must give 30 days’ written notice for unilateral termination. The employment contract shall specify the term of the contract, the job description and place of work, working hours, rest and leave, labor remuneration, work safety protection etc.

China employment contracts need to be officially stamped by the company in order to be valid. This Law is formulated for the purposes of improving the labor contractual system, clarifying the rights and obligations of both parties of labor contracts, protecting the legitimate rights and interests of employees, and establishing and developing a harmonious and stable employment relationship. In general, China employment contracts last for one year, with a probationary period of three months. Employers then have the option of renewing the contract after expiry or taking the employee on under an indefinite contract.

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