China public consultation on Draft Regulations addressing bad faith trademark applications

As a “first-to-file” system is adopted in China, where no intention to use or evidence of use is required as part of the trademark application process, so Chinese squatters can easily file applications for trademarks which are identical or similar to foreign brands. Squatters have been making a tidy profit “selling” these pre-emptively registered marks to the owner of the brand when they enter the Chinese market. If the squatter has not had any prior dealings with the brand owner, it can be difficult to allege traditional “bad faith” on the part of the squatter, and such pre-emptively registered marks can rarely be removed based solely on the existing opposition or invalidation grounds available. This has caused a real headache to foreign brand owners. In response to this, the China National Intellectual Property Association (“CNIPA”) published draft Regulations on regulating “abnormal trademark applications” on its…

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