The Chinese market is huge and developing so that there are many advantages for registration of your trademark in the registries of the Trademark Office of The State Administration For Industry & Commerce of the People’s Republic of China (SAIC).
Since the TRIPs agreement entered into force, the legislation on registration and protection of trademarks in China has become more and more similar to the European one. Nonetheless, the process has been gradual and not completed because the TRIPs agreement provided only ground rules that could be implemented by the States, parting the agreement according to their legislative situation in the long term. Companies that do not promptly register their
trademark in China may deal with many issues when trying to fight the counterfeiting of their products in order to gain trademark protection in China.
If you fail to register in time, there is a big risk that even before starting your expansion across the Chinese market, your trademark could have been already 'copied' and registered in China by a local company.
In fact, unlike Courts in Europe and United States, Chinese Courts can completely refuse the worldwide common practice of granting protection to non-registered trademarks of well-known companies. For example, in 1996 a Chinese clothing company registered a graphic of a horse identical to the Ferrari's one. The Chinese Trademark Office rejected Ferrari’s opposition to the registration, arguing that the Chinese company applied for the registration of the graphic first (first-to-file principle). Ferrari appealed the decision objecting that the symbol was recognizable all over the world, including China, as the symbol representing Ferrari brand. After 11 years of proceedings, in 2007, the Beijing First Intermediate Court decided that the Ferrari's horse graphic was not a famous trademark among Chinese consumers and it was not worthy of legal protection, although the name 'Ferrari' was.
In nearest future the situation might change due to the development of Chinese technology and commerce, which makes Chinese companies interested in trademark protection as well as the European and American ones, therefore the competition might become even tougher.
Taking into consideration the fact that the mere usage of the trademark without registration is legally irrelevant, you should act ahead of starting your commercial activities. This is also important because of the fact that the effects of legal protection in China enter into force from the moment of registration instead of the moment of application and that the ordinary time to obtain a registration is about 2-4 years.
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