The United States Patent and Trademark Office (USPTO) issued a report titled “Trademark and Patent Filings in China” (the Report) on Jan. 13, 2021, that discussed the recent rise in Chinese intellectual-property filings. The Report notes that the relevant authorities in China received about 7.8 million trademark applications and 1.5 million utility patent applications, which represented nearly half of the global total.
A press release for the Report can be found at: https://content.govdelivery.com/accounts/USPTO/bulletins/2b67805. The press release includes a link that can be used to download the Report.
The Report identifies four non-market factors that can contribute to the rise in trademark applications and suggests that these factors can also affect patent filings. These factors include subsidies, government mandates, bad-faith trademark applications and resulting countermeasures.
The fact that the Chinese government subsidizes trademark applications is well-known. The Report also identifies explicit government mandates directing state-owned entities to file certain types of trademark applications, such as Madrid Protocol trademark applications.
The Report also identifies three aspects of Chinese trademark law that motivate bad-faith filings. Namely, that bad-faith actors may register trademarks:
- To “ransom” them to their legitimate owners,
- To sell, without authorization, goods or services that appear similar to those of their legitimate owners in an effort to “free ride” on the owners’ goodwill
- To block the legitimate owners’ entry into the Chinese market or thwart the owners’ notices to takedown infringing products from e-commerce platforms.
Report at p. 5 (citing “Practical tips for battling bad-faith filers in China,” Brandy E. Baker, Dec. 31, 2018, World Trademark Review, www.worldtrademarkreview.com/brand-management/practical-tips-battling-bad-faith-filers-china [last accessed on Dec. 18, 2020]).
The Report further describes how the number of trademark filings is affected by so-called “defensive countermeasures,” such as the need by legitimate trademark owners to register their marks to avoid having to deal with bad-faith actors.
The Report discusses the implications of these non-market factors on the Chinese patent and trademark systems.