Archive for the Chinese Legal Issues Category

China Ramps up it’s Patent Industry, Surpasses USA

Posted in China - US Relations, Chinese Economy, Chinese International Trade, Chinese Legal Issues, Intellectual Property in China on 12/13/2012 by David Griffith

China Surpasses U.S. in Number of Patent Applications

By Sheri Qualters – The National Law Journal – December 12, 2012

Last year, for the first time, more patent applications were filed in China than in the United States. This surge reflects China’s increasing intellectual property maturity and growing pains, according to U.S. Intellectual property lawyers and experts.

In a December 11 announcement, the World Intellectual Property Organization reported that China’s patent office took in 526,412 applications, compared to 503,582 in the U.S. Patent and Trademark Office and 342,610 in Japan’s patent office.

Worldwide patent filings exceeded the 2 million mark, with 2.14 million filed last year. That’s a 7.8 percent boost over the 1.99 million applications filed in 2010.

“Sustained growth in IP filings indicates that companies continue to innovate despite weak economic conditions. This is good news, as it lays the foundation for the world economy to generate growth and prosperity in the future,” said WIPO director general Francis Gurry at a press conference in Geneva.

The numbers reflect a boost in innovation by Chinese nationals, said Stuart Meyer, an intellectual property partner at Fenwick & West in Mountain View, Calif. It’s not just U.S. inventors wanting to get protection in China because it’s commercially important, he said. “That’s a real sea change.”

Ultimately, such filing shifts could affect U.S. patent policy, which offers great protections for intellectual property producers, he said.

The balance is shifting a little bit because more U.S. companies are dealing with licensing intellectual property owned by foreign patentees, said Meyer. “We’re the ones that don’t need such rigorous protection because we’re on the other side of the coin. It changes the way we’re going to be thinking about this in the coming decades.”

The numbers are a milestone in the way innovation is distributed around the world, said Q. Todd Dickinson, executive director of the American Intellectual Property Law Association. “Clearly china is in growth mode in terms of research and development and patent filings track that closely.”

He also said China’s intellectual property system is maturing. “Clearly they’re using IP to protect indigenous innovation.”

The filings show that everyone wants to do business in China, but China also needs to improve patent enforcement, said Peter Toren, a partner at Weisbrod Matteis & Copley in Washington.

“I’ll be more impressed when I get the real sense that China is enforcing patent rights…I want to see them allowing companies to really enforce the rights they have,” Toren said.


International Patent Litigation – Is There a Home Court Advantage?

Posted in China - US Relations, Chinese International Trade, Chinese Legal Issues, Intellectual Property in China on 09/10/2012 by David Griffith

Author’s Note: Did Samsung get a fair trial against Apple in Northern California? Can Apple get a fair trial in Korea or China?  All interesting questions with potential billion dollar outcomes depending on the answer.

Some in Asia See Bias in U.S. Apple Verdict

By Jessica Seah  The Asian Lawyer  September 3, 2012

On August 24 a California federal jury awarded Apple Inc. over $1 billion in its smartphone patent infringement suit against Samsung Electronics Co. Ltd.—the largest patent verdict ever. The same day, a Korean court issued a split decision widely seen as more favorable to Samsung, and, last Friday, a Japanese court ruled against Apple outright, ordering the U.S. company to pay Seoul-based Samsung’s legal costs.

The contrast in outcomes has not been lost on intellectual property lawyers in Asia.

“I am surprised Samsung lost all counts in the case in the U.S.,” says one Beijing IP partner with an international firm. “I think there is a clear home court advantage there.”

Other IP lawyers in the region expressed similar sentiments, with some noting that perceptions of bias in the U.S. Apple ruling could provide cover to courts in the region, particularly those in China, that have been accused of favoritism themselves.

Matthew Laight, an IP lawyer and the Hong Kong–based China managing partner for U.K. firm Bird & Bird, says that inexperienced Chinese judges in patent cases could potentially draw the wrong lessons from the Apple case.

“Chinese judges are just getting their heads around whether or not to grant injunctions in patent disputes,” Laight says, “so the result of the Apple-Samsung case may influence how judges see things.”

Many lawyers in the region noted that the U.S. decision was made by a jury. The Korean and Japanese cases were both decided by judges.

The Beijing partner says he found the U.S. ruling less reasonable than the Korean one, in which the three-judge Seoul panel found that both Apple and Samsung infringed each other’s patents and ordered a halt to sales in the country of certain products from both companies. Some observers have said that ruling was more favorable to Samsung because it had already discontinued the affected products.

Apple’s hipper image helped with the California jury, the Beijing partner thinks. Despite being the world’s largest technology manufacturer by revenue, Samsung was the effective underdog in the U.S. case.

“Samsung was pitted against the most revered and successful company in the world,” he says. “So there is definitely a local bias there, especially when decided by jury. I have my doubts against the jury really understanding such a complex case.”

The seven men and two women of the jury found that Samsung infringed all but one of the seven patents at issue—a patent covering the exterior design of the iPad. They also decided that Apple didn’t violate any of the five patents Samsung asserted in the case.

In an interview with Bloomberg, jury foreman Velvin Hogan rejected accusations of local bias. He said the jurors were “inundated” by evidence, and the fact that Apple was headquartered in Cupertino, California—not far from the San Jose courtroom in which the case was heard—made no difference.

Morrison & Foerster and Wilmer Cutler Pickering Hale and Dorr represented Apple, while Quinn Emanuel Urquhart & Sullivan acted for Samsung.

In Japan, Apple had claimed that Samsung infringed its patent on synchronization and sought $1.3 million in damages. District Judge Tamotsu Shoji in Tokyo rejected Apple’s claim, though Apple has other infringement claims pending in Japan.

According to Yoshikazu Iwase, an IP partner at Tokyo-based Anderson Mori & Tomotsune, the Japanese court decision was not surprising because “traditionally Japanese judges are conservative in enforcing patents” and local judges are usually “not directly affected by the decisions of other jurisdictions.”

Still, large Asian corporations are generally accustomed to litigating in the United States and have faith in the fairness of the courts there. Though there may be a sense that Apple enjoyed a home-court advantage in San Jose, says Jones Day Tokyo partner Michiku Takahashi, that stops well short of the kind of bias they worry about in China, where courts are not independent and are generally seen as favoring well-connected parties.

“Experienced Japanese companies are not too bothered about court bias, but comparatively they are generally more concerned about decisions made by Chinese courts, than, say, in the U.S. or in Europe,” she says.

Many lawyers believe the Apple-Samsung fight will trigger a wave of new patent litigation targeting big Asian companies. Geoffrey Lin, a Shanghai-based IP partner at Ropes & Gray, says that lawyers will start to go back to look at their clients’ business models to make sure they are closely protected by their patents.

“International technology companies, especially those that manufacture smartphones, are going to start looking at jurisdictions where there is a lot of trolling,” says Lin.

Takahashi says smartphone-related patent litigation has already become common in recent years. “There has been an increasing number of patent troll cases here in Japan, where non [technology] practicing entities are registering smartphone patents,” she says. “So the Apple matter may give even the larger Japanese phone companies more confidence to litigate when they feel their patents have been infringed.”

But Laight says that while the Apple-Samsung case has gotten a lot of attention, the dispute might not be a sole driver for an increase in patent litigation in Asia.

Asian electronics companies from Japan, Korea, and Taiwan have long litigated against each other both in their home jurisdictions and around the world. Laight notes that now Chinese companies are getting in on the act. Last year Shenzhen-based telecommunications firm Huawei Technologies Co. filed patent infringement lawsuits against its smaller Chinese rival ZTE Corp. in courts in France, Germany, and Hungary. The patents relate to data card and 4G technologies, and ZTE has allegedly used Huawei’s trademark on some of its data cards. ZTE has countersued, alleging that Huawei infringed its 4G patents.



International Patent Applications in China

Posted in Chinese Legal Issues with tags , , , , , , , , , , , , , , , on 01/16/2012 by David Griffith


Courtesy of International Business Law Services

China has joined the growing list of countries allowing electronic filing of patent applications; the first day of the service was May 1, 2007.  Sophisticated software enables electronic filing of international patent applications with cooperation of the World Intellectual Property Organization’s (WIPO), Patent Cooperation Treaty (PCT). The WIPO is the “cornerstone of the international patent system” and its dynamic system, offering quick, flexible and economical approach to establishing patents in nearly 140 countries. In regards to China establishing this Intellectual Property (IP) milestone, and also the great interest in Chinese business, these questions will be answered: What Software is used for the Electronic Patent Process? How Does PCT-SAFE Filing Work? What Benefits are gained by Filing with the Electronic System? How Big Have Chinese Patent Applications Become? What IP Legislation does China Have for Patent Protection?
China newly implemented software for the electronic filing of international patent applications is the foundation of their entire patent filing system, which makes a formerly clunky process smooth and risk-free. The software, called “PCT-SAFE” (“Secure Applications Filed Electronically”), has been in use for awhile and working in patent offices across the globe, such as Australia, Denmark, the European Patent Office (EPO), Finland, France, Germany, Japan, Malaysia, Netherlands, Philippines, Poland, Republic of Korea, Romania, Slovakia, Spain, Sweden, United Kingdom and the United States of America.  Since February 2004, the software has added the superb capability of allowing businesses and inventors the ability to seek multiple-country patents by electronically submitting an international application under the PCT. In this instance, the WIPO acts as the receiving office of the patent filed.
How Does PCT-SAFE Filing Work?
According to the WIPO, the PCT-SAFE system has four major components:1)  PCT-SAFE client for preparing the PCT request form: in case of e-filing, it is also used for securely transmitting the entire application to the receiving office;2)  PCT-SAFE Editor: a word processor-like tool that enables users to prepare the text and drawings of a PCT application in electronic format (the application will be saved in Extensible Markup Language (XML)) for e-filing purposes;

3) Security services and a Public Key Infrastructure (PKI);

4) A receiving server for use in receiving Offices that includes a back-end system to print and securely store the received data.


What Benefits are Gained by Filing with the Electronic Patent System?
Chinese patent applicants who organize and submit PCT applications via electronic format will help the patent office by ensuring a more orderly, timely and efficient process. This cuts down on paper handling and eliminates traditional mail routines. In return, WIPO will allow the following, (i) fee reductions in some instances; (ii) eliminated or reduced costs for printing, copying and mailing the applications; (iii) Near instantaneous notification when the application is received and processed; and (iv) Easy and secure transmission of international applications.
How Big Have Chinese Patent Applications Become?
China is the 8th largest country for filing PCT applications and this grew by 57% from 2005 to 2006. Beyond this, the WIPO World Patent Report 2006 stated that China is now the 4th largest patent office in the world in terms of total patent applications filed.  While Chinese residents had an individual patent filing increase of greater than five-fold from 1995 to 2004, resulting in 65,786 patents placed; worldwide, a mere five patent offices account for three-quarters of all patents filed across the globe. The five top patent filers nations are the United States, Japan, South Korea, China and the European Patent Office (EPO).
What IP Legislation does China Have for Patent Protection?
China has placed a great deal of importance on patent registration (PR) legislation since the implementation of a legislative reform intending to protect fair market competition, safeguard market economic freedom and order, and promote economic and cultural development.Beginning in 1984, China has toiled to create and implement a reformed Patent Law, which was then amended in 1992. Despite starting late with IPR Legislation, China has used international models of successful patent legislation to draw on for IPR legislation, putting a Chinese slant upon the process. To help the effort, China joined the World Intellectual Property Organization, the Paris Convention for the Protection of Industrial Property, the Strasbourg Agreement Concerning the International Patent Classification, the Locarno Agreement Establishing an International Classification for Industrial Designs, and has also signed reciprocal agreements for IPR protection with the U.S. and other countries.The Chinese Supreme Court has formulated and established almost twenty judicial interpretations and explanatory papers in the last several decades, which were based upon apparent need arising from Patent cases. These include: “the circular on Several Issues concerning Trials of Patent Cases(February 1985), the Circular on the Issues of Geographical Jurisdiction over Patent Dispute Cases( June 1987 ), the Circular on Several Issues concerning Trial of Cases Involving Patent Application Disputes (October 1987 ), the Answers to Several Questions on Trial of Patent Dispute Cases ( December 1992 ), the Circular on Further Strengthening Judicial Protection of IPR  (September 1994 ), and the Opinions on the Correct Handling of Several Issues in Cases Involving Science and Technology Disputes ( April 1995 ).

Enforcing Contracts with Chinese SOEs Still Challenging

Posted in Chinese International Trade, Chinese Legal Issues, Doing Business in China on 09/06/2011 by David Griffith

Wall Street Journal On Line    By Andrew Galbraith   September 6, 2011

A spat over contracts between China’s biggest shipping company and foreign ship owners is calling attention to broader tension over the rise of a Chinese corporate sector that doesn’t always play by established global rules.

The move by China Cosco Holdings Ltd., the listed flagship of state-owned China Ocean Shipping (Group) Co., to halt or delay payments for vessels it leased at the height of the shipping boom in 2008 reflects in part the cyclical stresses in the global shipping industry. But some analysts, lawyers and executives in China say it also reflects a willingness among increasingly bold Chinese companies—often, like China Cosco, owned by the government—to snub existing norms of global commerce.

In recent years, foreign banks and other creditors have faced repeated difficulties getting payment on bonds or derivatives contracts with Chinese companies. In 2009, for example, China’s government encouraged state-owned airlines and shipping companies, including Cosco, to challenge losses from derivatives deals with foreign banks used to protect against sudden surges in the price of fuel. That same year, China-based Asia Aluminum Holdings Ltd. offered to buy back its debt for pennies on the dollar, eventually leading to losses for international investors.

Foreign companies that do business in China are routinely warned that contracts aren’t viewed in China with the same sort of legal sanctity that they receive in most developed economies. Jingzhou Tao, a Beijing-based lawyer with Dechert LLP, says that withholding payments is a frequent tactic used in China to force price negotiations. “A contract is not an unchangeable bible for Chinese companies,” Mr. Tao said.

Prices for leasing the cargo ships that carry commodities like coal and iron ore have plunged since 2008, when China Cosco signed the deals at issue. Industry executives say it is common for shipping companies to want to renegotiate long-term contracts as a result of economic swings. But it is unusual for financially solvent companies to unilaterally renege on contracts the way that China Cosco has done on some.

Representatives of Cosco Group and China Cosco didn’t respond to requests for comment Friday. During a conference call a week earlier after it posted a first-half loss, China Cosco Executive Director Zhang Liang called such disputes “normal” and blamed ship owners for “trying to use the media to make a bigger impact.” The company said it had renegotiated deals on 18 ships. A China Cosco official said Thursday that it plans to restructure its unprofitable dry-bulk shipping operations.

China Cosco, which has about 200 dry-bulk ships under charter and owns 234, appears to be trying to correct course. Some ship owners that had complained about the Chinese company’s failure to pay have said in recent days that they started receiving payments again.

On an earnings call Wednesday, DryShips Inc. Chief Financial Officer Ziad Nakhleh said the Greece-based company had been owed about $2.5 million by a China Cosco unit for three vessels, but that “Cosco has since resumed hire payments on all of the three vessels and we have no further issues with our counterparties.”

Angeliki Frangou, chairman and chief executive of Navios Maritime Holdings Inc., said Cosco stopped payments in July but has since met original agreements with no renegotiations. “We have been paid,” she said. “Cosco is a counterparty that we like to do business with and will continue to do business with. This was an incident that was very quickly resolved.”

But some in the industry remain frustrated and say the move could have lasting damage for Cosco’s reputation.

“They’ve paid up to date [and] I don’t want to be nasty,” said Raymond Ching, vice president at Hong Kong-based Jinhui Shipping & Transportation Ltd. “But obviously, withholding payments and giving us either no response or very, very absurd reasons—it’s just something that we won’t tolerate.”

Analysts and lawyers say big Chinese state-owned companies can be especially aggressive in dealing with foreign companies because of their government backing and the enormous clout they wield within China in industries that are often oligopolies.

“State-owned enterprises that are dominant in their own sector and in some cases more powerful than government departments are used to having things their way,” said Lester Ross, a Beijing-based partner at law firm WilmerHale. Mr. Ross said that Chinese companies in the minerals and cotton industries have a history of walking away from deals when prices move against them, and that foreign companies sometimes charge a premium for services to Chinese government companies because of the contract risks.

“These companies are only partly companies. They are also political entities,” said Carl Walter, a former Beijing-based banker for J.P. Morgan Chase & Co. who has co-authored two books about China’s state-owned enterprises. That means political imperatives, such as concerns over the value of national assets, can sometimes drive decisions by company chief executives, who at Chinese state-owned enterprises are appointed by the Communist Party. “When you do business with these major SOEs, you better make sure you make enough money to cover,” Mr. Walter said.

Arthur Bowring, managing director of the Hong Kong Shipowners Association, argues that while Cosco’s moves are worrisome for the industry, they won’t likely be that damaging to the company long term. He adds that in late 2008, Australian iron-ore producer Fortescue Metals Group Ltd. backed out of its obligations under some shipping contracts. After a period of arbitration, the company said in October that it had settled all disputes with shipping companies.

“People are now doing business with [Fortescue Chairman] Andrew Forrest again…and it’s almost like it never happened,” Mr. Bowring said.

Mr. Bowring said Cosco, which has been operating internationally for decades, is too experienced to think that it can apply Chinese rules to overseas deals. Still, he said that company relationships are viewed differently in China than in many other places. “Chinese culture will build a relationship before the contract,” he said. “The relationship is always something that can be talked about. The contract is just a set of papers that you keep in your bottom drawer.”

Fake Apple Store Shows Chinese IP Enforcement Challenge

Posted in Chinese Economy, Chinese International Trade, Chinese Legal Issues, Doing Business in China, Intellectual Property in China, Life in China on 07/24/2011 by David Griffith

Insight: Fake Apple store cuts to core of China risk to brands

By Jason Subler | Reuters – Fri, Jul 22, 2011

SHANGHAI (Reuters) – A fake Apple store in China, made famous by a blog that said even the staff working there didn’t realize it was a bogus outlet, is probably the most audacious example to date of the risks Western companies face in the booming Chinese market.

Few products have captured the imagination of Chinese consumers quite like Apple’s iPhones and iPads. Demand is surging across the country of 1.3 billion people, even hundreds of miles away from the tech giant’s official stores in Beijing and Shanghai.

That marks a huge opportunity for Apple to sell its iconic products, but it also leaves the most valuable brand name in the world vulnerable to the sort of scam perpetrated by the fake store in Kunming, in southwestern Yunnan province.

Complete with the white Apple logo, wooden tables and cheery staff characteristic of real Apple stores worldwide, the Kunming copy left even regular industry watchers startled at the elaborate fake.

“I’m not aware that there have been actual fake stores like that before,” said Bob Poole, vice president of the China operations of the U.S.-China Business Council in Beijing.

“If your products are being sold as fakes, then your reputation goes down and people are going to be less willing to buy. We have to maintain active vigilance.”

Apple has authorized close to a thousand resellers in China to sell its goods. They are required to comply with certain standards and rules on store layout and customer service to get the rights to sell such items as Apple’s iPhones and iPad tablet computers.

The Cupertino, California-based company, which global brands agency Millward Brown says has the world’s most valuable brand worth some $153 billion, has just four official stores in China, two of them in Beijing and two in Shanghai.

In spite of the number of resell outlets, many more copycats have popped up. They often sell real Apple products, obtained from illicit channels, such as smuggling, or through the grey market via Apple agents and distributors.

The blogger who made the store an overnight online sensation said the Kunming store was a “beautiful rip-off” and the salespeople “all genuinely think they work for Apple.”

The bogus store, where staff admitted to Reuters Friday was not an authorized reseller, cuts to the core of the risk big brands take in China.

The widespread unauthorized reselling even of real consumer goods means it is more difficult for companies like Apple to manage their brands and risks undermining their longer-term plans to make inroads into the country.

“It’s becoming more of a problem I think,” said James Roy, a senior analyst with retail consultancy China Market Research in Shanghai.

“A lot of foreign brands are increasingly really seeking to set up a real retail presence in China, not just selling to resellers or through franchisees,” he said.


That China is a hotbed for piracy is nothing new. Multinational companies have long seen problems such as intellectual property theft and unclear regulations as the price of doing business in the world’s fastest-growing major economy.

The United States and Europe have persistently pressed Beijing to do a better job of enforcing intellectual property rights and stamp out the production of everything from fake DVDs to medicine.

An increasing number of U.S. companies in China say the enforcement of intellectual property rights has deteriorated in the last year, an annual survey by the American Chamber of Commerce in Shanghai released in January showed.

China has said it is cracking down, particularly on piracy, and Western companies have claimed some victories.

This week, Baidu Inc, China’s biggest search engine, agreed with top music studios to distribute licensed songs through its mp3 search service, ending a legal dispute over accusations the company encouraged piracy.

The less-publicized phenomenon of unauthorized vendors setting up shop to peddle real products has grown alongside China’s manufacturing prowess. Many of the factories that produce brand-name goods on contract have been known to do extra runs of the goods to make extra cash, analysts say.

Paul French, chief China analyst at retail consultancy Access Asia, said Apple had two choices to clamp down on fake stores.  “One is they either have to police their operations better, or two, they have to sell everything through their own stores and cancel their reseller agreements,” he said.

China’s high import duties on many goods have also encouraged the likes of the fake Apple store in Kunming, analysts suggest.

Shop owners can buy everything from computers to cosmetics at significantly lower prices overseas, smuggle them into the country, and undercut the prices of official Chinese retailers.

Vendors often turn to Chinese students studying abroad to buy products in the United States, Hong Kong, Australia and other countries.

Internet “bulletin boards” are full of advertisements soliciting interested parties, who can earn 100-200 yuan ($15-30) in fees per iPhone or iPad they manage to sneak past customs agents when returning home for the summer or winter break.


At first glance, it might appear that companies would not mind having their products bought in other countries or obtained through other means and resold in China through resellers, as it helps drive sales but with less expense and hassle over customer service.

After all, building up a retail presence in a country as vast as China takes time and is expensive. That’s why many companies have sought to expand their presence through licensees.  The problem is, any negative experiences customers have with service at unauthorized resellers can backfire on the brand because customers relate their disappointment with the product.  “People might have a bad experience, they might blame the brand,” said Roy.

Many Western brands are now opting to take back control of their operations. It may mean a more measured pace of expansion, but it gives a company greater control. Starbucks last month took back control of its retail stores in southern China, having worked in the past through a joint venture.

While the issue of unauthorized retailers has not yet garnered the same attention as piracy, China has made efforts to crack down on such activities, stepping up screening to try to catch smugglers. But if Beijing’s track record with combating piracy is any guide, analysts say, it is unlikely that fake stores — Apple or otherwise — will be stamped out anytime soon.

“China has very low penalties. It’s almost considered a good business deal to get caught, then move and set up shop again,” said Poole of the U.S.-China Business Council.

Sports-Related Domain Name Disputes in Asia

Posted in Chinese Economy, Chinese Legal Issues, Doing Business in China, Intellectual Property in China with tags , , , , , , , , , , , , , , , , , , on 07/18/2011 by David Griffith


Courtesy of Internet Business Law Services

Sports personalities and promoters can turn to the Asian Domain Name Dispute Resolution Centre (ADNDRC) for dispute resolution services regarding domain names that are claimed to infringe registered trademarks. Other remedies available to them include those pursuant to personality rights law in China, or passing off and trademark law in Hong Kong.
The Asian Domain Name Dispute Resolution Centre (ADNDRC) was formed as a joint undertaking by the China International Economic and Trade Arbitration Commission, Hong Kong International Arbitration Centre and the Korean Internet Address Dispute Resolution Committee. It was subsequently approved by the Internet Corporation for Assigned Names and Numbers (ICANN) to provide dispute resolution services in regard to Asian generic top level domain names (gTLD’s), under the Uniform Domain Name Dispute Resolution Policy(UDRP).The ADNDRC may delete or transfer the domain name under paragraph 4 UDRP if the domain name is confusingly similar to the trademark; the domain name holder had no legitimate interest; and the domain name was registered or used in bad faith.

In Telstra Corporation Limited v. Domain-Broker-Labs, Case No.D2000-1789, the complainants, Australia’s leading information services company, entered into a strategic Pan-Asian Alliance with Pacific Century CyberWorks, a leading Asian communications company. They sued for and obtained transfer of the Asian respondent’s domain name, registered shortly after conclusion of the Alliance, on the grounds that the respondent did not carry on any related business, was not commonly known by any similar name, and did not act in good faith.

The panel in that case held that “given the [claimant’s] reputation and goodwill in the TELSTRA PCCW name and the public announcement which… featured…prominently in South East Asia, it is hard to see how the respondent can claim to have registered the name in good faith.… [given] the lack of any adequate explanation or the denial of bad faith….”

In Advance Magazine Publishers v. Shenzhen Hengtaixin Golf Utilities, CIETAC CND-200300007, respondent registered the domain name to provide information services concerning golf. The complainant was the owner of the trademark GOLF DIGEST for print publications in China. Article 11 of the Chinese Trademark Law and Article 49 of the Implementing Regulations of the Trademark Law provide that trademarks referring to the quality, quantity, or other features of goods may not be registered, and there is no right to prohibit others from using these terms normally. The panel ruled that the complainant could not register the trademark for information services on golf and was limited to print publications and similar goods; consequently, there was no right to prevent the respondent’s normal use of the descriptive term in its domain name.

In Alibaba (China) Network Tech., Ltd. v. Jichuang Power Group Co., CIETAC CND-2003000024, the China Internet Network Information Centre (‘CNNIC’), China’s official domain names regulator and administrators of .cn TLD, refused the application of Beijing Zhengpu Science Development Company for the Chinese name ‘Alibaba’ on the grounds that the domain was reserved for a well-known Hong-Kong based online business-to-business marketplace, Corporation. A Beijing Intermediate People’s Court ruled that CNNIC did not have the right to reserve Chinese domain names for well-known companies and ordered them to treat all domain applicants equally.


Are there any other sources of protection for domain names infringing identity rights of sports personalities in China?
Article 99(2) of the General Principles of the Civil Law guarantees legal persons the right to exclusive use of their personal names.  Article 120 provides, that if a legal person’s “name, portrait, reputation or honor is infringed upon, he shall have the right to demand that the infringement be stopped, his reputation rehabilitated, the ill effects eliminated and an apology made; he may also demand compensation for losses.”
How have the above legal protections been applied in practice?
In Shanghai Shenhua Football Club v. Shanghai Teleitong Trade, Gazette of the Supreme Court, vol. 69, no.1 (2001), the defendant used the name of the plaintiff, a Chinese national football champion in an advertisement.  The court held that the defendants were using the plaintiff’s identity to pursue commercial interests and required authorization for doing so.In 2004, a Fujian company registered the domain names of China’s gold medalists in the Athens Olympics,, without their authorization. After a public outcry, the company gave up the domain names.

In the run-up to the Beijing Olympics, China’s General Administration of Sport preregistered most of the names of China’s Olympic athletes, giving away the domain names to the country’s gold medalists as a gift.  The rest of the domain names were returned following an appeal by the CNNIC.


Is the law the same in Hong Kong?
The Hong Kong Bill of Rights Ordinance protects private individuals from invasions of privacy by the government and public authorities, but not by private persons or organizations.  Sports personalities have to rely on the UDRP, reinforced by passing off and trade mark law, in order to obtain protection against infringement for their identities.

How to Achieve Corporate Success in China

Posted in Chinese Economy, Chinese Legal Issues, Chinese Markets, Doing Business in China with tags , , , , , , , , , , , on 05/13/2011 by David Griffith


Multinational corporations now look toward China with a mixture of trepidation and anticipation. The remarkable speed and scope of Chinese economic growth is changing the global distribution of power and resources, possibly to the detriment of the major industrial powers. But this same transformation presents tremendous opportunities for companies who understand China well enough to leverage both its accomplishments and its deep-seated problems for corporate benefit.

In straightforward language, with numerous examples to back up his argument, Lieberthal cogently presents not only how to benefit from doing business in China, but also how to avoid the serious risks that the endeavor entails. The implications that Lieberthal lays out for corporate strategy are wide-ranging and critically important.

“This is a book to read before one begins work in China and to come back to once there. With its comprehensive analysis of challenges and insightful recommended responses, it efficiently points executives in the right direction and helps them avoid the errors that others have made. It has the potential to give any executive a flying start to executing their China strategy.”

Purchase “Managing the China Challenge“.