CentreO Blog

Foreign companies are advised to consider to get their Intellectual Property rights protected before entering into the China Market. As China works via “First to File” and not “First to Use” system. 

 

The Nice Classification System

China adopted an international system for categorising goods and services into appropriate classes. The system called the Nice Classification of Goods and Services (Nice Classification). Nice Classification separates all possible goods and services into 45 classes: 34 classes for goods and 11 classes for services. The classification was first established in 1957 by the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks, and is administered by the World Intellectual Property Organisation (WIPO).

Sub-class system in China

China Trademark office does not totally copy the Nice Classification. However, China Trademark office uses Nice Classification as the basis and make a unique Book on Classification of Similar Goods and Services for Chinese examiner’s reference. The book added unlisted Chinese common goods and services and subclasses within each of the 45 classes. The subclasses are further designed according to the similarity of the goods and services in China. In most cases, the goods or the services falling in different subclasses are not regarding as similar. It means the similar or identical trademarks can be registered within the same class because their specifications may fall in different subclasses.

For example, clothing under Nice Classification belongs to class 25. You may think both footwear and headgear are clothing and should belong to class 25. However, they have difference subclass in China. Footwear is under subclass 2507 while headgear under subclass 2508. You can see the classification system is more rigorous. 

For further information, please contact us. 

You may want to read: HOW TO PROTECT YOUR BUSINESS IN HONG KONG

Register Intellectual Property  in China

If a company doesn’t file its copyrights, patents, and trademarks in China, its IP has no formal protection there. Companies should register (or record) eligible Intellectual Property in China as early as possible. Companies should also understand the full range of IP for which they might file, including patents, trademarks, copyrights and as well as trade secret.

Top 4 Methods to Protect Your Intellectual Property In China

1. Patent

Protects an invention, design, or utilitarian features of a product. This is a non-renewable application. Furthermore, it falls in 3 categories, including 20 years protection for Invention. 10 years for design. Last but not least, utility model will have 10 years of protection.

Downside for for pharmaceutical application, that they need to disclose the genetic resource, no patent term extension, “junk” patenting surrounds, claims translation, patentable subject to matter. 

2. TRADEMARK

A word, phrase, symbol, or design, or combination identifying the source of goods or services. As a result, the term of protection in China for approved cases are 10 years. Unlike patent, trademark are renewable.

Downside for foreign brands, as people in China pre-register in advanced, that when foreign brand it’s trademark in China, there maybe trademark squatting issue.

3. COPYRIGHT

Protects an original work in a (fixed) medium of expression (books, music, sculpture, movies, software). This is a non-renewable application, and it will depends on applicant as individual or foreign entities.

For individual authors, it is considered as 50 years in addition to the lifelong of the author.  Hence, for foreign entities, it will be 50 years only, the term ‘piracy’ is used along the copyright.

4. TRADE SECRET

Confidential economic information that gives its owner a competitive advantage by reason of its secrecy, such as a formulary, business plan, or manufacturing technique.

Associated issues: Overlap in China between state secrets and commercial or trade secrets is not always clear, particularly when a State Owned Enterprise is involved. 

For further information, please contact us. 

You may want to read: PROTECT YOUR INTELLECTUAL PROPERTY

 

The Importance of Trademark Registration in China

Foreign investors sometimes overlook and ignore the importance of trademark registration in China. As China uses a “first-to-file” rule, which means that the first person who registers will own the trademark registration in China.  Nevertheless, the China trademark holder will also have all exclusive rights to distribute and sell the product. So, register your China trademark as soon as you can. 

5 Steps to register your China trademark? 

1. Submit the application form and other relevant documents by yourself or China Trademark Agency. State Administration for Industry and Commerce (SAIC) is responsible to handle the applications of trademarks.
2. SAIC has a formality check. To reviews the application and confirms whether you can proceed or if you need to provide other additional information.
3. After the formality check, SAIC starts Substantive Examination which is a thoroughgoing process to register the china trademark. If there is no problem, the Preliminarily China Trademark approved and published.
4. If there is no any other objection. China Trademark approves and issues the china trademark.
5. You receive a certificate of approval.

How long does the registration take?

The process can take everything from 12-16 months, depending on how smooth the registration process goes. The above steps are the most direct way. The process doesn’t involve any refusal, dispute or objection from SAIC or other parties. 

How about your China Trademark registration is rejected?

During the registration process, SAIC may refuse your files or your competitor may opposite your registration. However, there is an appeal mechanism. You can provide addition pieces of information, then SAIC can review for refusal filed. 

For further information, please contact us.

You may want to read: THE PROCESS OF REGISTERING A TRADEMARK?

China is the second largest economy in the world, while attracting many more global investors into the China. In order to run the business in a most cost-efficient way. Before making an investment decision, we suggest investors to understand the China taxation system and all potential relevant taxes that will incurs.

In addition, different type of investment activities will trigger different types of taxation. Within the China taxation system, there are a total of 18 different kinds, which can be divided into 3 categories according to their nature.

Goods and services taxes ( GST) 

1. Value Added Tax
2. Excise Tax / Tariff
3. Vehicle Purchase Tax
4. Customs Duty

Income taxes ( Profit Tax) 

5. Corporate Income Tax
6. Individual Income Tax

Property and relevant taxes 

7. Land Appreciation Tax
8. Real Estate Tax
9. Urban and Township Land Use Tax
10. Farmland Occupation Tax
11. Deed Tax
12. Resources Tax
13. Vehicle and Vessel Tax
14. Stamp Duty
15. Urban Maintenance and Construction Tax
16. Tobacco Tax
17. Vessel Tonnage Tax
18. Environmental Protection Tax

Is it the Tax Bureau response for collecting all kinds of tax?

Both the Custom Authorities and Tax Bureau are responding for tax collection.

The tax bureau is responding to collect 16 types of tax. While the Custom Authorities are responding to Custom Duty and Vessel Tonnage Tax. The Custom Authorities also are assisting to collect the Value Added Tax and the Excise Tax / Tariff on imported goods.

For further information, please contact us.

You may want to read: CHINA SIMPLIFIED ITS INCORPORATION PROCESS SINCE 2016