How to Stop China Counterfeits: Register Your China IP with China Customs

As we have written a number of times — see China Trademarks are the Most Important Thing of All and China’s New Trademark Environment — the essential first step in most any China IP strategy is to register your trademarks with China’s Trademark Office. Because China is a first-to-file country, until you register a trademark in China you have no rights in that trademark. But a trademark registration alone will not limit the spread of counterfeit goods. A trademark registration merely gives you the legal capacity to enforce your rights to that mark and it should properly be seen as just one of the pieces in your overall IP strategy. The same holds true for your products protected by a Chinese registered copyright or patent.

For any company concerned about counterfeit goods coming from China, the next step should be registering your trademark with China Customs. This is not a legal requirement but a practical one: though Customs officials have discretion to check every outgoing shipment for trademark or copyright or patent infringement against the Trademark Office database, in reality they only check against the Customs database. No separate registration with Customs means no enforcement by Customs. 

Registering your trademark, copyright and/or patent with Customs requires you to — at a minimum — submit the following documents with your application:

• A copy of your business license or certificate of incorporation (or other legal document confirming the existence your company). These documents must be in Chinese or translated into Chinese.
• A copy of the Chinese registration certificate for your trademark, patent or copyright.
• A Power of Attorney.
• Pictures of the goods for which you are seeking protection and their packaging.

If you register your IP with China Customs, they will contact you any time they discover a shipment of possibly infringing goods. At that point you have three working days to request seizure of the goods. Assuming you request seizure (and post a bond), Customs will inspect the goods. If Customs subsequently concludes the goods are infringing, they typically either donate the goods to charity (if the infringing mark can be removed) or destroy them entirely. The cost of destruction, and of storing the goods during the inspection process, will be deducted from your bond. As a practical note, do not expect any transparency regarding the destruction process or invitations to witness it — you are just going to have to take China Customs’ word on it.

Registration with China Customs generally takes three to five months and can be done only after China’s Trademark Office has issued a trademark certificate. The latter currently takes approximately twelve months, which means that within fifteen months of the date you file your trademark application, China Customs could be helping you by stopping counterfeits of your products from being exported from China. The same generally holds true for copyrights and patents.

In addition to the registrations discussed above, it almost always will make sense for someone to meet with China Customs on your behalf to introduce your product and advise officers on how to distinguish between genuine and counterfeit products. This will also show Customs you are willing to work with them to go after counterfeits. Seek out meetings at key ports and accept all invitations to Customs workshops, even if at first glance the port in question does not seem particularly critical.

Fifteen months can be an eternity in the retail world, so take action right away: Register your China trademark now, then register it again with China Customs. If you do this, you will almost certainly see a reduction in counterfeiting of your products, regardless of your industry and manufacturing locations.

We will be discussing the practical aspects of Chinese law and how it impacts business there. We will be telling you what works and what does not and what you as a businessperson can do to use the law to your advantage. Our aim is to assist businesses already in China or planning to go into China, not to break new ground in legal theory or policy.