Significant Overhaul of China’s Trademark Law: 10 Key Changes and Compliance Action Plan
On January 1, 2027, China will implement its most comprehensive trademark law overhaul in decades. Shifting from a registration-oriented system to one strictly centred on genuine trademark use, this reform requires immediate strategic adjustments for all international businesses operating in China.
The following section summarizes the key statutory changes and outlines the compliance steps that must be taken to protect brand assets.
Core Statutory Changes
- Objective “Bad-Faith” Standard: Subjective intent is replaced by an objective test, namely, whether a filing “clearly exceeds normal production and business needs.” Defensive filings must now have a rational connection to the actual or planned operations.
- Ex Officio Revocations: The China National Intellectual Property Administration (CNIPA) is empowered to proactively cancel trademarks thatremain unused for three consecutive years without justifiable reasons.
- Severe Financial Penalties: Bad-faith stockpilers face administrative fines of up to RMB 100,000. For misleading trademark use, businesses can face fines up to RMB 250,000, or up to five times the illegal turnover if it exceeds RMB 50,000.
- Faster Proceedings: The opposition period for preliminarily approved trademarks is shortened from three months to two months.
- Dynamic Marks Introduced: Animated logos, startup animations, and interactive interfaces are now officially registrable.
- No Wait Period for Reissued Marks: If a mark is cancelled for non-use or expires, third parties can register itimmediately, eliminating the previous one-year waiting period (which now only applies to voluntary surrenders).
- Equated Damage Calculations: The infringer’s profits are elevated to the same priority level as the owner’s actual losses, allowing plaintiffs to claim whichever amount is higher and better supported by evidence.
- Three-Year Non-UseDefence Clarified: In infringement lawsuits, the three-year non-use defence is measured backward from the start of the infringing act, meaning plaintiffs cannot escape this defence by resuming trademark use after infringement has begun.
- Expanded Well-Known Mark Protection: Cross-class protection is extended to unregistered well-known trademarks.
- Rights Abuse Penalties: Bringing bad-faith lawsuits against competitors to disrupt fair market competition is now explicitly prohibited.
Action Plan for Businesses
- Audit and Streamline Portfolios: Voluntarily surrender marks that exceed legitimate business needs or lack realistic plans for use to prevent hoarding allegations.
- Preserve Continuous Evidence of Use: Systematically document transactions, invoices, product packaging, and marketing. Notably, online commercial activities (e-commerce records, live streaming footage, app launch screenshots) are now codified as valid proof of trademark use.
- Accelerate Monitoring Schedules: Update your trademark watching protocols to accommodate the shortened two-month opposition window.
- Review Marketing and Packaging Compliance: Ensure that promotional materials, social media, and packaging do not contain misleading, exaggerated, or false claims regarding a product’s origin, quality, or ingredients (e.g., unsubstantiated “premium” or “all-natural” wording) to avoid severe administrative fines.
- Perform Agency Due Diligence: Work exclusively with trademark agencies that have completed the newly required record-filing system. Assisting clients in bad-faith filings will result in heavy agency penalties (RMB 10,000 to 200,000).
Conclusion
With China actively transitioning to a “genuine use” model, defensive registrations alone no longer guarantee brand security. Businesses must move toward active, highly documented trademark lifecycle management to successfully navigate this new regulatory environment. Our team would be happy to support you in this task.
Author: Ludwig Lindermayer
E-Mail: lindermayer@paustian.de