Dynamic Export

The value of goods exported to China in 2009 amounted to AU$42.4 billion, an increase of 31 percent over the previous year. With this significant volume of trade, it is important for Australian exporters to be aware of how to protect their intellectual property (IP) in this vast market.

Counterfeiting has historically been a problem and many manufacturers are so skilled at copying items it can be difficult to distinguish them from genuine items. In fact, the so-called ‘fake markets’ have become major tourist attractions in large cities like Shanghai and Beijing.

Faking it at the Shanghai World Expo

The 2010 World Expo in Shanghai is one of the biggest international events ever staged in China, attracting an expected 70 million visitors to the city. The Expo’s official mascot Hai Bao has become immensely popular in Shanghai, with images of the distinctive blue creature all over the city.

But alongside the official soft toys, key chains, and mobile phone hangers sold at licensed Expo stores, street vendors have been distributing fake products.

Organisers are not taking the counterfeiting lightly, and the Chinese Industry and Commerce Administrations have already taken action in relation to more than 270 cases of trade mark infringement, with fines imposed and counterfeit products destroyed.

It is important to note that most IP laws in China were passed only in the last 30 years. In that time China has made significant improvements to protecting and enforcing IP with the government making it a priority.

The number of patent and trade mark applications filed in China has reached a record high, with a 20.8 percent increase in trade mark applications and an 8.5 percent increase in patent applications between 2008 and 2009. The number of successful infringement actions taken by foreign companies in China is also growing.

Chinese companies are also beginning to pay more attention to protecting and enforcing their own IP. Recently Chint Group, a Chinese manufacturer of low-voltage electronics, took action against the French company Schneider Electric for infringing its utility model patent in China.

The court initially awarded Chint a record RMB 334 million in damages but the case ultimately settled for RMB 157 million (approximately AUD 24 million). The case is an example of the greater value being placed on IP by both Chinese companies and the courts.

How do you file a trade mark or patent application in China?

If you are thinking about exporting to China, or even using China as a manufacturing base for products you sell in Australia, you should think about protecting your important IP rights in China.

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