How to Legally and Properly License Trademarks in China ?

The trademark license, as one of the means of using trademarks, has, in practice, encountered many unexpected disputes due to illegal and improper use. How then should one legally and properly license trademarks? And, what may benefits will the rights holder gain after going through the administrative procedures? This essay summarizes the author’s opinions on these issues.

I. How to make the trademark license record

(By Albert Chen) According to the Measures for Recording Trademark Licensing Contracts (“Measures”), the rights holder, either the owner of the trademark or the licensee, or the trademark agency representing these parties shall apply for recordation of the trademark license. If the licensors are foreigners or foreign companies, however, the record must be handled by trademark agencies. In the application, the applicant shall submit the licensing contract recordation application, a duplicate of the licensing contract, and a copy of the trademark certificate. If the documents are in foreign languages, translation shall also be provided.

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An International Trade Dispute with Trademark Parallel Import Involved

By Lear Gong

The author recently handled a lawsuit involving trademark parallel import. The case itself was not complicated: a famous American bedding design company (“US Company”) holds trademark A in both China and Japan. The US Company licensed a Shanghai home furnishing company (“Shanghai Company”) to manufacture and sell products marked with trademark A within the territory of mainland China. A Japanese home furnishing company (“Japanese Company”) offered to import trademark A furniture from China to Japan, but demanded a written license from US Company. With the promise from the Shanghai Company, the parties concluded a sales contract, but the clause on the Shanghai Company’s duty to get a license from US Company was not clear. From the time the contract was concluded until the products were delivered, the Japanese Company always urged the Shanghai Company to present it the certificate of license issued by the US Company, but the Shanghai Company did not reply or present the certificate. The Japanese Company moved to terminate the sales contract based on failure to perform. The Shanghai Company then filed a lawsuit against the Japanese Company demanding that it continue performance of the sales contract.

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