How to take advantage of the “trademark hoarding” rule in China?

You may receive calls or mails from Chinese trademark agents saying your trademark has been registered by an anonymous person.  I would say some Chinese applicants are crazy in applying trademarks of foreign companies that may enter China or may need Chinese manufactuers because they want to sell the trademarks to potential buyers.  But do not rush to buy the trademark till you have a full understanding of the situation.

So how to solve this kind of issue?  Back to 2018, CTMO rejected 20,000 applications filed by a series of acutally related companies because such applications are obviously lack of intention to use – we may follow this thread.  Chinese law provides the purpose of trademark application should be for use, but not for selling for money.

For foreign companies facing a “bad faith” application without authorization, it should be clear that most of the time such company may have very little, if not no business existence in China – that’s why I do not think such company has a base to prove bad faith upon the fact of unauthorization application. 

The recommended way is to analyze the trademark package of the “bad faith” applicant – usually such applicant will apply a series of trademarks at the same time, such series trademarks being trademarks of foreign companies.  In this case, foreign company may be able to prove the applicant is registering the trademark in bad faith, namely such applicants are aiming to hoarding trademarks but not to use trademark.

The trademarks of "bad faith" applicant will be invalidated in case of trademark hoarding.