Threat and Opportunity
The number of patent applications and patent disputes Chinese companies are involved in have been on the rise at a time when the Chinese government chose enhancement of intellectual property rights (IPR) as one of its core economic strategies. According to the Chinese government, the number of administrative executions associated with patent infringement increased 79.8 percent from 9,022 to 16,227 between 2012 and 2013.
This implies that local Chinese companies can hinder Korean firms from penetrating the Chinese market by occupying patents and brand names in advance. In addition, the Trademark Law of China was revised last year for simplified trademark review and the number of trademark applications in China is likely to increase with time. These days, online trademark application is gaining popularity. The number of such cases amounted to 1.384 million or so in 2014, equivalent to more than 60 percent of the total for that year.
“It seems that some Korean firms are looking to register trademarks in China after some increase in sales and brand awareness,” said an industry insider, adding, “However, this can result in a serious problem if Chinese companies register the same trademarks beforehand.”