Donvay Wegierski | Director | Werksmans Attorneys | mail me |
Brand owners doing business in China are being put on notice. From 1 January 2027, the State Council can cancel trade marks registered in bad faith. It can also cancel marks that have become generic or have not been used for three consecutive years without legitimate reason.
The changes form part of China’s fifth revision to its Trade Mark Law, passed in June 2026. They add to third-party cancellations, which remain the current position. The fifth revision also formally recognises well-known marks for the first time. It also allows online and e-commerce evidence to prove genuine use. For brand owners who have long battled “trade mark squatting” in China, China’s trade mark reforms signal a meaningful, if not complete, shift in the state’s appetite to intervene.
The stakes are rising. China is South Africa’s largest trading partner. Bilateral trade increased by 6.4%, from US$34.2 billion in 2024 to US$36.4 billion in 2025. Government-backed efforts are also encouraging more South African businesses to enter the Chinese market. For these companies, understanding China’s evolving trade mark regime is no longer optional. China’s trade mark reforms therefore deserve close attention from businesses seeking to operate in the market.
Bad faith
Bad-faith applications, the hoarding of registrations and “trade mark squatting” remain significant issues for brand owners active in China. If someone else owns your mark without your authorisation, your preferred agent or distributor may become reluctant to act on your behalf. Imports could also face detention at customs.
The revision shifts towards stronger enforcement against bad-faith registrations. It amends the existing provision from “not for use” to disallowing marks that are “not intended for use and clearly exceeding normal production and business needs”. The State Council can also impose fines and revoke trade marks. These measures form an important part of China’s trade mark reforms.
Non-use cancellations
An applicant should have a bona fide intention to use a trade mark for the goods and services for which registration is sought in the relevant territory. Generally, a registered trade mark may face cancellation for non-use if the owner has not used it for a certain period. In China, that period is three years. Non-use cancellations commonly require active steps by an interested third party.
Some territories, such as the USA, require a Declaration of Use and specimens of use when an applicant files the application and/or renews it. These requirements help maintain a registration. While drafting China’s fifth revision may have considered Declarations of Use, the final revision does not stipulate them.
Despite this, ex officio cancellations will now be allowed. The State Council may cancel trade marks that have become generic or have not been used for three consecutive years without legitimate reason. This represents a significant change. Authorities may now initiate non-use cancellations themselves.
Well-known marks
A well-known mark or famous mark is a trade mark that has achieved such a degree of recognition among the relevant public that it receives a broader scope of protection than ordinary trade marks. This protection extends beyond the goods or services for which the mark is registered and applies without registration.
The fifth revision recognises well-known marks. However, the onus to establish well-known status remains high. Applicants must provide substantial evidence of market recognition. This evidence can include survey results, revenue, advertising expenditure and media coverage. Authorities will also decide each matter on a case-by-case basis.
This represents a significant introduction. Marks that imitate a well-known mark or mislead the public to the detriment of the rightful owner will not receive registration. The revision also forbids such use.
Online use
The revision defines evidence of use of a mark on goods, packaging, commercial transaction documents, advertising, exhibitions and other commercial activities. Businesses can use such evidence to identify and distinguish the source of goods.
Other commercial activities include use of the mark on the internet, e-commerce platforms, social media and digital advertising. This should ease the burden of providing evidence of use in non-use cancellations and contentious matters.
For businesses operating across digital channels, China’s trade mark reforms therefore provide greater scope to demonstrate genuine use.
Procedural revisions
Further changes include reducing the opposition term from three months to two months. The revision also introduces a one-year bar on filing following a voluntary cancellation. Motion marks and sound marks represent a further expansion.
The revision also introduces a significant move towards stringent control and accountability for trade mark agencies and practitioners. These parties will have to register their information with the State Council Trademark Authority. Failures can attract hefty fines.
There is always a risk of non-use cancellations. However, particularly in China, this represents a common recourse in review proceedings. This can occur when authorities refuse a trade mark because of a prior mark that may itself face cancellation.
Recognising online use should help brand owners defend against non-use cancellations. Given the authorities’ ability to initiate cancellations, brand owners should conduct regular portfolio reviews. They should also keep records in order and ensure that registrations remain in genuine use.