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Securing a trademark in China is a critical step for businesses entering the world’s second-largest economy, but the process is fraught with potential hurdles. Among the most common reasons for rejection is non-compliance with Article 21 of China’s Trademark Law, a provision that safeguards the integrity of the trademark system by regulating registrations that may harm public interests or violate legal principles. Understanding Article 21 is essential for applicants to avoid costly delays and ensure successful registration. This guide breaks down the legal framework, typical rejection scenarios, and actionable steps to navigate the process effectively.
Understanding Article 21 of China’s Trademark Law
Article 21 of the Trademark Law of the People’s Republic of China serves as a protective measure to prevent the registration of trademarks that could disrupt market order, infringe on public interests, or create unfair competition. Enacted to align with international intellectual property standards while addressing China’s unique market dynamics, the article empowers the China National Intellectual Property Administration (CNIPA) – the official body overseeing trademark registrations – to reject applications that fail to meet specific ethical and legal criteria. Unlike technical provisions governing distinctiveness or similarity, Article 21 focuses on broader public policy concerns, making it a critical yet often misunderstood aspect of China’s trademark regime.
The legal text of Article 21 states: “Where a trademark application is filed in bad faith and not for the purpose of genuine use, or where the registration of the trademark would harm public interests or disrupt public order, the Trademark Office shall reject such application.” This broad scope gives CNIPA significant discretion, requiring applicants to demonstrate both good faith and alignment with societal values. For foreign businesses, this underscores the importance of partnering with local legal experts who understand the nuances of China’s IP landscape.
Common Grounds for Rejection Under Article 21
CNIPA’s rejection decisions under Article 21 typically fall into three primary categories, each reflecting the provision’s focus on public interest and good faith. A 2023 CNIPA annual report revealed that Article 21 accounted for 18% of all trademark rejections, with bad faith filing emerging as the most frequent cause (42% of Article 21 cases), followed by harm to public order (35%) and disruption of market competition (23%).
1. Bad Faith Filing: This occurs when applicants register trademarks without intent to use them commercially, often to squat on well-known brands, extort royalties, or block competitors. A high-profile example came in 2022, when a Chinese individual attempted to register “TikTok Shop” as a trademark despite no connection to ByteDance. CNIPA rejected the application under Article 21, citing “obvious bad faith” and the likelihood of consumer confusion.
2. Harm to Public Order or Morality: Trademarks containing vulgar language, political sensitive terms, or cultural insults face automatic rejection. In 2021, an application for “Wuhan Virus” was swiftly denied under Article 21, with CNIPA stating it “undermined social stability and violated public morality.” Similarly, trademarks incorporating national flags, emblems, or names of state leaders are consistently rejected.
3. Unfair Competition: This includes registering trademarks that exploit the reputation of others or create a monopoly. For instance, in 2023, a local company tried to register “Starbucks Reserve” for coffee products, even though Starbucks had already established the “Reserve” line in China. CNIPA rejected the application, ruling it “unfairly leveraged the prior reputation of a well-known brand.”
| Rejection Ground | Definition | Example |
|---|---|---|
| Bad Faith Filing | Registration without intent to use; squatting on famous brands | “TikTok Shop” by non-ByteDance entity |
| Public Order Violation | Terms harming morality, politics, or culture | “Wuhan Virus” for medical products |
| Unfair Competition | Exploiting others’ reputation or monopolizing markets | “Starbucks Reserve” by unrelated company |
These cases highlight the need for applicants to conduct thorough pre-filing due diligence, including searches for similar marks and assessments of cultural sensitivity.
The CNIPA Examination Process for Article 21 Compliance
Trademark applications in China undergo a rigorous two-stage review by CNIPA, with Article 21 compliance assessed during the substantive examination phase. This process, which typically takes 4–6 months, involves specialized examiners trained to identify potential violations of the Trademark Law, including those under Article 21.
Stage 1: Formal Examination (1–2 months): CNIPA first verifies that the application is complete, with all required documents (e.g., power of attorney, business license) and fees submitted. Missing information or incorrect formatting will result in a supplementary notice, but this stage does not evaluate Article 21 compliance.
Stage 2: Substantive Examination (3–4 months): Examiners then assess the trademark for compliance with legal provisions, including Article 21. They conduct database searches to check for prior rights conflicts, evaluate distinctiveness, and review the mark for potential harm to public interests. For Article 21, examiners focus on:
- Evidence of genuine use intent (e.g., business plans, product development documentation)
- Similarity to well-known brands (to detect squatting)
- Cultural or political sensitivity of the mark’s wording or design
If concerns arise, CNIPA issues a rejection notice specifying the Article 21 grounds. Notably, CNIPA may request additional evidence from applicants during this phase, such as proof of ongoing business operations, to demonstrate good faith. For foreign applicants, providing localized documentation (e.g., Chinese-language business plans) can strengthen their case.
Responding to an Article 21 Rejection: The Reexamination Process
A rejection under Article 21 is not final. Applicants have 15 days from the date of receiving the rejection notice to file an appeal with the Trademark Review and Adjudication Board (TRAB), an administrative body under CNIPA tasked with reviewing disputed decisions. Success depends on presenting compelling evidence to refute CNIPA’s concerns, a process that often requires legal expertise.
Key Steps in Reexamination:
1. Analyze the Rejection Notice: Identify the specific Article 21 ground cited (e.g., “bad faith” or “public order harm”). This determines the evidence needed. For example, if accused of bad faith, applicants must prove intent to use the mark, such as through contracts with manufacturers, marketing plans, or sales projections.
2. Gather Evidence: For bad faith claims, submit documents like business licenses, product prototypes, or distribution agreements. For public order disputes, provide cultural analysis (e.g., expert opinions) showing the mark does not violate societal norms. A 2022 TRAB case saw a foreign fashion brand successfully appeal a rejection by submitting market research data proving its trademark’s design was not offensive to Chinese consumers.
3. File the Reexamination Request: Submit the appeal to TRAB with a formal response, evidence, and legal arguments. The fee for reexamination is RMB 750 per class, with processing taking 6–12 months.
4. Administrative Litigation (if needed): If TRAB upholds the rejection, applicants can file a lawsuit with the Beijing Intellectual Property Court, followed by the Beijing Higher People’s Court. This rare but critical step requires robust legal representation; only 12% of Article 21 cases proceed to litigation, with a 38% success rate in 2023.
Notably, TRAB decisions often prioritize objective evidence over subjective claims. For instance, in 2021, a technology firm successfully overturned a rejection by submitting proof of RMB 5 million in pre-registration investments in product development, demonstrating genuine use intent.
Proactive Strategies to Avoid Article 21 Rejections
Preventing an Article 21 rejection is far more efficient than appealing one. By integrating these strategies into the application process, businesses can significantly reduce risk:
1. Conduct Comprehensive Pre-Filing Searches: Beyond checking for identical or similar marks, assess whether the trademark could be perceived as squatting on a well-known brand. Tools like CNIPA’s online database and third-party platforms (e.g., WIPO’s Global Brand Database) help identify potential conflicts. For example, a company planning to register “Apple Home” for smart devices should search for “Apple” trademarks in Class 9 (electronics) to avoid accusations of riding on Apple Inc.’s reputation.
2. Demonstrate Genuine Use Intent: Include evidence of business activities in the application, such as a statement of use intent, product launch timelines, or partnership agreements. CNIPA increasingly scrutinizes “shell” applicants with no visible business operations, so attaching documents like lease agreements for office space in China can strengthen credibility.
3. Avoid Sensitive or Controversial Elements: Trademarks involving political figures, religious symbols, or culturally divisive terms face a high rejection risk. For example, marks containing “Xi” (a common surname but also the name of China’s leader) or “Tibet Independence” are automatically rejected. Consulting local cultural advisors ensures alignment with societal norms.
4. Register Trademarks in Line with Business Scope: Applying for trademarks across unrelated classes (e.g., a coffee shop registering in Class 42 for software development) may trigger bad faith suspicions. Stick to classes relevant to your core business, and expand registrations as the company grows.
5. Partner with a Qualified Local Agent: China’s Trademark Law requires foreign applicants to work with licensed local agents. Choosing an agent with expertise in Article 21 cases can help navigate gray areas, such as determining whether a mark’s cultural connotations might violate public order. Firms specializing in IP law, like GWBMA, have successfully guided multinational clients through complex Article 21 challenges.
Conclusion:
Article 21 of China’s Trademark Law serves as a vital safeguard against abuse of the trademark system, but its broad scope demands careful planning from applicants. By understanding the provision’s focus on good faith, public interest, and market fairness, businesses can avoid common pitfalls and enhance their registration prospects. Key takeaways include conducting thorough pre-filing due diligence, demonstrating genuine use intent, and leveraging local legal expertise to address cultural and regulatory nuances.
For foreign enterprises, the stakes are high: a rejected trademark can delay market entry by 6–12 months or more, costing valuable time and resources. Proactively aligning with Article 21 not only ensures compliance but also builds trust with Chinese consumers and authorities, laying the groundwork for long-term brand success. As China continues to strengthen its IP protection regime, adherence to provisions like Article 21 will remain a cornerstone of successful market participation.
