For the Chinese market, while international brands face tremendous opportunities, they must also tackle unique intellectual property challenges. Among these, it is common scenario that local distributors or agents to preemptively register the trademarks belong to their principals or represented persons. This article aims to analyze the legal protection provided to rights holders under Article 15.1 of the Trademark Law, and to offer systematic response strategies for brand owners.

Understanding Legal Tools: The Scope of Protection under Article 15.1

Article 15.1 of the amended 2019 Trademark Law of the People’s Republic of China states:

"Without authorization, if an agent or representative registers the principal’s or represented person’s trademark in their own name, and the principal or represented person raises an opposition, the registration shall not be granted and the use shall be prohibited."

This provision is a key legal tool specifically designed to combat trademark applications filed in bad faith by parties who have a particular legal or contractual relationship with the true trademark owner.  The core of its application lies in establishing the existence of such a relationship.

Key Legal Elements for the Application of Article 15.1

To successfully invoke Article 15.1, the rights holder must establish the following elements:

1.Existence of an Agency/Representative Relationship: Chinese administrative and judicial practice interprets this broadly, explicitly covering:

- Formal distributors or agents with signed contracts.

- Parties who have a contractual, business, or other relationship with the trademark owner in connection with the trademark application. This can include business negotiation representatives, joint venture partners, or any entity that becomes aware of the trademark through close commercial dealings.

2..Trademark Ownership by the Rights Holder: the disputed trademark must be identical or substantially similar to the trademark used or owned by the rights holder in the course of the commercial relationship, and the goods of the disputed trademark are same with or similar to the goods used by the rights holder. Providing evidence that the rights holder first used, created, and owns the trademark is critical.

3.Unauthorized Registration: the agent/distributor files the application without the rights holder’s consent or authorization.  Once the relationship is established, the burden of proof regarding authorization shifts to the applicant.

4.Opposition by the Rights Holder: the rights holder must proactively file an opposition or invalidation request under this provision.

Strategic Action Guide: Step-by-Step Response Plan for Brand Owners

Upon discovering a distributor's malicious trademark application or registration, immediate and structured action is required.

Phase One: Evidence Collection and Case Assessment

This foundational phase determines the strength of legal claims.

Solidifying Evidence of the Relationship

◦ Signed distribution, agency, or supply agreements.

◦ Invoices, purchase orders, and shipping documents.

◦ Communications related to the brand, market entry, or trademarks, such as emails and meeting minutes.

Proving Ownership and Prior Use

◦ Trademark registration certificates in your own country or other jurisdictions.

◦ Dated promotional materials, catalogs, or website screenshots featuring the trademark.

◦ Where applicable, evidence of the trademark’s international reputation (awards, media coverage, global sales figures).

Proving Malicious Intent

◦ Evidence that the distributor was explicitly aware of your trademark prior to filing (e.g., emails in which you provided logo files).

◦ Evidence showing the distributor has not made genuine use of the trademark, or is demanding an excessive transfer fee.

Phase Two: Choose the Correct Legal Procedure Path

Select the optimal legal route based on the different statuses of the conflicting trademarks.

Stage Three: Enforcement and Long-Term Strategy

• Civil Litigation (where applicable): If distributors are simultaneously engaged in manufacturing or selling counterfeit goods or unfair competition, consider initiating parallel civil litigation for damages.

• Customs Recordal: Immediately file for intellectual property protection recordal of your valid trademarks with the General Administration of Customs of China to prevent malicious distributors or others from importing or exporting infringing goods.

• Rebuilding Trademark Portfolio: While pursuing legal action, consider filing new strategic applications for core trademarks and key variants to consolidate your rights.

Preventive Measures: Building a Defensive System

The best strategy is prevention.  It is recommended to include the following clauses in all distribution agreements:

Clear Intellectual Property Ownership Clause: explicitly stipulate that all intellectual property related to the principal’s products, brands, and trademarks are solely owned by the principal.

Prohibition on Registration Guarantee Clause: set forth a dedicated provision requiring the distributor to guarantee not to apply for, register, or otherwise acquire, in any jurisdiction, any trademarks, domain names, copyright or social media accounts, etc., containing the principal’s trademarks.

Assistance and Confirmation Obligation Clause: require the distributor to assist the principal in trademark registration in China and acknowledge the principal’s prior rights.

Breach of Contract Liability and Termination Clause: clearly state that any breach of intellectual property clauses constitutes a material breach, entitling the principal to immediate termination of the agreement, and the breaching party must bear all costs incurred by the principal in recovering intellectual property rights.

Regular Monitoring: regularly search the CNIPA trademark database to monitor applications related to your brand, especially in relevant classes is also important.

Conclusion

Article 15.1 of the Trademark Law provides a powerful and targeted legal remedy for foreign brands owners to address the acute challenge of bad-faith trademark filings by distributors or agent. The three pillars of success are: 1) meticulous documentation and management of contracts and business relationships; 2) swift and decisive legal action; and 3) long-term, forward-looking intellectual property portfolio management strategies.

For overseas rights holders, addressing this issue require not only legal understanding but also strategic vision.  By regarding trademark security as a non-negotiable factor in distributor relationships and acting swiftly at the first signs of misconduct, brand owners can safeguard their most valuable assets in one of the world’s most critical markets.