China, Intellectual Property, International Law, Patents, Trademarks

How to Protect Against China Counterfeiting

If you sell or outsource your products to China, you should anticipate infringement of your intellectual property.

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If you sell or outsource your products to China, you should anticipate infringement of your trademarks, copyrights, patents, or trade secrets, and have an anti-counterfeiting/misappropriation plan in place before that happens.

The first step for any company doing business in China is to protect its intellectual property rights. Trademarks, patents, and industrial designs must be registered in China to be protected in China. Copyrights do not need to be registered to be protected, but registration will make it easier for you to prove ownership of your copyright in any dispute. Trade secrets cannot be registered, but they are protectable if their owner has taken reasonable measures to protect their secrecy…

If you are going to disclose a trade secret or other proprietary confidential information to a prospective China business partner, you should use a Non-Disclosure, Non-Use and Non-Circumvention (“NNN”) agreement written specifically for China. Though U.S.-style NDA Agreements (especially if they call for disputes to be resolved in a U.S. court) are pretty much worthless in this situation, China-appropriate NNN agreements can be quite effective at deterring Chinese manufacturers from copying your products.

You should also be sure to register your IP in both the countries in which you are selling your products and in the countries (probably China) in which they are being made. To further protect your IP in China, it typically makes sense for you to submit your IP registrations to the Chinese customs authority so that it will have a strong evidentiary basis for seizing infringing products.

Work now to establish good relations with government, law enforcement, and political organizations at the national, provincial, and local levels before you actually need assistance to deal with stolen IP. In so doing, however, you must be sure not violate the anti-bribery laws of either China or your home country or the country in which you conduct business.

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Dan Harris is a founding member of Harris Moure, an international law firm with lawyers in Seattle, Chicago, Beijing, and Qingdao. He is also a co-editor of the China Law Blog. You can reach him by email at firm@harrismoure.com.

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