For international businesses entering China, trademark conflicts pose significant risks. Similar marks in overlapping industries often trigger rejections under China’s Trademark Law (Article 30). Trademark coexistence agreements offer a strategic solution—yet their enforcement remains complex. This guide demystifies the process and limitations.
What Is a Trademark Coexistence Agreement?
A legally binding contract where two parties agree to register/use similar trademarks without consumer confusion. In China, these agreements:
- Resolve prior-right conflicts (e.g., similar marks in related classes).
- Supplement but don’t override absolute grounds for refusal (e.g., bad faith, public morality violations).
Filing Procedures with CNIPA
China’s National Intellectual Property Administration (CNIPA) evaluates agreements case by case:
- Document Submission:
- Original agreement (Chinese translation required).
- Evidence of distinct market presence (e.g., consumer surveys, geographic boundaries).
- Examination Criteria:
- Distinctiveness: Marks must not cause confusion (Article 13, Trademark Law).
- Good Faith: Agreements can’t circumvent legal prohibitions (Article 44).
- Timeline: 3–9 months for review post-submission.
⚠️ Critical Note: CNIPA rejects agreements if:
- Marks are identical for identical goods/services.
- Public interest is compromised (e.g., consumer safety).
Legal Limitations in China
Coexistence agreements have narrow enforceability:
- No Precedent Value: Each CNIPA decision is independent—past approvals don’t guarantee future outcomes (Supreme Court Guiding Case No. 160).
- Third-Party Challenges: Competitors can invalidate agreements via opposition/invalidation actions (Article 45).
- Judicial Scrutiny: Courts may void agreements violating antitrust principles (Anti-Monopoly Law, Article 17).
Case Study: Starbucks vs. Xingbake
Starbucks secured “星巴克” (Xīngbākè) in China but faced conflicts with local coffee brand “Xingbake.” A coexistence agreement allowed both marks to register by:
- Proving distinct customer bases (premium vs. budget segments).
- Limiting “Xingbake” to specific provinces.
Strategic Recommendations
- Pre-Agreement Due Diligence:
- Conduct a trademark similarity search using CNIPA’s database.
- Verify no prior identical marks exist (Article 31).
- Drafting Essentials:
- Define clear territorial/usage scopes.
- Include dispute resolution clauses (e.g., arbitration).
- Post-Filing Monitoring:
- Track third-party oppositions via CNIPA’s Gazette.
- Renew agreements every 5–10 years.
Why Partner with China-Specialized Services?
Navigating CNIPA’s nuanced stance requires local expertise. ChinaBizInsight offers:
- Trademark conflict resolution support, including agreement drafting and CNIPA liaison.
- Comprehensive IP verification to preempt disputes.
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Conclusion
Coexistence agreements are viable in China but demand precision. Align terms with CNIPA’s standards, anticipate third-party challenges, and engage experts to mitigate risks. For cross-border businesses, proactive trademark strategy is non-negotiable.