Defending brand rights has long been a problem for overseas firms in China, as legal rows involving Apple and Danone have shown in recent years. But with a growing consumer market at stake, firms are prepared to take on the struggle.
Chinese regulators recently cancelled the signature chequered black and tan pattern that defines British luxury brand Burberry.
The China Trademark Office placed a restriction on Burberry’s “check” trademark, which relates only to leather goods.
Burberry is appealing the decision. The company said it was “confident our appeal will be successful”.
“Burberry always takes the strongest possible action against those who use its trademarks unlawfully,” it said.
The company has fought and won handbag wars in Asia before. In 2010, Burberry’s Asia unit won a court case in Hong Kong against Polo Santa Roberta, a maker of leather bags and belts, over three check pattern designs registered between April 2006 and January 2008.
Burberry's sales in China rose about 20 per cent in the year to the end of March, making up 14 per cent of Burberry's retail and wholesale revenue, while 39 per cent of annual revenue comes from the Asia Pacific region, according to Bloomberg.
Foreign brands
Chinese consumers were the world’s biggest buyers of luxury goods in 2012, accounting for 27 per cent of industry sales, according to
consultants McKinsey.
But it’s a risky play too.
Danone, the world’s largest yogurt maker, lost a Chinese appeals court ruling in May 2009 in a dispute with its joint-venture partner Hangzhou Wahaha over ownership of the Wahaha trademark.
Last year, the former Chicago Bulls basketball legend Michael Jordan sued Chinese sportswear company Qiaodan Sports for using his Chinese name, Qiaodan, and jersey number 23 without permission.
The company denied the claim and countersued him for damages and the case is still in court.
There have also been investigations into foreign brands recently, with spotlight on Samsung and Apple, Starbuck’s pricing policy, pharmaceutical companies and baby-food companies.
