How to encourage EU SMEs to
enter the China market?
Simon Cheetham
Team leader
China IPR SME Helpdesk
6 March 2013
1
Presentation Outline
• China IPR Landscape & opportunities
• Trends & Case Studies
• The cost of IP
• Assessing What is Important
Critical success factors
Unique challenges
• What can we do to encourage SMEs?
6 March 2013
2
The landscape
•
•
•
•
China – too big to ignore
IP protection relatively new concept
BUT legal system improved
Chinese companies becoming substantial
competitors
• Foreign companies developing R&D presences
in China
• Chinese government stressed importance of
R&D and IP
6 March 2013
Current Opportunities
• China’s 12th 5 Year Plan = blueprint of
economic & social development to 2015
• Emphasis on balanced, eco-friendly
development
• Targets annual growth rate of 7%
• Focus on vastly expanded domestic demand
• Future growth expected from tech advances
6 March 2013
IPR China:
EU SMEs Most Common Issues
•
•
•
•
•
Not aware of importance of registering IPR – Know Before you go
Fail to understand the territorial nature of IP rights
Not Selecting the right business partner in China
Not Protecting trade secrets
Wrong perception about China IPR- Protection is possible
Different industry sectors face
Different problems / challenges
6 March 2013
5
The Helpdesk Initiative
Prevention Strategies
Plush Toys
Trademark, sourcing and manufacturing
contracts, record keeping re creation,
advertising/packaging
Design of drainage machines
IPR as part business strategy. Not just
design patents but trademark and
copyright
Wastewater Treatment
Trademark, trade secrets, non-disclosure
agreements, first to register
Enforcement Strategies
Olive Oil
Opposition to local trademark application
Umbrella
IP protection in China, sale in HK – steps
on hiring a lawyer
Lighting Group
Design patent infringement – received
legal advice ‘not sufficiently the same’,
business strategy
6 March 2013
6
Helpdesk Case Study
Background
A Greek company trading olive oil products started exporting their
products to China through a Chinese company in 2007. Later the Greek
company found that the Chinese company had, without their consent,
applied for registration of the trademarks associated with the Greek
olive oil products, not only for olive oil products but also for a whole
series of food products. The issues raised by the Greek company
included how to stop the registration process, how to protect their
trademark and how to find a lawyer.
Helpdesk advice :
•Contact an experienced China trademark lawyer to discuss their case
•Evaluate whether they can file an opposition against the Chinese company’s
trademark registration.
•Register their trademarks in alternative product categories.
•Consider negotiating a trademark buy-back with the Chinese company.
6 March 2013
7
Helpdesk Case Study (continued)
Outcome
The Greek company asked the Chinese company to withdraw the application
and offered to buy back the trademark. The Chinese company asked for
compensation of EURO 100,000. They worked with a law firm referred by the
Greek Embassy in China to file an opposition. They also considered filing
trademarks and related IPR in China.
IP Lessons
Register your IP rights in China before bringing the products to
market.
Oppositions to the application may be filed at the China Trademark
Office within three months of the date of publication of the
trademark application in the official Trademark Gazette.
File trademark registrations in any relevant classes. This will
provide broader protection for your brand and reduce the scope of
an infringer’s activities.
It should be considered that in some cases resolving the issue via
reconciliation and negotiation could be more economical (in terms
of time and money).
6 March 2013
8
China IPR SME Helpdesk:
Insights from EU SMEs in China
Video Case studies and insights brought to you by:
China IPR SME Helpdesk
China IPR SME Helpdesk Channel
6 March 2013
9
The Cost of IP
• “What has IP got to do with me?” - it is only
for big companies isn’t it?
• “We don’t own any IP” – we’re just a small
business, right?
• “We can’t afford IP” - complicated, risky &
expensive – a cost like insurance?
25 October 2012
10
Critical success factors
• Identify critical IPR relevant to products/services & register
• The smart approach – overlapping protection is harder to
defeat
Trade Mark
Design
INNOVATION
Copyright
Trade Secret
Utility Models
Invention Patents
6 March 2013
Critical Success Factors
•
•
•
•
•
•
•
Finding the right partner
Patents
Minimised technical information release
Pre-agreement
References and due diligence
Speak to other licensors/vendors
A good, tight agreement & clearly
defined the territory
6 March 2013
Unique challenges
6 March 2013
13
th
4
Every
person on Internet is
Chinese
Source: 29th statistical report on internet development in China
6 March 2013
14
Enquiries – Areas of IPR
Design Patent
7%
Domain Name
7%
Trade
Secret Utility Model
5%
2%
Trademark
38%
Invention Patent
7%
Copyright
11%
General
23%
Prevention Vs Enforcement?
Enforcement
24%
Prevention 76%
6 March 2013
15
Helpdesk Advice: EU SMEs taking action
EU SMEs actions
after advice from the Helpdesk:
6 March 2013
16
Helpdesk Enquiries – Top Industries
Industry
Percentage
Manufacture of machinery and equipment
Manufacture of textiles
16%
7%
Manufacture of electrical equipment
Architectural and engineering activities
Activities of membership organisations
6 March 2013
6%
5%
9%
17
How we can encourage SMEs…
• Clearly defined service offering
• Strong message – ‘know before you go’
• Client servicing- Multiple approaches
• Evolution of the project Reaching SMEs through
Intermediary organisations
• Flexibility in planning, delivery and budget
• Integration with Member State, EC and other projects
6 March 2013
18
The China IPR SME Helpdesk provides:
free, confidential, business-focused advice on
China IPR to EU SMEs
Helpdesk Enquiry Service – [email protected]
Training & Events
Materials
Online Services - www.china-iprhelpdesk.eu
For more information please contact the Helpdesk:
Room 900, Beijing Sunflower Tower
No. 37 Maizidian Street
Chaoyang District
Beijing 100125, P.R. China
Hotline number: +86 (10) 6462 0892
6 March 2013
19