Heineken sewn up in Chinese trademark tangle

September 27, 2013 3:11 pm

Heineken sewn up in Chinese trademark tangle

By Demetri Sevastopulo in Hong Kong

China became the world’s copycatting centre by faking everything from Louis Vuitton bags and PhD diplomas to Apple stores. Now Heineken has become the latest multinational to face an intellectual property challenge – from a tiny Chinese sewing machine company. The global brewer has accused Wujiang Xili Machinery Factory, a company from Jiangsu province with fewer than 50 employees, of pirating its name and logo, and using them at a Shanghai trade show this week.The case comes as the US, Europe and Japan exert continuing pressure on China to improve its intellectual property record.

Apple last year agreed to pay $60m to Proview Technology (Shenzhen) to end a long-running iPad trademark dispute as it was preparing to unveil the third generation of its tablet in China. Michael Jordan, the retired US basketball star, is also embroiled in a case with Qiaodan, a sportswear company with thousands of stores in China, in which he says the company illegally used his Chinese name on their garments.

China this month amended its trademark law in ways that lawyers say will make it easier for foreign companies to protect their trademarks. The new law, which takes effect in May, will raise the penalty for trademark infringement and increase the burden on a defendant to prove that an application was made in good faith.

Geoffrey Lin, a lawyer at Ropes & Gray, said China had become “more consistent” in the application of its intellectual property laws. But he said foreign companies still face a lot of “hijacking” where local companies register trademarks that resemble those of a multinational before the foreign company can do so – in a process akin to people buying internet domains that use the names of big companies.

Earlier this year, China’s State Administration for Industry and Commerce ruled that Wujiang Xili acted in “bad faith” in applying to register two Heineken names. But the company registered a third version, which the brewer has petitioned to have cancelled.

Joe Simone, a partner at SIPS, a Hong Kong intellectual property firm that is acting on behalf of Heineken, said piracy had serious ramifications for foreign companies.

“A pirate that steals your trademark can effectively stop you from entering the PRC [People’s Republic of China] market and using Chinese factories to produce goods for global distribution,” said Mr Simone.

Cai Fuwei, Wujiang Xili’s legal officer, said the Jiangsu company had not acted in “bad faith”. He said the logo was designed by an outside party, and that the trademark registration had not breached Chinese law.

Asked if the logos were alike, he said: “Heineken didn’t show me their trademark, so I don’t know whether ours looks similar.”

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

One Response to Heineken sewn up in Chinese trademark tangle

  1. Pingback: IP Osgoode » Beer, Reform, and Policy: A Pint of Chinese Trade-mark Law

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