Immaterialgüter- und Wettbewerbsrecht

Local Famous Trade Marks in China: Towards a Transparent Market and Fair Intellectual Property Governance under the Prism of Consumer Protection

The widespread local famous trade mark protection (‘LFTM’) regime in China imposes tensions between the intended function of trade mark rights and the ones conferred by local legislatures. To that, this research explores comprehensive solutions adhering to the legal principle of fairness.

Last Update: 16.07.21

Not all the de facto functions a trade mark can perform in the real world are recognised as de jure functions. In the legal sense, a pre-selection has been undertaken to determine the functions of trade marks that are legally protected.

Further, while certain rationales of de jure trade mark functions are derived from the empirical ‘is’, they are all designed with additional criteria intended to facilitate their realisation. Trade mark-related laws and policies are, of course, man-made, and part of the standards, rules, and concepts are, in a sense, the result of decisions or policy choices made following the weighing-up of interests. That determines that law-makers/policy-makers play the dominant role in designing and operating the trade mark system, sometimes far outweighing the other stakeholders’ inputs, such as the consumers and the trade mark proprietors.

The main object of this research, the LFTM regime in China, is a typical example of this man-made nature of trade mark laws, presenting a sui generis approach to trade mark regulation and offering a different paradigm. Unlike the situation surrounding known trade marks in other jurisdictions where the determination of a famous trade mark is undertaken rather passively, China has a unique ‘double track’ trade mark enforcement system. Under that, the administrative authorities play a far more proactive role, inter alia by selecting and conferring the ‘honourable title’ of LFTM to a considerable number of local enterprises each year. This presumed competence is conferred by the laws of a local legislature influenced by the local governmental strategies.

The LFTMs enjoy far stronger protection, e.g., monetary rewards, and the LFTM proprietors are entitled to freely use ‘LFTM’ as a marketing tool on the packaging or advertisements. The LTFM label presents a powerful and unique tool compared with the other third-party certifications (e.g. certification mark), for it is a governmental endorsement.

The intended functions of the LFTM regime, as explicitly stated, include protecting the legitimate rights and interests of the LFTM’s proprietors, promoting the local economic development, protecting the legitimate rights and interests of the consumers, and maintaining the economic order. However, in practice, neither the specific modalities nor the actual impacts align with the stated objectives nor the rational basis of trade mark protection.

Furthermore, the LFTM regime is not an isolated case merely relevant to China. Instead, it is part of the larger global context of the shift in intellectual property law functions resulting from the legislative interventions in the competitive process. The marchio storico in Italy is an example.

This research adopts a comparative and multi-perspective approach, identifies a clear and comprehensive solution to the tension surrounding the fundamental tenets of fairness, and provides universal value to the broader global context.


Doctoral Student

Tian Lu

Main Areas of Research

I.4 Fairness als Rechtsprinzip