Brand owners doing business in China are being put on notice. From 1 January 2027, the State Council is authorised to cancel trade marks which are registered in bad faith, have become generic or have not been used for three consecutive years, without legitimate reason. The changes form part of China’s fifth revision to its Trade Mark Law, passed in June 2026, adding to third-party cancellations, as is the current position. The fifth revision also formally recognises well-known marks for the first time and allows online and e-commerce evidence for proving genuine use. For brand owners who have long battled “trade mark squatting” in China, the revision signals a meaningful, if not complete, shift in the state’s appetite to intervene.
The stakes are rising. China is South Africa’s largest trading partner, with bilateral trade increasing by 6.4% from US$34.2 billion in 2024 to US$36.4 billion in 2025, and government-backed efforts encouraging more South African businesses to enter the Chinese market. For these companies, understanding China’s evolving trade mark regime is no longer optional.
Bad Faith
Bad-faith applications and the hoarding of registrations or “trade mark squatting” remains a significant issue for brand owners who are active in China. If someone else owns your mark without your authorisation, your preferred agent or distributor may be reluctant to act on your behalf. Imports could also be detained at customs. The revision shifts toward stronger enforcement against bad faith registrations, amending the existing provision from “not for the purpose of use” to disallowing marks that are “not intended for use and clearly exceeding normal production and business needs,” with the State Council permitted to impose fines and revoke trade marks.
Non-use cancellations
An applicant should have a bona fide intention to use a trade mark for the goods and services for which registration is sought in the relevant territory. Generally, a registered trade mark may be vulnerable to cancellation for non-use if it has not been used for a certain period, being three years in China. Non-use cancellations commonly require active steps by an interested third party.
Some territories, such as the USA, require a Declaration of Use and specimens of use on filing the application and/or on renewal to maintain a registration. While Declarations of Use may have been tabled in drafting China’s fifth revision, the final revision does not stipulate them.
Despite this, ex officio cancellations will be allowed whereby the State Council may cancel trade marks that have become generic or have not been used for three consecutive years without legitimate reason. This is a significant change as non-use cancellations may also now be initiated by the authorities.
Well-known marks
A well-known mark or famous mark is a trade mark that has achieved such a degree of recognition among the relevant public that it is afforded a broader scope of protection than ordinary trade marks, beyond the goods or services for which it is registered and without registration.
The fifth revision recognises well-known marks; however, the onus to establish well-known status remains high, requiring substantial evidence of market recognition, including survey evidence, revenue, advertising expenditure, media coverage, and decided on a case-by-case basis. This is a significant introduction whereby marks which imitate a well-known mark or mislead the public to the detriment of the rightful owner will not be registered and that use forbidden.
Online use
The revision defines evidence of use of a mark on goods, packaging, commercial transaction documents, advertising, exhibitions and other commercial activities for the purpose of identifying and distinguishing the source of goods. Other commercial activities include evidence of use of the mark on the internet, e-commerce platforms, social media, and digital advertising, which should ease the burden of providing evidence of use in non-use cancellations and contentious matters.
Procedural revisions
Further changes include reducing the opposition term from three to two months and a one-year bar on filing only following a voluntary cancellation. Motion marks and sound marks are a further expansion. There is also a significant move to stringent control and accountability for trade mark agencies and practitioners who will be required to register their information with the State Council Trademark Authority, with failures attracting hefty fines.
There is always the risk of non-use cancellations; however, particularly in China, this is a common recourse in review proceedings where a trade mark has been refused due to a prior mark that may, in turn, be vulnerable to cancellation. Recognising online use should help brand owners defend against non-use cancellations. Considering the authorities ability to initiate cancellations, brand owners are reminded to conduct regular portfolio reviews, keep records in order and ensure that registrations are in genuine use.
