China’s trademark rulings are finally starting to make sense—none more than President Trump’s case this week.
Trump received initial approval of 38 trademarks that the Trump Organization applied for in China last year, according to the trademark office and reports. Now Trump’s business can use the Trump name on restaurants, real estate services, financial products, and a bevy of other interests. That he will, as critics have worried, is unlikely; Trump has said he’d refrain from foreign business deals while in office.
What’s been lost amid the criticism is that the approved Trump trademarks are a positive signal for Western businesses that have long been frustrated by China’s trademark system. It appears things are slowly getting better. And it started with His Airness.
Late last year, basketball great Michael Jordan won a trademark case in China’s Supreme Court against a Chinese sports brand that sold “Jordan” shoes under his translated Chinese name. The Court ruled that the brand, Qiaodan, was deceptively using his likeness, and ordered their trademark be returned to Jordan.
Until the Jordan victory, the past few years of the trademark story in China had been about American companies unfairly facing squatters who’ve abused China’s trademark system, which awards applications based on the first to apply.
The New England shoe maker New Balance was sued for using the translations of its Chinese name because another businessman held the rights to the name. Last year, a Beijing court ruled that a Chinese leather goods company that stamped “IPHONE” onto its wallets had rights to the name over Apple (AAPL). And before that, Tesla’s expansion in China was cast in doubt before it settled with the Chinese owner of its trademarked name.
Trademark experts in China said Trump’s case was unlikely the result of favoritism. They pointed to a handful of Trump’s trademark applications that were rejected in the same process.
Instead, it was likely the result of improved rulings that may reward foreign businesses instead of Chinese squatters. After the Jordan ruling, the official state news agency Xinhua wrote, “The Jordan/Qiaodan ruling shows China’s determination to protect [intellectual property rights] and suggests that China will treat domestic and foreign parties in the same way.”
Still, progress is spotty. New Balance, using its own well-known brand name in China, lost an appeal of its case last year. It was stuck paying the trademark owner of its brand name almost $1 million.