Navigating the Waves of Greenwashing: Part 2 - "Green" trademark regulations in China

In China, there are different regulatory practices concerning "green" trade marks. Regarding the registration process, it has been observed that the China National Intellectual Property Administration (CNIPA) has adopted a strict standard when examining green trade marks in recent years.

In Part Two of our series, Navigating the Waves of Greenwashing, we look at the regulations and penalties for deceptive trade marks in China. In Part One, our Australian Trade Mark experts discuss the implications for brands misusing 'green' recent actions in Australia.

Trade marks that include terms such as "green," "natural," and "organic" are likely to face objections during the CNIPA's examination based on one or more of the following grounds:

1. Deceptive nature: The mark is considered deceptive and may mislead the public regarding the characteristics, quality, or contents of the goods or services. As a result, it cannot be used as a trade mark according to Article 10(i)(7) of China's Trade Marks Law.
2. Lack of distinctive character: The mark lacks distinctive character and cannot be registered as a trade mark according to Article 11(i)(3) of China's Trade Marks Law.
3. Descriptive nature: The mark is considered descriptive and cannot be registered as a trade mark according to Article 11(i)(2) of China's Trade Marks Law.

Some examples of these objections are as follows:

Trade Marks	Objection Grounds
"" in Classes 10, 35	absolute ground objection raised based on Article 10(i)(7) of China Trade Marks Law
"" in Classes 25, 35	absolute ground objection raised based on Article 10(i)(7) of China Trade Marks Law
"" in Class 3	absolute ground objection raised based on Article 10(i)(7) and Article 11(i)(3) of the China Trade Marks Law
"" in Class 29	absolute ground objection raised based on Article 10(i)(7) of China Trade Marks Law
"" in Class 24	absolute ground objection raised based on Article 10(i)(7) of China Trade Marks Law

Despite the efforts of applicants to file applications for review and argue against the CNIPA's objections, the objections are consistently maintained, and the applications are rejected. The CNIPA's approach in this regard is stringent.

Without registration, it is basically not possible to use those "green" trade marks in China. Article 52 of China's Trade Marks Law highlights the penalties for entities that pass off an unregistered trade mark as a registered trade mark or use an unregistered trade mark in violation of Article 10 of the China Trade Marks Law.

The relevant local administrative department for industry and commerce shall take action to stop such acts, order the offending party to make corrections within a specified time limit, and may circulate a notice regarding the matter.

If the illegal business revenue amounts to RMB 50,000 yuan (around USD7,000) or more, a fine of up to 20% of the illegal business revenue may be imposed. If there is no illegal business revenue or the illegal business revenue is less than RMB 50,000 yuan, a fine of up to RMB 10,000 yuan (around USD1,400) may be imposed.

"Green" advertising regulations

While there are no specific regulations concerning "green" advertising, all advertising is subject to regulation under the Advertising Law, Anti-Unfair Competition Law, and Product Quality Law in China.

Case Example: Shanghai Marilai Industrial Co., Ltd.

Shanghai Marilai Industrial Co., Ltd. (上海马利来实业有限公司) published advertisements for products such as "KI polysaccharides" through various media platforms, including advertising boards at operating premises, official websites, and WeChat official accounts. These advertisements made claims such as "KI polysaccharides can deeply detoxify the liver, spark stem cells, regenerate liver cells, and have successful cases of conditioning all chronic liver diseases, including hepatitis B, fatty liver, alcoholic liver, cirrhosis, ascites, and liver cancer."

Furthermore, they falsely claimed to have obtained patent rights and labelled their product packaging as "organic" without obtaining "organic" certification for the products. These actions violated Article 9(3), Article 12(2), Article 17, Article 28(1)(2)(5) of the Advertising Law, and Article 35(1)(1) of the Organic Product Certification Management Measures.

In accordance with Article 55(1), Article 58(1)(2), Article 59(1)(3) of the Advertising Law, and Article 50 of the Organic Product Certification Management Measures, the Market Supervision and Administration Bureau of Shanghai Municipal Songjiang District imposed an administrative penalty. This penalty included ordering the cessation of the dissemination of illegal advertisements and imposing a fine of RMB 500,000 yuan (around USD 70,600).

Certification Marks

Registering green trade marks in China has become increasingly challenging, however one appropriate way to use "green" marks is through the use of certification marks. Certification marks indicate independent certification by the owner that the goods or services meet specific defined characteristics. Typically, certification marks are held by organisations that have the authority to manage or supervise compliance with these standards.  For example, there are certification marks for green food , green building selection products, green food production materials, and more. 

Using a certification mark can help overcome objections related to deceptive or descriptive nature, as the mark signifies that the product has undergone a certified evaluation process.

It is important to note that the certification process itself can be rigorous and requires compliance with specific standards and requirements.

Practical tips for trade mark owners in China

Various laws in China ensure that green trade marks genuinely reflect the environmental characteristics of goods or services, preventing false advertising and misleading consumers. Within this legal framework, China aims to maintain fair market competition, protect consumers' rights, and promote the healthy and sustainable development of the environmental industry. Violating these laws, can lead to a series of legal consequences, including administrative penalties, civil compensation, and even criminal penalties.

Utilising certification marks can be a viable option to demonstrate compliance with specific environmental standards and overcome objections. It is advisable to consult with a qualified intellectual property attorney familiar with Chinese trade mark laws and practices to navigate the registration process successfully.

Here are some practical tips for applicants seeking to register green trade marks in China:

1. Exclude terms such as 'organic' ('有机' in Chinese), 'green' ('绿色' in Chinese ), 'natural' ('天然' in Chinese ), 'eco' ('生态' in Chinese), 'environmentally friendly' ( '环保' in Chinese) when filing trade mark applications for green trade marks in China.
2. Applying to use certification marks that can be used in relation to the relevant goods or services. However, ensure that you can meet all the required standards and criteria before applying.
3. Ensure that the use of green trade marks complies with all relevant laws and regulations.
4. Seek professional legal advice prior to filing your trade mark application.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.