Why the fifth major revision to China’s Trademark Law requires a strategy shift for brand owners

On December 22, 2025, the Draft Amendment to the Trademark Law of the People’s Republic of China was submitted to the 19th meeting of the Standing Committee of the 14th National People’s Congress for deliberation for the first time. As the fifth major revision since the Trademark Law came into force in 1983, this amendment closely addresses the pain points in industry development, with its core logic shifting fully from “registration-centred” to “governance-intensive”. It precisely focuses on prominent issues such as malicious registration, the prevalence of “zombie trademarks,” and trademark abuse, to establish a more comprehensive system for trademark registration, management,  and protection. This amendment will have a profound impact on enterprises’ trademark strategic layout, compliance management boundaries, and the selection of rights protection paths. The following seven core highlights deserve close attention from enterprises.

Newly Included – Dynamic Signs as Registrable Trademarks

This revision for the first time incorporates dynamic signs (such as short-video opening animations, APP loading animations, brand promotional dynamic logos, etc.) into the scope of registrable trademark elements, placing them on an equal footing with traditional trademark types like words and graphics, which fills the gap in the protection of new-type commercial signs in the digital economy era. In digital scenarios such as short videos, live streams, and mobile applications, dynamic logos, brand animations, and interface transition effects have become the core carriers of brand differentiation and identification. Compared with static signs, dynamic signs can effectively strengthen consumers’ brand awareness and recognition through a more substantial visual impact and stronger memory cues. Incorporating dynamic signs into the trademark protection system this time is not only an inevitable measure to conform to the development trend of the digital economy, but also brings significant benefits to digital transformation-oriented enterprises in the fields of science and technology, the Internet, media and entertainment, e-commerce, etc., providing legal support for the all-round layout of their brand assets.

Enterprises must strictly abide by compliance boundaries when applying for dynamic sign trademarks: first, avoid applying for purely functional or descriptive dynamic effects (such as dynamic demonstrations only used to show the way to use products); second, exclude dynamic forms that arise from the nature of the goods themselves and are necessary to achieve technical effects; third, shall not apply for dynamic content with adverse impacts. Meanwhile, enterprises should plan the creation, registration and copyright protection of dynamic signs in advance, conduct searches for prior rights, and avoid application failures due to conflicts with others’ intellectual property rights.

Strengthening the Whole-chain Regulation of Malicious Registration: The “Zero-Tolerance” Orientation of Articles 18 and 53

Through the linkage between Articles 18 and 53, the Draft Amendment has established a whole-chain regulatory system for malicious registration featuring “pre-prevention + in-process review + post-punishment”, which clearly reflects the “zero-tolerance” attitude towards malicious trademark registration behaviours and resolves long-standing industry problems such as “trademark hoarding” and “speculative squatting” at the institutional level.

Article 18: Access Threshold Control for Malicious Registration (Core Basis for Refusal of Registration)

Article 18 of the Draft Amendment to the Trademark Law of the People’s Republic of China: Where an application for trademark registration is filed not for use and is obviously beyond the needs of normal production and operation, the registration shall not be granted.

No one may apply for trademark registration by means of fraud or other improper means.

This article integrates and optimizes Article 4 (malicious application not for use) and Paragraph 1 of Article 44 (registration by means of fraud or improper means) of the current Trademark Law, clearly defining two types of circumstances for refusing registration, namely “hoarding-type malicious application” and “fraudulent improper application”, which significantly enhances the certainty of legal application and provides clear adjudication guidelines for the review, opposition and invalidation procedures.

Hoarding-type malicious application: Double determination of “not for the purpose of use + obviously beyond the needs of normal production and operation”

The core of “not for the purpose of use” is the applicant’s lack of genuine commercial use intention, specifically manifested in the absence of product R&D plans, market layout schemes, and actual sales plans, with the core purpose being hoarding and transferring for profit.

In examination practice, the determination of “obviously beyond the needs of normal production and operation” usually takes the following dimensions into careful consideration:

• Application scale dimension: Whether the number of applied trademarks, the covered Classes of goods/services and the registration density are abnormal. For example, applying for hundreds of trademarks across dozens of irrelevant Classes within one year, or a natural person without an operating entity applying for trademarks in batches.
• Subject qualification dimension: Whether the enterprise scale, operation period, and core business scope of the applicant match its application behaviour. For example, a small or micro enterprise blindly applying for trademarks in all Classes, or a shell company applying for a large number of trademarks without actual operations.
• Application intention dimension: Whether there are circumstances such as listing the trademark for transfer immediately after application, the trademark being highly similar to a well-known brand without a reasonable source of originality, or repeatedly squatting on prior-used trademarks of others.
• Industry practice dimension: Compare with the conventional trademark layout of enterprises in the same industry. For example, a catering enterprise applying for trademarks in completely irrelevant fields, such as the chemical industry and machinery, which are obviously beyond the conventional operations of the industry.

It should be noted that limited defensive registration based on genuine business expansion plans and to prevent infringement risks (such as registering core brands in related Classes) is within the scope of legality and compliance due to its reasonable business logic and is permitted by law.

Fraudulent Improper Application

In examination practice, typical manifestations of “applying for trademark registration by means of fraud or other improper means” include:

• Forging documents certifying the applicant’s qualification, such as business licenses and identity certificates;
• Fabricating trademark use evidence or concealing material facts to mislead the examination authority;
• Providing false application materials, including priority certificates and power of attorney;
• Evading legal provisions through means such as splitting applications or filing fraudulent changes;
• Preemptively registering marks that constitute national symbols or public resources, thereby harming public interests;
• Disrupting the order of trademark registration and protection through malicious oppositions, malicious litigation, or similar improper conduct.

Underlying Legislative Logic of the Clause Amendment

• Free up public resources: Clearing “zombie trademarks” and “hoarded trademarks” to address the problem of occupied trademark resources, enabling enterprises with genuine use needs to obtain trademark rights efficiently and improving the efficiency of trademark examination.
• Uphold fair competition: Curbing the monopolisation of trademark resources by a small number of entities, safeguarding the equal right of small and medium-sized enterprises to access trademark rights, and fostering a fair and orderly market environment.
• Guide bona fide trademark applications: Strengthening the principle of “use-oriented” trademark filing, encouraging market entities to align trademark applications with their actual business operations closely, and promoting the sound development of brand building.
• Enhance administrative efficiency: Reduce malicious applications at the source to reduce the workload of administrative procedures such as examination, opposition, and invalidation, and achieve optimal allocation of administrative resources.

Article 53: Catch-all Provision for Administrative Penalties Against Malicious Registration (Core Legal Basis for Ex Post Facto Disciplinary Actions)

Article 53 of the Draft Amendment to the Trademark Law of the People’s Republic of China

Where a trademark registrant commits any of the following acts of malicious trademark registration that cause adverse effects, the competent trademark enforcement authority shall issue a warning and may impose a fine of not more than RMB 100,000:

(1) Applying for registration of a mark that it knows violates the provisions of Article 15 of this Law;

(2) Applying for trademark registration in violation of the provisions of Article 18 of this Law;

(3) Intentionally applying for trademark registration in violation of the provisions of Articles 20, 21 and 23 of this Law.

This provision establishes, for the first time in China’s trademark legal framework, clear administrative penalty standards targeting malicious registration conduct. Together with Article 18, it forms a dual disciplinary loop of “registration refusal + fine imposition”, upgrading the regulation of malicious registration from mere “procedural denial” to “substantive punishment” and substantially increasing the costs of illegal activities.

Scope of Application: Covering Core Malicious Registration Scenarios

The provision explicitly enumerates three categories of punishable conduct, covering typical illegal acts in the field of trademark registration:

• Violation of Article 15 (Marks Prohibited from Use): Applying for registration of trademarks containing prohibited elements, including national/ political party symbols, foreign state emblems, international organization insignia, official hallmarks, Red Cross/Red Crescent emblems, ethnically discriminatory signs, deceptive marks, marks with adverse effects, and place names of administrative divisions at or above the county level;
• Violation of Article 18: Engaging in hoarding registration without intent to use the mark, or applying for registration through fraudulent or improper means;
• Violation of Articles 20, 21 and 23: Preemptively registering well-known trademarks; prior-used trademarks subject to agency/representative relationships or commercial ties; or trademarks that infringe upon others’ prior legitimate rights and interests (such as the right to name, portrait right, copyright and trade name right, etc.), or preemptively registering unregistered trademarks that others have used and that have acquired certain influence.

Legislative Value: Returning to the Core Purpose of the Trademark Law

By strengthening the deterrence of penalties, this provision primarily achieves three legislative objectives: first, clearing “zombie trademarks” and “hoarded trademarks” to optimize the allocation of trademark resources; second, guiding market entities to embrace the use-oriented principle for trademark applications, ensuring that trademark rights truly serve brand operation rather than speculative profiteering; third, consolidating the institutional defense line for fair competition, and safeguarding the order of trademark registration as well as the legitimate rights and interests of consumers.

Core Compliance Strategies for Enterprises

Faced with the tightened regulation of malicious registration, enterprises shall establish a full-process compliance system to mitigate legal risks:

1. Pre-filing Compliance Screening: Conduct pre-filing trademark searches, strictly exclude prohibited marks, and refrain from crossing legal red lines.
2. Adherence to the Principle of Good Faith: Abandon the mindset of “preemptive squatting” and “trademark hoarding”, and foster the good-faith philosophy that “application shall be accompanied by preparation for use”.
3. Enhanced Assessment of Trademark Use Necessity: Conduct an evaluation of the necessity of trademark use before applying, and retain supporting documents such as business plans, product R&D records, and market layout schemes to substantiate the application’s legitimacy.
4. Matching Application Scale to Business Needs: Ensure that the quantity and Classes of trademark applications are commensurate with the enterprise’s business scale and scope of operations, avoiding excessive defensive registration.
5. Preservation of Complete Evidence Chain for Trademark Use: Fully retain evidence of trademark use (such as sales contracts, invoices, promotional materials, and exhibition records, etc.) to provide evidentiary support for addressing potential disputes.

Cross-Class Protection for Unregistered Well-Known Trademarks: Resolving Brand Protection Dilemmas in the Initial Stages

Article 20 of the Draft Amendment to the Trademark Law of the People’s Republic of China

Where a trademark applied for registration for identical or similar goods constitutes a reproduction, imitation, or translation of another party’s unregistered well-known trademark not yet registered in China and is likely to confuse, the application shall be rejected, and the use of such trademark shall be prohibited.

Where a trademark applied for registration for dissimilar goods constitutes a reproduction, imitation, or translation of another party’s well-known trademark, misleads the public, and is likely to harm the interests of the holder of such well-known trademark, the application shall be rejected, and the use of such trademark shall be prohibited.

In practice, emerging brands, time-honoured brands, and other entities often face the predicament of their core signs being preemptively registered across dissimilar Classes before completing trademark registration, due to delays in the trademark registration process or insufficient awareness of their brand layout. Previously, unregistered well-known trademarks were only entitled to protection for identical or similar goods, lacking a clear legal basis to prohibit preemptive cross-Class registrations in their entirety. This gap resulted in the dilution of brand value and disruption of market order. By expanding the scope of cross-Class protection, this amendment restructures the legal framework to achieve consistent protection for both registered and unregistered well-known trademarks. It establishes a continuous protection system for such entities throughout the entire lifecycle from brand inception to maturity, effectively resolving their challenges in safeguarding rights during the initial growth phase.

It is essential to clarify that this amendment does not alter the core regulatory framework for the recognition of well-known trademarks in China: the three fundamental principles of “case-specific recognition, passive protection, and recognition on an as-needed basis” remain strictly applicable. Specifically, recognition of a well-known trademark must be based on a specific case and shall be initiated only upon the explicit request of the party concerned. The recognition decision shall be binding only for the said case. Furthermore, the recognition procedure shall be triggered solely when the case cannot be fairly and appropriately resolved without such recognition. In terms of the factors considered for recognition, the core criteria, including the degree of recognition among the relevant public; the duration, manner, and geographical scope of trademark use; the duration, intensity, and geographical scope of promotional activities; and the record of trademark protection (in particular, prior recognition as a well-known trademark) have only been refined slightly in wording without any substantive changes. This ensures the stability and continuity of the well-known trademark recognition regime.

Procedural Efficiency Optimisation: Shortening Processing Cycles and Resolving the Dilemma of Cyclical Litigation

This amendment focuses on improving the efficiency of trademark administrative procedures and reducing the costs of proper protection. It optimises procedural rules through two core adjustments, addressing the practical pain points of lengthy processing cycles and cyclical litigation:

1. Shortening the current trademark opposition period from three months to two months, to enhance the efficiency of administrative examination.
2. Clarifying the rules for suspension of examination in proceedings, and putting an end to the chaos of cyclical litigation. Where the determination of prior rights and interests involved in procedures such as opposition, review of refusal, review of non-registration and invalidation must be based on the outcome of another case pending before a people’s court or being handled by an administrative authority (e.g., where the cited trademark is in an unstable state such as being subject to a non-use cancellation or an invalidation), it is clarified that the administrative authority shall generally suspend the examination. This measure can effectively avoid procedural repetitions and cyclical litigation caused by the uncertain status of prior rights, streamline the proper protection process at the institutional level, reduce the time and economic costs of right protection for enterprises, and improve the overall efficiency of trademark administrative examination and right protection procedures.

Streamlining the Application of the One-Year Grace Period to Safeguard Fair Competition

The Draft Amendment eliminates the one-year grace period requirement applicable to three scenarios under the current law: trademark cancellation, invalidation, and failure to renew upon expiration, retaining such protection only for trademarks voluntarily removed by their registrants.

Article 50 of the current Trademark Law stipulates that where a registered trademark is cancelled, invalidated, or not renewed upon expiration, the Trademark Office shall not approve applications for identical or similar trademarks within one year from the date of cancellation, invalidation, or removal. In contrast, Article 48 of the Draft Amendment clarifies that the one-year ban on approving identical or similar trademark applications for the same or similar goods shall apply solely to trademarks voluntarily removed by their registrants, commencing from the date of the removal announcement. The grace period provisions for the aforementioned three types of involuntary removal are hereby repealed.

The core rationale for abolishing the grace period for cancelled trademarks is as follows: such trademarks cease to be valid after registration because their holders failed to fulfill statutory obligations of use (e.g., non-use for three consecutive years without just cause, hoarding for profit without actual use) or engaged in unauthorized use (e.g., altering the trademark without approval, using it beyond the approved scope, or allowing it to become a generic name). In essence, the holders have either voluntarily abandoned their rights or lost them due to violations. These trademarks no longer serve their core function of distinguishing the source of goods or services, as no corresponding products or services continue to circulate in the market, resulting in minimal risk of consumer confusion. The original legislative intent of the grace period, to prevent consumer confusion, no longer applies. In practice, the Trademark Office has long ceased to reject subsequent applications for identical or similar trademarks because the grace period for a cancelled (due to non-use) trademark has not expired. This amendment merely aligns legislative provisions with established administrative practice.

The grace period was initially designed to protect consumers from confusion. However, trademarks that are invalidated, primarily due to violations of prohibition clauses, infringement of prior rights, or malicious registration, are deemed invalid ab initio, as their registration was unlawful. Typically, such trademarks have not been used or have seen only minimal use, leaving no substantial residual goods in the market and posing negligible consumer confusion risks. Retaining a grace period for these trademarks would not only serve no practical purpose but also hinder legitimate trademark registrations by other enterprises, indirectly enabling malicious applicants to obstruct subsequent registrations a second time, a result contrary to the principle of fair competition. In practice, the Trademark Office has long ceased to cite invalidated trademarks within the grace period as a basis for rejecting subsequent applications. This amendment merely aligns with current practices and refines the legislative logic.

Under the current Trademark Law and examination practice, a one-year grace period also applies to trademarks not renewed upon expiration, and the Trademark Office has often rejected subsequent applications for identical or similar trademarks by citing such unrenewed trademarks within the grace period. The Draft Amendment abolishes this grace period, based on the following core reasoning: if a trademark holder fails to renew the registration within the statutory 12-month renewal period plus the 6-month grace period, this shall be deemed a voluntary waiver of the trademark’s commercial value. Its market use has already ceased, and consumer recognition of the trademark will naturally fade over time. As these trademarks leave no residual goods or services in the market, the risk of consumer confusion is exceptionally low, rendering the grace period’s original legislative purpose obsolete and its retention unnecessary.

In summary, the core value of a trademark lies in distinguishing the source of goods or services. Involuntary removal, whether due to non-renewal, cancellation, or invalidation, indicates that the trademark has lost its practical utility or failed to comply with legal requirements. Removing the grace period for these scenarios serves two key purposes: first, guiding enterprises to return to the essence of trademarks as tools for commercial use, and abandoning practices of hoarding trademarks through procedural loopholes; second, freeing up trademark resources long occupied by zombie trademarks, expired unrenewed trademarks, etc., optimizing resource allocation efficiency, reducing administrative examination costs, and channeling resources to enterprises with genuine use needs.

Conversely, retaining the one-year grace period for voluntarily removed trademarks strikes a precise balance between private rights and public interests. Voluntary removal often stems from enterprise strategic adjustments (e.g., brand upgrading or business downsizing), where the trademark may still retain market recognition. The grace period thus prevents consumer confusion while safeguarding the remaining interests of the right holder.

Key Implications and Compliance Strategies for Enterprises:

1. For Trademark Registrants: Strengthen trademark portfolio management by promptly completing renewal procedures, standardising trademark use, and preserving comprehensive use evidence. This will prevent the loss of brand assets due to involuntary removal.
2. For Subsequent Applicants: Where an application has been filed for the cancellation or invalidation of a prior conflicting trademark, submit the trademark application concurrently to preempt third-party filings and maximise the protection of legitimate rights and interests.

Strengthening Trademark Use Supervision and Regulating the Exercise of Rights

Adding Misleading Use as an Illegal Act and Establishing a Three-level Progressive Penalty Mechanism

Article 56 of the Draft Amendment clearly stipulates that where a trademark registrant alters the registered trademark, the registrant’s name, address or other registered matters without authorization, or uses the registered trademark in a way that misleads the public (that is, misleading consumers to form wrong perceptions about the source, quality, raw materials, place of origin, etc. of goods/services through the trademark itself, the way of use or the publicity context), the trademark law enforcement department shall order it to make corrections within a time limit; if it fails to make corrections within the time limit, a fine of not more than 50,000 yuan shall be imposed; if the circumstances are severe, its registered trademark shall be cancelled. Meanwhile, it is clarified that if a trademark becomes a generic name or is not used for three consecutive years without justifiable reasons, any party may apply for non-use cancellation, and the trademark administration department may also initiate cancellation.

The addition of the illegal act of misleading use and the imposition of fine penalties in this revision have formed a three-level disciplinary system of “order to make corrections within a time limit → fine → cancellation of trademark”, marking the transformation of the Trademark Law from “valuing registration over use” to “attaching equal importance to registration and use”, and strengthening the principle of good faith and the protection of consumers’ rights and interests.

Clarifying That the Trademark Administration Department May Take the Initiative to Cancel Two Types of “Zombie Trademarks”

First, registered trademarks that have become generic names for the designated goods; second, registered trademarks that have not been used for three consecutive years without justifiable reasons, to solve the problem of idle trademark resources accurately.

Core Points for Enterprises’ Compliance Response

1. Conduct self-inspections on trademark use compliance, focusing on problems such as trademark alteration, inconsistent information and misleading use.
2. Establish a three-level compliance system covering the “system level (formulating a trademark use specification manual) + implementation level (reviewing materials before release) + monitoring level (regular monitoring)”.
3. Regulate trademark use and publicity to ensure that statements related to product ingredients, quality, place of origin, etc., are true, accurate and verifiable, and put an end to misleading use.
4. File change recordal promptly after changes in registration information.
5. Use the trademark as registered on the registration certificate; any modification to the trademark requires a new application.
6. Regularly retain evidence of trademark use to cope with the risk of non-use cancellation.
7. Strengthen trademark monitoring, promptly correct signs that the trademark is becoming a generic name, and avoid the loss of rights.

Regulating Malicious Lawsuits and Preventing the Abuse of Rights

Article 78 of the Draft Amendment to the Trademark Law of the People’s Republic of China: Where a malicious trademark lawsuit is filed, the people’s court shall impose penalties in accordance with the law; if losses are caused to the other party, civil liability shall be borne in accordance with the law.

Paragraph 4 of Article 68 of the current Trademark Law provides only a principled framework for malicious lawsuits, without clarifying civil liability for compensation, resulting in low costs and high returns for acts such as “extortionate rights protection” and “litigation for profit”, which seriously disrupt market order and waste judicial resources. Article 78 of the Draft Amendment extends the liability for malicious lawsuits from administrative liability to civil liability, filling the legal gap. As the core basis for regulating malicious lawsuits in the trademark field, this article marks the transformation of China’s Trademark Law from “simply strengthening rights protection” to “attaching equal importance to rights protection and preventing the abuse of rights”, providing clear legal support for accurately cracking down on chaos such as “extortionate rights protection” and helping maintain a fair and orderly market and judicial environment.

Impact on Enterprises and Response Measures

1. Establish a review mechanism for the basis of trademark rights, and conduct strict verification before filing a lawsuit to ensure that the litigation claims have a sufficient factual and legal basis.
2. Regularly retain evidence of trademark use (including sales records, publicity materials, market share data, etc.) to consolidate the basis for rights and avoid being identified as filing a malicious lawsuit due to weak rights-related evidence.
3. If a malicious lawsuit is received, promptly collect evidence of the other party’s malicious acts (such as previous litigation records, evidence of false statements, etc.), actively respond to the lawsuit and defend itself, and claim that the other party shall bear civil liability for compensation in accordance with the law; after winning the lawsuit, an application may be filed with the people’s court for imposing penalties on the party that filed the malicious lawsuit.

This Draft Amendment brings both opportunities and challenges to enterprises. The opportunities lie in further expanding the scope of brand protection, significantly improving the efficiency of trademark procedures, and continuously improving the market competition environment, thereby providing a more solid institutional guarantee for enterprises’ brand layout and rights protection. The challenges are reflected in the continuous strengthening of trademark use supervision and the increasing requirements for compliance management, which put forward higher standards for enterprises’ full-process trademark management capabilities. Under such circumstances, enterprises need to optimise and adjust their trademark strategies as soon as possible, establish a whole-chain trademark management system “with use as the core and compliance as the bottom line”, actively adapt to the new regulations resulting from the law revision, and effectively convert policy dividends into core brand competitiveness.