China’s counterfeit issue is notorious. Millions of fake products are produced and distributed every day in the mainland. This issue has been addressed for many years now, but not much has changed. There are countless markets in China that sell fake goods. With the rise of the eCommerce industry counterfeit products also went online. As a result, online platforms distribute millions of fake goods. The counterfeiting industry is blooming in China, producing ample profits for the violators.
International brands operating in China face challenges when entering the Chinese market. Since the market is flourishing with fake goods, brands need to protect themselves from competing with “their own brand”. In order to identify and stop the sources of counterfeit products, many actions are taken. Legal actions, trademarks and copywriters are needed to safely operate on the market.
In order to fight the huge counterfeit market, authorities imposed trademark infringement rules. In May of 2014, a new Trademark Law was put in place. This law imposes severe punishments for repeated infringements and big fines for fake goods production. With the rising legal restrictions on counterfeit products, many producers of fake goods moved from brick-and-mortar setting to online. As a result, it became more difficult for brands to protect and keep control of their rights in the mainland. In 2014, more than 40% of goods sold online were fake products.
With few laws and a huge drive for money, China turned out to be an ideal place for mass counterfeit goods production. Countless factories that produce fake goods are the sources for many job placements that are badly needed in China. This could be one of the reasons why it is so hard to eliminate the counterfeit market.
Nevertheless, there is a way for a safe and successful online presence in the mainland. One of the biggest advice for brands is to register their brand name and get the trademark in China even if they are not trying to expand to China right away. Registering a brand name, buying domains and getting trademark will give brands an opportunity to secure brand name from other parties using it. In addition, it is recommended that brands check the market time to time on the presence of fake copies being sold online.
Beijing-based Web Presence In China (WPIC) is an independent, full service digital marketing and IT development agency. Having over 13 years of on the ground experience in the China digital sector, the firm has worked with over 300 global companies and leads a team of 120 people between their global offices. WPIC supports China and the greater APAC region in digital and IT solutions.