Court decision may signal mainland opening to U.S.-based social media platform
Facebook Inc has won a trademark case in court against a Chinese company that registered the brand name "face book," a decision involving intellectual property rights (IPR) that may signal the U.S.-based company will be welcomed by China, experts said on Monday.
The Beijing High People's Court ruled recently that Guangdong-based Zhongshan Pearl River Drinks Factory should not use the "face book" trademark it registered in 2011, according to a report the court released on its website on April 28. The company produces food and beverages.
The food company deliberately copied prominent trademarks, which has disturbed market order, said the Beijing High People's Court.
Neither Facebook nor Zhongshan Pearl River Drinks Factory responded to the Global Times' request for comment on Monday.
"Along with the case Facebook has won, its founder Mark Zuckerberg has expressed his great interest in the Chinese mainland market in public many times," Liu Dingding, a senior analyst at Beijing-based Internet consultancy Sootoo, told the Global Times on Monday. "It's quite possible Facebook could enter the Chinese mainland market."
Currently, U.S.-based social media platform Facebook is not available in the mainland.
But there are some good signals. For instance, founder and CEO Zuckerberg met Chinese top officials in March. Zuckerberg posted on Facebook in March that he was running with several people by the gate of the Forbidden City in Beijing.
Yet experts still warned that some social networks such as LinkedIn have tried to break into the Chinese market but have mostly underperformed, because it's difficult to enter a sector that's controlled by domestic Internet giants such as Tencent Holdings, according to Liu.
For instance, WeChat, the popular messaging app, which was launched by Tencent in 2011, had 697 million monthly active users at the end of 2015, up 39 percent year-on-year, according to Tencent in March.
It's essential for these international social networks to localize, said Liu. It's not enough to build a Chinese-version website - it's also necessary to focus on Chinese users' habits.
These international companies need to hire professional local staff who know the domestic market well and are familiar with Chinese laws and regulations, noted Liu.
Facebook is not the first international company to have faced a trademark dispute in China.
A Beijing court ruled last week that a local company Xintong Tiandi Technology, was entitled to use the trademark "IPHONE." Xintong Tiandi trademarked "IPHONE" for leather products in China in 2007.
Apple Inc, maker of iPhones, said it intended to request a retrial with the Supreme People's Court, according to a report by the BBC on May 4.
Apple's case is different from that of Facebook, Chang Yachun, a lawyer specializing in the IPR issue at Beijing Kangda Law Firm, told the Global Times on Monday.
Chang noted that Xintong Tiandi holds the trademark in China to sell leather goods with the brand "IPHONE," while Apple sells phones.
Also, Xintong Tiandi registered the trademark in 2007, while Apple only started to sell iPhones in 2009 in China.
The local company registered the trademark before Apple's iPhone became popular in China, said Chang, and Apple would need to prove otherwise.
Zhan Baosheng, a Chinese businessman who registered the "Tesla" trademark years before the U.S. electric automaker entered China, sued the company for trademark infringement in July 2014. In August 2014, Zhan agreed to cancel his trademarks in China, and Tesla withdrew claims for compensation from Zhan
"International companies need to obey Chinese laws and regulations, and they better register their trademarks as early as possible if they want to operate a business in China," Chang said.
