China's lure as a lucrative market for British firms comes with a warning: look after your brand. It is a lesson that award-winning footwear designer Kat Maconie learned when she first went into China.
Kat Maconie is an award winning London based footwear designer. She formed her eponymous brand in 2009 and has built a global empire from her humble west London studio roots. She has created catwalk shoes for Felder Felder and Fyodor Golan, collaborated with Roberta Einer, and established a range of accessible pieces for British high street giant Dune. In essence, her shoes and of course her name, have iconic status across the world.
When Maconie first pursued expansion into China, having been approached by a "very excited" local wholesaler, she had not yet sought trademark protection. Only when moving ahead with the arrangement did the matter of her brand name arise. It was then she discovered that `Kat Maconie' had already been registered in Hong Kong.
At first she thought this would be a minor irritation, to be settled with the exchange of a small sum of money. In the first instance she recalls that it was extremely difficult to track the culprit down. When she did manage to find him in China, he demanded $50,000 to hand over the Kat Maconie name to Kat Maconie.
As the wholesaler was ramping up for the big launch, there was no exchange of contract in sight. When the individual was finally ready to play ball, he insisted on being flown first class from China to Hong Kong. Further costly demands were made prior to signing the necessary transfer documents, this requiring the presence of multiple notaries to guard against fraud.
"It took me one year to officially register in China," Maconie recalls. While her own name has been returned to her and business in China is thriving, she urges others embarking on a similar overseas adventure to think about a strategy for protecting their hard work and good name. Indeed, she advises, even if not setting up overseas just yet, consider registering your brand anyway. "If you don't, someone else will."
Maconie's experience is not unique and China is not the only country to see the rise of the trade mark squatter. As emerging nations move closer to the mainstream, it is almost inevitable that enterprising individuals will seek to capitalise on the hard work of others by appropriating their name. It is easy and cheap to do for them but difficult and potentially expensive for the genuine brand owner to undo.
Talking to a legal firm, experienced in brand protection, is a first step towards protection, advises Rowena Price, partner at Gill Jennings & Every LLP. Although the cost may be seen as prohibitive, initiating the process now could save an awful lot more later as the brand retrieval process ensues, especially if an IPO is likely somewhere down the line.
With the best will in the world, it is, notes Price, almost impossible for a small business to protect its name globally; it is just too time-consuming and expensive. The key, she says, is to focus on key markets. However, she warns that replication of the UK trade-marking experience should not be expected in emerging territories. In China, for example, the trade mark law is barely 30 years old – in other Asian countries it is even younger. There is still some way to go for the legal processes to reach full maturity.
Of the 2,876,048 trade mark applications filed in China in 2015, just 176,893 were lodged by foreign applicants. A new law passed in 2014 and revisions in May 2016 have laid the ground for increased protection for trade mark applicants. However, the number of applications being rejected has increased too. For the legitimate applicant, it therefore makes sense to ensure documentation is faultless. An experienced trade mark law firm, capable of leveraging close relationships with relevant local agencies and governmental bodies, should help ease the process.
For the likes of Kat Maconie and the many others who have suffered at the hands of the trade mark squatter, taking action sooner rather than later is the best form of protection.