For decades, the playbook was painfully familiar. A foreign brand would enter, or even just announce plans to enter, the Chinese market, only to discover that someone had already registered its name, logo, or Chinese translation.

Under China’s strict first-to-file system, prior use of a mark abroad counts for little. The legitimate owner can be left fighting a slow and costly battle simply to use its own name in one of the world’s largest markets.

In 2026, that playbook is changing from two directions at once. China’s National Intellectual Property Administration (CNIPA) is pushing through a sweeping legislative overhaul, while a landmark Supreme People’s Court ruling has finally gone in favor of a foreign brand owner after a 13-year fight.

Together, these developments mark one of the most significant shifts in Chinese brand protection in years. They also bring new obligations for foreign brand owners.

The CNIPA Overhaul: From “Who Filed First” to “Who Actually Uses It”

On June 26, 2026, China’s National People’s Congress passed a comprehensive revision to the Trademark Law. The revision covers 87 articles across nine chapters and will take effect on January 1, 2027.

The changes are the result of a CNIPA-led reform effort that has been underway since 2023. More importantly for foreign brands, they shift the system’s focus away from simply asking who filed first and toward whether a trademark is genuinely being used.

Here’s what foreign brand owners should know.

● Bad faith is now explicitly defined and penalized.

Hoarding, fraudulent filings, squatting by agents or distributors, and copying well-known marks, including unregistered marks, are now expressly prohibited by statute.

Fines for bad-faith applicants can reach RMB 100,000. Agencies that knowingly assist squatters may also face liability.

● The opposition window is getting shorter.

The opposition period will be reduced from three months to two. That gives brand owners less time to identify and challenge problematic filings.

For companies with significant trademark portfolios, occasional reviews may no longer be enough.

● CNIPA gains proactive cancellation powers.

Starting in 2027, CNIPA will be able to initiate non-use cancellation proceedings on its own.

A new one-year embargo will also prevent squatters from immediately re-filing a mark that has been cancelled.

● The evidentiary bar for “genuine use” is rising.

This should make it easier to remove inactive squatted marks. At the same time, it creates additional risks for legitimate brands that hold older registrations but cannot produce strong, contemporaneous evidence of use.

Invoices, packaging, advertising materials, sales records, and other evidence of genuine use will become increasingly important.

● New penalties target “deceptive” trademark use.

Under a new Article 56, marks found to be misleading may be subject to fines and, potentially, ex officio cancellation.

CNIPA Is Already Taking a Tougher Approach

The changes to the law do not come out of nowhere. CNIPA has already been taking a tougher approach ahead of the law’s formal entry into force.

Practitioners report that the agency has become markedly more aggressive since early 2025 in rejecting marks as non-distinctive or “deceptive.”

This tougher approach can also create risks for legitimate businesses. In some cases, long-registered marks have reportedly been caught in the crossfire when defendants respond to infringement claims by challenging the plaintiff’s own trademark registration.

The Courts: A 13-Year Squatting Saga Finally Ends

While CNIPA is changing the rules for the future, China’s courts are also signaling a shift in how existing trademark disputes should be handled.

The clearest example came in March 2026, when the Supreme People’s Court ruled in a case involving Reckitt Benckiser’s Schiff vitamin brand.

The dispute lasted 13 years. It involved 45 interrelated opposition, invalidation, and non-use cancellation proceedings, as well as 10 rounds of administrative litigation.

The squatter had filed 82 trademark applications across 17 unrelated classes and was publicly offering the marks for sale. The pattern was a textbook example of bad-faith hoarding.

Yet earlier rulings, including CNIPA decisions in 2021 and 2022, went against Reckitt. At the time, examination practice focused heavily on the similarity of goods rather than the broader pattern of cross-class hoarding.

That changed on March 19, 2026.

The Supreme People’s Court explicitly recognized the squatter’s bad faith and ruled in Reckitt’s favor.

The significance of the case goes beyond the Schiff mark itself. It supports the use of a broader pattern of conduct as evidence of bad faith. In other words, a squatter’s entire filing history can matter, rather than just the circumstances surrounding one disputed trademark.

More Pressure on Trademark Agencies

The Schiff case was not an isolated development.

In April 2026, the Supreme People’s Court released a batch of “typical cases” covering several important issues. These included the relationship between criminal convictions and civil punitive damages, the referral of counterfeiting evidence to prosecutors, and potential liability for trademark agencies involved in bad-faith registrations.

A Guangzhou court has since applied this reasoning directly. It ordered both a competitor and its trademark agency to pay compensation for malicious squatting.

The decision sends a clear warning to trademark agencies: assisting a bad-faith applicant can carry consequences of its own.

Where Legislation and Litigation Meet

What makes 2026 particularly significant is the way these developments reinforce each other.

The new law’s provisions on agency liability echo what the Guangzhou court has already done in practice.

The law’s greater emphasis on patterns of bad faith also mirrors the reasoning used by the Supreme People’s Court in the Reckitt case.

Together, the message is becoming clearer. China is moving toward a trademark system that looks more closely at why a mark was filed, how it is being used, and whether the applicant is acting in good faith.

But China Is Not Declaring War on Large Trademark Portfolios

The courts also appear conscious of the need to avoid going too far in the other direction.

Recent rulings have distinguished speculative trademark hoarders from bona fide brand owners. For example, courts have declined to penalize a company that later legitimately repurchased a mark that had originally been registered in bad faith by someone else.

The message is not that large trademark portfolios are inherently suspicious.

Instead, the focus is on the applicant’s conduct and the circumstances surrounding the registrations.

What Foreign Brands Should Do Now

The changes make proactive trademark management even more important.

1. File early, and file the trio.

Register your English name, Chinese-character name, and Pinyin transliteration. Ideally, do this 12 to 18 months before entering the Chinese market.

The Michael Jordan “Qiaodan” name-rights case took nine years to resolve. Waiting until a market launch is approaching can be an expensive gamble.

2. Keep your use evidence current.

Do not wait until a cancellation action begins to reconstruct evidence of trademark use.

Maintain invoices, packaging, advertising materials, sales records, and other relevant documentation as part of your regular trademark management process.

3. Monitor new filings regularly.

The opposition window is becoming shorter, dropping from three months to two.

That means businesses need to identify problematic applications quickly. For brands with significant exposure in China, real-time or more frequent monitoring may be worth considering.

4. Look at the bigger pattern.

The Reckitt case strengthens the argument that bad faith can be demonstrated through a broader pattern of conduct.

If a potential squatter has filed large numbers of marks across unrelated classes, that filing history may become important evidence.

5. Do not overlook trademark agencies.

Agencies that knowingly assist with bad-faith registrations may face liability.

That creates another potential avenue of recourse for legitimate brand owners and gives businesses another reason to investigate the parties behind suspicious filings.

What This Means for Brand Owners

None of these changes eliminates the fundamental risk created by China’s first-to-file system.

Speed still matters. A brand that waits too long can still find its name already registered by someone else.

The difference is that the system is becoming less forgiving of applicants who deliberately exploit that first-to-file system.

For foreign businesses, the practical lesson is simple: register early, monitor continuously, and keep evidence of genuine use.

China’s legislature and courts are both moving toward stronger protection for genuine brand owners and tougher treatment of opportunistic filers.

The real test will come after the new Trademark Law takes effect on January 1, 2027. If the reforms deliver faster and more predictable outcomes in practice, rather than simply stronger rules on paper, they could fundamentally change how foreign companies approach trademark protection in China.

On a related note: China’s National Copyright Administration is separately pursuing its own reform track, with draft Implementing Regulations addressing AI-generated content, audiovisual works, and technical protection measures. The draft regulations were open for public comment through August 12, 2026. Different agency, different law, and a different set of challenges, but worth keeping on your radar if your IP strategy touches China. More on that in a future edition.

Sources

● European IP Helpdesk, “Tightening the Screws: How China’s Trademark System Is Turning Against Foreign Brands in 2026”

● European IP Helpdesk, “China’s 2026 Trademark Law Revision: 10 Changes Reshaping Brand Protection”

● Loeb & Loeb LLP, “China’s 2026 Trademark Law Revision: A Shift Toward a Use-Oriented Trademark Regime”

● IAM Media, “Schiff Brand Prevails After Supreme Court Concludes 13-Year Trademark Squatting Saga”

● Harris Sliwoski LLP, “Five Practical Steps Foreign Brands Should Take to Prepare for China’s New Trademark Law”