Daimler is suing China's State Administration for Industry and Commerce (SAIC) after its trademark office rejected the Mercedes-Benz manufacturer's application to register the mark BEIJING BENZ. The lawsuit coincides with new figures showing that three-quarters of foreign manufacturers in China consider IP enforcement crucial.

Daimler originally made its trademark application in August 2005. The application was refused two years later and Daimler's appeal was also rejected. The SAIC argued that BEIJING BENZ is not registrable as a mark in China because:

  • its abbreviation of the company's name would mislead consumers;
  • it includes the name of a region above county level; and
  • it includes the name of the country's capital.

Danny Friedmann, a consultant on Chinese IP rights and author of IP Dragon, told WTR, "I don't think Daimler has a case. Although, I think the [SAIC's] argument that the use of the abbreviation will mislead consumers is debatable."

On the SAIC's latter points, there can be no doubt. Article 10 of China's Trademark Law states: "The geographical names as the administrative divisions at or above the county level and the foreign geographical names well known to the public shall not be used as trademarks."

Meanwhile, in a survey conducted of 108 foreign multinationals in China by global consultancy firm Booz & Co, 73% of respondents said that enforcing IP rights was either "important" or "very important" and that the government had made "incremental progress on protecting IP rights".

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