Mark owners must be wary of Chinese character name threat

Since January 1 2007 the Business Companies Act 2004 has been the sole corporate statute for registration of companies in the British Virgin Islands (BVI). Every company that was previously incorporated under the International Business Companies Act (Cap 291) and did not voluntarily elect to re-register under the new Business Companies Act 2004 during 2006 has been automatically re-registered under the new act. One important feature of the new act is that it allows the registration of a company with an additional name in foreign characters, such as Chinese characters, if approved by the registrar.

However, the likely possibility that one of the over 700,000 companies registered in the BVI may be doing business in China with a Chinese character name and possibly cause confusion with another business may prove to be a threat to global trademark owners. Injunctive relief against this form of misrepresentation is available at common law in the BVI in an action for passing off.

As a preventive measure, however, it may be more economical to ensure that the company was not able to register the deceptive Chinese characters or the English name of the business in the first place by seeking to register both the English version and the foreign character version of the business name. The registrar of corporate affairs, who is also the registrar of trademarks in the BVI, can then exercise a discretion under the new act not to approve the additional foreign character name of the company. Further, the registration of the business name as a trademark in its Chinese characters will provide an additional right of action against any BVI company which may be causing confusion in the Chinese market.

Although it would be necessary to prove distinctiveness to register a business name as a trademark in the BVI, the criterion is that the business name must be represented in some particular and distinctive manner. Foreign characters of a business name would qualify as a particular and distinctive manner of representing a name under BVI trademark law. Therefore, as part of a strategy to protect global brands from being exploited in China, for example, by persons other than the trademark owner, it is always advisable to register a trademark in the BVI in the foreign characters as a preliminary preventive step.

Jamal Smith, Harneys, Tortola