Three steps for successful assignment negotiations in China

When seeking to agree a trademark assignment in China, negotiation is not only crucial, but effective. Generally, when we think about negotiations, the first thing that springs to mind is the need to be tough. Usually, we charge at them like a battle, brandishing our influence and our power moves. However, does such an approach actually result in a win-win scenario?

The key is to have an open mind. Think of a negotiation more like a dance – two or more people moving fluidly, in sync with one another. It is not about dominating the other party, but rather about crafting relationships based on give and take, and moving together in unison. To do this, it is vital to be well prepared.  

First step: do your research

While it is often overlooked, proper preparation should never be underestimated. Its primary purpose is to evaluate whether what you are asking for is realistic. You should ask yourself these questions in order to reach that conclusion:

  • What is your end goal?
  • What do you want that sits within the range of your client's budget?
  • What would make you walk away from the table?
  • Is what you want realistic budget-wise? If so, what is the rate or exchange scope?
  • What requests can be left behind, and what must you insist on?

You will also want to solidify the basic information of:

  • the target, including industry, use status, reputation, business plans and key products and market; and
  • the trademark, including its history, status or importance, subclass and key goods, as well as any identical or similar marks and possible alternative actions.

While they may seem obvious, a lot of people do not think to ask these questions. 

As an example, imagine that you are negotiating for a trademark assignment with a big competitor. They may set their grounds based on their reputation. This can put you into a passive position, which is not a good place to be.   

However, rather than accepting this you can explore the range of what is possible. Look at industrial reports, websites, administration for industry and commerce records or the China National Intellectual Property Association database. Try to find out the other side’s biggest, average and developing line of products, and set your requirements based on these.

Then, build a solid rationale explaining why you are their best option and what you can bring to the table after you reach the negotiation (eg, remote work possibilities).

When facing a big competitor, it is commonly assumed that they use their trademarks without considering assignment. However, they might be prepared to make concessions if they could more easily register outside of China or obtain storage options. When necessary, invalidation, opposition or non-use cancellation actions can put pressure on them to return to the table. 

Second step: prepare mentally

Asking for things can get emotional. Real and complex feelings – fear, anxiety, sometimes even anger – are at play during a negotiation.

Usually, both parties will insist upon enforcing their own principles and refuse to accept concessions, by which stage, the negotiation becomes a battle or a debate.

It is better to predict this outcome in advance and think twice before you act upon these feelings. When you have prepared for the possibility that your request could either be met or denied, you will be prepped to deal with any surfacing feelings.  

The key is to stay calm – it is fine to take breaks or leave the battleground peacefully.

Third step: put yourself in the other person's shoes

It can be difficult to say ‘yes’ in negotiations. While such a red line can make you feel that you are in the more powerful position, this assumption can lose you negotiations. 

You have detailed reports, plans, even your own fallback strategies in your hands. Before jumping into discussing requirements, why not cooperate rather than argue? 

It is important to remember that many negotiation missteps do not actually come from disagreements, but from misunderstandings. Listen well; it will show that you are ambitious, but also that you care.

When you know the reason behind the other side’s requests, this can help you break the deadlock. Sometimes, they may need to have a superior make the final decision or they may want a higher transfer fee. They may just want to continue their business relationship with the client. 

While these steps are not one-size-fits-all for negotiations in China, it may enable you to discover unexpected opportunities for win-win solutions when it comes to trademark assignments.

This is an Insight article, written by a selected partner as part of WTR's co-published content. Read more on Insight

Unlock unlimited access to all WTR content