Growing concerns over brand competitiveness

By Song Hongmei (chinadaily.com.cn)
Updated: 2007-08-07 18:00

In the cosmetics industry, foreign brands make up 75 percent, while in food and medicines, they comprise 30 percent to 40 percent. Three of the top four laundry detergent producers have been acquired by foreign companies.

Liu Liedong, general legal consultant for the China Oil and Food Corporation, a leading grain, oil and foodstuff trading conglomerate in China, said that the fundamental purpose of international companies in China is to raise their market share and promote their trademarks, with capital, technology and brands acting as their most powerful weapons.

Attracted by foreign capital and technology, many Chinese enterprises do not pay due attention to the handling of their brands when cooperating with foreign investors.

He said Chinese enterprises usually put their trademarks into joint ventures. With the development of the new company, foreign investors gradually gain a controlling position or just replace the Chinese brands with their own.

Furthermore, few Chinese brands have overseas registration. Forty-six percent of 500 famous domestic brands have no registration in the United States, according to data from the seminar.

Some famous Chinese brands, including Tongrentang, a leading traditional Chinese medicine manufacturer, China"s largest computer maker Lenovo, and electric appliance maker Haier have been maliciously or falsely registered in some foreign countries.

Malicious registration of domestic brands outside the country has caused a direct loss of US$200 million in the past over three years, added Wu, saying it is partly due to a lack of awareness in brand cultivation and a global strategy.

Liu suggested that Chinese enterprises improve their awareness of IPR protection and at the same time that the government strengthen law enforcement of its trademark assessment system.

(For more biz stories, please visit Industry Updates)

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