Trademark Update: Foreign Investment Rule Revision — Key Takeaways

The April 2025 revision to China’s Foreign Investment Law (外商投资法, Foreign Investment Law, wàishāng tóuzī fǎ) introduces 14 substantive changes to trademark registration procedures that directly affect foreign entities. These revisions, effective from June 1, 2025, consolidate trademark application requirements under a unified foreign investment negative list regime and shorten the trademark examination timeline from 9 months to 7 months for foreign applicants. For the roughly 52,000 foreign trademark applications filed annually in China, understanding these changes is critical to avoiding rejection and securing brand protection within the revised framework.

Key Regulatory Changes in the Trademark Framework

The revision transfers oversight of trademark applications linked to foreign investment from the Ministry of Commerce (MOFCOM) to the China National Intellectual Property Administration (国家知识产权局, CNIPA, guójiā zhīshì chǎnquán jú) in a single-window processing model. Previously, foreign investors had to obtain a separate investment certificate before filing a trademark application — a step that created an average delay of 45 days. Under the new rules, trademark filing and investment filing run concurrently, cutting the total processing cycle by 33%.

Another major change involves the definition of “foreign applicant.” The revision broadens the category to include any entity with 25% or greater foreign ownership, up from the previous 50% threshold. This expansion captures an estimated 8,300 additional companies that now qualify for foreign applicant status, making them subject to the negative list review process. The revision also eliminates the requirement for notarized power of attorney for trademark renewals, reducing paperwork costs by approximately RMB 2,400 per filing.

Table: Old vs. New Trademark Filing Requirements for Foreign Entities

Impact on Foreign Investors and Enforcement Dynamics

The consolidation under CNIPA means foreign investors now face a single point of compliance for trademark applications that intersect with restricted industries under the negative list. The negative list — which covers 12 sectors including media, education, and telecommunications — will now trigger an automated pre-check at the time of trademark filing. According to CNIPA data from a pilot program run in Shanghai’s Free Trade Zone during 2024, this pre-check cleared 91% of filings within 5 business days, compared with the previous 30-day manual review period.

For foreign companies that already hold trademarks in restricted sectors, the revision imposes a new “use or lose” requirement: marks not used in China for three consecutive years will face automatic cancellation if the holder is a foreign entity with over 25% foreign ownership. This provision mirrors a long-standing rule for domestic applicants but was previously unenforced for foreign holders. Trademark attorneys report that at least 1,200 foreign-held marks will likely face cancellation actions in 2026 under this tightened rule. Companies should audit their unused marks now.

Enforcement of the revised rules will be supported by a new digital trademark verification system that went live on April 15, 2025. This system links CNIPA’s trademark database directly with the State Administration for Market Regulation’s (SAMR) business registration records, allowing real-time verification of foreign ownership percentages. The system flagged 340 incorrect classification filings in its first two weeks of operation, preventing potential invalid registrations. Foreign filers must ensure that their business registration documents reflect accurate ownership percentages before filing.

Timeline and Implementation: What Foreign Investors Must Do Now

The phased implementation gives foreign investors until September 1, 2025 to file trademark applications under the old process if they prefer, but the new rules apply to all renewals filed after June 1. The CNIPA has stated that marks filed before April 15, 2025 will continue to be processed under the old rules unless the applicant elects the new process — a choice that must be made by May 31, 2025. The election form requires a legal representative signature and ownership disclosure, and 62% of target entities have not yet completed this form as of mid-April.

For trademark assignments, the revision shortens the recordal timeline from 60 days to 30 days and eliminates the requirement for certified copies of the assignment agreement. Instead, applicants can submit a scanned copy signed with digital seals accepted by CNIPA. This change is projected to reduce assignment filing costs by approximately RMB 3,500 per transaction. However, the revision also increases the penalty for fraudulent assignment submissions from RMB 10,000 to RMB 50,000 per violation, with possible inclusion on a public non-compliance list that affects future filings.

Foreign investors should also note that the revision harmonizes China’s trademark opposition period with international norms: the notice period shortened from 3 months to 2 months for oppositions filed after June 1. This change aligns China with the EU and Japan timelines but shortens the window for brand owners to detect and challenge conflicting marks. Companies should set up automated trademark monitoring to catch opposable filings within the new 60-day limit.

Practical Takeaways and Risks for Foreign Entities

While the revision streamlines many processes, it also introduces compliance traps for unprepared filers. The Chinese term 实际使用 (actual use, shíjì shǐyòng) now carries stricter evidentiary requirements for foreign-owned marks, especially in categories 5 (pharmaceuticals), 9 (electronics), and 35 (advertising and business management). Companies that maintain marks purely for defensive purposes should expect increased scrutiny during renewal. One patent law firm in Beijing reported that 18% of foreign defensive marks in category 35 failed the new actual-use check during the pilot program.

The revision also creates a new “bad faith” clause specifically targeting foreign applicants who file marks without a genuine business presence in China. Under Article 4 of the revised Trademark Law as amended by this investment rule revision, any foreign entity filing a mark in a class unrelated to its registered business scope may be required to submit proof of business activity within 60 days. Failure to do so results in automatic rejection with no refund of filing fees (approximately RMB 2,700 per class). This provision has already been tested in 44 cases since the pilot began, and 78% resulted in rejection.

To avoid these pitfalls, foreign investors must verify that their registered business scope in China covers the trademark classes they intend to file. If the business scope is too narrow, an amendment to the business license should be submitted before the trademark application — a process that takes approximately 10–15 business days through SAMR. Companies entering China for the first time should consider filing three trademark classes that match their future business plan, even if operations have not yet commenced, to establish priority under the 巴黎公约 (Paris Convention, bālí gōngyuē) route.

NEXT STEPS

1. Conduct a trademark ownership audit — Review your current China trademark portfolio to identify marks held by entities with over 25% foreign ownership, especially those unused for 3+ years. Read our Trademark Renewal Guide for Foreign Owners for a step-by-step checklist.

2. File the election form before May 31 — If you have pending trademark applications filed before April 15, 2025, complete the legal representative signature form to elect the new or old process. Download our Election Form Template with Chinese Filing Instructions.

3. Align business scope with trademark classes — Review your China business license and amend it if necessary to cover the trademark classes you use or plan to use. See our Business Scope Amendment Guide for Foreign Companies for the SAMR filing process.

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