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Padlocked to an export exemption? The OEM-related trade mark dispute in China

Lizhou Wei

Keywords: origin function; cross-border OEM activities; trade mark infringement; labels clause; export exemption

Should a trade mark owner have the right to prevent third parties from affixing a trade mark to products intended for export? This problem has attracted less attention in the EU and US than it deserves. In comparison, Chinese courts have had to stand on this issue in the last decades when adjudicating on the cross-border OEM cases. Since the judicial opinion of the Chinese Supreme People's Court has always been in flux with the change of the presiding judge of the IP tribunal, this remains an open question in China. In practice, most Chinese courts are inclined to accept the export exemption rule and deny that OEM activities constitute trade mark infringement. This article questions the export exemption rule and calls for a return to the strong-protection approach. It is proposed that affixing a trade mark to products per se constitutes trade mark infringement irrespective of where the products are to be sold, which is more dogmatically coherent with the legal materials and also in line with the existing policy objectives in China.

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