Licensing a registered trademark to others involves two core steps: signing a written trademark license contract, and then having the licensor record the license with CNIPA. The licensor also bears a statutory duty to supervise the quality of the licensee's goods.
Legal Basis
Article 43 of the Trademark Law provides that a trademark registrant may, by concluding a trademark license contract, authorize another person to use its registered trademark. The licensor shall supervise the quality of the goods on which the licensee uses its registered trademark, and the licensee shall guarantee the quality of the goods on which the registered trademark is used. A party licensed to use another's registered trademark must indicate its own name and the origin of the goods on the goods bearing that mark. A trademark license contract shall be submitted to CNIPA for recordation and published by CNIPA; without recordation, it may not be asserted against a bona fide third party.
The Process
- Sign the license contract: specify the license type (exclusive, sole or ordinary), the licensed goods, territory, term, fees and quality clauses;
- File the recordation application: the licensor submits the license recordation to CNIPA with the application form and contract-related materials;
- Publication of recordation: CNIPA publishes the recordation, and the information enters the public register.
The recorded license term may not exceed the trademark's validity period; if the trademark is near expiry, renew it first and then record the license.
Consequences of Not Recording
Non-recordation does not affect the contract's validity between the parties, but it creates two risks: first, the license may not be asserted against a bona fide third party — if the trademark is assigned, an assignee without knowledge may disregard the license; second, in infringement litigation, the licensee's standing to sue may be affected.
Advice for Licensors
Assess the licensee's qualifications and quality-control capability before licensing; keep records of quality supervision during the term; and promptly record a modification or cancellation when the licensing relationship changes. Trademark licensing is an excellent way to monetize brand assets, but a hands-off approach dilutes brand value and may even trigger joint-liability disputes over quality problems.
If you are facing the above situation, you may first run a license recordation through MyTMBee to confirm feasibility before deciding whether to file, avoiding blind filings that waste official fees.