Kiwi exporters beware of e-commerce
By Johnathan Chen The recent New Balance case should be a big wake up call for Kiwi companies exporting to Asian markets, especially those capitalising on e-commerce to do so. Selling online is a great idea as it gives companies ready access to untapped consumer markets – especially in China, where the emerging middle class’ demand for foreign goods is hard to service except by e-commerce platforms, and for those consumers that are in more remote areas of China. The reach of e-commerce is far and wide; at it is expanding at a rapid pace. But beware; the risks that come with it are significantly larger too. New Balance Athletic Shoe, Inc. the US sportswear and shoe giant, was recently ordered to pay $22m in damages for infringing a trade mark – the largest amount awarded in China’s Guangzhou Court history for a trade mark case. James & Wells Head of Asia Division, Johnathan Chen, says that with e-commerce growing incredibly fast in China it’s a very tempting avenue for Kiwi companies wanting to increase sales to take, but they need to be careful. “The New Balance example shows that Chinese courts really mean business and will take action against ‘blatant infringers’. It gave the benefit of the doubt to the original IP rights owner, even over a huge international company,” he says. In 2006 New Balance set up a Chinese subsidiary and marketed its products under the Chinese brand ‘Xinbailun’ (which references ‘New (Xin) Balance (Bailun)’). However, the brand ‘Bailun’ had already been registered in 1996 by a private businessman in relation to shoes, hats and other clothing. He subsequently registered a series of related marks, which included ‘Xinbailun’, and was granted trade mark rights in 2008. He then sued New Balance in 2011, who claimed they were innocent […]