And Finally

National spirit

Kweichow Moutai ends 17-year trademark battle

Moutai-w

Foreigners’ favourite A-share

Moutai is the drink of choice at Chinese state banquets and corporate get-togethers but after a 17-year ordeal, the storied baijiu’s producer has finally decided to abandon its efforts to register a trademark that bills the sorghum spirit as China’s “national liquor”.

The Shanghai-listed Kweichow Moutai had filed at least 10 applications with the Trademark Review and Adjudication Board (TRAB) dating back to 2001.

It was outright rejected nine out of 10 times but the company’s tenth and last attempt has been the most dragged-out and controversial of all.

As far back as 2012 the TRAB had given the application its initial approval to proceed, but that decision was overturned in 2016 following fiery objections from 33 parties including state-backed rivals such as Wuliangye Yibin and COFCO. According to Caixin Weekly, some of Moutai’s competitors had also applied to carry the term “national liquor” in their trademarks, but none had obtained the approval.

The trademark regulator explained that bestowing the “national liquor” description would imply that Moutai was the best liquor in the country. This would violate trademark laws and adversely affect competition, it decided.

Kweichow Moutai then filed an appeal for the TRAB to review the case in 2017, which was also rejected. But the Guizhou-based company refused to give in. It subsequently filed a lawsuit against the trademark office in the Beijing Intellectual Property Court last month, demanding that the authorities withdraw their rejection and re-evaluate its trademark application afresh. Kweichow Moutai also named 31 of its baijiu-producing competitors in its suit.

The company’s forceful actions have backfired, however, as they only served to stoke concerns from the public, with many accusing Kweichow Moutai of being arrogant and capricious.

On August 13, the company abruptly issued a declaration on its official website that it would withdraw the lawsuit and abandon its “national liquor” claim altogether. It also apologised to the TRAB, saying that it “fully respects and accepts” the latter’s decision, and expressed “sincere gratitude” to “brother companies” in the baijiu industry and “all parties in society”.

The statement added that the lawsuit was filed due to a miscommunication within the company, but did not specify details.

However, media firm CBN noted that even if Kweichow Moutai cannot use the term “national liquor” in its product trademarks, it has long branded and advertised its baijiu as a national drink. Through large-scale advertising, splashy public relations efforts and joint promotions with its product distributors, it is already designated as the ‘national wine’ in the eyes of most Chinese consumers. The trademark rejection will likely have little to no impact on its brand value, CBN concluded.


© ChinTell Ltd. All rights reserved.

Exclusively sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.