When most people think about intellectual property protection for animated characters or fictional figures, they think copyright or trademark registration. But in China, there is a third, often overlooked weapon in the arsenal: merchandising rights/commercialization rights — and it can be decisive.

This right is not codified in China's Trademark Law itself, but is recognised through the China National Intellectual Property Administration (CNIPA) Trademark Examination and Review Guidance (2021) and increasingly reflected in administrative decisions. In essence, it protects the commercial value and business opportunities attached to a famous character name or artwork title — value built through the rights holder's creative labour and investment — from being misappropriated by third parties through trademark registration.

To date, we have successfully represented clients in dozens of similar trademark opposition and invalidation cases. In one representative matter, a third party had filed a trademark identical to our client's famous cartoon character name across goods in Class 20 — an applicant with no connection to the character whatsoever.

CNIPA upheld our opposition. The authority found that the character name had attained public recognition in China prior to the disputed application, that its fame was the direct result of the rights holder's creative and commercial investment, and that allowing registration would enable the applicant to unfairly leverage the character's goodwill and crowd out legitimate business opportunities belonging to the true rights holder — squarely engaging Article 32 of the Trademark Law (protection of prior existing rights).

What makes this right particularly powerful:

• It does not require the rights holder to hold a prior trademark registration in China
• It protects names and titles that have achieved a degree of public recognition, even where copyright in a name alone may not subsist
• It is effective against bad-faith filings in goods and services classes the rights holder has not yet entered

For brand owners in film, animation, gaming, and publishing — especially those with Chinese market exposure — this is a right worth knowing and asserting proactively.

If you are facing similar trademark squatting on a character name, film title, or fictional IP, we would be glad to discuss how this framework applies to your situation.