China

Appleby is pleased to welcome seasoned litigator Alvin Sin, who will be joining our Shanghai office as Partner and our Hong Kong office as Legal Manager, effective 30 June 2025. This key appointment underscores Appleby’s commitment to strengthening our presence in Greater China, enabling us to offer an even broader range of commercial dispute resolution services tailored to meet the evolving needs of our clients, and deepening our capabilities in handling complex cross-border disputes. Alvin brings over a decade of experience in corporate, commercial, and regulatory disputes across Asia. He has a track record representing clients in high-value arbitration, litigation, regulatory matters and corporate investigations, with a particular focus on the financial services, biopharmaceuticals, technology, professional services and real estate sectors. Alvin regularly advises investment banks, multinational corporations and professional services firms on regulatory and compliance matters. Prior to joining Appleby, Alvin spent more than 10 years at a leading US law firm in Hong Kong and several years at a leading Chinese-Australian law firm. Fluent in English, Cantonese, and Mandarin, Alvin offers deep regional market expertise, helping clients navigate cross-border disputes involving offshore jurisdictions. David Bulley, Appleby’s Hong Kong and Mainland China Managing Partner, commented, "We are delighted to welcome Alvin as we continue to expand Appleby’s dispute resolution practice in Greater China. With every change that we make to the Hong Kong and Shanghai teams we are looking to continue to improve our offering for clients. Alvin’s combination of legal expertise and Chinese language and commercial insight significantly enhances our offering for Mandarin and Cantonese speaking Hong Kong and Mainland China clients and positions us to better support clients facing complex cross-border disputes." Eliot Simpson, Appleby’s Hong Kong Head of Dispute Resolution, added, "With Alvin’s arrival, Appleby enhances its ability to provide comprehensive dispute resolution services, spanning high-stakes litigation across multiple offshore finance jurisdictions. Our team remains dedicated to delivering strategic, commercially driven solutions for financial institutions, professional services firms, and multinational corporations operating across Asia and beyond." Reflecting on his new role at Appleby, Alvin said, “I am excited to be joining Appleby and to play a part in the firm’s continued growth across the region. I’m looking forward to collaborating with my colleagues to help clients navigate legal complexities and find effective solutions to their disputes.” With this appointment, Appleby reaffirms its dedication to providing comprehensive, client-centric solutions for complex disputes throughout Asia and beyond. _________________________________________________________________ 毅柏律师事务所任命冼雋杰为上海办公室合伙人，进一步增强大中华区争议解决业务实力 毅柏欣然宣布，资深诉讼律师冼雋杰（Alvin Sin）将于 2025 年 6 月 30 日正式加入本所，出任上海办公室合伙人及香港办公室法律经理。此项重要任命彰显了毅柏持续拓展大中华区业务版图的承诺，进一步巩固了我们为客户提供量身定制商事争议解决方案的能力，并强化了本所应对复杂跨境争议的专业实力。 冼律师在亚洲拥有逾十年处理公司、商事及监管争议的丰富经验，在高额仲裁、诉讼、监管事务及企业调查方面屡获佳绩，尤为专注于金融服务、生物医药、科技、专业服务及房地产等行业。他长期为投行、跨国企业及专业服务机构提供有关监管与合规的法律建议。 在加入毅柏之前，冼律师曾于香港一家知名美国律所服务逾十年，并曾任职于一家享有盛誉的中澳合资律所。他精通英语、粤语及普通话，熟悉亚洲法律市场，为客户处理涉及离岸司法管辖区的跨境争议提供独到见解。 毅柏香港及中国大陆区管理合伙人布泰玮（David Bulley）表示：“我们非常欢迎冼律师的加入，他的加入标志了毅柏持续深耕大中华区争议解决业务的决心。毅柏在香港及上海走过的每一步脚印，都是为了进一步提升我们为客户提供的专业服务。冼律师能够结合法律专业、中文语言能力及商业洞察，加强我们为普通话及粤语客户提供服务的能力，也让我们在应对复杂跨境争议时更具优势。” 毅柏香港争议解决业务主管冼耀仁（ Eliot Simpson） 补充道：“冼律师的加入，使我们在多个离岸金融法域提供高端诉讼服务的能力更上一层楼。我们的团队将继续致力于为金融机构、专业服务公司及跨国企业提供战略性与商业导向兼备的争议解决方案，覆盖亚洲及更广泛地区。” 谈及加入毅柏，冼律师表示：“我非常高兴能够加入毅柏，并参与毅柏在亚太地区的持续拓展。我期待与同事们携手合作，协助客户应对法律挑战，并为其争议提供高效务实的解决方案。” 此次任命再次印证了 毅柏致力于在亚洲及更广泛地区提供全方位、以客户为中心的复杂争议解决方案的承诺。

On December 20, 2024, the China Securities Regulatory Commission (“CSRC”) released the Provisions on the Administration of Recognised Hong Kong Funds (“MRF Regulation”), which will come into effect on January 1, 2025. The Interim Provisions on the Administration of Recognised Hong Kong Funds effective from July 1, 2015 will be repealed. Nearly a decade after the implementation of the Mainland-Hong Kong Mutual Recognition of Funds (MRF) scheme (“MRF Scheme”), it is further optimized, releasing greater policy flexibility and business opportunities. On the same day, CSRC released an updated version of the Frequently Asked Questions of the China Securities Regulatory Commission on Mainland-Hong Kong Mutual Recognition of Funds (“CSRC FAQ”) and an updated version of the Guidelines on Application Documents for Registration of Recognised Hong Kong Funds. The Hong Kong Securities and Futures Commission (“SFC”) also released an updated version of the Frequently Asked Questions on Mainland-Hong Kong Mutual Recognition of Funds. The People’s Bank of China and the State Administration of Foreign Exchange issued an amendment to the Operational Guidelines on Capital Management for Cross-Border Offering and Distribution of Securities Investment Funds between the Mainland and Hong Kong. These measures provide institutional guarantee for the smooth implementation of the optimized MRF Scheme. I. Major Optimizations of the MRF Regulation The amended MRF Regulation primarily optimizes the Northbound MRF in the following three aspects: The upper limit on the value of units in a Northbound MRF fund sold to investors in the Mainland has been relaxed from the original 50% of the value of the fund’s total assts to 80%. For example, if the AUM of a Hong Kong fund is RMB 1 billion in Hong Kong, under the previous rules, the AUM of this fund sourced from Mainland distribution shall not exceed RMB 1 billion. After the implementation of the MRF Regulation, the sales scale of this fund in the Mainland is able to reach RMB 4 billion, increasing the potential scale by RMB 3 billion. Additionally, it is expected that some Northbound MRF funds currently suspending Mainland distribution due to the 50% sales limit will gradually resume subscription in the Mainland until they reach the new upper limit of 80%. It is allowable to delegate the investment management functions of Northbound MRF funds to overseas asset managers in the same group with the Hong Kong managers. (1) Previously, if any investment management function of a Hong Kong fund is delegated to any affiliate of the manager which is not domiciled in Hong Kong, this fund will not be eligible to apply for the distribution in the Mainland under the MRF Scheme. The MRF Regulation removes this restriction, which will enable dozens of Hong Kong funds with delegated investment functions to qualify for distribution in the Mainland through the MRF Scheme. These funds typically invest in mature markets such as the United States and Europe, and are managed by affiliates of the manager in related markets in the capacity as sub-manager or investment manager. (2)If any investment management function of a Hong Kong fund is delegated to an entity which is not an affiliate of the manager and is domiciled in a country or region outside Hong Kong, this fund is still not eligible to apply for the distribution in the Mainland under the MRF Scheme. (3) According to the MRF Regulation, the securities regulator of the country/region where the affiliated investment delegates domicile shall have signed MoU on regulatory cooperation with CSRC and maintained effective regulatory cooperative relationship with CSRC. The MRF Regulation adds the flexibility to accommodate the potential inclusion of more Hong Kong funds under the MRF scheme in the future. According to the MRF Regulation, not only conventional equity, mixed, bond and index funds (including ETFs) can participate in the MRF Scheme, but “other types of funds recognized by CSRC” may also be included in this scheme. This means that certain types of funds (such as FOF), which are currently hot topics in the market, may gradually be included in the MRF scope upon recognition by CSRC as the Northbound MRF Scheme matures. II. Development of the Northbound MRF Under the MRF Scheme, the distribution of Hong Kong funds in the Mainland is referred to as “Northbound MRF”, while the distribution of Mainland funds in Hong Kong is referred to as “Southbound MRF”. After nearly ten years of development, Northbound MRF has effectively met the growing diversified investment needs of Mainland investors. Currently, 41 Hong Kong funds managed by 21 Hong Kong fund managers have been registered with CSRC and are publicly offered in the Mainland. From the perspective of Hong Kong managers, the following global asset managers, local Hong Kong asset managers and Hong Kong subsidiaries of Mainland financial institutions are actively participating in Northbound MRF business: Global asset managers (6) JPMorgan, Schroders, Amundi, HSBC, Pictet, UBS Local Hong Kong asset managers (6) Hang Seng, Zeal, BEA Union, Value Partners, Income Partners, Gaoteng Hong Kong subsidiaries of Mainland financial institutions (9) CCBI, BOCHKAM, BOCI-Prudential, Haitong, Bosera, ChinaAMC, E Fund, CISI, CSOP In terms of the product type, the existing MRF funds with global theme account for a small share, while the predominance are the funds with major investment in Hong Kong stocks, China theme and Asia/Asia-Pacific theme. As of the end of October 2024, the net outflow of Northbound MRF funds amounts to RMB36.5 billion. Given that the total quota for Northbound MRF is RMB 300 billion, there remains an available quota of around RMB 260 billion for Northbound MRF funds. III. Eligibility Requirements for Northbound MRF Funds In line with the new provisions of the MRF Regulation, Hong Kong funds participating in the Northbound MRF Scheme shall meet the following eligibility requirements: Requirements on Hong Kong Fund (1) Domicile: The proposed MRF fund is established and operates in Hong Kong in accordance with Hong Kong laws, is authorised by SFC for public offering and is regulated by SFC. (2) Product type: The proposed MRF fund shall be a conventional fund, including conventional equity, mixed, bond or index fund (including ETF), as well as any other type of fund recognized by CSRC. “Any other type of fund recognized by CSRC” leaves flexibility to the inclusion of more types of Hong Kong funds in the MRF Scheme.  (3) Track record: The proposed MRF fund shall be established for more than one year. If the fund was redomiciled to Hong Kong from another jurisdiction (such as the Cayman Islands or the British Virgin Islands), it shall be redomiciled for more than one year. (4) AUM: The proposed MRF fund shall have a minimum fund size of no less than RMB 200 million or its equivalent in a different currency. The requirement of RMB 200 million refers to the size of the fund at the time submitting the MRF application, but CSRC will also take into account the fund size of a certain period prior to the submission. (5) Primary investment direction: The proposed MRF fund shall not primarily invest in the Mainland market, and its investment in the Mainland market shall not exceed 20% of the fund’s assets. (6) Upper limit on sales scale in the Mainland: The value of units in the proposed MRF fund sold to investors in the Mainland shall not exceed 80% of the value of the fund’s total assets. (7) Dispute resolution method: If the proposed MRF fund adopts litigation for dispute resolution, it shall not exclude the jurisdiction of Mainland courts. Requirements on Fund Manager (1) Qualification of the manager: The fund manager of the proposed MRF fund shall be registered and operate in Hong Kong and hold the asset management license in Hong Kong; (2) Compliance of the manager: The fund manager of the proposed MRF fund shall not have been the subject of any major regulatory actions by SFC in the past three years or if it has been established for less than three years, since the date of its establishment. Regarding how to determine major regulatory actions, the CSRC FAQ clearly states that “during the registration process of a Northbound MRF fund, the fund manager shall truthfully disclose to CSRC whether it has been the subject of any regulatory actions by SFC in the past three years or since the date of its establishment, and CSRC may consult SFC on the determination of ‘major regulatory actions’”. (3) Delegation of investment functions: The investment management functions of the proposed MRF fund can be delegated to any asset management institution operating in Hong Kong and holding relevant license granted by SFC, or to any asset management affiliate “within the same group”. “Within the same group” refers to that there is actual control relationship between the manager and the investment delegate, or the manager and the investment delegate are controlled by the same actual controller. Meanwhile, the securities regulator of the country/region where the affiliated investment delegate domiciles shall have signed MoU on regulatory cooperation with CSRC and maintained effective regulatory cooperative relationship with CSRC. Trustee: The assets of the proposed MRF fund shall be under custody, and the trustee shall satisfy the eligibility requirements stipulated by SFC. Mainland agent: A Mainland retail fund manager or Mainland bank/securities firm with custody license shall be appointed as the agent of the proposed MRF fund. The Mainland agent is responsible for handling product registration, information disclosure, distribution arrangement, data exchange, funds settlement, regulatory reporting, communication and liaison, client service, monitoring and other matters of the proposed MRF fund in the Mainland on behalf of the Hong Kong manager. IV. Application Documents for Northbound MRF Funds After being registered with CSRC, Northbound MRF funds can be publicly distributed in the Mainland. To apply for the registration with CSRC, Hong Kong managers shall submit registration applications to CSRC via the Mainland agents appointed by them. According to the Guidelines on Application Documents for Registration of Recognised Hong Kong Funds, Hong Kong managers shall submit the following materials to CSRC via Mainland agents: Application report: mainly including the basic information of the fund, the fund’s fulfillment of registration conditions, the fund’s Mainland agent, arrangements for distribution and information disclosure in the Mainland, as well as issues that require special attention from the regulator Fund documents, including: Trust Deed; PRC Prospectus and Product Key Facts Statement (KFS); Explanatory statements and undertaking letters about the fund documents: Explanatory statement on whether there are any differences between the Trust Deed, Prospectus and KFS to be released in the Mainland and SFC-approved versions, and the reasons for such differences; Statement confirming that the Trust Deed is the latest complete version authorised by SFC; Statement confirming that the consolidated prospectus and the SFC-authorised version in other languages are consistent with each other and both versions have equal effect; Statement confirming that the Simplified Chinese versions of the registration application documents and offering documents are consistent with and have the same effect as the other language versions authorised by SFC; Agency agreement duly executed by Hong Kong manager and the Mainland agent for the Northbound MRF fund;   Other relevant fund materials, including: SFC’s approval letter for authorising the fund; Latest audited annual financial report of the fund; Statement on the daily AUM of the fund during the recent one month; Eligibility statement and supporting documents for the manager, trustee, and Mainland agent (registration certificates, licenses, etc.); PRC legal opinion issued by a PRC law firm; Other materials required by CSRC. According to the MRF Regulation, relevant materials should satisfy the following requirements: Being written in Simplified Chinese; Relevant terminology shall conform to the practice of the Mainland fund industry; If the original is in another language, a true, accurate, and complete Simplified Chinese translation shall be provided. Given that Hong Kong documents, such as fund documents and annual reports, are typically available only in English or in both English and Traditional Chinese versions, and that the terminology used in Traditional Chinese versions differs from Mainland financial market conventions, Hong Kong managers shall prepare Simplified Chinese translations of relevant documents in advance. These Simplified Chinese translations shall not only truthfully, accurately and completely reflect the content of the original language versions, but shall also optimize and adjust the terminology, wording, and expressions to align with Mainland fund industry practices and Mainland regulators’ reading and review habits. V. Updates of Existing Northbound MRF Funds For Northbound MRF funds that have been approved and are publicly distributed in the Mainland, the current Mainland offering documents specify a 50% limit on Mainland distribution. Hong Kong managers shall promptly initiate updates to the Mainland offering documents, and release updated versions as soon as possible after the MRF Regulation takes effect on January 1, 2025, so as to validate subsequent Mainland distribution. For Northbound MRF funds that have currently suspended Mainland subscription due to the 50% limit, in addition to the aforementioned document modifications, Hong Kong managers can also begin preparing relevant announcements to resume Mainland subscription after the MRF Regulation takes effect. VI. Participants in Northbound MRF Business In the Northbound MRF business, Hong Kong managers need to appoint the following Mainland institutions to carry out the distribution of Northbound MRF funds: Engaging a Mainland institution as the Mainland agent Engaging the Mainland fund distributors to distribute Northbound MRF Funds Engaging China Securities Depository and Clearing Corporation Limited (“CSDC”) to provide services such as unit registration, distribution data transfer, fund settlement Engaging Shenzhen Securities Communication Co., Ltd. (“SSCC”) to handle data conversion and transmission for Northbound MRF funds Mainland Agents As mentioned above, the Hong Kong manager needs to engage a Mainland agent which is either a Mainland retail fund manager or a Mainland institution with custody license for securities investment funds, to handle relevant matters for Northbound MRF funds in the Mainland. According to public information disclosed by CSRC, among the 41 approved Northbound MRF funds, there are 11 Hong Kong managers engaging affiliates in the Mainland as their Mainland agents of the Northbound MRF funds. For example, JPMorgan engages JPMorgan Asset Management (China) Company Limited, HSBC AM engages HSBC Jintrust Fund Management Company Limited, Amundi engages ABC-CA Fund Management Co., Ltd., Schroders engages BOCOM Schroders Fund Management Co., Ltd. as their Mainland agents. There are 10 Hong Kong managers managing total 16 funds that engage independent non-affiliated fund management companies or banks with fund custody license as Mainland agents. Among these independent Mainland agents, Tianhong is the most active one, which provides agency services for total 9 Northbound MRF funds of 5 Hong Kong managers. Choosing a retail fund manager as the Mainland agent, especially when the Hong Kong manager has a Mainland affiliated retail fund manager, can take advantage of the extensive market foundation and client resources of the Mainland retail fund manager. The retail fund manager can organize distribution network to expand the distribution of Northbound MRF funds in the Mainland. Meanwhile, it can also leverage the retail fund manager’s years of compliance experience in fund distribution and information disclosure, thereby providing experiential support for the distribution, information disclosure and regulatory reporting of Northbound MRF funds in the Mainland. In recent years, with the steady progress of capital market opening-up, 9 foreign institutions have established WFOE FMCs (wholly foreign-owned retail fund management companies) in China, including BlackRock, Neuberger Berman, FIL, Schroders, AllianceBernstein, Allianz, Manulife, JPMorgan and Morgan Stanley. WFOE FMCs have a unique advantage in terms of onshore and offshore resource integration and in promoting the deep involvement of offshore affiliates in the Northbound MRF business. In terms of custodian banks, currently 5 WFOE banks (wholly foreign-owned banks) have been approved for securities investment fund custody license, including Standard Chartered, Citibank, Deutsche Bank, BNP Paribas and HSBC. If the group to which the WFOE custodian bank belongs has long-term cooperation with the group to which the Hong Kong manager belongs, and the WFOE custodian bank holds the fund distribution license, such WFOE custodian bank can provide one-stop services that combine both of agency and distribution services for Northbound MRF funds. WFOE banks can effectively extend their rich resources and professional advantages accumulated in the bank QDII to the market of Northbound MRF funds which offers a larger investment quota capacity, fully leveraging their inherent advantages in cross-border asset allocation and wealth management. Mainland Distributors According to the MRF Regulations, Hong Kong managers can either directly or engage the Mainland agents to sign the distribution agreements with Mainland distributors. In practice, there are three models for signing distribution agreements: Hong Kong managers directly sign bilateral agreements with Mainland distributors; Mainland agents sign bilateral agreements with Mainland distributors based on authorization from Hong Kong managers; Hong Kong managers and Mainland agents jointly sign trilateral agreements with Mainland distributors. The direct involvement of Hong Kong managers in the negotiation of distribution agreements and the appointment of Mainland distributors allows for better control of the distribution process and strategy, and greatly reduces compliance and legal risks. However, since Hong Kong managers may not have cooperation with Mainland distributors before, this model usually entails higher due diligence costs and increased coordination efforts. In contrast, Mainland agents are more familiar with the domestic market, allowing them to provide sales strategies and customer services that are better tailored to local market conditions and leverage past sales experience and long-term cooperative relationships with relevant distributors. Hong Kong managers can choose the most suitable cooperation model by considering the actual needs and the mainland distribution arrangement. CSDC and SSCC The MRF Regulation requires Hong Kong managers to appoint Mainland agents to exchange data with fund distributors through technical platforms designated by CSRC. Currently, most Hong Kong managers of Northbound MRF funds authorize the Mainland agents to sign agreements with CSDC via which the Mainland agents engage CSDC to provide services such as unit registration, distribution data transfer, fund settlement. Additionally, Mainland agents need to engage SSCC to handle data conversion and transmission for Northbound MRF funds. When engaging CSDC with unit registration and data transfer, Hong Kong managers shall conduct business testing with CSDC during their initial onboarding to CSDC’s TA platform for open-end funds. If Hong Kong managers appoint new registrars in Hong Kong, they shall coordinate with these registrars to join CSDC’s TA platform and participate in business testing. It is important to note that CSDC currently requires registrars accessing their system to be institutions registered and operating in Hong Kong. We have observed that some Hong Kong retail funds use registrars based in Luxembourg, Cayman Islands or the British Virgin Islands. If such funds intend to register as Northbound MRF funds for Mainland distribution, additional work may be necessary so as to access CSDC’s system. VII. Conclusion The optimization of MRF Scheme will better serve the cross-border investment needs of investors in both the Mainland and Hong Kong, promote high-level institutional opening-up of Mainland capital markets, further strengthen Hong Kong’s position as an international financial center, and provide global asset management institutions with more business opportunities. Authors: Sandra Lu, Lily Luo and Sue Sun

AnJie Broad Law Firm successfully advised YSB Inc. (Stock Code: 9885.HK) in its 100% equity acquisition of Folding Space (Cayman) Ltd., with transaction value of approximately RMB 1.035 billion. This transaction marks the largest market-driven M&A transaction in the internet medical service sector of Hong Kong capital market in the past three years. This acquisition will strengthen YSB Inc.'s supply chain and commercial service capabilities, supporting the growth of its own-brand business and enhancing its competitive position in the market. AnJie Broad Law Firm provided comprehensive legal services to YSB Inc. in this acquisition, led by Partner Cai Hang, who coordinated the overall process and organized a team of experts across various fields. Partner Yao Ting, along with project members Yang Jing, Dong Xiao, and Dong Jiongpei, conducted thorough legal due diligence on Folding Space, assisted in designing the transaction structure, drafting and finalizing of transaction documents. They also provided legal opinions for the CSRC’s offshore filing process and supported YSB’s CSRC filing for its offshore issuance. Partner Song Ying and team member Lu Weijia handled the concentration of undertakings filing required for this transaction. The AnJie Broad team’s efficient and high-quality service earned strong recognition from the client.  

Malicious trademark registration has long been a primary concern for trademark holders. The Chinese Trademark Law has played a crucial role in countering malicious trademark registrations and upholding market order since its implementation on March 1 1983. However, despite the amendments to the Trademark Law in 1993, 2001, 2013, and 2019 that refined the legislative measures against malicious registrations, with the deep development of a market economy, a growing disparity between high trademark demand and limited resources has emerged and malicious registrations have persisted. Pre-emptive trademark registrations of unique terms related to public resources, hotspots, or sudden events, as well as names of celebrities, etc. have frequently occurred, continuously posing challenges to trademark rights protection. China will enhance its efforts in combating malicious trademark registrations across all sectors, in order to: Curb the trend of frequent and recurring malicious trademark registrations; Guide market entities towards a proper awareness of trademark registration; Promote a shift towards sensible trademark application practices; Uphold the integrity of the trademark registration system; and Enhance the business environment. This commitment will be reflected in legislation, law enforcement, and other aspects. Amendments to provide legal support for combating malicious trademark registration activities 1.1. Updates to the Trademark Law An upcoming fifth amendment to the Trademark Law will introduce several new measures to further rigorously combat malicious trademark registration activities. The current Trademark Law, in effect since November 1 2019, marks the fourth amendment to the 1983 Trademark Law. In contrast to the 2013 revised Trademark Law, the current Trademark Law places a strong emphasis on combating malicious trademark registration activities. It includes provisions such as an “application for trademark registration that is malicious and not filed for the purpose of use shall be refused” (emphasis added). Furthermore, actions that breach these rules can now serve as legitimate grounds for objections and declarations of invalidity. The front line in combating malicious registrations has been advanced, with additional regulations dictating that trademark agencies shall not accept the entrustment if they are aware, or should be aware, that their clients' trademark applications are under the category of "applications not filed for the purpose of use". Clear penalties for violations by these agencies have also been outlined. In light of the diverse tactics employed in malicious trademark registrations, the provisions of the current Trademark Law no longer align with practical developmental needs. For example, if a trademark is acquired through illegitimate means, although this qualifies as one of the statutory grounds for invalidation under the existing law, it is not recognised as a valid basis for opposition or explicitly categorised as a form of malicious trademark registration. In other words, under the current Trademark Law, an application for invalidation can be filed against a registered trademark on the ground of “registration acquired by unfair means”, but this ground cannot be used to file oppositions to trademarks that are pending registration. This logic clearly undermines the principle of advancing the front line in combating malicious trademark registrations. In practice, guided by the legal principle of good faith, "trademark registration acquired by unfair means" is recognised as one of the grounds for opposition. Some examiners cite this reason when making decisions to refuse registration in cases of oppositions. However, the lack of alignment between legal provisions and judicial practices leads to divergent examination standards among examiners. This objective discrepancy results in situations where opponents, whose oppositions are unsupported, must then initiate invalidation applications based on the same grounds. This systemic flaw not only squanders administrative resources but also highlights the significant hurdles in upholding trademark rights. On January 13 2023, the China National Intellectual Property Administration (CNIPA) released a Draft Revision of the Trademark Law of the People's Republic of China (Draft for Comments). If adopted, this revision would represent the fifth amendment to the 1983 Trademark Law. The draft introduces several measures to regulate malicious trademark registration activities. It not only defines applying for trademark registration through deception or other unfair means as malicious registration, leading to grounds for refusal and opposition, but also incorporates a system mandating the compulsory assignment of maliciously registered trademarks. Additionally, it specifies that legal responsibility should be assumed for infringing actions occurring after the registration but before the declaration of invalidity of maliciously registered trademarks. The draft outlines fines for malicious trademark registrations and requires civil compensation to be paid to others for losses due to malicious trademark registration applications. These additions underscore the continuous improvement and reinforcement of measures against malicious trademark registrations in China. 1.2. Further initiatives The revision of supporting regulations and systems such as the Implementing Regulations of the Trademark Law and the Guidelines for Trademark Examination and Adjudication is actively promoted, thereby strengthening the coordination between legal norms at different levels. During a press conference held by the CNIPA on February 22 2023, the vice director of the Trademark Office, Chang LI, emphasised the commitment to sustaining rigorous efforts in combating malicious trademark applications and hoarding activities. The CNIPA pledged to promptly address malicious pre-emptive registrations that jeopardise national and public interests. The comprehensive strategy aims to aggressively suppress malicious trademark registrations in all sectors, while continuously monitoring and controlling profit-driven hoarding practice. To consolidate the recent achievements made in combating malicious trademark registrations and to enhance oversight across all sectors, the CNIPA formulated the Work Plan on Systematic Governance of Malicious Trademark Registration for Promotion of High Quality Development (2023–2025) (the 2023–2025 Plan for Governing Malicious Trademark Registrations) on April 20 2023. This initiative prioritises "minimising the likelihood of success of malicious trademark registration activities". The plan proposes the rigorous combating of malicious trademark registration activities in accordance with the law and regulations, with the primary objective of achieving substantial advancements in regulating malicious trademark registrations by 2025. The above highlights China's firm and ongoing stance in combating malicious trademark registrations across all sectors. Refinements to normative documents will feature measures targeting such registrations in the Implementing Regulations of the Trademark Law. This includes further detailing what constitutes "serious circumstances" regarding malicious trademark registration applications and scenarios in the compulsory assignment system that could lead to confusion, along with their implementation in relevant departmental regulations and normative documents to clarify operational rules. The dynamic refinements of the Guidelines for Trademark Examination and Adjudication will involve intensifying research efforts on the governance challenges posed by malicious trademark registrations, timely formulation of pertinent policy documents, and the exploration of innovative examination rules within legal bounds. Enhancing the enforcement of laws and regulations The 2023–2025 Plan for Governing Malicious Trademark Registrations outlines that local intellectual property offices and trademark offices must strictly comply with laws, regulations, and rules such as the Trademark Law, the Implementing Regulations of the Trademark Law, several provisions on regulating trademark application and registration behaviour, regulations on the supervision and administration of trademark agencies, and the Provisions on the Determination and Protection of Well-Known Trademarks. They are mandated to lawfully refuse registrations, declare invalidity, block assignments, and disallow pledge registrations for malicious trademark applications. Cases involving individuals engaging in malicious pre-emptive trademark registration contrary to good faith principles and trademark agencies involved in illegal practices are to be forwarded to the relevant authorities for proper investigation. Approvals will not be granted under the law for cases where numerous malicious trademark registrations are pre-emptively pursued and subsequently assigned for profit. Regarding the act of maliciously applying for trademark registration, the current Trademark Law only broadly outlines administrative penalties such as warnings and fines and lacks provisions on specific fine amounts or civil liability. However, in the forthcoming fifth revision of the Trademark Law, with respect to malicious trademark registration applications, a fine of up to CNY 250,000 is expressly defined, alongside the introduction of administrative penalties involving the confiscation of illegal gains. Furthermore, civil liability is broadened to encompass compensation claimed by affected individuals and compensation claimed by prosecuting authorities in public interest lawsuits concerning activities that undermine national interests, public interests, and related concerns. In addition to expanding the application scope of administrative measures such as disapproval of registration and declaration of invalidity, as well as increasing administrative and civil actions against malicious trademark registration activities, there has been an increase in cases where courts, in judicial proceedings involving obvious wilful infringement, exceed the statutory maximum compensation limit of CNY 5 million and apply punitive damages to enhance the crackdown on malicious trademark registrations. For example, at the end of 2023, the Beijing Intellectual Property Court unveiled the Top Ten Typical Cases of Malicious Trademark Registrations; among which, a liquor company registering trademarks similar to the renowned ‘Yege’ series trademarks incurred a ruling mandating the defendant to compensate the plaintiff for economic losses totalling CNY 10 million. As a nation governed by statutory laws, China has made substantial legislative strides in combating malicious trademark registrations, offering explicit legal foundations and policy backing for addressing these issues and protecting the rights of all parties involved. It is essential for rights holders and trademark professionals not only to understand and effectively utilise new legal provisions but also to move beyond mere adherence to legal texts. Legal statutes shape social interactions, while societal evolution influences adjustments to legal frameworks, establishing a mutually beneficial relationship between law and society. Considerations in the use of trademarks Given China's continued and stringent crackdown on malicious trademark registrations, along with enhanced regulatory measures, the following recommendations are put forth by the authors for businesses to consider when applying for a trademark registration or acquiring trademarks from others: Enterprises applying for trademarks should promptly register trademarks aligned with their operational requirements to prevent the trademarks they have already put in use from being pre-emptively registered by others. Simultaneously, companies should uphold the principles of honesty and integrity, and govern their trademark application and registration processes in strict compliance with legal mandates. Trademark applications should exhibit reasonableness and legitimacy to steer clear of penalties related to suspected trademark infringement. If an enterprise aims to acquire trademarks from a third party through assignment, it is crucial to examine whether the trademarks being acquired have any defective titles. In practice, if the assigner is involved in malicious trademark squatting, there is a hidden risk that the assigned trademark could still face invalidation even after a successful assignment. Enterprises should raise awareness of trademark usage and uphold standardised records of promotional materials, sales contracts, invoices, and other evidence of use. By presenting such evidence of use, enterprises can seize the opportunity to defend their rights when confronting instances of trademark squatting by others. Final thoughts on China’s efforts to combat malicious trademark registrations Combating malicious trademark registrations is an ongoing effort, and in China, the measures taken to combat such registrations and the punitive fines imposed reflect a trend towards more stringent crackdowns. This approach is geared towards upholding a healthy and well-regulated trademark registration system, nurturing a supportive intellectual property legal framework, and safeguarding the legitimate interests of trademark rights holders.