ALL IN A NAME...
http://english.eastday.com/epublish/gb/paper1/981/class000100005/hwz151794.htm
For many years now, foreign firms have been complaining about the brazen manner in which local Chinese firms violate their trademarks. Walk along West Nanjing or Huao Hai Rd, and undoubtedly you will be approached by a vendor offering you a "Rolex" watch or a "Gucci" wallet. Whether or not this actually affects the market share of Rolex or Gucci is debatable. It is unlikely that somebody wishing to purchase a genuine Rolex watch will opt for a cheap knock-off from a street vendor, however certainly Rolex doesn't want inferior products circulating with their trademark on it. In the article above, the situation is somewhat different. Roche Pharmaceutical Co has launched an action against the local Chinese company Southwest Pharmaceutical Co, the Shanghai Fuxing Pharmacy Chain Management Co and Fuxing's Ningqiang Road outlet for violating the trademark of the painkiller Saridon by producing and selling the drug with a similar brand name. Here, the situation is somewhat differerent to my example above, as this must be a huge concern to Roche over loss of market share. One of the dangers in entering into JV's or manufacturing agreements is the possibility that the local side will use the acquired technology or production methods to compete with the Foreign side. As a lawyer, it certainly underscores the need to have a strong non-competition clause in any contract entered into with a local party. Time and time again foreign parties get burnt by not paying enough attention to the potential for their local partner to turn into their competitor.
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