Australian wine exports to China bounce back: Unbottling trade mark protection for brand owners

October 24, 2024

Australian wine exports to China have increased significantly since China lifted its high tariffs on Australian bottled wine in March this year.

According to new data from Wine Australia,¹ in the 12 months ending September 2024, the value of Australian wine exports to mainland China totalled AU$611.5 million, up from AU$7.3 million the previous year (an 8,320.5% increase).

What's more, South Australian wine accounted for AU$517.4 million of that total (approximately 85% of all Australian exports to China in the past year).

Still red wine remains the most popular variety for export, accounting for over 90% of wine volume shipped to China in the past year.

For reference, the value of Australian wine exports to China pre-tariff (in the 12 months ending October 2020) peaked at around AU$1.26 billion.

As discussed in our article earlier this year, IP Australia's Annual Report 2024 identified China as the third most popular overseas trade mark filing destination for Australians, taking up a 13.1% share of total overseas applications made in 2022, just behind the USA and New Zealand.

Searching and filing your trade marks in China

Australian wineries that export to China (or are planning to start) should be checking their trade mark portfolios and seeking to protect their brands by applying for trade mark registration in China, with a view to securing registration before use commences.

Securing a trade mark registration is particularly important in China given it is a "first-to-file" jurisdiction, meaning the first person to file a trade mark will (subject to some exceptions) generally be considered the owner of the mark, regardless of whether they were first to use that mark.

Australian wine brands are therefore advised to file in China before entering the market, to avoid counterfeit manufacturers or trade mark "squatters" from filing there first. In a recent example, Penfolds discovered that a trade mark squatter had registered the Chinese transliteration of its brand in China (奔富, pronounced "BEN FU" in Mandarin) which Penfolds had been using in the Chinese market since the 1990s, resulting in lengthy legal proceedings that ended up before the Supreme People's Court.

Similarly, before launching a wine product in China, it would be worth conducting a freedom to use search, to ascertain if that mark is free to be used (and registered) to minimise the risk of infringing another party's existing mark.

Trade mark owners should also consider whether to use or apply to register a brand that is the Chinese transliteration of their trade mark/s. This is not only relevant to marketing to local consumers, but also minimises the risk of third-party labels attempting to deceive local consumers by using a Chinese transliteration of a popular brand name, as exemplified by the Penfolds case.

For a confidential discussion about your trade mark strategy in China, please contact the Dentons Trade Marks Team in Australia.

¹ Available at https://marketexplorer.wineaustralia.com/export-dashboard.