Trademark dispute lawsuit started by Guangxi Yuchai Machinery Group (hereafter referred to as Guangxi Yuchai), represented by Unitalen attorneys at Law, against Yuhuan County Kanmen Yuchai Machine Plant of Zhejiang Province (hereafter referred to as Zhejiang Yuchai) on the latter’s “Yujichaipei” wording and logo trademark application with the Trademark Office of the Chinese State Administration for Industry and Commerce (SAIC) finally got preliminary solution today. The Trademark Office finds the dispute reasonable, and refuses granting registration approval to “Yujichaipei”. Guangxi Yuchai is a large-scale state-owned enterprise, manufacturing and selling diesel engines and parts, engineering machines, lubricant oils, motors, automobiles etc. The internal market presence of the company’s diesel engines is larger than that of other similar products, and these engines are preferred to others as environmentally friendly. Its lubricant oils are produced under US prescriptions, and their quality is well received by customers. The “Yuchai” brand name used by the company with its diesel engines is very popular within the country, and was recognized as “famous trademark” by the Guangxi Province Administration of Industry and and Commerce consecutively in 1993 and 1998. On March 31, 2000 Zhejiang Zhengda Trademark Law Office represented Zhejiang Yuchai to apply for and register with SAIC Trademark Office the “Yujichaipei” trademark, which, upon preliminary examination and approval by the Trademark Office, was published in the “Trademark Bulletin”, issue 776. Guangxi Yuchai turned for legal help to Unitalen immediately upon hearing about the registration. With a closer study of the case facts we made a thorough analysis on behalf of the company: Firstly, after proper examination and approval, Guangxi Yuchai registered with No.318160 the “Yuchai” wording, and the “YC” logo and with No.1035383 – the “Yuchai” trademark, for use with products of the seventh type (diesel engines and electricity generators). The “Yujichaipei” trademark applied for registration thereupon by Zhejiang Yuchai was also designated for use with products of the seventh type (diesel engines, internal combustion engine parts and gasoline engines). The products under the two registrations function as diesel engines, their use is basically similar (or, otherwise, of engine–parts relationship), therefore these products may be regarded as similar or analogous. The use of the Chinese characters “ji” and “pei” with the trademark name of Zhejiang Yuchai is lacking in the sense of identification and may easily attract the customer’s attention on the characters “yu” and “chai”. Therefore, these two trademarks have similar trademark names and are used with similar or analogous products. Secondly, with the first trial already at hand, if Guangxi Yuchai files no objection within the stipulated time period, the Trademark Office will legally grant registration authorization to the other party or, to put it in other words, the perfect opportunity will be lost. The other company will gain legal protection as soon as it registers the trademark. However, there are also two kinds of legal measures to be taken even at that point. First of these is to file a disputed trademark application with the Trademark Examination Committee. This application, as far as the Trademark Office and the other party are concerned, is bound to bringing about more attention and stronger disapproval by raising the risk stakes even higher, than at the time of the official trademark publication. The second measure possible is usually not well met by companies, i.e. spending a fortune to forcefully buy out the already registered in bad faith trademark. It is worth mentioning that, once the applicant has successfully registered the trademark and has obtained special trademark registration rights, it is very much possible that he transfers or leases the trademark to third parties. We advised the company to urgently make a decision, gather case evidence material and file an objection with SAIC Trademark Office, in order to most effectively and timely obstruct the other party’s trademark registration. Guangxi Yuchai accepted Unitalen’s legal opinion and filed an objection. After laborious investigation, today the Trademark Office finally found the dispute reasonable, and rejected the grant of registration approval for “Yujichaipei”. From this case we realized that popular trademarks like “Yuchai” are the result of hard work and efforts combined with considerable financial and material resources investment in the products. Guangxi Yuchai is not an exception: as a famous producer in the diesel engines and lubricant oils industry, only as a result of long-lasting efforts did the company obtain its present outstanding achievements and business influence. The Yuchai trademark is widely popular, and customers accept it with love and trust. With all this at hand, company trademark is not only a joker for enlarging market position, but also a guarantee for customer satisfaction. Enterprises must therefore attach high importance to trademark all-round protection. In order to exist and develop, enterprises must indubitably realize that they have to rely on technological development and technological innovation, and be good at applying different business strategies and policies. They must also better understand the importance of trademark use and protection in order to protect their own and the society’s interests. Chinese companies must decisively embrace the trademark rights protection idea. Lack of strong sense of protection devalues and weakens the popularity of a famous trademark; brings about the risk of falling into ignorance of hardly worked-out trademarks; finally ending up in devaluation of the company’s intangible assets. China is already a formal member of the World Trade Organization. Whether Chinese companies can succeed in facing international competition is to a great extent a question of whether they can effectively attach importance to intellectual property rights protection. To rapidly and largely strengthen Chinese companies’ understanding of intellectual property rights protection, to help them obtain and exercise trademark strategy abilities in order to meet WTO post-accession development requirements, is a pressing responsibility of representing organizations like ours. Hopefully, we will be able to attract the attention of our society’s various circles.