Experts are warning that foreign automotive giants have started gathering evidence of intellectual property infringement by domestic companies, signaling the potential for a "patent war" in the near future.
During inspections conducted by the Guangzhou Intellectual Property Rights (IPR) enforcement team in several auto parts markets, officials discovered widespread confusion regarding patent markings and certifications. Many products claimed to be patented but lacked proper patent numbers or valid certificates. Some items even falsely advertised U.S. patent filings, which are not recognized under Chinese law. This kind of misleading information poses a serious risk to local businesses.
Over two consecutive days, officers from the Guangzhou Municipal Intellectual Property Office, together with local inspection teams, carried out extensive checks across 21 auto parts markets. In just one day, they inspected nearly 200,000 items across 1,800 stalls in 16 different markets. At Yiyun Square, a major hub for auto parts, inspectors found numerous issues: some products bore vague claims like “patent applied for†or “counterfeit is illegal,†yet failed to provide actual patent numbers. Others had unclear or non-existent patents, and the stall owners couldn’t produce valid documentation to support their claims.
Many products were labeled entirely in English, making it impossible for consumers to verify their authenticity. One vendor claimed that the products were exported and therefore labeled in English, but the law enforcement officers reminded them that all products sold in China must be marked in Chinese, regardless of origin.
The author observed that many stall owners had little understanding of intellectual property rights, with some showing indifference. To raise awareness, officers distributed IPR promotion cards, but some were discarded in trash bins, highlighting the need for more effective education.
Why focus on auto parts? Officials explained that the domestic auto parts industry is highly competitive, with many companies manufacturing and selling substandard or counterfeit goods. Meanwhile, large multinational automakers have filed numerous patents in China and are actively collecting evidence of local infringement. If domestic firms don’t strengthen their IP protection, they may soon face costly legal battles.
Guangzhou has become a key player in the automobile industry, with major brands like Honda, Nissan, and Toyota establishing operations there. This has led to the growth of a robust auto parts sector, with over 200 companies involved and 27 specialized markets generating nearly 10 billion yuan in annual turnover. Without proactive IP protection, some companies could find themselves targeted by international lawsuits.
Since September, Guangzhou authorities have launched multiple crackdowns on counterfeiting and patent infringement, working alongside industry and commerce departments. The first phase of the campaign has shown positive results, and the second phase is now underway, marking a new era of stricter intellectual property protection in the auto parts sector.
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