With the integrated development of the Guangdong-Hong Kong-Macao Greater Bay Area, Hong Kong’s strategic position as an important window and international springboard for Mainland enterprises to “go global” has become increasingly important. In our legal practice assisting Mainland enterprises in expanding into Hong Kong or developing markets, we have frequently observed a common issue: many well-known brands in Mainland China, upon entering the Hong Kong market, encounter the predicament of having their brand identifiers squatted, or face “shadow companies” (Company Name Squatting) with extremely similar names appearing in the market. This not only causes direct economic losses to enterprises but also severely dilutes the brand value accumulated over the long term.

An enterprise’s brand identity is far more than a simple name. It is a matrix of legal assets and commercial image formed jointly by the company name, trademark, and domain name, which is particularly critical in the digital era. These three elements have intertwined functions but different legal bases. Without coordinated planning, protection gaps easily arise in cross-border scenarios. This article aims to analyze, based on practical cases, how to build a forward-looking, comprehensive brand protection and defense system for Mainland enterprises planning to enter or already entering the Hong Kong market.

I. Typical Predicament:

When Well-Known Brands Encounter a Cross-Border “Rights Vacuum”

Imagine a real and common business scenario: a well-known electronics manufacturer in Mainland China (hereinafter “Mainland Company”) is planning to enter the Hong Kong market. During preliminary research, it unexpectedly discovers that a company with a very similar name, “Hong Kong XX Electronics Limited,” already exists in Hong Kong. More concerning is that this company has registered a “.net” domain name highly similar to the Mainland brand, and its website design style deliberately imitates the Mainland Company’s official image, selling various competing products.

The awkward reality is that although the Mainland Company owns trademarks in Mainland China, due to the strict territoriality of trademark rights, without registration in Hong Kong, it cannot obtain legal protection locally. Additionally, the Mainland Company has not established a physical branch in Hong Kong. This “rights vacuum period”—where brand influence has arrived but legal rights have not yet landed—makes the enterprise vulnerable to malicious squatters, leading to brand confusion, goodwill damage, customer diversion, and even liability entanglement.

II. Clarifying Misconceptions:

Registering a Hong Kong Company ≠ Obtaining Exclusive Brand Rights

A common misconception is that successfully registering a company name with the Hong Kong Companies Registry automatically grants exclusive rights to that name in commercial activities. This actually confuses the boundaries of rights under different legal concepts:

1. Company Name:

Primarily used to identify an independent legal entity. The Hong Kong Companies Registry’s review mainly focuses on whether the name is identical or too similar to names of “registered” companies and generally does not proactively examine whether the name infringes others’ prior trademark rights or trade names. This leaves room for the registration of “shadow companies.”

2. Trademark:

This is the core intellectual property right for distinguishing the source of goods or services. Only through successful registration of a trademark with the Hong Kong Intellectual Property Department can the right holder obtain exclusive rights under the “Trade Marks Ordinance” for the designated goods or services and initiate legal proceedings against infringement.

3. Domain Name:

This is the core address of an enterprise in the Internet world. Its registration follows a “first-come, first-served” principle with low barriers, independent of the examination systems for company names and trademarks.

III. Building the System:

A Trinity Active Defense Strategy of “Trademark-Domain Name-Monitoring”

To address the above risks, we recommend that Mainland enterprises, when planning their Hong Kong market entry, adopt the following proactive, systematic defense strategies:

1. Trademark First: Solidify the Rights Foundation

Trademark registration is the most powerful legal weapon for brand protection. Enterprises should initiate Hong Kong trademark applications during the market entry preparation phase, not wait until product launch or dispute occurrence.

· Strategic Recommendations:

In addition to covering core classes for the main business, enterprises may consider appropriate defensive registration based on brand awareness and future development plans—that is, registering in related classes or even unrelated classes that could easily be exploited, to prevent others from using the brand’s reputation for squatting in the future.

2. Domain Name Positioning: Block Cyberspace

In the digital era, domain names are the key entry point for online brand traffic. Cybersquatting is a common threat.

· Strategic Recommendations:

Implement a defensive domain name registration strategy, registering major top-level domains related to the main brand as early as possible, such as .hk (Hong Kong), .com (International), .cn (China), etc., as well as common spelling variations. The cost of this approach is far lower than the cost of recovering a domain name through arbitration or litigation later.

3. Continuous Monitoring: Seize the Timing for Rights Enforcement

For “shadow companies” that have already appeared, the Hong Kong “Companies Ordinance” provides a relatively quick administrative remedy channel.

· Key Mechanism:

If a newly registered Hong Kong company name is found to be “too like” your company name/brand, a complaint may be lodged with the Registrar of Companies under Section 108(1)(a) or 108(1)(b) of the Companies Ordinance.

· Key Evidentiary Points:

When lodging a complaint, sufficient evidence must be provided to support the claim that the name being “too like” may cause confusion. For example:

Goodwill Evidence: Materials proving that your brand enjoys a reputation in Hong Kong, such as advertising records, media reports, sales data, award certificates, customer testimonials, etc.

Evidence of Likelihood of Confusion: Market survey results, actual instances of confusion (such as customer misdirected inquiries, complaint records), or likelihood of confusion analysis by professionals.

Prior Use Evidence: Records showing that you used the name or trademark in commercial activities in Hong Kong prior to the other company’s registration date.

Trademark Rights Evidence: If the trademark is already registered in Hong Kong, a copy of the registration certificate is the strongest evidence of ownership.

· Timing Key Points: Such complaints generally need to be made within 12 months of the registration of the suspect company. Therefore, it is crucial to establish a regular monitoring mechanism for Hong Kong company name registrations to promptly identify infringement signs and respond quickly.

· Other Grounds for Complaint: Besides the name being “too like,” name complaints to the Companies Registry may also be based on other statutory grounds, including: misleading information was provided for the company to be registered under that name (Section 108(1)(c), complaint period: 5 years); any undertaking or guarantee made for the company to be registered under that name has not been fulfilled (Section 108(1)(d), complaint period: 5 years); or the name at the time of registration was one which the company was not entitled to be registered under the Ordinance (Section 108(1)(e), complaint period: 3 months).

· Litigation Route: If the time limit for filing a name complaint with the Companies Registry has passed, the right holder may still consider protecting their rights through court proceedings, such as initiating a passing-off action or a trademark infringement action based on a registered trademark. Compared with administrative complaints, litigation procedures are more time-consuming and costly, but they remain an important legal means to hold infringers accountable, stop confusing conduct, and obtain compensation. Particularly importantly, if the right holder successfully obtains a court order prohibiting the company from using the name, the person benefited by the order may deliver an official copy of the order and a notice in the specified form to the Registrar of Companies for registration. The Registrar may then issue a written direction requiring the company to change its name within a specified period, providing a clear legal link to directly initiate the administrative name change process through judicial judgment.

4. Effective Use of Mechanisms: Efficiently Resolve Domain Name Disputes

For domain names that have been maliciously squatted, the applicable dispute resolution mechanism depends on the specific registration management body and the domain name system involved. For example, for most generic top-level domains (such as .com, .org, etc.), the Uniform Domain Name Dispute Resolution Policy (UDRP) provides a more efficient and economical global dispute resolution route compared to traditional litigation. For certain country-code top-level domains (such as .hk, .cn, etc.), localized dispute resolution policies or arbitration procedures may exist.

· Practical Reference: In the case of Nutricia International B.V. v. Peter Chan (WIPO D2017-1826), the right holder of the well-known milk powder brand “APTAMIL” successfully initiated a UDRP complaint against the squatted domain name “aptamilhk.com.” The complainant proved three essential elements: the domain name was confusingly similar to the trademark; the squatter had no legitimate rights or interests; and the domain name was registered and used in bad faith. Ultimately, the right holder quickly regained control of the domain name. This provides an efficient path for enterprises to address similar issues.

Conclusion

In Hong Kong’s highly legalized and competitive international market, brand protection has shifted from passive “post-event remedies” to proactive “pre-event strategies.” For Mainland enterprises, entering Hong Kong is not only about expanding business but also a practical test of their brand management system and compliance capabilities.

By constructing a multi-dimensional defense system of “trademark rights first, strategic domain name positioning, and continuous monitoring of market entity names,” enterprises can not only effectively avoid intellectual property risks during cross-border development but also demonstrate their mature governance level and long-term development plans to the global market and partners, laying a solid legal foundation for the brand’s stable and long-term development in Hong Kong and on the broader international stage.

Authors｜ Huang Yuanting, Attorney (Long An Hong Kong), Li Tongbo, Trainee Solicitor (Long An Hong Kong)

Reviewer｜ Lin Jinghuan, Senior Partner Attorney (Long An Hong Kong), Chen Wenxin, Attorney