Behind Time-honored Names: It’s More Than Business

By Doris Li, China IP,[Comprehensive Reports]

By Qiu Jiong

  In 2006, attorney Shang Jiaquan from the Beijing Globe Law Firm had his first time-honored brand case: providing legal consultations to an old restaurant in Niujie Food Court.
  As an IP lawyer, Shang Jiaquan followed the orthodox IP knowledge and concepts in dealing with IP problems. But when he encountered time-honored brand problems, he felt that the problems were both simple and complicated: It was simple because the legal relationship is straightforward; it was complicated because the time-honored brands, grown out of old societies, are sort of square pegs in the round holes of the modern IP protection system.
  “The time-honored brand is neither exclusively a legal nor an IP subject matter,” said Mr. Shang to the journalist. “The unique aspect of time-honored brands that set them apart from modern IP subject matters is the degree of brand awareness; yet, brands are somewhat connected with the trademarks, and are thus the proper subjects of IP protection for the corporate branding interests.”
  This, however, is not clear to all brand owners. Many of the time-honored brand successors confuse trademarks with brands, and weigh the importance of brand protection more heavily than trademarks. “In terms of protection, trademarks are obviously better protected than brands. And brand conflicts can only be solved in court through trademark litigation. There is no other channel of legal protection,” said Mr. Shang.
  The 2007 case of registering time-honored brands by the general manager of Jiumen Food Court taught the time-honored brand owners a visual lesson of trademark protection for time-honored brands. Although brand inheritors finally took back their trademarks, it was all due to the government intervention, said Mr. Shang. “Without a registered trademark, it is almost impossible to settle such cases by legal means.”
  According to Mr. Shang, the difficulty does not lie in showing proof, but in establishing legal basis. This is especially so if the registrant is a large business.
  The time-honored brand names in the E-time
  A few years ago, the Ministry of Commerce initiated the, “Project of Revitalizing the Old-Branded Shops and Businesses.” Under this project the Beijing Government shows more regards for the development of time-honored brand shops and businesses by installing schemes for protecting and supporting them, providing financial supports, information consultations and agency services, as well as promulgating the Measures for the Administration of Special Funds Used for the Promotion of the Development of the Old Shops and Enterprises of the Commercial and Service Industries in Beijing. Moreover, it has set up the Beijing Time-honored brands Association, rendering reforming, brand building, marketing management and intangible assets protection services to the old shops and enterprises in Beijing.
  On May 31, 2009, the Beijing Traditional Brands Association launched the first online store for time-honored brands in China, “,” and constructed a service and e-commerce platform, providing functions of online ordering and paying. The store also cooperates with China Union Pay and China Merchants Bank and has issued the “Beijing Time-honored brands Credit Card,” using the modern payment instrument to explore markets and to spread influence.
  After interviewing several time-honored brand businesses, the journalist learns that the online store greatly promotes their sales, and saves them the economic and technical troubles associated with setting up their online stores independently. Three months after the store was put into operation, it got more than 25 million hits, and daily average hits reached more than 400,000. About 60% of the orders were from nearly 500 cities across China, and about 80% of the orders were related to food.
  From the store’s website, the journalist found nearly 100 time-honored brands, including the well-known Quanjude, Zhangyiyuan, Wuyutai, Tongrentang, Liubiju, Daoxiangcun, Daoxiangcun, Neiliansheng and Donglaishun. Some brands give an overall profile of their historical and cultural backgrounds. Store chief You Xuezhi told this journalist: “For time-honored brand products, central selling on the Internet is a way of widening selling channels, expanding market space, attracting more of the young cyber citizens, and more importantly, breaking through geographic restrictions.”
  Time-honored brand names in the back streets
  The journalist also learns from the interviews that there are seven basic ratification requirements for time-honored brands. They primarily must have the ownership or licensed right of the trademarks. Secondly, the brand must have been created in 1956 or before.
  Old names as they are, these old businesses are scaled differently in reputation, as Tongrentang, Wuyutai and Ruifuxiang are much more backed by government offers with all-out financial supports, supportive policies and legal consultations. Both the government and the businesses themselves hope to continue the century-time-honored brands, establish brand enterprises and be competitive in the world market. However, for some small-scale time-honored brand shops, the government takes the attitude of, “let live or die.”
  With some difficulties, the journalist found Ms. Yuan Qinghua, deputy secretary-general of the Beijing Traditional Snack Association and general manager of China Wanfeng National Snacks Town. What she deals with are mostly “homeless” old shops.
  Four years ago, the Beijing Traditional Snack Association raised 11.7 million Yuan as the initial funds to build the Jiumen Snacks Street in a 3,000 square-meter imitation antique building in the Houhai area of Beijing. The street accommodated 11 old shops that had been “homeless” after the demolition of the Menkuang by street, including brands such as Pie Zhou, Quick-fried Tripe Feng, Cheese Wei, Tea Soup Li, Sheepshead Ma, Small Intestine Chen, and Tofu Jelly Bai. Thanks to the Association, the handicrafts that had been passed down for decades and almost been abandoned by their inheritors were finally retained.
  The interview was scheduled last year. But it was just before the deadline of this article that the journalist managed to meet her in an imitation antique office on the 3rd floor of the Wanfeng National Snacks Town, which was still under construction and was a little bit messy. Asked about the construction progress of the snacks town, Ms. Yuan said: “Time is pressing. We plan to open it before the May Day. Now we must get everything ready. Wanfeng National Snacks Town is a collection of snacks from all over the country. Beijing’s snacks are only a part of them. There will also be handicraft shows and folk performances.”
  In Snack Town, all merchants enjoy “three exemptions”: no entrance fee, no minimum sales requirement and rent free. But there are also three essentials: the merchants must guarantee that their products have folk and regional characteristics, historical backgrounds and certain brand awareness; they must have years of experiences in dealing in the folk characteristic products; and they must own the proprietary intellectual property rights.
  Awaiting more government supports
  Although Tea Soup Li, Small Intestine Chen and Tofu Jelly Bai fall in the same old-brand category as Daoxiangcun, Quanjude and Tianfuhao, they are not in the same development league. Old snack shops are also shackled in the area of development. “Owners of old snack shops are mostly elderly men with conventional thoughts, although there have been some improvements in recent years. What we want to exhibit are both the small snacks and the great art in them. But now, all we can do is to protect them from vanishing.” Ms. Yuan said.
  Before interviewing the old businesses, the journalist visited Mr. Gao Yidao, the first secretary-general of the Beijing Time-honored brands Association. Mr. Gao associated himself with old businesses in the 1990s. When the Beijing Traditional Brands Association was set up on August 31, 2005, he was the secretary-general. Talking of time-honored brands, Mr. Gao seemed to be a “chatterbox”: “Time-honored brands are just like the old city walls, the quadrangle dwellings and the “Hutongs” (alleys) of Beijing. They are an inseparable part of this civilized ancient capital and a part of Beijing’s traditional culture. Same as other traditional cultures, they are deeply deposited. The difference is that as the dynamic business symbols, time-honored brands have been endowed with refreshing commercial civilization of this new epoch. Now, the problems of time-honored brands are mostly residual historical ones, involving many aspects, especially the intellectual property aspect.”

  From Gao’s words, the journalist can understand his deep passion for time-honored brands is. When talking about some well-developing old enterprises, Gao was very proud. But when referring to the adverse factors to the development and some declining old enterprises, he reacted with anger and frustration.
  Gao also thinks that at present, legal problems are the bottleneck that constrains the development of old businesses. He said, “The works of old businesses involve many legal issues. Some issues, such as trademark and domain name conflicts, have no policies to abide by. Many time-honored brands have seen malicious trademark squatting, which could have been avoided if we had special legislation to prevent this practice. The demolition of households and buildings is another problem. Under the legal gap, profits-driven property developers forced old shops and enterprises to relocate. Now many old shops have left their original places, leaving behind not only the prime site, but also fame. Until recently, old businesses were void of a specific legal status, and treated as ordinary state-owned enterprises and governed by general policies. I think it is imperative to make independent legal provisions and policies for them.”
  Every time-honored brand is characterized by unique techniques and features, and every brand conveys a profound cultural background and rich stories. They should enjoy different protections and deserve policies to develop and support them. On the development road of Chinese brands, time-honored brands show more promises of being world famous. However, the fate of time-honored brands is not only in their own hands.

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