The Bavarian Supreme Court ordered a German company to stop infringing on the trademark of the century-old Chinese "Wangzhihe" brand on April 23, marking it as the first win by a Chinese time-honored brand in defending its intellectual property rights overseas.

Wangzhihe,three-century-old Chinese bean curd brand

Apparently the "Wangzhihe" case is merely the tip of an iceberg involving the pirating of Chinese time-honored brands abroad with Tongrentang, Dukang, Goubuli being rush-registrated in Japan and Zhuyeqing, a famous wine brand, being pirated in South Korea.

Compared to their western rivals, many Chinese time-honored brands have a poor sense of protecting their brands, which is one of the major reasons why they lost their glorious long history.

“Brand is the lifeline for owners of time-honored brands, but many of them do even not register their brands. They inherited their brands from their ancestors and take for granted their rights to the brands. They have no knowledge of intellectual property rights and do not feel it is necessary to have brands registered”, according to a senior consultant at Fanjiashi Consultancy Ltd.

Senility’s troubles

Poor sense of intellectual property rights is only one of the problems being faced by old brands. Business for older Chinese establishments in general has been lackluster. In late 2006, the Ministry of Commerce certified 430 enterprises nationwide with the “China Time-Honored Brand” award. According to a survey, 20 percent of them are on the verge of bankruptcy, 70 percent barely make ends meet, and only 10 percent run with good profitability.

The problems of old brands perhaps also have an historical origin. With few exceptions, China’s older brands changed from private to state ownership in the 1950s, during the nationalization campaign. This meant that brands that had been founded and run for generations by families with a personal connection to the brand were suddenly in the hands of managers and employees with no such connection.

In short, the brands easily fell victim to inefficiency. And one of the side effects of being an old business is too many old employees and retired workers. As a result, many old brands found themselves burdened with pensions and medical care expenditure, thus unable to invest in innovation and keep abreast of new market demands.