China: Court Protects Unregistered GIs under Unfair Competition Law
Published 26 September 2025
Xia Yu
On 16 June 2025, the People’s Court of Panyu District, Guangzhou City, Guangdong Province of China (“Court”) issued its judgment No. (2025) Yue 0113 Min Chu 16557 in the case concerning unfair competition dispute filed by the Qichun County Li Shizhen Qi Mugwort Brand Protection Association (“Association”) against Nanyang Natural Brand Pharmaceutical Technology Co., Ltd. (“Natural Brand Company”), Nanyang Lvying Mugwort Biological Products Co., Ltd. (“Lvying Company”), and Guangzhou Huowo Trading Co., Ltd. (“Huowo Company”). The Court held that unregistered geographical indications (“GIs”) constitute intellectual property (“IP”) rights enjoyed by eligible groups, and the use of such GIs on unrelated goods by others amounts to unfair competition. This is the first time that China has explicitly protected an unregistered GI in a judicial decision.
Mugwort is a plant whose leaves possess properties in traditional Chinese medicine such as warming the meridians, removing dampness, dispersing cold, reducing inflammation, and stopping bleeding. “Qi Mugwort” refers to the mugwort produced in the area historically known as Qizhou, now Qichun County, Hubei Province, and is a name used in traditional Chinese medicine. The renowned Ming Dynasty pharmacologist Li Shizhen wrote in the “Compendium of Materia Medica” regarding mugwort leaves: “Since the Chenghua era, the mugwort from Qizhou has been considered superior, used as a local tribute, valued throughout the land, and called Qi Mugwort”. In January 2011, the former General Administration of Quality Supervision, Inspection and Quarantine of China determined Qi Mugwort as a GI and specified that the protected geographical area for Qi Mugwort GI covers the administrative region of Qichun County, Hubei Province. Producers within this protected area may apply to use the special mark for GI Products. “Qi Mugwort” has not been registered as a collective or certification trademark. Promoted by the local government and relevant authorities, the reputation of “Qi Mugwort” has become increasingly prominent, and the scale of production and sales of Qi Mugwort-related products by local businesses has grown substantially. On 26 March 2024, the Qichun County Government authorized the Association to exercise the relevant rights of the right holder of the Qi Mugwort GI. In March 2024, the Association discovered that Huowo Company was selling moxa sticks produced by Lvying Company on JD.com. The outer packaging of the moxa sticks bore the “Lvying” trademark, stated the raw material as “moxa wool made from natural mugwort leaves”, indicated Lvying Company’s enterprise name at the bottom, and listed the manufacturer on the side as “Nanyang Lvying Mugwort Company”, a wholly owned subsidiary of Lvying Company. Additionally, the front, back, and one side of the packaging prominently displayed the characters of “Seven-Year Qi Mugwort” in large font. Huowo Company’s product description page on the JD.com platform included a quotation from the “Compendium of Materia Medica” describing “Qi Mugwort”. The owner of the “Lvying” trademark is Natural Brand Company, whose legal representative is a major shareholder of Lvying Company. The Association contends that the “Lvying” brand “Seven-Year Qi Mugwort” are infringing products jointly operated by Natural Brand Company, Lvying Company, and Huowo Company, which seriously infringes upon the “Qi Mugwort” GI IP rights managed by the Association and constitutes an act of unfair competition. The Association filed a lawsuit with the Court, requesting that the three companies be ordered to cease the acts of unfair competition and pay compensation for economic losses in the amount of RMB 500,000 (equivalent to US$ 70,200).
The Court identified the key issues of the case as follows: First, whether “Qi Mugwort” constitutes a GI or a generic name for the goods; Second, whether an unregistered GI enjoys exclusive rights even if not registered as a collective or certification trademark; Third, whether the use of “Qi Mugwort” on product packaging or in online promotions constitutes infringement, and if so, what liability should be borne and by whom.
Regarding the first key issue, the Court held that “Qi Mugwort” is a GI, indicating that the mugwort raw material of the products bearing this GI from Qichun County. Article 16 (2) of China’s Trademark Law provides that a GI serves to indicate that a good originates from a specific region, and that the particular quality, reputation, or other characteristics of the good are essentially attributable to the natural or human factors of that region. A generic name for goods or services refers to a name that is conventionally and commonly used for a type of good or service within a certain scope. “Mugwort” is the generic name for the goods. “Qi” refers to the ancient Qizhou, now Qichun County. “Qi Mugwort” is thus composed of a geographical name plus the generic name of the goods. Through identification and introduction by renowned ancient medical scholars, and subsequent use, promotion, and publicity over time, “Qi Mugwort” has come to signify that the mugwort leaves and their processed products originating from Qichun County possess a distinctive quality different from identical products from other regions, a quality closely linked to the natural factors of Qichun County.
Regarding the second issue, the Court held that the a GI not registered as a collective or certification trademark still constitute a form of IP, enjoyed by natural persons, legal persons, or other organizations that meet certain conditions. Their management and protection should be authorized by the government or competent industry authorities of the region indicated by the GI. Except for tobacco products, China adopts a voluntary registration system for trademarks, including the GI trademarks of collective and certification trademarks, permitting the use of unregistered trademarks including unregistered GIs. A GI signify that a product originates from a specific region and possess commercial value for use, being permitted for use only by natural persons, legal persons, or other organizations that meet specific conditions. Article 123 of China’s Civil Code stipulates that a GI is an IP right. Once a mark not registered as a collective or certification trademark is recognized as a GI, it becomes a civil right and should be managed and protected by a collective organization authorized by the local government. The recognition of an unregistered GI requires case-by-case determination. In this case, “Qi Mugwort” can be recognized as a GI, and the Association has the standing to bring this lawsuit. The mugwort products originating from the designated protected area within Qichun County may use the GI of “Qi Mugwort”.
Regarding the third key issue, the Court held that Lvying Company’s use of “Qi Mugwort” on product packaging and Huowo Company’s promotional use of quotations describing “Qi Mugwort” from the “Compendium of Materia Medica” on its webpage constituted infringement. Article 6 of China’s Anti-Unfair Competition Law prohibits business operators from engaging in acts of confusion that are sufficient to lead others to mistake their products for the g=products of another person or to believe there exists a specific connection with another person. The prominent use of “Qi Mugwort” on the packaging of the products manufactured by Lvying Company was sufficient to cause the relevant public to mistakenly believe that the products had a specific connection with the similar products from the geographical area indicated by the “Qi Mugwort” GI. As Lvying Company failed to prove that the mugwort raw material used in the products originated from the indicated geographical area, its actions harmed the rights and interests of other legitimate business operators and consumers, constituting unfair competition. Natural Brand Company merely authorized Lvying Company to use its registered trademark of “Lvying”, which does not constitute infringement. Huowo Company, having sold the products based on authorization from Lvying Company and promoted the effects of “Qi Mugwort” by quoting the “Compendium of Materia Medica”, shall only be liable for ceasing the infringement.
After comprehensive consideration of factors including the reputation and distinctiveness of the “Qi Mugwort” GI, the nature and circumstances of the infringing acts, and the relevant costs incurred, the Court ordered Lvying Company and Huowo Company to immediately cease the use of the “Qi Mugwort” GI, and Lvying Company to pay compensation to the Association in the amount of RMB 50,000 (equivalent to USD 7,020).
The Court’s ruling breaks with the traditional mindset that GIs must be registered to qualify for protection. It is the first time in judicial practice that an unregistered GI with a certain degree of market recognition and a clear origin can be protected as legitimate rights and interests under the Anti-Unfair Competition Law. This ruling provides a strong path for judicial protection for unregistered GI products with a certain degree of recognition. It is important to emphasize that whether an unregistered mark constitutes a GI is determined on a case-by-case basis. It is still recommended that unregistered GIs first apply for registration as collective trademarks or certification trademarks to enhance their distinctiveness. When considering the amount of compensation, the Court in this case emphasized that “the mark is not registered as a collective trademark or certification trademark, and its distinctiveness from other marks is not as prominent as that of a registered trademark”.
Mugwort is a plant whose leaves possess properties in traditional Chinese medicine such as warming the meridians, removing dampness, dispersing cold, reducing inflammation, and stopping bleeding. “Qi Mugwort” refers to the mugwort produced in the area historically known as Qizhou, now Qichun County, Hubei Province, and is a name used in traditional Chinese medicine. The renowned Ming Dynasty pharmacologist Li Shizhen wrote in the “Compendium of Materia Medica” regarding mugwort leaves: “Since the Chenghua era, the mugwort from Qizhou has been considered superior, used as a local tribute, valued throughout the land, and called Qi Mugwort”. In January 2011, the former General Administration of Quality Supervision, Inspection and Quarantine of China determined Qi Mugwort as a GI and specified that the protected geographical area for Qi Mugwort GI covers the administrative region of Qichun County, Hubei Province. Producers within this protected area may apply to use the special mark for GI Products. “Qi Mugwort” has not been registered as a collective or certification trademark. Promoted by the local government and relevant authorities, the reputation of “Qi Mugwort” has become increasingly prominent, and the scale of production and sales of Qi Mugwort-related products by local businesses has grown substantially. On 26 March 2024, the Qichun County Government authorized the Association to exercise the relevant rights of the right holder of the Qi Mugwort GI. In March 2024, the Association discovered that Huowo Company was selling moxa sticks produced by Lvying Company on JD.com. The outer packaging of the moxa sticks bore the “Lvying” trademark, stated the raw material as “moxa wool made from natural mugwort leaves”, indicated Lvying Company’s enterprise name at the bottom, and listed the manufacturer on the side as “Nanyang Lvying Mugwort Company”, a wholly owned subsidiary of Lvying Company. Additionally, the front, back, and one side of the packaging prominently displayed the characters of “Seven-Year Qi Mugwort” in large font. Huowo Company’s product description page on the JD.com platform included a quotation from the “Compendium of Materia Medica” describing “Qi Mugwort”. The owner of the “Lvying” trademark is Natural Brand Company, whose legal representative is a major shareholder of Lvying Company. The Association contends that the “Lvying” brand “Seven-Year Qi Mugwort” are infringing products jointly operated by Natural Brand Company, Lvying Company, and Huowo Company, which seriously infringes upon the “Qi Mugwort” GI IP rights managed by the Association and constitutes an act of unfair competition. The Association filed a lawsuit with the Court, requesting that the three companies be ordered to cease the acts of unfair competition and pay compensation for economic losses in the amount of RMB 500,000 (equivalent to US$ 70,200).
The Court identified the key issues of the case as follows: First, whether “Qi Mugwort” constitutes a GI or a generic name for the goods; Second, whether an unregistered GI enjoys exclusive rights even if not registered as a collective or certification trademark; Third, whether the use of “Qi Mugwort” on product packaging or in online promotions constitutes infringement, and if so, what liability should be borne and by whom.
Regarding the first key issue, the Court held that “Qi Mugwort” is a GI, indicating that the mugwort raw material of the products bearing this GI from Qichun County. Article 16 (2) of China’s Trademark Law provides that a GI serves to indicate that a good originates from a specific region, and that the particular quality, reputation, or other characteristics of the good are essentially attributable to the natural or human factors of that region. A generic name for goods or services refers to a name that is conventionally and commonly used for a type of good or service within a certain scope. “Mugwort” is the generic name for the goods. “Qi” refers to the ancient Qizhou, now Qichun County. “Qi Mugwort” is thus composed of a geographical name plus the generic name of the goods. Through identification and introduction by renowned ancient medical scholars, and subsequent use, promotion, and publicity over time, “Qi Mugwort” has come to signify that the mugwort leaves and their processed products originating from Qichun County possess a distinctive quality different from identical products from other regions, a quality closely linked to the natural factors of Qichun County.
Regarding the second issue, the Court held that the a GI not registered as a collective or certification trademark still constitute a form of IP, enjoyed by natural persons, legal persons, or other organizations that meet certain conditions. Their management and protection should be authorized by the government or competent industry authorities of the region indicated by the GI. Except for tobacco products, China adopts a voluntary registration system for trademarks, including the GI trademarks of collective and certification trademarks, permitting the use of unregistered trademarks including unregistered GIs. A GI signify that a product originates from a specific region and possess commercial value for use, being permitted for use only by natural persons, legal persons, or other organizations that meet specific conditions. Article 123 of China’s Civil Code stipulates that a GI is an IP right. Once a mark not registered as a collective or certification trademark is recognized as a GI, it becomes a civil right and should be managed and protected by a collective organization authorized by the local government. The recognition of an unregistered GI requires case-by-case determination. In this case, “Qi Mugwort” can be recognized as a GI, and the Association has the standing to bring this lawsuit. The mugwort products originating from the designated protected area within Qichun County may use the GI of “Qi Mugwort”.
Regarding the third key issue, the Court held that Lvying Company’s use of “Qi Mugwort” on product packaging and Huowo Company’s promotional use of quotations describing “Qi Mugwort” from the “Compendium of Materia Medica” on its webpage constituted infringement. Article 6 of China’s Anti-Unfair Competition Law prohibits business operators from engaging in acts of confusion that are sufficient to lead others to mistake their products for the g=products of another person or to believe there exists a specific connection with another person. The prominent use of “Qi Mugwort” on the packaging of the products manufactured by Lvying Company was sufficient to cause the relevant public to mistakenly believe that the products had a specific connection with the similar products from the geographical area indicated by the “Qi Mugwort” GI. As Lvying Company failed to prove that the mugwort raw material used in the products originated from the indicated geographical area, its actions harmed the rights and interests of other legitimate business operators and consumers, constituting unfair competition. Natural Brand Company merely authorized Lvying Company to use its registered trademark of “Lvying”, which does not constitute infringement. Huowo Company, having sold the products based on authorization from Lvying Company and promoted the effects of “Qi Mugwort” by quoting the “Compendium of Materia Medica”, shall only be liable for ceasing the infringement.
After comprehensive consideration of factors including the reputation and distinctiveness of the “Qi Mugwort” GI, the nature and circumstances of the infringing acts, and the relevant costs incurred, the Court ordered Lvying Company and Huowo Company to immediately cease the use of the “Qi Mugwort” GI, and Lvying Company to pay compensation to the Association in the amount of RMB 50,000 (equivalent to USD 7,020).
The Court’s ruling breaks with the traditional mindset that GIs must be registered to qualify for protection. It is the first time in judicial practice that an unregistered GI with a certain degree of market recognition and a clear origin can be protected as legitimate rights and interests under the Anti-Unfair Competition Law. This ruling provides a strong path for judicial protection for unregistered GI products with a certain degree of recognition. It is important to emphasize that whether an unregistered mark constitutes a GI is determined on a case-by-case basis. It is still recommended that unregistered GIs first apply for registration as collective trademarks or certification trademarks to enhance their distinctiveness. When considering the amount of compensation, the Court in this case emphasized that “the mark is not registered as a collective trademark or certification trademark, and its distinctiveness from other marks is not as prominent as that of a registered trademark”.