Unauthorized Overseas Registrations of Korean Trademarks Surge, Impacting K-Beauty and K-Fashion Brands

CJ CheilJedang encountered a significant hurdle in 2023 when attempting to register its “bibigo” trademark in Paraguay. The Paraguay Patent Office rejected the application, citing an existing registration by a local distributor who had unauthorizedly appropriated the trademark. CJ CheilJedang initiated legal proceedings, including an invalidation trial, and in 2024, the local court ruled in favor of CJ CheilJedang, invalidating the prior registration. However, the process took a full year, illustrating the lengthy challenges companies face in reclaiming trademark rights abroad. A CJ CheilJedang official noted, “For well-known trademarks, malicious trademark applications often occur for financial purposes.”

As K-fashion and K-beauty brands gain global popularity, unauthorized preemptive registrations of Korean trademarks overseas have surged. Brand hunters preemptively file and register trademarks of Korean companies in foreign jurisdictions, often catching the companies unaware until they plan market entry. Losing trademark rights abroad forces Korean companies to incur substantial legal costs and restricts their ability to sell or export products in those countries. Moreover, if the preemptively registered trademarks are used on inferior products, it can harm the original brand’s reputation.

Data from the Korean Intellectual Property Office (KIPO) and the Korea Intellectual Property Protection Agency (KIPPA) reveal that suspected unauthorized preemptive registrations of Korean brands abroad reached a record 9,520 cases in 2023. This figure represents an 89.8% increase from 5,015 cases in 2022. In 2024, as of the end of May, 4,524 cases have already been recorded, suggesting the annual total may exceed 10,000.

China remains the most affected region, with 2,162 cases reported in 2023 and 1,346 cases already recorded in 2024. Financial damages in China alone amounted to approximately 245 billion won over the five years from 2019 to 2023. These damages reflect the value of trademarks sold by brokers who unauthorizedly preempted Korean trademarks and resold them on Chinese trademark trading platforms. Although the 2023 damage figures are pending, the near doubling of cases indicates a likely significant increase in losses.

Southeast Asia is also experiencing growing trademark infringement issues. According to a joint survey by KIPO and KIPPA, Indonesia ranked second with 1,293 suspected unauthorized registrations as of May 2024, closely following China’s 1,346 cases. Vietnam (634 cases), Thailand (509 cases), and Singapore (397 cases) also reported substantial numbers. Since investigations primarily focused on China and Southeast Asia, the global scale of the problem is likely even larger.

The affected brands span diverse sectors including food, beauty, clothing, and electronics. Notable examples include CJ CheilJedang’s “bibigo,” K-fashion brand “Matin Kim,” and K-beauty brand “Joseon Beauty.”

Companies at the forefront of the Korean Wave, particularly in cosmetics, food, and apparel, are the most targeted. Hago House, operator of the “Matin Kim” brand, confirmed ongoing responses to trademark infringements in China. Goodal Global, a major beauty company, recently established an intellectual property team to combat such issues. A Goodal Global representative stated, “Fake websites mimicking our official site have appeared abroad, and we receive authenticity inquiries at our Korean customer center. We have posted warnings about counterfeit sellers on our official website.”

Reclaiming trademark rights after unauthorized preemptive registration abroad is challenging. Legal remedies such as asserting prior use rights, invalidation trials, or lawsuits are time-consuming and costly. Consequently, many companies resort to financial negotiations despite the drawbacks.

Beyond trademark preemption, companies face difficulties addressing counterfeit product manufacturing and distribution. A food industry official noted frequent unauthorized use of trademarks in China and ongoing legal actions against infringing factories. However, publicizing these issues is avoided to prevent fueling anti-Korean sentiment and harming sales.

The South Korean government supports companies through the “K-brand Dispute Response Support Project,” providing expert assistance via patent law firms. Despite this, uptake remains low, with only 78 cases supported in 2023, 84 in 2022, and 44 through May 2024. An official from KIPPA explained that many small and medium-sized enterprises (SMEs), which bear the brunt of damages, show limited interest due to no immediate overseas expansion plans and the required financial contribution for support. Smaller indie brands often hesitate to pursue reclamation due to these costs.

Meanwhile, the number of overseas trademark applications filed by Korean companies continues to rise, reflecting increased global market entry driven by the popularity of K-beauty, K-fashion, and Korean goods. According to KIPO, overseas trademark filings by domestic companies increased from 1,747 in 2021 to 1,783 in 2022, and 2,006 in 2023.