An important development in China’s trademark enforcement landscape is the recent clarification of the criminal liability threshold for counterfeiting service trademarks. The Ecovis Experts from Shanghai K-insight Law Firm illustrate this shift with a representative case where the unauthorized use of registered service marks - including well‑known trademarks - resulted in significant legal consequences.
Why This Case Matters
China has handed down a significant ruling on the misuse of service trademarks, offering much‑needed clarity for businesses operating in service‑based industries.
The Facts
The defendant, a Shanghai Education Technology Co., Ltd., used registered trademarks such as "LEGO" on identical education and training services without authorization. These trademarks were applied to items such as store signage, decorations and employee uniforms, and the defendant had gained a profit of over 510,000 yuan from training fees.
The Court’s Decision
The court determined that the defendant was guilty of counterfeiting a registered trademark, as criminal liability is established based on the training fees collected, according to the 2025 Interpretation on Several Issues Concerning the Application of Law in Handling Criminal Cases of Intellectual Property Infringement (hereinafter referred to as the “2025 Interpretation”).
Commentary: The Takeaway for Businesses
This is a landmark case in the criminal protection of service trademarks, following the inclusion of service trademark counterfeiting as a criminal offense in the Amendment (XI) to the Criminal Law. For the first time, the 2025 Interpretation clarifies the criteria for determining "identical services" and establishes that the amount of illegal gains serves as the threshold for prosecuting the crime of counterfeiting a registered service trademark.
It further specifies that service fees collected by the perpetrator constitute illegal gains. The 2025 Interpretation closes the gap in the criminal protection of service trademarks, reflecting the principle of equal protection for both service and commodity trademarks alike.
More importantly, the clarification of criminal protection standards for service trademarks signifies the development of a comprehensive intellectual property protection system in China. For service industries such as education, training, and entertainment, the 2025 Interpretation will effectively prevent the counterfeiting of registered service trademarks. Therefore, enterprises should strengthen their trademark compliance management systems and avoid using unauthorized registered trademarks in their services, as this may result in criminal liability.