The State Administration for Industry and Commerce ("SAIC") recently released a draft Opinion Regarding Improving Registration Efficiency and Actively Promoting Reformation of Enterprise Name Registration (the "DRAFT") seeking public review and comment.

The DRAFT lists five (5) major aspects that SAIC would like to improve regarding enterprise name registration and administration.

Of particular relevancy to the IP enforcement practice is the DRAFT's provision of three guidelines as follows on dealing with complaints against enterprise names:

1. Speeding up the resolution on enterprise name disputes, by which the DRAFT promotes solving the disputes over company names through intermediation. If intermediation fails, the DRAFT requests the local AIC to find the enterprise's name improper and correct the name by force in due time if necessary.

2. Dealing with the conflict between enterprise names and trademarks in accordance with the relevant laws, under which the DRAFT requires the local AIC to improve the procedure and system for solving disputes between enterprise names and registered trademarks or unregistered well-known trademarks according to the Trademark Law and Anti-Unfair Competition Law. The DRAFT urges the enterprise registration department of local AICs to cooperate actively in this regard.

3. Enhance the correction of improper enterprise names, under which the DRAFT provides that where an enterprise name is found improper by the AIC but the enterprise refuses to correct the improper name in due time, the AIC can publish the unified social credit number of the enterprise in the National Enterprise Credit Information Publication System and mark that the enterprise name "XXX" has been found improper, according to the Provisional Regulations on Enterprise Information Publicity. After the enterprise corrects the improper name, the AIC shall publish the name after correction and remove the marks.

We believe the DRAFT is encouraging to the current IP enforcement practice against registered but infringing enterprise names. The current AIC's practice on the correction of infringing enterprise names has been widely criticized due to the low success rate in finding improper enterprise names and low efficiency in correcting the names. In the very least the DRAFT encourages local AICs to find improper enterprise names and provides a method for these AICs to force the correction when the other side refuses to cooperate.