In Shenyang, China the emergence of a few fake luxury brand stores have recently caught the attention of many Chinese people, as they have been voicing their surprise and displeasure on the internet. The fake stores are located in an area called Wanda Square, and they have been arranged almost adjacent to each other.
On July 26th, a reporter suddenly noticed several foreign luxury stores were recruiting new employees, and many of these store names had their original names altered to something different. As she continued to explore, she noticed that these stores even placed posters inside their stores displaying their products and almost replicating each detail of all the products. The reporter continued to walk around the area, until she encountered a security guard, who informed her, the stores had not opened yet, and he opined the brands were most likely fake.
Subsequently, the reporter decided to inquire about more information regarding Wanda Square (Note: Wanda is one of the richest companies in all of China, with an estimated value in the billions). The Wanda representative informed the reporter, Wanda Square had just opened their operations in the area and the street with the “high quality goods” had no relation with Wanda. The Wanda representative went on to explain the foreign luxury stores were all fake, and the company deliberately placed the stores there to attract retail stores to purchase real estate. She later clarified the fake luxury brand stores were setup there to increase the prestige of the area, making it more appealing for potential purchasers to buy real estate. When the reporter probed the Wanda representative about their reasoning for placing the stores there, the representative responded by saying it was the company’s decision, and she was not allowed to unveil the company’s business strategies.
A lawyer in Beijing responded to the surprise and displeasure of many Chinese people, by saying this phenomenon was commonly seen amongst real estate companies. He further pointed out, despite all the media attention this issue was garnering, making fakes of well known international brands was uncommon.
According to the trademark laws of China, people who have unregistered trademarks are granted certain privileges and rights. People who decide to use commercial products or similar commercial products in this manner, would be classified as a trademark violation, but since the stores have not made any money and are not officially operating, the damages to the respective companies is difficult to quantify. Due to this, many real estate companies are walking a fine line of what is legally and morally acceptable. Many experts believe there should be a larger impetus for government departments to view this trend as an urgent need to curtail the use of fake brands in China.