The impact of the Japan-South Korea trade war on the industrial chain of China, Japan and South Korea and analysis of brand infringement issues

The impact of the Japan-South Korea trade war on the industrial chain of China, Japan and South Korea

Recently, the Japanese government announced that it will tighten controls on the export of three materials: hydrogen fluoride, fluorinated polyimide and photosensitive agent photoresist to South Korea, triggering concerns about the global supply chain. Although these three materials are little known, they affect a market worth hundreds of billions of dollars. This move by Japan not only affects Korean semiconductor companies, but may also have a chain reaction on Chinese companies.

In the context of globalization, the production of a commodity often requires the participation of multiple countries. Products such as memory and OLED screens are typical representatives of this international division of labor. There is an industrial chain division of labor between China, Japan and South Korea based on comparative advantages: Japan produces semiconductors and OLED materials and exports them to South Korea, while South Korea exports semiconductors and OLED products to China, and China reprocesses them into mobile phones, TVs and other finished products for sale around the world.

Chen Yan, executive director of the Japan Enterprise (China) Research Institute, said that in the above-mentioned fields, there is a close industrial chain division of labor between China, Japan and South Korea. South Korea’s Samsung is the largest manufacturer of DRAM memory chips and NAND flash memory chips, accounting for 40% and 35% of the global market respectively. Another Korean company, SK Hynix, is the world’s second largest DRAM chip manufacturer, with a market share of 31%. In the field of OLED production, Samsung and other Korean manufacturers are also leading the industry.

It is worth noting that Japan is the largest supplier of OLED raw materials fluorinated polyimide and semiconductor raw materials photoresist and high-purity hydrogen fluoride. Japan’s fluorinated polyimide production capacity accounts for 90% of the world’s total production capacity, and its high-purity hydrogen fluoride gas production capacity accounts for 70% of the world’s total. In 2018, South Korea’s semiconductor exports were US$128.15 billion, of which exports to China reached US$85.78 billion.

Japan has imposed export controls on South Korea, which has had a negative impact on the normal operation of the industrial chain. If South Korean companies have problems with the supply of components, it may drag down the production of smartphone manufacturers such as China’s Huawei. Bloomberg’s Japanese version also mentioned that the Japanese government’s sanctions against South Korea have had a profound impact on the world’s manufacturing industry. In addition to the two countries involved in Japan and South Korea being greatly affected, China may also be affected.

“Dangers” and “opportunities” to China’s industry

Although the trade war between Japan and South Korea has brought many challenges to the Chinese industry, it has also brought new opportunities. Zhao Kyung-yeop, a senior researcher at the Korea Economic Research Institute, analyzed that if the economic dispute between Japan and South Korea expands, the electronic and electrical industries of both countries will be damaged, and the output of related products in China may increase by 2.1% as a result. Hong Kong’s South China Morning Post also believes that China may be able to gain a competitive advantage through economic and trade frictions between Japan and South Korea.

Analysis of brand infringement issues

Perspectives on Trademark Law

In the business world, many brands choose to use the names or lyrics of famous songs as their brand names to attract consumers and convey specific emotions or images. However, such an approach may constitute trademark infringement. According to the provisions of the Trademark Law, a trademark refers to a mark used to distinguish goods or services, including words, graphics, letters, numbers, colors, sounds, etc. Therefore, the name of a song can be considered a trademark, and if the name is registered and associated with a specific product or service, the use of the same or similar name by other businesses may constitute trademark infringement.

Similarity and confusion

When determining whether infringement occurs, the similarity and confusion between the song name and the registered trademark need to be considered. If the song name is very similar to a registered trademark and involves the same or similar products or services, it may cause confusion among consumers and lead to them mistakenly thinking that the two are related. In this case, using the song name as a brand name may constitute trademark infringement.

Views of rights holders

In addition to trademark law, it is also necessary to consider the attitude of the song rights holder towards the use of the brand. Even if the song name is not registered as a trademark, the rights holder may file an infringement lawsuit if they believe that the use of the brand infringes upon their rights. In this case, brand users may need to prove that their use is reasonable and does not cause confusion or damage the goodwill of the rights holder.

Brand suggestions

• Trademark Search and Registration: If you plan to use the song title as a brand name, it is recommended to conduct a comprehensive trademark search to ensure that the name has not been registered by others and does not conflict with trademarks in related fields. If possible, it is recommended to register a trademark to strengthen the legal protection of the brand name.
• Copyright Authorization: If you plan to use the song name as a brand name, it is recommended to contact the rights holder of the song to obtain authorization or license. This will ensure that your use is legal and reduce possible legal disputes.
• Similarity assessment: When choosing to use a song title as a brand name, conducting a similarity assessment is a necessary step. Please consult a professional intellectual property lawyer to evaluate the similarity between the song title and the registered trademark. This will help you understand potential legal risks and the possibility of infringement.
• Brand Positioning and Differentiation: If you decide to use a song title as a brand name, make sure your brand positioning and differentiation matches the style and emotion of the song itself. Reduce the potential for confusion with song rights holders by clearly communicating your brand philosophy and uniqueness.
• Transparency: When using a song title as a brand name, be transparent about your brand’s origins and associations with consumers and relevant stakeholders. Clearly state your relationship or collaboration with the song rights holder to avoid confusion and misunderstanding.

To sum up, the trade war between Japan and South Korea has had a profound impact on the industrial chains of China, Japan and South Korea, and has also brought new opportunities to the Chinese industry. In terms of brand naming, you need to be careful when using song names as brand names to avoid potential legal disputes and infringement risks.