First-to-File vs First-to-Use: Who Owns a Trademark and Why It Matters
The Context
When companies think about trademarks, they often assume one rule applies everywhere. Use the name first, and you own it. In reality, trademark ownership depends heavily on where you are doing business.
Globally, trademark systems follow two different systems. First to file and first to use. These systems determine who gets the legal rights to a brand name, and they can lead to very different outcomes for companies expanding domestically or internationally.
Understanding this distinction is essential for building, protecting, and scaling a brand.
First to File Trademark System: Ownership Goes to the Earliest Application
In a first-to-file system, trademark rights are granted to whoever files the trademark application first. Actual use of the brand does not determine ownership. The filing date does.
This means a business can be actively using a brand name for years and get blocked from market entry in a new country if another party registers the trademark first.
Most countries in the world follow this model, including the European Union, China, Japan, the United Kingdom, and many major global markets.
In these jurisdictions, registration is not a formality. It is the foundation of ownership.
First to Use Trademark System: Ownership Follows Real Market Use
First-to-use systems focus on who can prove earlier commercial use of a trademark. In these countries, using the name in business can create rights even before registration.
The United States, Canada, Denmark, Australia, India and a limited number of other jurisdictions follow this approach.
Registration still matters, but in case of conflict, the one who can prove they used the trademark first wins. The burden, however, is on the brand to prove continuous and genuine use.
Why This Difference Matters
The distinction between these systems has serious business consequences.
Sometimes businesses assume that using a name automatically protects it everywhere. In first-to-file countries, that assumption can be costly. Brands have lost names after investing heavily in marketing, distribution, and expansion, simply because someone else registered the trademark first.
This risk is especially pronounced in China, where trademark squatting has been a long-standing and well-documented issue. Because China operates under a strict first-to-file system and does not require prior use at the time of registration, third parties often register foreign brand names before the brand enters the market. These registrations are frequently made with the intention of blocking market entry, demanding payment for transfer, or exploiting the trademark themselves.
While similar risks can exist in other first-to-file jurisdictions, China remains one of the most challenging markets for foreign brands. Early trademark filing strategy is therefore not just recommended, but often essential for companies planning any current or future activity in the Chinese market.
Takeaways for Brands
Trademark strategy is not universal. It must reflect where a business operates today and where it plans to grow tomorrow. Some best practices include:
Understanding which trademark system applies in each key market
Filing early in first-to-file jurisdictions
Monitoring trademark registers for conflicting applications
Aligning brand expansion with trademark protection timelines
Knowing when and where to file can determine who owns the brand you are building.
Disclaimer
This article is for informational purposes only and does not constitute legal advice. If your company would like guidance on trademark filing strategy or international filing, our team at Abrande can help.
