Mar­ket, not govts, can judge what is a wor­thy prod­uct

China Daily (Hong Kong) - - COMMENT - THE LA­BELS

“fa­mous trade­mark”, “re­puted trade­mark” and “well-known trade­mark” were hon­orary ti­tles is­sued by gov­ern­ments at dif­fer­ent lev­els to Chi­nese prod­ucts in or­der to en­cour­age com­pe­ti­tion and help con­sumers iden­tify qual­ity prod­ucts. How­ever, the State Ad­min­is­tra­tion for In­dus­try and Com­merce says the prac­tice is out­dated and it plans to put an end to it. Bei­jing News com­ments:

Gov­ern­ments at var­i­ous lev­els started be­stow­ing the hon­orary trade­mark ti­tles shortly after China bid farewell to its decades long planned econ­omy in the early 1980s as a means to set up role-model man­u­fac­tur­ers in certain in­dus­tries.

But the short­com­ings of the prac­tice have be­come in­creas­ingly ob­vi­ous as China’s mar­ket has evolved. That a Sta­te­owned en­ter­prise can more eas­ily ob­tain such a ti­tle than a pri­vate com­pany shows the lack of fair­ness in the eval­u­a­tion mech­a­nism that orig­i­nated in an era when most prod­ucts were man­u­fac­tured by SOEs. Also, some of­fi­cials seek il­le­gal gains from the eval­u­a­tion process for such la­bels. Once prod­ucts car­ry­ing a govern­ment-en­dorsed trade­mark la­bel are found to be prob­lem­atic, the whole sys­tem and the govern­ment’s im­age will be dam­aged.

The food safety cri­sis trig­gered by the melamine-con­tam­i­nated baby for­mula in 2008 is just a case in point. Many prob­lem­atic dairy prod­ucts bore the dis­tinc­tion of be­ing a “fa­mous trade­mark”, or “in­spec­tion-ex­empted prod­ucts”, the other kind of hon­orary ti­tle given by the gov­ern­ments.

More­over, gov­ern­ments now lack the nec­es­sary ex­per­tise to eval­u­ate some cut­ting-edge prod­ucts in to­day’s mar­ket.

The trade­mark eval­u­a­tion prac­tice has al­ready ful­filled its his­tor­i­cal task. In a de­vel­oped mar­ket econ­omy, con­sumers have the rights and means to de­cide the pop­u­lar­ity of com­modi­ties. Mar­ket de­mand is a more pre­cise ap­praisal than a govern­ment’s eval­u­a­tion.

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