The Story Behind Trump’s Chinese Trademark

Amid the tumultuous end to his first month in office, President Donald Trump got a piece of long-awaited good news: After more than a decade of hold-ups in court, his application to trademark his name in China was finally approved.

Because the announcement came shortly after Trump announced for the first time his commitment to the so-called “One China Policy,” in which governments officially recognize the Republic of China but not Taiwan, the decision immediately prompted speculation about conflicts of interest. Senator Dianne Feinstein of California, for instance, wasted little time in declaring the new trademark unconstitutional. “China’s decision to award President Trump with a new trademark allowing him to profit from the use of his name is a clear conflict of interest and deeply troubling,” said Feinstein, adding, “If this isn’t a violation of the Emoluments Clause, I don’t know what is.” (Feinstein was referring to a section of the constitution that prohibits officeholders from accepting “any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.”) A report from ThinkProgress that the decision violated a Chinese rule prohibiting trademarks that are “the same as or similar to the name of leaders of national, regional, or international political organizations” only further fueled charges of corruption.

According to critics, China’s decision to grant Trump’s trademark application is a means to curry favor with the president, to give the president a revocable gift that would nudge him in the direction of a more favorable stance toward the country. After all, there’s plenty of incentive for China to do so: Trump has repeatedly taken rhetorical, if not yet actual, stances that jeopardize the relationship between the two countries. For example, Trump has accused the Chinese government of currency manipulation, which, coupled with his calls to re-negotiate trade deals, has led to concerns that he could spark a trade war with China. Then there’s the fact that, even before he became president, Trump already indicated that the United States may do away with the One China Policy by calling the president of Taiwan in December, something U.S. presidents had not done for nearly 40 years, well before he called his Chinese counterpart. The British newspaper the Independent appeared to articulate precisely this viewpoint, titling its article on the development “China awards Donald Trump valuable trademark days after he agrees to honour ‘One China’ policy.”

But as more details emerged, the case that the Chinese government granted Trump’s trademark as a simple quid-pro-quo deal with the president began to seem less clear-cut—although that’s not to say that the possibility can be categorically ruled out. The court case long predates Trump’s run for president. He has been fighting to wrest control of his brand in China for more than a decade against entrepreneurs who have marketed products under his name—or, as some claim, just the word “trump,” with no intent to refer to the famous businessman-turned-politician. The February 15th ruling, though not yet a decisive victory, gives the Trump Organization the sole rights to use the president’s name for construction purposes, which could open the door to further decisions in his favor on some 49 pending trademarks and 77 previously registered trademarks on a wide range of products that could come before the court in the near future. And, as The Washington Post observed, the Chinese court’s decision does not necessarily mean that the Trump Organization will be imminently expanding into China; rather, it simply means that Trump will be able to stop other developers or entrepreneurs within the country from using his name on their buildings or products.

Moreover, the decision to grant Trump his long-sought-after trademark actually happened months ago. The same court invalidated a competitor’s claim to the Trump name in September; in November, shortly after the election, the Chinese government granted Trump provisional approval to trademark his name for real-estate services within the country, an outcome that itself was seen at the time as likely paving the way for last week’s announcement.

Besides, it’s not altogether uncommon for American brands to have difficulty registering their trademarks in China. Just as quick-thinking entrepreneurs in the U.S. often grab domain names before they become important—Shannon Burchett, who purchased TrumpPence2016.com well before Trump won the Republican nomination, springs to mind—buying up trademarks that may be valuable in the future is something of a cottage industry in China. Trump is neither the first to face such a problem nor the first to win back his trademark in court; in 2012, Apple paid the Hong Kong-based hardware manufacturer Proview International Holdings $60 million to take back its trademark for the iPad, while in 2016, Facebook and Michael Jordan, two of the most recognizable brands in the world, wrapped up legal battles to attain control over their names.

None of this definitively proves that Trump and China did not execute a straight-up swap, with Trump receiving a trademark and China receiving renewed adherence to the One China Policy. Nor does the mere coincidence of Trump receiving his trademark so shortly after speaking with Chinese President Xi Jinping represent the smoking gun his critics desire. Instead, what the story demonstrates is just how much the president’s financial dealings complicate any understanding of the motivations behind his policy decisions: Whether on purpose or by mere coincidence, the outcome of a decade-long legal dispute is now inextricably linked, in the public imagination if not in fact, to a high-profile question of international diplomacy. And it highlights the way accusations of corruption often exist not in obvious acts of self-dealing or one-to-one trades but in shades of gray, with cross-cutting motives and well-timed coincidences that almost never definitively prove payoffs but that nevertheless continually suggest malfeasance.

Regardless of whether the court’s decision represents a quid-pro-quo scenario, the argument that it creates a conflict of interest remains wholly intact. Whether Trump, China, or both saw the trademark court as a bargaining chip in broader political negotiations is essentially immaterial; all that matters is that the Chinese government made a decision that provides the president new opportunities to make money in the country. That in and of itself will color Trump’s future interactions with the country, especially if, as The New York Times has suggested, this is only the first in what could be a long series of decisions in Trump’s favor. Each subsequent ruling in his favor will serve to remind Trump of the personal profits he could reap by improving his own personal relations with China, even if doing so leaves  the American people worse off.

As the president’s list of known financial entanglements continues to grow, it is worth considering some hypotheticals of how they may end up playing out in the realm of public policy. Adhering to the One China Policy may be in the best interest of both the American people and the international community—it has been essentially a precondition for the maintenance of mutually beneficial relations with China for decades—but future questions may not be so uncontroversial. Trump reached office in part by promising to take a hard line on trade, even if the wisdom of doing so with a country like China remains questionable; the prospect of expanding his business into the country may lead him to take a more conciliatory tone than he otherwise would. Because of its rapid growth, China has quickly become the world’s largest polluter and a target of international efforts to fight climate change; opening the Chinese market to Trump Organization products could be all the additional incentive the president, already a climate-change denier, needs to help scuttle those efforts. And, though Trump has spoken about the importance of assisting Christian refugees from the Muslim world, he has never mentioned persecuted Christians in China; should it become an issue, the Chinese government now has the shiny object of Trump’s trademark which they can use to distract the president from the issue—or, should they so choose, threaten to revoke if he attempts to intercede.

Even if the trademark was not granted with the explicit intent of influencing Trump, as Kathleen Clark, a professor of ethics at Washington University in St. Louis, told NPR, it demonstrates the possibility that “when Donald Trump is dealing with the Chinese government on behalf of the United States, he may also be thinking about what the Chinese government can do not just for the U.S. but for Donald Trump and his businesses and his own financial well being.” Perhaps Trump’s conflicts of interest in China will not manifest in any of the aforementioned ways. Perhaps when it comes to China specifically, his conflicts of interest will not substantively divert his policy-making impulses;  many of the decisions that he might make in defense of his pocketbook dovetail with his, and the Republican Party’s, general pro-business stances. But with so many financial entanglements all over the world, and with the pernicious effects of even small personal incentives well-established in the scientific literature, it’s likely that in the long run, one will influence his decisions.

Though the situation with Trump’s Chinese trademarks is far more complicated than it looked when the news broke, it nevertheless demonstrates the problem with the president’s refusal to relinquish his business. The impact of Trump’s conflicts of interest will rarely be black and white, but they will continually offer temptation for the president to act on behalf of his company as well as, or instead of, the country he serves.