The China Experts: Paul McCourt of Hamilton Litestat on Brand Squatters, 3C Certification and Changing Course
- 4 hours ago
- 4 min read
In this episode of The China Experts, Kristina Koehler-Coluccia is joined by Paul McCourt, Director of Business Operations at R Hamilton Litestat, the British manufacturer of decorative sockets and switches. Hamilton had been buying Chinese components for fifteen years before it tried to sell into China, and the entry attempt ran into a brand squatter, a certification regime nobody had budgeted for, and three years of closed borders. Paul's account is unusually honest about what that cost, and about the decision to change route rather than push on.
Who is Paul McCourt?
Paul McCourt is Director of Business Operations at R Hamilton Litestat, a family manufacturing business founded in the UK in 1968 that makes metal electrical accessories for the high-end residential and hotel market. Hamilton had sourced components in China for around fifteen years and assembled in the UK. About five years before this interview, Paul was given the task of establishing a business in China, on the reasoning that Chinese travellers were seeing those finishes in European hotels. He joins The China Experts to walk through what happened next.
What this episode covers
Why a UK manufacturer that already bought from China found selling into China a completely different problem
Discovering a brand squatter who had been trading under the Hamilton name for five or six years
What a dormant China entity still costs you in monthly filings and annual audit
The 3C certification process, the Beijing laboratory and the hundreds of samples
Why the company chose to wind up its entity and work through distributors instead
Building a China-specific brand and a deliberately narrow product range
Paul's summary of the whole exercise: preparation, preparation, preparation
The brand squatter nobody knew about
The most cautionary part of the conversation is how Hamilton found out its name was already being used in China. A shipment was stopped at Ningbo port because customs said the mark did not belong to them. It did not, in China: another company had registered it and had been operating for five or six years, complete with the name on the side of its trucks and a copy of Hamilton's distinctive letterform. The squatter wanted a substantial payment to go away, Hamilton refused, and the fight ran through several avenues over a long period. In the meantime the company had to trade under a shortened China-specific brand instead.
This is the single strongest argument for filing early. China operates a first-to-file trademark system, which means the right belongs to whoever registers it, not to whoever built the brand. Starting trademark registration in China before you begin commercial conversations is far cheaper than litigating afterwards, and a proper search would have surfaced the squatter years earlier.
A dormant company is not a free company
Hamilton set up a Shanghai entity, filled in what Paul estimates was close to a thousand forms, and was ready to trade when the borders closed. The business was mothballed for around three and a half years. What surprised him was that a dormant company in China is not dormant in the eyes of the authorities: monthly tax filings continue, quarterly returns continue, and the company still has to be audited once a year even with no trading activity.
That is worth knowing before you incorporate rather than afterwards. China company registration creates an ongoing obligation, and keeping it clean means continuous cloud accounting and financial reporting plus annual tax and audit work whether or not there is revenue. Hamilton's alternative plan, hiring its own local representatives, ran into the same wall as everything else: you cannot interview and build trust in a team you have never met.
Certification, product range and the decision to change route
Before Hamilton could sell anything it needed 3C certification. Its range had to be tested by a laboratory in Beijing, and an agency acting on the Chinese authorities' behalf audited the UK factory to check the manufacturing process, how a faulty product would be replaced and how it was built to specification. Because a single socket might exist in ten finishes, each variant had to be submitted separately, which meant sending hundreds of samples. The certification is then re-audited annually, which Hamilton has continued to do despite not yet producing for the market.
Faced with that overhead, the managing director's view was that the cost of supporting an unused entity was not justified, and the company chose to wind it up and go through distributors, mirroring an arrangement that already worked for it in the Middle East. Paul is careful to frame this as a change of business model rather than an exit: if volumes justify it later, the entity can be re-established. In the meantime the China range was deliberately narrowed from a catalogue of roughly 25,000 items to a handful of ranges with sockets at local amperages, USB charging and wide rockers, and no dimmers, on the basis that Chinese customers prefer brightly lit rooms. Companies at that stage often want a presence without a legal entity, which is where employer-of-record hiring and recruitment in China can bridge the gap.
Watch the full interview
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