"Malicious cybersquatting" mostly occurs in the field of rights that can bring certain economic or spiritual benefits based on the principle of "application first", so it mostly occurs in trademarks, domain names and trade names. Regarding "malicious cybersquatting", Article 31 of the Trademark Law stipulates that "a trademark that has been used by others and has certain influence shall not be registered first by improper means". Therefore, "malicious cybersquatting" means that the applicant applies for registration of a trademark that has been used by others but has not yet been registered in his own name in an unreasonable or illegal way.

The social harm caused by malicious cybersquatting is very obvious, which is mainly reflected in the following three aspects:

1. It destroys the normal market competition order, seriously damages the economic interests of normal operators, and hinders China's transformation from manufacturing economy to brand economy. The essence of malicious cybersquatting is the misappropriation of others' goodwill or reputation, or the illegal occupation of public resources, which will inevitably destroy the normal market competition order. In order to cope with malicious registered trademarks, enterprises either buy back at high prices, or invest a lot of manpower and material resources to solve lawsuits, or register a large number of so-called "defensive trade mark" in advance, resulting in an unwarranted waste of economic resources. The proliferation of malicious registered trademarks affects the cultivation of trademark awareness by legitimate operators and hinders or even stifles the formation of well-known brands.

2. It consumes a lot of trademark examination and judicial resources, endangering the order of trademark registration and use. Malicious cybersquatting, including infringement of others' rights and interests, occupation of public resources and trademarks with no real intention, has made the already overwhelmed trademark examiners and judicial personnel worse, seriously reducing the efficiency of trademark examination and litigation. The number of trademark applications and the number of trademarks in China have been the highest in the world for ten years in a row, and it is still growing at the rate of 1% every year. Due to the long period of trademark examination and many obstacles in the previous trademark, it is difficult to apply for a normal trademark, which affects the establishment of a normal trademark order.

3, seriously endangering the international image of China's intellectual property protection. For example, Japan's industrial economy has made public statements accusing China of malicious cybersquatting, and the Italian Foreign Trade Commission has made a special trip to China to crack down on fake Italian brands.