New regulations will make it more difficult for companies to protect their domain names from cyber-squatters in China.

Under the new rules, foreign and local firms will need to prove malicious intent and act quickly to have any hope of retrieving stolen domain names, according to a regulatory official interviewed by Chinese news site Sina. 

The new rules appear to give a green light to cyber-squatters who buy up domain names which are similar to brand names in the hope of selling them later for a profit.
The unnamed official from China's state-controlled domain name regulatory body, the China Internet Network Information Center (CNNIC), told Sina that the new laws more clearly define circumstances under which cyber-squatting is "permissible" . 

Previous regulations prevented cyber-squatting when claimants to the domain name could prove 'malicious intent' on the part of the squatter. However, according to Sina, the new rules suggest that merely registering an existing brand as a domain name does not by itself constitute 'malicious intent'.

The term applies only to certain obviously hostile acts, for example when the cyber-squatter tries to rent or sell the domain name to a competitor of the putative owner.

The new rules, which have not yet been formally announced, apparently force companies to either pre-register all potential domain names themselves, or at least to maintain a vigilant watch for newly-registered domain names that might be similar to their own trademarks.

They further state that any challenges to a new domain name must be made within two years of its initial registration.