21/12/2015 9:06 AM AEDT | Updated 15/07/2016 12:51 PM AEST

Aussie Startup Farmer Brown's Dairy Company Had Its Logo Stolen in China, And Milk Is Being Sold

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A Melbourne-based dairy startup has fallen victim to China's obsession with Australian milk, as its new logo has been captured and registered by the competition.

Farmer Brown's Dairy Company is still in its infancy and owner Tori Best told The Huffington Post Australia she tried to register it at the China Trademark Office only to find someone else already had.

"The message for me is that if you're an Australian business, be very mindful of your intellectual property and register your trademark before showing anybody because they were so quick. It's not even out in the public domain," Best told HuffPost.

"Then I went through the process of deciding whether I would start again or challenge it."

Best's lawyer Dan Plane of Simone IP Services in Hong Kong said logo piracy was incredibly common in China.

"It happens all the time in China, and the goal of the Chinese pirate is usually two fold -- they might want to hold the trademark, and in effect, hold a foreign brand hostage and force them to buy the mark back.

"Or they'll basically be trying to set themselves up as a partner. They'll say 'we've already got the trademark, let us distribute your product'."

Australian milk is rare and valuable in China.

Plane said Chinese people were keen to get their hands on Australian milk after a history of local milk poisoning and contamination.

"Australian dairy products and milk powders are really seen as the safest, healthiest option," Plane told HuffPost.

"You will literally cross the border here into Hong Kong and there are signs prohibiting people form carrying more than a certain amount of milk powder.

"Mainland Chinese people go to Hong Kong to buy up as much Australian milk powder as they can and then they take it over the border in small amounts."

Plane said for that reason, Chinese companies were keen to pirate or copy Australian dairy products as well as other products.

"It's not just dairy -- wine too," Plane said.

"We do have a reputation globally and particularly in China for having clean air, blue skies, incredible agriculture products beautiful landscapes and particularly moving into the food space, Chinese consumers have had issues over the last 10 years food safety part in relation to food products for safety."

In Australia, demand for baby formula has outstripped supply as people stockpile tins of powder -- presumably to sell in China.

Fights have broken out in supermarkets as parents try to stop bulk sales while one student told he could earn $100,000 a year buying Australian formula and selling it in China.

As for Farmer Brown's, University of Technology Sydney Communications Law Centre director Michael Fraser said there was one avenue the company could pursue.

"You have to register your logo in all territories otherwise you could have quite a hard time defending it, but there is one avenue they could look into," Fraser told HuffPost Australia.

"If the logo could be considered an original artwork, replicating it requires permission. If the use of this artwork in the form of the logo amounts to a commercial infringement, there could be quite a substantial damages claimed.

Fraser said China was now a signatory of the agreement on the World Trade Organisation's Trade-Related Aspects of Intellectual Property Rights stating they have to put in place enforceable copyright measures.

Meantime Best's challenge to the China Trademark Office has been submitted and she said she was hoping they'd rule in her favour.