I'm not getting into an hypothetical argument about this however the problem could possibly occur therefore, one would assume, that ICANN did discuss this possibility and if not, why not?
The fact is that we trade in China under our example.com, example.cn and example.asia names however we do know that there are Chinese companies in our trade using these names in Mandarin and obviously use as near as possible similar latin domain names for their websites such as example+keyword.com/cn/asia.
How or who is going to resolve this? We've not all got the financial resources of Apple v Apple or Budweiser v Budweiser.
Remember there were loads of disputes after the .eu launch fiasco therefore this could be even a bigger problem and, presumably, have to be fought on a country by country basis?
I suppose for companies with made-up names it will not be as big a problem as for those with generic dictionary names?