What they mean for foreign IP owners

As the first of the newly established IP courts becomes operational in Beijing, further details surrounding its operation and the implications for foreign IP owners are beginning to emerge.

With the swift launch of the Beijing IP Court in Haidian district, home to major universities as well as local technology giants, additional details of the court's impact on foreign IP owners, caseload and key personnel have emerged.

The Beijing IP Court and foreign brand owners

Early indications suggest the Beijing IP court may be dominated by trade mark administrative appeals, contrary to the IP Courts' intended mandate to focus on 'hard' IP: patents, plant varieties, semiconductor layout designs, software copyright and technical trade secrets. 

This flows from the Beijing IP Court's exclusive jurisdiction over first instance appeals against administrative decisions of the Patent Review Board (PRB) and the Trade Mark Review and Adjudication Board (TRAB) involving the grant and validity of patents and trade marks respectively. This, along with the disproportionate number of foreign parties involved in administrative appeals and the exponential growth in trade mark administrative appeals in recent years, makes the Beijing IP Court of particular interest to foreign brand owners.  This interest will be further heightened by the IP Courts' exclusive jurisdiction over civil cases involving the affirmation of well known trade marks. 

The Shanghai and Guangzhou IP Court dockets will largely be populated by civil IP infringement cases. 

Substantial caseload

As of 5 December the Beijing IP Court has accepted more than 221 cases, including several high profile matters involving Wechat and Momo (often referred to as "China's Tinder"). Around 63% of these cases involve administrative appeals from the PRB and TRAB.  Roughly 46% of the court's overall caseload involves 'technical' subject matter. 

But there are already concerns over the court's capacity to handle its substantial caseload.  The court's 100 staff, 25 of whom are judges, are expected to receive more than 10,000 cases in 2015. This under-resourcing may lead to substantial delays and compromise the court's mission to improve the quality of IP jurisprudence. 

Personnel

On 2 November the 14th National People’s Congress Standing Committee appointed Judge Su Chi as the first President of the Beijing IP Court and a member of the judicial committee. Chen Jinchuan and Song Yushui were selected as Vice Presidents. The session also selected the first batch of 25 judges for the Beijing IP Court.  The Supreme People’s Court' Decision on the Selection of IP Court Judges (trial) requires IP Court judges to be judicial personnel of merit currently occupied in IP-related work, or professionals with equivalent qualities and qualifications in IP legal practice, legal study or legal education.  IP Court judges are expected to receive higher remuneration than the average judge at other Intermediate People's Courts. 

In addition, the IP Courts will establish a technical investigator system. On a general level, the investigators will assist judges to understand and determine technical issues raised. We await more specific guidance as to the precise nature of the role and what weight may/must be given to their opinions by judges. 

The Guangzhou IP Court is due to become operational on 15 December 2014; the Shanghai IP Court by the end of the year. 

We greet these latest developments with quiet optimism, tempered by the understanding that this nascent IP apparatus faces a number of practical and systemic challenges.  We look forward to providing further updates as all three IP Courts become fully operational over the coming months.

You can read more about the jurisdictional boundaries of all three courts here.