On 1 October 2009 amendments to Chinese patent and design laws will be adopted. These changes may well have ramifications for Australian companies conducting business in China.

A brief summary of the changes is below. Most notable is the introduction of absolute novelty (that is, that novelty is to be assessed against publications anywhere in the world rather than just in the Chinese jurisdiction). This will bring Chinese patent and design law, in this regard, in line with the majority of other countries in the world. This is a positive change for companies who manufacture in China, of who may be faced with a Chinese manufacturer filing a patent for their products, even though the company has already released their product elsewhere in the world.

A further new requirement is that approval must be obtained in certain circumstances to file outside China. This may have a negative impact on those who develop inventions in China. We are currently corresponding with our Chinese associates to clarify the term ‘completed’, and gauge the likely practical and commercial effects of these changes, and in particular the risks and opportunities they present.

By way of a very brief overview, the reported changes to China’s patent laws include:

  • The introduction of a more stringent novelty requirement for validity. Under the amendments a valid patent will need to be new over prior art published, publicly used or known anywhere in the world (absolute novelty). This is in contrast to the current requirement that a patent must be new over publications anywhere in the world but publicly used or known in China only (relative novelty).
  • If an invention depends on access to and use of genetic material, the source of the genetic material must be disclosed.
  • The establishment of new grounds for the grant of a compulsory licence
  • An increase to the potential award amounts in the event of infringement
  • Where an invention is ‘completed’ in China the applicant (whether foreign or national) must request the Chinese Patent Office to carry out a security and secrecy examination and obtain approval to file patent applications outside China.

In relation to designs, the reported changes include:

  • The introduction of absolute novelty for the purposes of design validity. As with patents, the result of this is that Chinese designs will now need to be new over designs that were made public (by publication or use) anywhere in the world before the priority date of the design.
  • The requirement that, in order to be valid, a design must be distinguishable from obvious combinations of existing designs.
  • That two-dimensional designs consisting only of patterns, colours, or combinations thereof will not be registrable.
  • The requirement for design applications to be accompanied by a brief description of the product to which the design is to be applied.
  • The introduction of multiple design applications whereby a single design application can cover multiple designs in relation to a single product or a set of products.
  • That offering to sell products which are the subject of design protection without permission of the design owner will be considered infringement.