Bringing you regular news of key developments in the area of Intellectual Property in China.

General

The General Rules of the Civil Law of the People’s Republic of China provide further clarification on the objects protected by intellectual property rights, 15 March 2017

The General Rules of the Civil Law of the People's Republic of China (the “Rules”) were adopted by the National People's Congress on 15 March 2017 and will be effective from 1 October 2017. The General Principles of Civil Law of the People's Republic of China only list patents, trademarks, copyright and rights of discovery as intellectual property rights that can be protected. In comparison, the Rules clarify the scope of intellectual property as proprietary rights in respect of the following objects: (1) works, (2) inventions, utility models and designs, (3) trademarks, (4) geographic indications, (5) trade secrets, (6) layout designs of integrated circuits, (7) new plant varieties and (8) other objects as specified by the law. This is the first time that the objects protected by intellectual property rights are explicitly listed indicating the Chinese government’s determination to strengthen the protection regime of intellectual property in China.  

For the full text of the Rules, please click here (Chinese only).

SIPO issued the Notice on the Pilot Project of Arbitration and Mediation for Intellectual Property Disputes, 9 March 2017

The State Intellectual Office (“SIPO”) issued the Notice on the Pilot Project of Arbitration and Mediation on Intellectual Property Disputes (the “Notice”), which aims to improve dispute settlement mechanisms for intellectual property disputes. The Notice includes the following measures to promote settlement: (1) establishing Intellectual Property Mediation Organisations in the chambers and associations of commerce located in important areas, (2) constructing the Intellectual Property Information Exchange and Case Acceptance Platform, (3) strengthening cooperation with major arbitration institutions and their local branches or local institutions that have a strong influence in the region and (4) establishing the Intellectual Property Arbitration Centre to encourage lawyers, patent attorneys, tech engineers and other professionals to actively participate in dispute resolution.

For the full text of the Notice, please click here (Chinese only).

The Supreme People’s Court has issued the 16th Batch of Guiding Cases, 6 March 2017

The Supreme People's Court ("SPC") has distributed the Circular on Releasing the 16th Batch of Guiding Cases for the reference of the courts when adjudicating on similar cases (the “Circular”).

According to the Circular, the 16th batch includes a total of ten guiding cases (No.78 – No.87), all of which relate to the intellectual property field, including nine civil cases and one criminal case. The civil guiding cases mainly involve disputes over infringement of copyright, trademark rights, patent rights, rights of new plant varieties, anti-monopoly issues such as unfair sale practices where a business operator combines undesirable products with popular products and disputes over the abuse of dominant market positions. The criminal guiding case relates to the crime of counterfeiting trademarks.

For the full text of the Circular, please click here.

Patents

SIPO revised the guidelines for patent examination, 28 February 2017

SIPO issued the Decision of the State Intellectual Property Office on Amending the Guidelines for Patent Examination (the “Decision”). The Decision includes revisions of thirteen sections and will be effective from 1 April 2017. According to the Decision, business models which contain both the content of business rules and methods and technical characteristics may be patented. In addition, methods of amending a claim are generally limited to deletion of a claim, deletion of a technical solution, further limitation of a claim and correction of an obvious error. Further limitation of a claim refers to adding one or more technical characteristics which are defined in other claims into the claim which is under amendment with the effect of narrowing the scope of protection.

When a file for the patent application for an invention has been published but the grant of the patent right has not been announced, the relevant procedural documents can be consulted and copied, including the application documents, formality documents, notifications, decisions and corresponding response of the applicant and retrieval reports etc.

For the full text of the Decision, please click here (Chinese only).

Guiding Case No.83 Weihai Jiayikao Household Electrical Appliances Co., Ltd. v. Yongkang Jinshide Industry and Trade Co., Ltd. and Zhejiang Tmall Network Co., Ltd.

The case concerns a patent infringement dispute by the largest online sales platform in China. The outcome of the case indicates that online platforms have an obligation to take reasonable measures to prevent infringement behaviours.

Weihai Jiayikao Household Electrical Appliances Co., Ltd. (the “Plaintiff”) claimed that Jiayikao Company, Yongkang Jinshide Industry and Trade Co., Ltd. (“Defendant A”) promoted and sold the infringing products on the Zhejiang Tmall Network Co., Ltd. platform without the Plaintiff’s authorisation. The Plaintiff then claimed that Zhejiang Tmall Network Co., Ltd. (“Defendant B”) failed to take effective measures after the Plaintiff complained of patent infringement therefore Defendant B should bear the liability for the infringement jointly and severally with Defendant A. The courts in both the first and second trials generally supported the claims of the Plaintiff.

The main point of the dispute was whether Defendant B should bear joint liability. Defendant B claimed that it had rejected the Plaintiff’s complaint of infringement as the complaint lacked details of the infringement analysis and consequently it was reasonable for Defendant B not to take measures to rectify Defendant A’s infringing behaviours. However, the courts held that where an internet user commits the infringement via an online platform, if the notice sent to the online service provider by the patent holder requesting reasonable measures against the infringement includes the identity of the infringed patent, the ownership certificate, the network address of the infringer and preliminary evidence for infringement facts, such notice is a valid notice for requiring protection measures. The complaint rules established by the online service provider itself shall not affect the enforcement of the rights holders own legal rights. Due to this reasoning, Defendant B’s claim that the complaint was ‘unqualified’ was not a sufficient legal reason for not taking reasonable measures against the infringement.

For the full text of the judgment, please click here: ChineseEnglish

Qilu brings anti-trust litigation against Sihuan’s pharmaceutical standard essential patent

Sihuan Pharmaceutical Co., Ltd. (“Sihuan”) owns the core patents for the drug Cinepazide and the patented technologies are listed as the national mandatory standards for producing Cinepazide.

Qilu Pharmaceutical Co., Ltd. (“Qilu”) wanted to manufacture Cinepazide and applied for the corresponding licence from Sihuan but failed to obtain the licence. Qilu still launched its Cinepazide product after obtaining market approval from the drug authority which then triggered Sihuan’s infringement complaint. Following disappointing results in the infringement litigation, Qilu sued Sihuan for creating a monopoly and unfair competition in early 2017.

This litigation has attracted a lot of attention as it is considered to be the first standard essential patent (“SEP”) anti-trust case in the Chinese pharmaceutical industry and the outcome may indicate the court’s view on such cases from a judicial practice perspective.

For the full text of the judgment, please click here (Chinese only).

Trademarks

The Supreme People’s Court provides further clarification of the Administrative Cases Involving Trademark Right Licensing and Confirmation, 10 January 2017

The Supreme People’s Court (“SPC”) issued the Provisions of the Supreme People's Court on Several Issues concerning the Trial of Administrative Cases Involving Trademark Right Licensing and Confirmation (the “Provisions”) which will become effective on 1 March 2017.

The Provisions include thirty one articles which regulate key practical legal issues including uncertainties of the scope of issues to be reviewed in administrative litigation, prohibited features of trademark applications, the determination of conspicuous characteristics, confusion with well-known trademarks, misleading consumers, malicious registrations, the protection of prior copyright, name rights and other substantive matters. The Provisions aim to improve the role of judicial review and to enhance the efficiency in licensing and confirmation of trademarks.

For the full text of the Provisions, please click here (Chinese only).

State Administration for Industry and Commerce issues the Revised Trademark Review and Adjudication Standards, 4 January 2017    

The State Administration for Industry and Commerce ("SAIC") has issued the revised Trademark Review and Adjudication Standards (the “Standards”) in accordance with the third revision of the Trademark Law.

The Standards add new standards for reviewing audio trademarks. The Standards also adopt the application standards of Article 19.4, Article 50 and Article 15.2 of the Trademark Law as well as the standard of determining the interested parties. The revisions broaden and improve the contents relevant to trademark reviews and adjudication standards.

For the full text of the Standards, please click here (Chinese only).

Copyright

The National Copyright Administration has issued the 13th Five Year Plan for Copyright Related Work, 25 January 2017

The National Copyright Administration (“NCA”) has issued the Circular on issuing the 13th Five Year Plan for Copyright Related Work (the “Plan”).

The Plan sets out the general principles and specific objectives for the 13th Five Year Plan. The Plan indicates that the number of work projects registered will increase in annual growth by an average of 15% and the registered copyright of computer software will see a 10% increase in average annual growth. The Plan also encourages: (1) facilitation of the third revision of the Copyright Law and the revision of other related regulations and rules, (2) that special attention is paid to the regulation of online copyright protection, (3) the enhancement of monitoring and regulation of online literature, music, film, television, games, animation, software and other core fields and (4) the implementation of new information technologies, including cloud computing, the Internet of Things, big data and mobile internet, as new administrative methods.

For the full text of the Plan, please click here (Chinese only).