China’s Patent Law subject to fourth amendment

By John Xia, Corner Stone & Partners

China’s current Patent Law was promulgated in 1985, and it has been amended three times. Over the 30 years of implementation of the Chinese contemporary patent system, this law has made remarkable achievements in encouraging and protecting inventions and creations, and in promoting scientific and technological progress and innovation.

Along with its rapid development in recent years, China needs to make further efforts to build itself into a strong country in terms of intellectual property (IP), as well as in terms of economy.

John Xia
Corner Stone & Partners

In the context of economic globalization, in order to enhance the implementation of China’s IP rights strategy to adapt to the political, economic and diplomatic changes in a new era, the executive meeting of the PRC State Council passed the draft of the fourth amendment to the Patent Law on 5 December 2018, which is ready for submission to the Standing Committee of the National People’s Congress for review, and is expected to be promulgated in 2019.

The newly amended draft Patent Law includes the following changes:

  1. Intensify patent protection and safeguard the legitimate rights and interests of right holders. Strengthen the law enforcement of patent protection and solve common problems in the existing systems. Improve specifically the relevant evidence rules to overcome “difficulties in producing proof”. Clarify the effectiveness of administrative mediation agreements to shorten the “lengthy process”. Supplement the punitive compensation system for intentional infringement and increase greatly the cost of law-breaking to increase “low compensation”. To address the problem of “high cost and poor effect”, intensify the investigation and punishment for intentional infringements such as group infringement and repeated infringement, intensify the punishment for counterfeiting patents, improve the corresponding administrative law enforcement means, clarify the relevant tort liability, and keep patent protection credit information records. In particular, in view of the development of e-commerce and globalization trends, define the legal liability of network service providers in patent infringements, promote the rapid and healthy development of e-commerce, and suppress effectively patent infringements on the internet.
  2. Promote the implementation and utilization of patents to realize patent value. Further clarify the status of the inventor and designer in employment invention and creation, and stipulate that the principle of contractual priority applies for the ownership of the invention and creation accomplished by using the material and technical conditions of the employer. Allow the inventor or designer to adopt the patent technology according to the agreement with the employer, and obtain corresponding earnings to increase the low conversion rate of patent technology achieved by the state’s research institutions and colleges and universities. Introduce license of right to reduce the cost of patent licensing, and to balance the supply-and-demand information for patent licensing. Introduce the implied licence system for standard essential patents, and stipulate that the patentees fulfill the obligation to promote social fairness and progress while enjoying their rights.
  3. Satisfy the statutory requirements for the functions of governmental agencies and build a service-oriented government. Clarify the service responsibilities of the national and local patent administration departments, and emphasize the responsibility of the patent administration departments in strengthening market supervision, providing patent services and promoting patent utilization.
  4. Perfect patent examination system and improve patent quality. It is now allowed to protect partial design. Extend the protection period for design patents from the current 10 years to 15 years to lay the foundation for joining the Hague Agreement. Optimize the procedures for application, review, re-examination and invalidation of patents, establish the domestic priority system for design, perfect the provisions on priority claims, and clarify the ex officio review principle of patent re-examination and invalidation procedures.
  5. Perfect the legal system for patent agency and promote the healthy development of intellectual property service industry. Enhance the importance of patent attorneys in patent agency services. Strengthen the in-process supervision and feedback supervision of patent agency services, and create a legal environment conducive to legal operation, honesty and integrity, and healthy competition. Develop marketization, specialization and internationalization among patent information service agencies, and provide high-level patent services for innovation actors.
  6. In addition, some other provisions of the Patent Law have also been improved and adapted.

John Xia is a partner at Corner Stone & Partners

Corner Stone & Partners
1905, Tower B, Tian Yuan Gang Centre,
No. 2 Dongsanhuan North Road, Chaoyang District,
Beijing 100027, China
Contact details:
Tel: 86 10 8446 4600 (Ext.816)