JAN
Draft Amendments to Patent Law Released for Comment
On Jan 4, the Draft Amendment to the Patent Law of the People's Republic of China was released on the website of the National People's Congress for comments. The Draft Amendment was submitted to the 7th meeting of the Standing Committee of the 13th NPC for deliberation. The Draft strengthened the protection of the legitimate rights and interests of patentees, promoted the implementation and application of patents, and put a number of practices that were mature enough into legal norms. To increase the intensity of compensation for patent infringement, the cost of violating the law, and fully demonstrate the deterrent effect of the law, the Draft proposed to stipulate that if the circumstances of intentional patent infringement are serious, the amount of compensation may be determined as one to five times the amount calculated according to the losses suffered by the right holders, the benefits obtained by the infringers or the reasonably multiplied amount of the royalties of the patents. In cases where it is difficult to calculate the amount of compensation, courts may determine the amount of damage between 100,000 Yuan to 5 million Yuan. In terms of perfecting the patent licensing system, the Draft proposed to establish a new domestic priority system for applying design patents, optimize the procedures for claiming priority, and extend the protection period of design patents from 10 years to 15 years. The Draft also defined the principles of good faith and prohibition of abuse of rights, and extended to the scope of protection of patents for innovative drugs.
The 9th China IP Annual Forum
From Jan 12 to 13, the 9th China IP International Annual Forum & 2019 Annual Conference of In-house IP Managers was held in Beijing. With the theme of "New Era, New Frame and New Balance", the Forum focused on the new path of innovation for Chinese enterprises, and the development of intellectual property rights, under the era of changes. At the forefront of the intellectual property industry and fully grasping the trends of development and the IP industry, the Forum attracted representatives from IP department of governments, experts, scholars, representatives of IP service agencies, as well as IP managers from hundreds of enterprises from China, the US, France, the UK, Japan and other countries and regions. The total number of participants was more than 800.
The Establishment of the Intellectual Property Tribunal of the Supreme People's Court
On Jan 1, the IP Court of SPC was established in Beijing. Zhou Qiang, chief justice and president of SPC, unveiled the IP Court. The establishment of IP Court was to further unify the adjudication standards of IP cases, equally protect the legitimate rights and interests of all market subjects in accordance with the law, and strengthen the judicial protection of IPRs. Since Jan 1, the IP Court had performed its statutory duties, hearing mainly patent and other professional and technical, civil and administrative IP appeal cases.
E-Commerce Law
On Jan 1, the E-Commerce Law of the People's Republic of China was formally implemented, which regulated the behavior of E-commerce operators, including individuals. The E-Commerce Law stipulated that e-commerce operators, including procurement service providers, are required to register as market entities and pay taxes in accordance with the law. When E-commerce operators engaged in cross-border e-commerce, they shall abide by laws, administrative regulations, and relevant state guidances on import and export. E-commerce platform business operators shall establish and improve credit evaluating systems, publicise credit rating rules, and provide consumers with a channel through which they can evaluate the commodities sold or services provided on the platform, otherwise they may be fined up to 500,000 Yuan.
Reach for Gold
On Jan 24, WIPO announced the theme of 2019 World Intellectual Property Day–Reach for Gold: IP and Sports. April 26, 2019 was the 19th World Intellectual Property Day. The WIPO website points out that sports has become a multi-billion dollar global industry and that business relationships based on intellectual property rights help protect the economic value of sports. According to WIPO's introduction, this year's World Intellectual Property Day would explore how innovative creations and IPRs that encourage and protect innovative creations can contribute to the development of global sports; how sports enterprises use patents and designs to promote the development of new sports technologies, new materials, new training methods and new equipment, so as to help improve sports performance and attract sports enthusiasts all over the world; how sports stars can generate income by their own brands and working with brand sponsors; how broadcasting rights lay the foundation for the relationship between sports and television and other media, making it easier for sports enthusiasts to have access to sporting events; how technological advances in robotics and artificial intelligence drive changes in sports.
50 Million Yuan
On Jan 4, the unfair competition and trademark infringement case of Guangzhou Hongri Gas Appliances Co., Ltd. (Hongri) v. Guangdong Ruishang Electrical Appliances Co., Ltd. (Ruishang) and eight other defendants were heard. The Guangzhou Intellectual Property Court held that Ruishang's use of the "Hongri E" trademark on gas stoves, range hoods, water heaters, and other products infringed upon the rights and interests related to the brand name "Hongri" held by Hongri, and the related acts constituted unfair competition. The court ruled Ruishang to stop the infringement immediately and remove the infringing trademarks on its inventory, and together with other dealers to compensate Hongri the economic loss of 50 million Yuan and reasonable rights protection costs of 450,000 Yuan. This was the highest amount of compensation ruled by the Guangzhou Intellectual Property Court since its establishment.
Internet Court
Jan 8 was the 100-day anniversary of Guangzhou Internet Court's establishment. Over the past 100 days, Guangzhou Internet Court had put 1,861 cases on file and concluded 951, and the first batch of 13 judges had closed 73 cases per capita. The intelligent trial platform had received more than 3 million visitors, received 2,903 applications for filing, and the subject matter involved was more than 120 million Yuan. Among them, 44.01% of the applications for filing were automatically received during off-working hours. 46% cases were Internet copyright infringement disputes, contract disputes of financial loan accounting for 26%. The remaining cases were mainly related to online shopping contract disputes, small loan contract disputes, Internet service contract disputes, the use of the Internet to infringe upon other people's personal rights, property rights disputes and so on. In mid-February, Guangzhou Internet Court launched the judicial blockchain platform to solve the difficulty of obtaining electronic evidence. Guangzhou Internet Court was established on September 28, 2018, the third Internet court established in China after Hangzhou and Beijing Interenet Courts.
Acceptance Windows
On Jan 31, the Trademark Office of CNIPA issued the Announcement on Approving the Establishment of the Seventh Batch of Trademark Acceptance Windows, the seventh batch of 12 industrial and commercial and market regulatory departments, including the Miyun Branch of Beijing Municipal Market Supervision Administration, to set up trademark acceptance windows, which would officially start operation on Feb 1, 2019 to carry out the acceptance and registration of trademark applications. The 12 trademark acceptance windows are: Miyun (Beijing), Ulanqab (Inner Mongolia), Huangpu (Shanghai), Yangpu (Shanghai), Xiangyang Free Trade Zone (Hubei), Yichang Free Trade Zone (Hubei), Xixian New Area (Shaanxi), Yangling Demonstration Zone (Shaanxi), Jiayuguan (Gansu), Jinchang (Gansu), Wuwei (Gansu), Linxia (Gansu).
Meiling
Four companies used the "Meiling" trademark on suspended ceilings, bathroom heaters and other products, and used the word "Meiling" in the enterprise names, for which Hefei Meiling Co., Ltd. sued them to the Beijing Intellectual Property Court. After hearing, the court held that in this case, the four defendants had a division of labor and communication of meaning, their ways of infringement were similar, which constituted joint infringement and should be held liable in accordance with the law. The evidence showed that the benefits gained by the four defendants from infringing acts and the losses caused to the plaintiff were far higher than the plaintiff's claim of 3 million Yuan, so the compensation claimed by the plaintiff was fully supported by the court. The four defendants should jointly and severely bear the liability of 3 million Yuan for compensation.
FEB
The Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area Issued
On Feb 18, the Central Committee of CPC, and the State Council issued the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area, which called for strengthening the protection and application of IPR in optimizing the regional innovation environment. The Outline proposed to strengthen Guangdong-Hong Kong-Macau Greater Bay Area's cooperation in IPR protection and professional training in an all-round way, relying on the regional IP cooperation mechanisms between Guangdong and Hong Kong, Guangdong and Macao, and the Pan-Pearl River Delta. The administrative law enforcement and judicial protection of IPR should be better strengthened, to better realize the role of institutions such as the Guangzhou Intellectual Property Court, and strengthen IP law enforcement in key areas and links such as e-commerce, import and export. International cooperation in the creation, application, protection and trade of intellectual property rights should be strengthened to establish and improve a mechanism for cross-border cooperation in intellectual property cases. Relying on the existing trading venues to carry out intellectual property transactions to promote the rational and effective circulation of intellectual property rights and carry out the cultivation of a standardized market for IP protection and the commitment of "genuine goods". Full play should be given to the radiating role of IP service development zones to promote the integrated development of high-end IP services and regional industries, and promote the settlement of IP disputes through non-litigation dispute resolution (including arbitration, mediation, negotiation, etc).
Institutional Adjustment of CNIPA
In accordance with the reform and deployment of the central organs, the former Patent Reexamination Board of CNIPA was merged into the Patent Office of CNIPA, while the Trademark Office of the former State Administration for Industry and Commerce (SAIC), Trademark Review and Adjudication Board, and Trademark Examination and Cooperation Center were integrated into the Trademark Office of CNIPA. After the restruction, the examination of patents and trademarks would be carried out in the name of CNIPA.
China and the US Conclude the 7th Round of High-Level Economic and Trade Consultations
On Feb 24, the 7th round of China-US High-level Economic and Trade Consultations concluded. The two sides implemented the consensus reached by the two heads of state during their Argentina meeting late last year, and had in-depth communication on topics of mutual concerns including technological transfer, IPR protection, non-tariff barriers, the service industry, agriculture, trade balance and implementation mechanism. US President Donald Trump announced on Twitter that he would postpone the plan to raise tariffs on Chinese imports on Mar 1. This round of consultations had taken another important step forward in promoting the settlement of economic and trade frictions between China and the US. In the last round of consultations, the two sides reached a consensus in principle on major issues and discussed a memorandum of understanding on bilateral economic and trade issues, while in this round, the two sides mainly discussed trade balance and structural issues, and substantial progress was made on specific issues. From consensus in principle to substantive progress, from agreement consultations to text negotiations, China-US Economic and Trade Consultations had paid more attention to details and had been getting closer to the goal of reaching an agreement. In recent years, IPR protection has been included in the list of achievements of the China-US consultations many times, which had made substantial progress in this round of consultation, fully reflecting the consistency of the aspirations of the two sides and the overlap of interests.
Annual Data
The CNIPA released annual statistics on patents, trademarks, geographical indications and layout-designs of integrated circuits in 2018. Data showed that in 2018, the number of applications for invention patents in China was 1.542 million, and a total of 432,000 invention patents were authorized, of which 346,000 domestic invention patents were granted. In 2018, the top three domestic enterprises (excluding Hong Kong, Macao and Taiwan) in the number of invention patents granted in China were: Huawei (3369), China Petrochemical (2849), OPPO (2345). By the end of 2018, the number of invention patents in China reached 1.602 million, an increase of 18.1% over the same period last year; the number of invention patents per 10,000 population reached 11.5. In 2018, the number of PCT international patent applications accepted was 55,000, an increase of 9.0% over the same period last year. The number of domestic valid trademark registrations (excluding foreign registrations in China and through Madrid System) reached 18.049 million, an increase of 32.8% over the same period last year. The number of applications for international trademark registration through Madrid System exceeded 6,000, an increase of more than 25% over the same period last year. A total of 2,380 geographical indication products and 4,867 registered geographical indication trademarks were approved.
5G Plan
Beijing issued the Beijing 5G Industry Development Action Plan (2019-2022), which put forward that in the next five years, major projects and activities, such as the Beijing sub-city center, Beijing's new airport, the 2019 Beijing World Expo, the 2022 Beijing Winter Olympic Games, and the upgrading along Chang'an Street, would become the demonstration of 5G applications. The Plan took demand traction, innovation-driven, key breakthroughs, and advanced layout as the development principles, and put forward development goals in aspects of network construction, technological development, and industrial development. The goal of network construction was that by 2022, Beijing telecommunication operators would invest more than 30 billion Yuan in 5G to achieve 5G network coverage in the functional core areas, and sub-centers of the city.
Import and Export
The growth rate of China's service exports reached an eight-year high in 2018, and imports and exports maintained a high growth rate in December, according to the official website of the Ministry of Commerce. In 2018, IP royalty imports totaled 235.52 billion Yuan, up 22%; and exports totaled 36.8 billion Yuan, up 14.4%. Exports of technical services totaled 115.35 billion Yuan, up 14.4%, while imports totaled 83.92 billion Yuan, up 7.9 %. The scale of service import and export reached a record high, with its structure being continuously optimized, and the quality improved. The import of IP royalties increased significantly, with the demand and export competitiveness of high-end productive services increasing simultaneously. It showed that China's demand for high-end productive services has been strong, while the export competitiveness of high-end productive services was also improving.
Software Copyright
China's software copyright protection platform was officially released on January 18 at the Annual Meeting of China's Software Industry Association, The Chinese software copyright protection platform was jointly developed by the China Software Industry Association and Unitrust Time Stamp Authority, which aimed to enhance the IP protection awareness of Chinese software enterprises, strengthen their independent protection ability, solve the difficulties in confirming the right of software and providing proof. The platform took the legally valid trusted time stamp authentication as the main means, which could be authenticated in real time in the code generation, design and development stage, and issued legally valid trusted time stamp authentication certificate for the software work in time. Through the website, API interface and mini programs provided by the platform, software developers could obtain proof of ownership in a few seconds to achieve the purpose of rapid, immediate and effective self-protection of IPR. The official website of the China Software Industry Association, as the entrance to China's software copyright protection, would continue to open service portals all over China in the future, and any enterprise and individual can obtain software copyright protection services through Internet.
200 Million Yuan
According to preliminary statistics, customs across China detained a total of 44,500 batch of inbound and outbound infringing goods in 2018, involving 22.94 million pieces of infringing goods worth 200 million Yuan, according to data released by the General Administration of Customs. The batch, quantity and value of infringing goods seized by customs in 2018 increased by 132.1%, decreased by 43.4%, and increased by 11.1% respectively over the previous year. In 2018, the Customs launched a four-month "Longteng" special campaign to protect IPRs of enterprises with advantages in exporting IPRs, confiscating 385 batches of suspected infringing import and export goods, involving 3.09 million pieces of goods worth 61.14 million Yuan. The Customs together with the State Administration of Market Supervision and other departments, launched a 2018 Special Action Plan on Supervision of Online Market "Sword at the Internet Campaign" to crack down on infringement and violation of the law in the Internet field. In addition, the Customs also made great efforts to promote regional customs law enforcement cooperation, establish a rapid response to major cases and major infringement risk information, and establish a linkage mechanism for the detection and distribution of cases, so as to prevent the act of infringing and counterfeit goods circulating to other ports. The Customs also conducted joint supervision with the Ministry of Public Security on major cases such as the export of integrated circuits and sports shoes. In terms of international cooperation, in 2018, the Customs also strengthened exchanges with countries and regions along the "Belt and Road Initiative" on IPR protection.
