The Greater China IP Updates ˇV October 2021

By Lyndon 

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CNIPA Discusses Rise in IP in China

According to Heng Fuguang, the Deputy Director General of the General Affairs Office of the China National Intellectual Property Administration, granted patents, trademarks and layout design of integrated circuits all grew rapidly year-on-year, which shows that market players have become more active in innovation, creation and entrepreneurship.  Another aspect is the ongoing reform in streamlining administration, delegating power, improving regulation and upgrading services.  Also, there has been a steady campaign to improve the professionalism of the IP examiners and related fields of expertise.  This has resulted in the pendency for the examination of higher-valued invention applications to be shortened to 13.4 months, and the average examination pendency for trademark registration to be reduced to below 4 months.  The Patent Administration Department now has consolidated its authority to deal with patent infringement disputes nationwide, and this has resulted in 13,800 cases of administrative adjudication of patent disputes in the first half of this year.  A further directive, the Administrative Adjudication Measures for Major Patent Infringement Disputes, was issued on May 31, 2021 which will further improve the handling of major cases, unify the standards for determining infringement, and give full play to the role of the patent administrative department.

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IP in China according to the 2021-2025 five-year plan

Intellectual Property has increased in importance in China in recent years, and that continues to be the case as highlighted in the latest five-year plan.  Two main themes are apparent:

1. An emphasis on strengthening enforcement to maximize the benefits of intellectual property.
2. An increase in efforts to protect intellectual property rights linked to high-technology fields that are seen as essential to Chinaˇ¦s economic strength.

Concerning enforcement, the recent 4^th amendment of the Patent Law improved many protections for patent holders.  The pharmaceutical sector benefited from new regulations protecting their IP, for example.  Also, a stricter compensation system was set up to deal with patent infringements with the possibility of fines being levied up to five times the basic cost of damages.  More investment in manpower and training has been secured for the judicial and administrative branches as well as the arbitration and mediation system.  This will be further adjusted throughout the next five years so as to produce a fair balance between the rights of any potential infringer to make their case and the IP rights holder.  There are also plans to set up the National Guidance Center for Handling Overseas Intellectual Property Disputes to assist businesses with overseas IP disputes.  The second main theme as regards IP issues will be to support the high-technology field.  Such areas as photonics, micro and nanoelectronics, network communications, artificial intelligence, biomedicine, and modern energy systems.  Itˇ¦s likely that patentability exclusions and patentability hurdles will be reduced to facilitate Chinaˇ¦s wish to be technologically self-reliant.  Which claim formats will be more acceptable to CNIPA, which invention areas will be more accepted, and whether works and inventions completed by AI can be patentable are some of the issues that need to be clarified in the next five years.

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China Emphasizes Better Caliber of Patent Submissions

The implementation of the new 5-year plan in China looks forward to enabling the development of high tech IP.  The Chinese government would like to see more inventions in the area of big data, biotechnology, new energy, new materials, high-end machinery, new energy vehicles, green environmental protection materials, aerospace and marine hardware.  One strongly emphasized idea is that ownership of high-value invention patents will be preferred compared to just ownership of invention patents.  To promote this initiative, new legislation including revisions to the ˇ§Measures on Regulating Patent Application Behaviorsˇ¨ will be drafted to prevent time-wasting irregular patent applications from clogging the system.  There are some concerns, however, that there might be some over-reach. The IP Owners Association stated that some IP strategies like filing multiple divisionals to obtain the optimal protection for each of the best inventive features in an application might be penalized under the new system.

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