OEM Manufacturing and Trademark Infringement in China

“Made in China 2025” policy forced Supreme People’s Court to Change Direction on OEM Manufacturing Exception to Trademark Infringement

Introduction

For years Western companies have relied on Chinese factories to manufacture their products at low cost and export them back to other markets to be sold with high margin of profit. This is normally referred to as OEM manufacturing, where OEM stands for Original Equipment Manufacturer. This was for decades the main business model for China’s industrial and economic development and it earned China the nickname of “World’s Factory”. In recent years, things have changed. China is now a market with hundreds of millions of consumers buying foreign products online or traveling and shopping abroad, while cheap manufacturing is moving elsewhere to be replaced by High-Tech businesses. In this evolving socio-economic landscape, OEM manufacturing has lost its prior standing in the government policies. China is now projected towards a further integration of its economy into the global capital system. Aside from the already renown “Belt & Road” initiative, China has recently launched “Made in China 2025”, a new grand plan to showcase China’s own brands and industries to the world and move away from being the world’s “factory” to an economy producing higher value products and services.

This policy change embodied in the “Made in China 2025” program, is also reflected in the recent legal developments concerning the relation between OEM manufacturing and trademark infringement. This article will explore the evolution of such relation and will comment on the most recent leading decision on this topic issued by the Supreme People’s Court this October 2019.

Continue reading “OEM Manufacturing and Trademark Infringement in China” »

Update of Geographical Indications Protection in China

This is the PPT by Guizeng (Wayne) Liu, as a speaker of the panel, CSA25 Geographical Indications around the World at the 141st INTA Annual Meeting in Boston, USA, May 18-22, 2019. Moderator: James Tumbridge, United Kingdom, and Speakers, Guizeng (Wayne) Liu, China; Shawna Morris, USA; Andrew Papadopoulos, South Africa; Elio De Tulio, Italy and Julian Vadillo, Mexico.

In China, GIs bear significance to advance the social economy development, promote trade and investment and protect cultural heritage.

Registration and Administration of GI as Certification Mark and/or Collective Mark by China Trademark Office (CTMO) under China National Intellectual Property Administration (CNIPA) of the State Administration for Market Regulation (SAMR)The Accumulative number of filings of trademarks is over 36.7 million, the number of registrations is over 24.1 millions, and effective number of existing registrations is nearly 21.2 millions. Almost every 5.3 entities in the market own one registered trademark.

Continue reading “Update of Geographical Indications Protection in China” »

Time limit missed in China? Request for restoration at CNIPA

If you missed the time limits according to patents in China, there are two options for restoring the rights before the Chinese Patent and Trademark Office (CNIPA). The procedure in China is similar to the restoration of rights under EPC rules, however, without remedy as Further processing.

Time limit missed – restoration in Europe

Whoever misses the time limits for the rights in patent protection can request the restoration of rights according to international regulations. The request for restoration pursuant to Rule 136 EPC(European Patent Convention) must be filed within two months of the removal of the cause of non-compliance with the period, but at the latest within one year of expiry of the unobserved time limit.

In any case, the request for restoration must be well-founded, which means “all due care required by the circumstances” have been taken, see Article 122(1) EPC.

Chinese patent law also offers such restoration of rights after failure to comply with the time limits. However, it is particularly noted that there is no such remedy as Further processing (under Rule 135 EPC) before the CNIPA.

Before the Chinese Patent and Trademark Office (CNIPA), two possibilities can be used for Re-establishment of rights for the invention patent, utility models and designs (i.e., these rules do not apply to the Chinese trademarks).

Continue reading “Time limit missed in China? Request for restoration at CNIPA” »

Support for patentees from the Chinese Supreme Court?

The CNIPA’s decisions I am talking about are re-examination decisions (against a rejection decision of a patent application), and invalidation decisions (against a request for invalidation of a granted patent. The appeals against these CNIPA’s decision can only be filed in Beijing, as the CNIPA is always the defendant in such appeals. At present, only the Beijing IP Court will accept such appeals. A further appeal against the Beijing IP Court’s decision used to be filed at the Beijing High Court. However, from 1 January 2019, all appeals against the Beijing IP Court’s decisions on patent and utility model cases will be handled by the IP Tribunal of the China Supreme People’s Court (the CSPC) directly.

Such appeals had low, if not very low, reversal rate statistically. According to data kindly provided by Darts-IP:

  • The reversal rate of the invalidation decisions increased every year from 2014 to 2017, from about 10% to 15%; and
  • The reversal rate of the re-examination decisions increased every year from 2014 to 2017, from about 7% to 10%.

Together with the change of handling all appeals on patent and utility model cases by the IP Tribunal of the CSPC directly, the CSPC also now has a set of stipulations to handle such appeals, bring the Chinese patent re-examination/invalidation system closer to the international norm. Some major points are as below:

  • More open interpretation of sufficiency (than the CNIPA).
  • More open view on generalization (than the CNIPA).
  • Relevant technical field should refer to the lowest level in the international patent classification.
  • What a patentee says during infringement proceedings would be considered at invalidation.

This article was written by our IP Expert Toby Mak and originally published in the CIPA Journal. To access the full article, please click here.

DOMAIN NAME REGISTRATION AND PROTECTION IN CHINA

With the development and usage of World Wide Web, mobile internet and mobile phones, the Chinese E-Commerce market got an enormous growth. According to “Chinese E-Commerce Market Data Monitoring Report 2016”, the E-Commerce transaction amount reached 22.97 trillion RMB in 2016.

For both Chinese and international enterprises, to join this market is a trend but also a necessity. As one of the mainly path for entering E-Commerce market, the meaning of domain name registration is therefore getting more and more important.

Worldwide exist 330 million registered domain names currently. In China is the number in the amount of 50 million. China is becoming the second largest domain name market in the world. This market is interesting for both domain name service providers and enterprises as domain user. The foreign providers need to know the policy and rules for running a domain name business in China. And how to register and protect domain name in China is now an important issue that the enterprises should pay attention to. Continue reading “DOMAIN NAME REGISTRATION AND PROTECTION IN CHINA” »