SIPO’s good intentions

The Chinese State Intellectual Property Office (SIPO) has issued invitation for comments on the next revision of the Chinese Patent Law. Why is this important for your business? Well hopefully, because it means it will soon become easier to protect your patents and therefore your innovations in China.

The revisions proposed by SIPO focus on resolving difficulties in enforcing patent rights in China. SIPO has openly commented that currently it is difficult for the patentee to enforce their patent rights in China. The difficulties are due to the following two main factors:

–       The first factor is the unattractiveness of compensation for infringement.

–       The second factor is the difficulties in providing evidence, particularly when the defendant does notcooperate or even forges or destroys evidence.

I for one am happy that SIPO has openly admitted these issues, now the business of dealing with them can start!

Let  us take a closer look at the first factor, SIPO’s proposed amendments introduce the US ‘triple damage’ concept – literally, the tripling of the amount of damages an infringer should pay to the patentee – for wilful infringement. It is not yet clear how wilful infringement will be determined, but it is suspected that China would reference the US mechanism. That is, if the defendant could provide ‘a non-infringement opinion’ – a statement from a patent attorney saying that the patent was not infringed – BEFORE infringement is alleged, then it is less likely to be deemed ‘wilful infringement’. In other words, if someone knowingly infringes your patent and you can show this, the amount of damages you could get from them would be tripled and greater than ever before under Chinese law.

To deal with the second factor, SIPO has proposed to impose compulsory measures to be carried out by the Chinese People’s Courts in the event of the defendant not cooperating, forging or destroying evidence. This move is a result of complaints from patentees that have experienced the above kind of negative behaviour from the defendant when enforcing their patents in China.

This is a step in the right direction; however, it is still unclear as to what the specific compulsory measures are. Furthermore, even if such compulsory measures could be successfully implemented, evidence that may be important to the patentee’s case would not be available during the case. As such, opinions have been submitted to SIPO that in these situations, the defendant should be forced to accept the patentee’s presented evidence. This would be good news if you’re a patent rights holder; if the infringer is withholding evidence (their accounts for example) you would be able to provide the evidence you have uncovered and force them to accept it.

If these revisions are implemented, both gathering evidence and obtaining a satisfactory amount of damages, will become easier for (European) businesses; this will also make it far less attractive to initiate infringing actions in the first place. All in all, these are encouraging movements for patent holders; a positive reassessment of your IP enforcement strategy might soon be in order!

SIPO’s proposed revisions also greatly enhance the function of administrative enforcement, which is carried out by local officials of SIPO. This topic has raised substantial controversy and will be discussed in the next blog article.

In the meantime let us know your thoughts on this article!

 

Working for Tee & Howe, Dr. Toby Mak is a registered Chinese Patent Attorney and has a PhD degree in Chemistry. Toby has over 10 years of experience in the patents and designs industry, with substantial exposure to the handling of both contentious and non-contentious matters. Toby can be contacted at toby.mak@teehowe.com

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