TopTop

Shadow

Search

advanced search
search help

 

ipHandbook Blog

Your source for expert commentary on IP management issues.
Go to the blog

 

About

Editor-in-Chief,   Anatole Krattiger

Editorial Board

Concept Foundation

PIPRA

Fiocruz, Brazil

bioDevelopments-   Institute

Intellectual Property in China

Researched and compiled by Taylor Jones (student at Sandra Day O’Connor College of Law at Arizona State University), with Hong Shen, Attorney-At-Law at Long An Law Firm, Beijing and Anatole Krattiger. Last updated on 13 January 2010.

General Information about IP in China
Utility Patents
Trademarks
Plant Variety Protection
Trade secrets
Access to Genetic Resources / Biodiversity
Indigenous/Traditional Knowledge
Geographic Indications

If you are knowledgeable in the field of IP in China and have additional and/or updated information regarding IP in China, please add your comments at the end of this page or contact us at editors@ipHandbook.org. We will be glad to update this page with your help and inputs.

1.      General Information about IP in China

1. 1     Membership of International Treaties and Conventions related to IP

1.2     Treaties Signed Between U.S. and China related to IP

1.3          Main IP Offices

  • State Intellectual Property Office of P.R.C.

o   http://www.sipo.gov.cn/sipo_English/
o   Address: No. 6, Xitucheng Lu, Jimenqiao Haidian District, Beijing City 100088
o   Telephone: (010) 62 08 31 14
o   Note: click here for telephone numbers regarding various inquiries
o   Email: sipo1@sipo.gov.cn

  • Patent Office, State Intellectual Property Office of the People’s Republic of China

o   http://www.sipo.gov.cn
o   Address: 6, Xitucheng Lu, Jimenqiao Haidian District,100088 Beijing
o   Phone: (86 10) 62 08 31 14
o   Email: sipo@sipo.gov.cn

  • Trademark Office, State Administration for Industry and Commerce of the People’s Republic of China

o   http://www.ctmo.gov.cn
o   http://www.saic.gov.cn
o   Address: 8, Sanlihe Donglu, Xichengqu,100820 Beijing
o   Phone: (86 10) 68 01 04 63 / 68 01 34 47 / 68 03 22 33
o   Email: dfa@saic.gov.cn

  • National Copyright Administration of the P.R.C.

o   http://www.ncac.gov.cn/cms/html/205/index.html
o   Address: 85, Dongsi Nan Dajie, 100703 Beijing, China
o   Phone: (86 10) 65 12 78 69
o   The government established this administration in 1985.  The administration employs 50-100 attorneys who organize the drafting of  laws, policies,  and rules related to copyright.  They also oversee the implementation of those rules.
State Administration for Industry and Commerce of the People’s Republic of China
o   http://www.saic.gov.cn/english/index.html
o   Address: 8 Sanlihe Donglu, Xichengqu, Beijing, 100820, P. R. China
o   Phone: (86 10) 68 01 04 63/ 68 01 34 47
o   Email: dfa@saic.gov.cn

  • Intellectual Property Department of Hong Kong Special Administrative Region of China

o   http://www.info.gov.hk/ipd
o   Address: 24/F & 25/F Wu Chung House, 213 Queen’s Road East, Wanchai, Hong Kong (SAR)
o   Phone: (852) 2961 6888
o   Email: enquiry@ipd.gov.hk

  • Intellectual Property Department, Directorate of Economic Services, Macao Special Administrative Region Economic Services

o   Website: http://www.economia.gov.mo
o   Address: Administration and Finance Division, Rua Dr. Pedro José Lobo 1-3, Luso International Bank Building, 6/F, Macau (SAR)
o   Phone: (853) 2856 2622
o   Email: info@economia.gov.mo

  • China

o   China
o   10) 68 01 04 63/ 68 01 34 47
o    dfa@saic.gov.cn

1.4          Selected Law Firms

  • Beijing Arete Intellectual Property Agency

o    http://www.arete-ip.com/
o    Address: Suite 1201, Building 3, Zhubang2000 Business Center, NO.98 Ba Li Zhuang Xi Li, Chaoyang District, Beijing 100025, P. R. China
o    Phone: 0086-10-85869056, 85869057
o    E-mail: info@arete-ip.com

  • China Intellectual Property (H.K.) Limited

o   http://www.cip-hk.com/
o    Address: Level 3, Three Pacific Place
1 Queen’s Road East
Hong Kong
o    Phone: +852 8108 8856
o    E-mail: info-hk@cip-hk.com

  • Long An Law Firm

o    http://www.longanlaw.com
o    Address: Room 188, Beijing International Club, 21 Jianguomenwai Street,
o    Beijing 100020, P. R. China
o    Phone: +86-10-65325588
o    Cell phone: +86-13601188081
o    E-mail: shenhong@longanlaw.com

  • Lexgoal Intellectual Property Law Office

o    http://www.lexgoal.com
o    Address: No.503, Tower B, Fucheng Plaza, No. 98 Beilishilujia, Xicheng
o    Phone:  (00 86) 10 68 33 44 56/ 86 58 54 55
o    Email: mail@lexgoal.com

  • A complete list of firms specializing in Chinese IP can be found on IPMenu.com

o    http://www.ipmenu.com/ipfirms/China.htm

1.5          Background on the legal Environment

China began to pass and implement intellectual property laws in 1980’s.  China is, therefore, newer to IP regulation than many other countries.  Nonetheless, China has signed most international treaties regarding intellectual property.  Chinese national law dictates that once China becomes a member to an international treaty, the laws of the treaty may be cited before the People’s Court in decision making, even when they conflict with national law.  The national laws consist of the Trademark Law, the Patent Law, the Copyright law, and other policies made by various governmental agencies.

1.6          Other relevant resources

  • China (sponsored by the Chinese government)

o   Chinaipr.gov.cn/index.shtml

  • The World Intellectual Property Organization website includes a comprehensive and up-to-date list of all of China’s laws concerning intellectual property.

2.      Utility Patents

2.1          General Information

While its piracy rate remains high, China has made tremendous efforts to protect intellectual property since the early 1980’s.   Even though China’s first patent law was enacted in 1984, China has attempted to bring its IP laws in line with international standards in the last thirty years.

The Chinese government has taken steps to combat counterfeiting and piracy, and has subsequently lowered its piracy rates.  But counterfeiting and piracy still exist and are rampant for the following reasons.   First, criminal penalties for piracy are not strong enough. For example, in 2006, the Supreme Court and Supreme Procuratorate issued the “Interpretation by the Supreme People’s Court and the Supreme People’s Procuratorate on Several Issues of Concrete Application of Laws in Handling Criminal Cases of Infringing Intellectual Property.” This Judicial Interpretation lowered the threshold of criminal penalties and provided more specific criteria regarding sentencing for egregious intellectual property infringement.   Critics, however, argue that the threshold for criminal penalties for IP infringement should be even lower.

Second, the Chinese government faces the considerable challenge of educating its populace about intellectual property infringement.  The Ministry of Commerce (MOFCOM) of the People’s Republic of China sponsored the China Intellectual Property Rights Protection Website (IPR in English), which is currently the only comprehensive governmental portal in the field of IPR protection.  It has become an authoritative site to publicize China’s efforts and achievements in IPR protection and provided strong public opinion support for international IPR negotiation and public relation. Please find China’s IP protection information at http://www.chinaipr.gov.cn/. Finally, more impartial enforcement of laws will improve China’s IP enforcement.

The Chinese government offers the following four remedies for IPR infringement: Administrative protection, customs protection, civil law protection and criminal protection, please see http://www.chinaipr.gov.cn/Directions/index.shtml.

·         Patent Law

The Patent Law of the PRC (中华人民共和国专利法) was first enacted in 1984 and has been amended twice.  The second  amendment (Decision Implementation Patent Law, Decree (Amendment), 28/12/2002, No. 368) was enacted in 2002.  It extended patent rights to 20 years after the date of filing the application, a requirement of the WTO sponsored TRIPS agreement.  The most recent amendment was enacted on December 27, 2008. China, like most countries, grants a patent to the first person to correctly file the patent.

Since China is a signatory to the Paris Convention, a person who has applied for a patent in a signatory country to the Paris Convention may file a patent application in China.  If he files in a China within one year (for inventions and utility patents), or six months (for design patents) of the date he filed in another country, China will consider the patent filing date as the date the person filed in the previous country, not the date he filed in China.

·         Patent Searching

As a signatory to the Paris Cooperation Treaty, the Chinese government must conduct an international search before granting a patent.  Members of the public may search for patents on the State Intellectual Property Office of P. R. China Patent Trademark Office’s website: at http://www.sipo.gov.cn/sipo2008/ or

http://218.240.13.210/sipo_EN/search/tabSearch.do?method=init.

2.2 Distinct Information

·         Patentability

The Patent law authorizes the following types of patents: invention patents, utility model patents and design patents.  An invention patent exists from 20 years from the date of application.  Inventions and utility model applications must contain an abstract and a description, claims, and drawings (optional).  A design patent has a term of 10 years and must include a set of drawings or photos of the product sized from 3cm x 8cm to 15cm x 22cm and with no shaded lines and/or dotted lines. The utility model patent also has a term of 10 years.

The Chinese Patent Law (Articles 5 and 25) prohibits the issuing of patents for the following products:

  • Patents that are contrary to public interest or immoral
  • Scientific discoveries
  • Methods regarding mental activities
  • Animal and plant varieties
  • Methods for treatment of disease
  • Substances obtained by means of nuclear transformation

All patents must meet the following three criteria:

1.      The product must be novel, meaning, “before the filing date of the application, no identical invention or utility model has been publicly disclosed in domestic or foreign publications or has been publicly used or made known to the public by any other means in the country, nor has any other person previously filed with the Patent Office an application describing an identical invention or utility model that was recorded in patent application documents published after the said date of filing.” (Article 22).

2.      The product must be inventive, meaning, “compared with the technology existing before the filing date of the application, the invention has prominent and substantive distinguishing features and represents a marked improvement, or the utility model possesses substantive distinguishing features and represents an improvement.” (Article 22).

3.      The product must have practical Usage, meaning, “the invention or utility model can be made or used and can produce positive results” (Article 22).

Process for applying patents http://www.sipo.gov.cn/sipo_English/application/:

1.    Foreign applicants with no business office in China may file for a patent.  They must file in Chinese and must file their applications through registered patent agents.
2.   Applicants must submit an application with the State Intellectual Property Office in Beijing.
a.       The application must contain an instruction letter stating the type of application to be filed, the title of the invention/model/design, the applicant and inventor’s full name, address and nationality, and a request for a simultaneous substantive examination (optional)
b.      The applicant must submit a power of attorney and any certified priority documents.
3.   The Patent office conducts a preliminary examination to make sure it meets the formal requirements of the Patent Law.  If the office finds “no cause for rejection” at this stage, it will issue utility and design patents.
4.   Inventions
a.       The Patent office usually publishes invention patents 18 months after the application is filed unless the applicant requests an earlier publication.
b.      The patent office gives patentees three years from the date they applied to request a substantial examination.   Applicants must disclose prior art during the substantial evaluation process to prove their invention is inventive.
5.   If the product passes the required examinations, the patent office will issue a certificate.  The office will then register and publish the patent.  If the patent is rejected, the applicant can file for reexamination with a semi-independent Patent Reexamination Board (PRB).  Appeals from the PRB are heard in the civil Division of the People’s Court.

Protection Against Patent Infringement

  • Patent infringement includes the exploitation of a patent without permission by the patentee.  The Patent Law requires that parties first attempt to negotiate with each other.  If this fails, patentees may choose to use the administrative process for redress, or to file with the People’s Court under Article 57.
  • Should the patentee use the administrative process, the Patent Office is authorized to impose the following remedies: mediation (at the request of either party), injunctions, fines up to 50,000 RMB (6,000 USD), or compensatory damages (the amount of the illegal earnings).
  • The patentee may choose to file in civil court within two years of the alleged infringement.  The court may award damages “according to the losses suffered by the patentee or the profits gained by the infringer out of the infringement.”
  • Finally, the Patent Office can pass egregious cases onto the Public Security Beauro, which investigate and decide whether or not to prosecute the violator.

2.3          Licensing Restrictions

·         Compulsory Licenses

Chapter Six of the Patent Law of China gives the patent administration organ of the State Counsel the authority to issue compulsory licensing for the purpose of exploiting a patent not in use by the patent holder.

  • The administration may only grant compulsory licenses in the case of “national emergency or any extraordinary state of affairs occurs, or where the public interest so requires” (Article 49).
  • There is no requirement of time the patent has not been in use.
  • The person requesting the compulsory license must prove that he attempted to enter into a contract with the original patentee for the use of the patent (Article 51).
  • Any person who obtains a compulsory license does not have an exclusive right to the patent and may not license the patent to anyone else.
  • If the circumstances justifying the compulsory license cease to exist, the original patent holder may petition the Patent Office to revoke the compulsory license (Article 52).
  • Finally, grantee of the compulsory license must pay the patentee a reasonable exploitation fee. This amount is determined through negotiation of the parties involved. If the parties cannot come to an agreement, the Patent Office will decide the amount (Article 55).

·         Licenses of Right

The Patent Law gives patentees a right to give or sell the patent right to another person or company.   Article 63 states that it is not a patent infringement for any person to use the patented process, sell, or offer to sell the product with the “authorization of the patentee.”

Requirements for a license of right (Article 12):

I.       The original patent holder must enter into a written license contract for exploitation with the licensee.
a.       The application of the patent must be published before the patent holder may license out the patent.
II.     The licensee must pay the patentee a fee for the exploitation of the patent.
III.   The licensee may not authorize any entity or individual to exploit the contract that is not expressly referred to in the contract between the licensee and original patent holder.

3.      Trademarks

3.1          General Information

The Trademark Law of the People’s Republic of China was passed in 1982.  The newest amendment of the Trademark Law went into effect in 2002.  This purpose of this amendment was to bring China in compliance with TRIPS by extending trademark registration to certification marks, three-dimensional symbols, and collection marks.

China uses the “first-to-file” system as it does with patents and copyrights.  This system is different than the “first-to-use” system of the United States.   Trademarks must “be so distinctive as to be distinguishable,” and may not conflict with any previously registered trademarks.  The trademark may not violate any of the trademark laws.

3.2          Distinct Information

What types of marks are eligible for a trademark in China?

  • Collective trademarks, meaning “signs which are registered in the name of bodies, associations or other organizations to be used by the members thereof in their commercial activities to indicate their membership of the organizations” (Article 3, para. 2).
  • Certification trademarks, meaning, “signs which are controlled by organizations capable of supervising some goods or services and used by entities or individual persons outside the organization for their goods or services to certify the origin, material, mode of manufacture, quality or other characteristics of the goods or services” (Article 3, para. 4).
  • Service Trademarks, meaning, marks used by companies to designate a service they provide, for example, airline’s symbols.
  • Product Trademarks, meaning, marks affixed to a good that identify the good.

What types of marks are ineligible for a trademark in China?

  • Those similar or identical to national symbols or national landmarks, state names, national flags, flags of foreign countries, or flags of intergovernmental organizations
  • Those similar or identical to the symbols or names of the Red Cross or the Red Crescent
  • Those having a discriminatory nature against any nationality
  • Those having an exaggerated nature or that constitute false advertizing
  • Those “detrimental to socialist morals or customs, or having other unhealthy influences.”
  • Signs that include a product’s generic name or model
  • Signs directly referencing the quality, raw material, use, or quantity of the good.

Who can file a trademark application in China?

  • Citizens of China
  • Select foreign persons or companies
    • Persons from a signatory country to the Paris Convention
    • Persons from a signatory country to the Madrid Protocol may file for a trademark as of 1989.
    • Foreign persons or companies must use an approved Chinese agent to submit the application, but recent amendments allow foreign companies with businesses in China to register without the use of an agent.

How do I file a trademark application in China?

The US Bejing Embassy lists the steps necessary to file a trademark application in China.

  • The Trademark Law requires foreign companies with no established physical presence in China to use a state-appointed agent for register of their trademark.

o   Applicants should contact the Trademark office for a list of agents.
o   Applicants must pay agents to prepare and submit the application.  The price depends on how many marks are being designated and how many classes are being registered.

  • Complete and sign the application form and required power of attorney.
  • Determine what class of goods under the International Classification of Goods the product falls under.
  • The Chinese government has no public search engine for previously granted trademarks.  A trademark agent will perform a search on a government database in the Chinese language.
  • The trademark agent or applicant, if no agent is required, should then submit the application to the SAIC Trademark Office in Beijing.
  • The Trademark office will conduct a review to make sure that all application materials are included and properly submitted.
  • At this point, the Trademark Office either rejects the trademark or gives it preliminary approval.

o   If it is rejected, the applicant has 15 days to request a review by the Trademark Review and Arbitration Board.  This decision is appealable to the People’s Court.
o   If, after three months from the preliminary approval, the trademark is approved, and no person files an opposition to the trademark, the Trademark Office registers the trademark and publishes the application in the Trademark Gazette.

What rights does a trademark in China confer?

When a trademark is granted, the grantee has an exclusive right to exploit the trademark fora period of ten years, staring from the date of approval of the registration.  The owner may apply for renewal of the trademark in the six months prior to expiration of the trademark.

How do I protect my trademark rights in China?

The following acts constitute trademark infringement under Article 52 of the Trademark Law

  • use of a trademark that is identical with or similar to a registered trademark in respect of the identical or similar goods without the authorization from the trademark registrant;
  • making and/or knowingly selling counterfeits of trademarked goods;
  • to replace, without the consent of the trademark registrant, its or his registered trademark and market again the goods bearing the replaced trademark; or
  • causing prejudice to the exclusive right of another person to use a registered trademark.

Article 53 of the Trademark Act sets out three kinds of actions the trademark owner may take against the violators should another person use the trademark or a mark similar to the trademark in a way regarding the goods and services laid out in the trademark.

(1)   The trademark owner may file an administrative claim with the Trademark Office of the SAIC.  Shortly after the owner files a complaint with the Office, an investigation begins.   The Office may choose to impose the following remedies: injunctions, destruction of unlawful trademark representations, destruction of counterfeits of the trademarked goods, and/or confiscation of materials used in the unlawful activities.  The Office may issue fines up to three times the amount of the legal profit with a maximum fine of RMB100,000 (12,000.00 USD).  The Office may not, however, issue compensatory damages.

(2)   The trademark owner may file a civil action in the People’s Court for infringement.   In 2002, the Courts published “Several Questions on the Application of Law in Trial of Trademark Civil Dispute Cases.”  This document explains that complainants have two years after the alleged infringement to file suit.  The complaint must allege that the infringing act involved an identical or similar mark to the owner’s mark, that the infringing mark represented the owner’s registered trademark, and that this use violated the holder’s exclusive right to use the trademark.  Remedies include those allowed by the Trademark Office as well as compensatory damages.  The amount of damages may not exceed RMB500,000 (US $60,000).

(3)   The State may prosecute the infringer in criminal court.  The holder of the trademark may submit a complaint to the public security bureau, who may then recommend prosecution of the alleged violator.  Sentencing of a convicted violator ranges from two to seven years imprisonment, depending on the facts and circumstances of the case.

3.3          Licensing restrictions

Article 40 of the Trademark Law authorizes any trademark registrant to authorize another person to use the trademark.  The registrant must sign a trademark license contract which must include the name of the licensee and the origin of the goods.  The original trademark owner must supervise the quality of goods.  Also, the origin of the goods must be indicated on the goods the licensee makes or sells.  Finally, the trademark license contract must be submitted to the Trademark Office for record.

4.      Plant Variety Protection

The authoritative laws regarding plant variety protection in China are the Regulations of the People’s Republic of China on the Protection of New Varieties of Plants, as published in the PVP Gazette, Issue No. 85, October 1999.  The Regulations conform to the International Union for the Protection of New Varieties of Plants (UPOV) an intergovernmental organization with headquarters in Geneva.   China submitted the Regulations to the UPOV and became the 39th member of the Union April 23, 1999.

The Ministry of Agriculture is responsible for examining and granting new agricultural plant rights, whereas the State Forestry Administration is responsible for examining and granting new plant variety rights.  Since the enactment of the Regulations, the government has protected 78 new genres of plants and species of forest plants and 62 of agricultural plants.  MOA has accepted 4,695 applications for plant variety rights and has granted 1,417 applications, according to the Chinese Plant Variety Website.

Requirements for a new plant variety under the Regulations of the People’s Republic of China on the Protection of New Varieties of Plants,

  • A new plant variety is “a cultivated plant variety, or a developed one based on a discovered wild plant, which is new, distinct, uniform and stable, and whose denomination is adequately designated” (Art. 2).

o   Uniformity requires that “the plant variety in respect of which variety rights are applied for is uniform, subject to the variation that may be expected, in its relevant features or characteristics after propagation” ( Art. 16).
o   Stability requires “the plant variety in respect of which variety rights are applied for keeps characteristics unchanged after repeated propagation or at the end of a particular cycle of propagation” (Art. 17).
o   The plant’s demonization “must distinguishable from that for any other known plant variety of the same or similar botanical genus or species.  The denomination, after its registration, shall be the generic designation of the new plant variety in question” (Art. 18).

  • The plant must be novel, meaning, the propagating material of the new plant variety has not been sold prior to the filing of the application, or the material has not been for sale with the consent of the breeder for more than one year in China, or for four to six years in foreign territory, depending on the breed of plant (Art. 14).

The Application Process

Applicants for new plant variety protection may download an application online and submit the application online, though the website currently glitches when one clicks on the “submit application” tab on the home page.  All applications must be submitted in Chinese.   After submission, the authorities conduct a preliminary examination to ensure the application is complete and meets standards set out in the Regulations.  If it fails to pass this examination, the application is denied.

Surviving applications undergo a substantial examination of whether the plant variety is novel, has an adequate denomination, and whether the application is stable and uniform (Art. 27).  The examining authorities may deem it necessary to test the plant variety at a designated testing institution.  If the application is acceptable, it will be registered and published within three months.   If the application is denied, the applicant has three months to file a request with the Re-Examination Board for New Varieties of Plants.  If the application is again denied, the applicant has 15 days to file suit in the People’s Court.

What rights does a plant variety protection confer?

Should the government grant an application, the holder has an exclusive right in their protected variety, meaning, no other person may sell or produce the plant material for commercial purposes without the consent of the holder (Art. 6).  This right exists for 20 years after the application filing date in the case of vines, forest trees, fruit trees and ornamental plants and 15 years for all other plants.  However, others may produce the protected plant variety without paying the holder and without consent of the holder of the plant is exploited for breeding and other scientific research or when the variety is used for self-propagation and self-use by the farmers.

Should someone violate the holder’s right, the holder may file a complaint with the administrative departments of agriculture and forestry of the People’s Governments or directly file suit with the People’s Court (Art. 39).  Both offer the remedies of injunction and  compensatory damages.

Additional resources:

  • The Protection of New Varieties of Plants website has a searchable database with all protected plant species arranged by forest trees, ornamental plants, fruit trees, bamboo, and other plant varieties.
  • The Beijing Plant Variety Headquarters

o   http://www.cnpvp.net/root/dljg_view_en.aspx?type=org&&id=31
o   Address: No 320 Room Haidiankeji No 281 North Middle Road of the Forth Ring Road Haidian District Beijing,10083
o   Phone: 010-82384870

  • China is a member of the International Union for the Protection of New Varieties of Plants whose mission is “to provide and promote an effective system of plant variety protection, with the aim of encouraging the development of new varieties of plants, for the benefit of society.”  The UPOV website is located at http://www.upov.int/

5.      Trade secrets

The Law of the PRC Against Unfair Competition went into effect on December 1, 1993.  The law includes protection against infringement of trade secrets. The Law defines a trade secret, referred to as a “business secret,” as, “business information which is unknown by The public, which may create business interests or profit for its legal owners, and also is maintained secrecy by its legal owners” (Article 10, §3).

The following acts constitute infringement of a trade secret under Article 10, as summarized on the article Anti-Unfair Competition & Trade Secret featured on Chinese Intellectual Property Rights website.

(1)   obtaining business secrets from the owners of rights by stealing, promising of gain, resorting to coercion or other improper means;

(2)   disclosing, using, or allowing others to use business secrets of the owners of rights obtained by the means mentioned in the preceding item;

(3)   disclosing, using, or allowing others to use business secrets that he has obtained by breaking an engagement or disregarding the requirement of the owners of the rights to maintain the business secrets in confidence. Where a third party obtains, uses or discloses the business secrets of others when he obviously has or should have full awareness of the illegal acts mentioned in the preceding paragraph, he shall be deemed to have infringed the business secrets of others.

Do I have to register a trade secret in China?

No.  Because there is no formal process for registering trade secrets in China, the Chinese government puts heavy emphasis on business to ensure they protect their trade secrets on their own.  See the article Precautionary Measures for Protecting Business Secrets on the IPR in China website.

How are trade secrets protected in China?

A trade secret holder may either bring an administrative action or file in civil court.  The Unfair Competition Law gives Local Administration for Industry and Commerce Offices, which fall under the PRC’s State Administration for Industry and Commerce the power to investigate possible acts of unfair competition and impose penalties for such acts.   Administrative remedies include the following: revoking the business license of those engaging in unfair competition, imposing a fine, imposing an injunction against the illegal activity, and confiscating any income derived from the illegal activity.  The Trade Secret Regulations give the Local Administrations for Industry and Commerce Office the right to order the person engaging in unfair competition to return any materials related to the trade secret, or destroy such materials if the materials would reveal the trade secret to the public.  The administrative agency may not, however, award compensatory damages.

Should a trade secret owner seek compensatory damages, he must file a civil suit in the People’s Court.  The Interpretation of the Supreme People’s Court on Some Issues Concerning the Application of Law in the Trial of Civil Cases Involving Unfair Competition, adopted in 2006, determined that damages for infringement of trade secret shall be determined in the same way as damages for patent infringement are determined.  Thus, the court may award compensatory damages and injunctions.

The Supreme People’s Court and Supreme People’s Procuratorate issued an interpretation in 2004 that allows the Court to impose up to three years prison sentence for serious infringements of trade secrets.  If the infringement is found to be “exceptionally serious” (the false trademark earns RMB 2,500,000 for individuals and RMB 7,500,000 for corporations), then a defendant can be imprisoned up to seven years and fined.

Can trade secrets be licensed in China?

The Law of the PRC Against Unfair Competition does not address licensing of trade secrets whatsoever.   Since China allows the licensing of patents as of rights, and since the Law does not prohibit licensing, it is most likely that two parties may bargain at arms length and enter into a contract regarding a trade secret.

About the licensing of trade secrets, Contract Law of P.R. China http://www.fdi.gov.cn/pub/FDI_EN/Laws/law_en_info.jsp?docid=50943 has the relevant provisions. Chapter 18 in Contract Law is about Technology Contracts. In Section 3 Technology Transfer Contracts, Article 342 provides, “Technology transfer contracts include contracts for the assignment of patent, assignment of patent application right, transfer of technical secrets, and patent licensing. A technology transfer contract shall be in written form.”

Additional Resources

The Embassy of the United States in Beijing, China has complied an intellectual property rights toolkit that discusses how individuals and businesses may protect their intellectual property rights, as well as how to protect a copyright, patent, and trademark, and tradesecret.

6.      Access to Genetic Resources / Biodiversity

6.1          General Information

China has a massive land territory of 9.6 million square kilometers and has one of the most diversified ecosystems in the world, with rain forests, deserts, marine systems, alpine meadows, wetlands, and tundra.  China has an important genetic diversity stock and ranks in the top ten countries for genetic diversity of animals and plants, with 30,000 species of plants.   For additional information regarding China’s biodiversity, see Conservation International’s report, found here.

6.2          Distinct Information

China was the 64th member to sign the United Nations Convention on Biological Diversity at the Earth Summit in June 1992 at Rio de Janeiro.  The conventions attempts to deal with the following issues: conservation and sustainable use of biodiversity, sharing genetic research among the signatory countries in an equitable way, access to biotechnology for countries that provide traditional scientific knowledge or genetic information, public awareness and education.

China’s National Report on the Convention of Biological Diversity can be found here.   The Office of Biodiversity Conservation, part of the Department of Nature and Ecology Conservation, which is governed by the Ministry of Environmental Protection is responsible for the regulating biodiversity.

The Office of Biodiversity Conservation has constructed a Chinese Biodiversity Information System (CBIS) consisting of one central information system, five disciplinary division information systems, and more than thirty data source information systems.  For more information about the CBIS see the China Internet Information Center report on the subject.  Note: the main CBIS database is not yet accessible to the public.

Contact Information:

Division of Nature Reserves and Species Management, Department of Nature Conservation, State Environmental Protection Administration
115 Xizhimennei Nanxiaojie
Beijing 100035, China
Tel:  (86 10) 66111423
Email: chshbai@sina.com

7.      Indigenous/Traditional Knowledge

China is unique in its use of traditional medicine as it annually exports US $6 billion in herbal drugs.  A representative from India’s National Botanical Research Institute stated that China’s success comes from its application of modern technology to scientifically validate traditional and indigenous knowledge of herbs and drugs.

In 2003, India, Iran, South Korea, Malasyia, Thailand and China met to create the Asia-Pacific Traditional Medicine Network (APTMNET) (see the article “Asia-Pacific Nations Unite on Indigenous Knowledge,” as reported on the Science and Development Network).   Members agreed to start their own national website databases regarding indigenous and traditional herbs and drugs.  China’s national APTMET website reportedly has 10 databases of traditional Chinese medicine resources, patents information of traditional medicine, and a list of China’s laws regarding alternative medicine.  Though listings for the above Chinese website come up in a search, but cannot be accessed on all computer servers.

For more information regarding the internal regulation of Chinese Traditional Medicine, see the article, Regulatory Situation of Herbal Medicines: A worldwide Review from the Traditional Medicine Programme, part of the World Health Organization.

8.      Geographic Indications

A geographic indication is a name of a good or product that corresponds to the geographical location associated with the product.  China’s regulation of geographic indications comes mainly from two international treaties of which China is a signatory country, the Paris Convention, and the TRIPS Agreement, as well as China’s national Trademark Law.

Article 16 of the Trademark Law defines a geographic indication as, “signs that signify the place of origin of the goods in respect of which the signs are used, their specific quality, reputation or other features as mainly decided by the natural or cultural factors of the regions.” The law states that when a geographic indication misleads the public because the goods are not from the region indicated on the good, the indication will be prohibited from receiving a trademark.  All other geographic indications registered in good face are valid.

Articles 22 to 24 of the Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement also address geographic indications.  TRIPS prohibits “the use of any means in the designation or presentation of a good that indicates or suggests that the good in question originates in a geographical area other than the true place of origin in a manner which misleads the public as to the geographical origin of the good.”  Interested parties may sue a company that names a product after a geographic location from which the product did not originate.  This portion of TRIPS is in harmony with China’s Trademark Law.

The use of a geographic indication could also violate the TRIPS prohibition of unfair competition under the Paris Convention, which treats geographic indications as industrial property part 1(2).  Unfair competition includes “all acts of such a nature as to create confusion by any means whatever with the establishment, the goods, or the industrial or commercial activities, of a competitor. …. false allegations in the course of trade of such a nature as to discredit the establishment, the goods, or the industrial or commercial activities, of a competitor” and “indications or allegations the use of which in the course of trade is liable to mislead the public as to the nature, the manufacturing process, the characteristics, the suitability for their purpose, or the quantity, of the goods” (art 10bis (3)).

The information contained on this page is for reference purposes only and does not constitute legal advice. Contact local legal counsel for a determination of the best course of action for your case.


See the Criminal Law of China Section 7 from Article 213 to Article 220, which provides the criminal liabilities to IP infringement (http://www.fdi.gov.cn/pub/FDI_EN/Laws/law_en_info.jsp?docid=50917 ) .

(http://www.chinaipr.gov.cn/laws/laws/others/232859.shtml ).