Your source for expert commentary on IP management issues.
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
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. 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
o Website: http://www.economia.gov.mo
1.4 Selected Law Firms
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
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
2.2 Distinct Information
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:
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.
Protection Against Patent Infringement
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.
· 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.
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?
What types of marks are ineligible for a trademark in China?
Who can file a trademark application in China?
How do I file a trademark application in China?
The US Bejing Embassy lists the steps necessary to file a trademark application in China.
o Applicants should contact the Trademark office for a list of agents.
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.
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
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.
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,
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).
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.
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.”
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.
6.1 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.
Division of Nature Reserves and Species Management, Department of Nature Conservation, State Environmental Protection Administration
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.
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 ) .