I. Laws and Regulations
The State Administration for Market Regulation and other five national government agencies, namely the Ministry of Public Security, Ministry of Agriculture and Rural Affairs, General Administration of Customs, National Copyright Administration of China and National Intellectual Property Administration, jointly released the Implementation Measures on Enhancing IPR Law Enforcement in the Area of Online Shopping and Foreign Trade (hereinafter referred to as “the Implementation Measures”) to enhance inter-departmental coordination, further improve the IPR law enforcement, increase the efforts on IPR infringement crackdown and safeguard the legitimate rights and interests of right holders and the market order of fair competition. The Implementation Measures adheres to the problem-oriented approach and introduces various measures, taking into consideration IPR infringements in areas of online shopping and foreign trade characterized by online-offline, cross-regional and chain-based operation.
China National Intellectual Property Administration (CNIPA) recently released the Guideline on Examination and Enforcement of Integrated Circuit Layout Design (tentative) (hereinafter referred to as “the Guideline”), which consists of four parts, namely, examination, review and cancellation, administrative law enforcement as well as licensing and pledge. Since 2011 when the Regulations on Protection of Integrated Circuit Layout Design came into force, applications of IC layout designs keep rapid increase, so does the number of cancellation cases concluded. Up to now, pledge contracts registered with CNIPA totaled 6, involving 50 items of IC layout designs.
Chinese political advisors gathered on May 13 to discuss the revision of the country's copyright law during a biweekly session in Beijing. Wang Yang, a member of the Standing Committee of the Political Bureau of the Communist Party of China Central Committee and chairman of the CPPCC National Committee, noted that copyright law was the pillar of legislations on intellectual property, and significant to the creation and distribution of cultural and intellectual products, improving Chinese people's literacy in science and culture, and building the country into a global leader in innovation. He called for adherence to a people-oriented philosophy of development to properly deal with the relationship between the creation, protection and utilization of copyright, and establishing a copyright system with Chinese characteristics in the new era.
China is stepping up efforts to revise its regulation on new plant varieties, affording them greater protection. It was announced at an event celebrating the 20th anniversary of the country's entry into the International Union for the Protection of New Varieties of Plants. The event was held by the Ministry of Agriculture and Rural Affairs, the National Forestry and Grassland Administration, and China National Intellectual Property Administration (CNIPA). Over the past two decades, some 26,000 applications for new plant varieties were filed in China, enabling the country to rank top in the world for them in 2018.
Chinese intellectual property professionals applauded the country's ongoing negotiation to join the Hague Agreement regarding industrial design, which is seen as a crucial step to show China's commitment to intellectual property protection. "Joining the international agreement means our protection of patents should be further intensified or, more precisely, it means the length of the time that we protect industrial design patents must be extended," Ma Yide, an IP professor from Zhongnan University of Economics and Law, said on May 26.
As one of the important targets of IP protection in China, human genetic resources and the management thereof have attracted much attention. The Regulations of the People's Republic of China on the Management of Human Genetic Resources were officially announced and would be in effect from July 1. The "Regulations" clearly provides for the use and external supply of human genetic resources. According to the "Regulations", if the achievements are made by using China's human genetic resources for international cooperative scientific research, the patent application of which shall be jointly filed by the participating parties and the eventual patent rights shall be shared by them.
II. Government Policies
On April 24, State Councilor Wang Yong attended the main event of national IP publicity week and delivered remarks. He stressed that the thought of Xi Jinping on socialism with Chinese characteristics in a new era should be followed as the guidance and the implementation of IPR strategy should be deepened to fully enhance IPR protection, continuously optimize the innovation and business environment, release the vitality of innovation and creativity to the utmost and vigorously support the high-quality economic development. Wang pointed out that the accelerated establishment of a modernized economic system and the promotion of all-round opening-up raised higher and new requirements for the IPR work. It is required to accelerate the construction of an IPR protection system featuring strict, general, fast and equal IPR protection, improve the punitive damages system of IPR infringement, severely punish the illegal acts of IPR infringement and treat equally the domestic and foreign enterprises. It is of importance to continuously raise the quality and efficiency of reexamination, enhance the operational service system, promote the creation and utilization of IPRs and develop the IPR-intensive industries. The IPR international cooperation is to be deepened to advance the building of inclusive, balanced and effective international IPR rules.
According to the Report on Assessment of the Ten-Year Implementation of National Intellectual Property Strategy Outline, China has laid a solid foundation toward an IPR-powered country. From 2007 to 2016, China has participated in the setting of 1,705 international standards. Since the implementation of the outline in 2008, China has achieved remarkable IPR results. IPR is playing an increasingly important role in stimulating innovation and entrepreneurship, creating a sound business environment and supporting high-quality development of economy and promoting social advancement and cultural prosperity, among other things. Domestic valid invention patent grants have increased to 1,356,000 in 2017 from 84,000 in 2007; valid trademarks have increased to 14,920,000 from 2,353,000; copyright registrations have increased to 2,748,000 from 159,000; and new plant varieties, geographical indications and layout-designs of integrated circuits also welcomed significant increase.
On April 30, China (Guangdong) IPR Protection Center was officially unveiled. The center will provide fast coordinative protection for strategic emerging industries in Guangdong Province, which will first serve new-generation information technology and biological industries. Among others, the center aims to provide support to local key industries, establish a fast and coordinative IPR services system, realize fast pre-examination, rights identification and operation guidance and promote IPR creation, utilization, protection, management and service as a complete chain. Up to now, a total of 1,614 enterprises and public institutions have registered with the center, including Huawei, Tencent, Guangzhou Phar. Holdings and South China Sea Institute of Oceanology, Chinese Academy of Sciences.
The Ministry of Industry and Information Technology has issued commercial licenses for 5G on June 6, according to China Central Television. Four major telecom carriers -- China Telecom, China Mobile, China Unicom and China Broadcasting Network -- received the first batch of four 5G commercial licenses, said the report. China's big three telecom carriers are forecast to spend 900 billion to 1.5 trillion yuan ($134 billion to $223 billion) in total on 5G network construction from 2020 to 2025, according to a report from the China Academy of Information and Communications Technology.
The National Development and Reform Commission, the country's top economic planner, is working on a national technological security management system that will be implemented soon. The 21st Century Business Herald comments: The introduction of such a system is an important, if not overdue, measure to strengthen the country's protection of its key technologies according to the State Security Law. Establishing such a system, a conventional international practice, can effectively reduce national security risks, and also meets the needs of China's economic and social development.
The general offices of the Communist Party of China Central Committee and the State Council have jointly released a circular on improving the system of administrative adjudication and strengthening related work. According to the circular, administrative adjudication refers to the act of administrative organs which adjudicate the civil disputes that are closely related to administration. More efforts should be made to improve the administrative adjudication of disputes in areas such as the ownership of natural resources, infringement of intellectual property rights and government procurement, according to the circular.
III. Law Enforcement
In 2017, the Ministry of Public Security (MPS) and the State Tobacco Monopoly Administration jointly established an Office of Study on Tobacco-related Crimes to carry out joint data-based campaign. Over the past two years, the office has collected 110 million pieces of related data, developed three models of intelligent analysis, discovered over 1,000 pieces of clues concerning cross-regional cases and uncovered a total of 2,929 cases, forming a working prospect featuring joint coordination and resources sharing between different departments. So far, the MPS has established cooperation on criminal IPR law enforcement with 35 international organizations, national and regional law enforcement institutions. Since 2015, the MPS has worked with overseas law enforcement agencies in conducting more than 40 investigations, carried out 18 law enforcement actions and a series of joint case-uncovering actions with INTERPOL, which further improve the effect of crackdown.
According to the statistics released by the General Administration of Customs of China (GACC) on April 23, the customs nationwide took IPR protection actions 49,700 times in 2018, detaining 47,200 shipments of IPR infringing goods inbound and outbound, up 146.03% year on year and involving 24.8002 million items of goods. In 2018, a great quantity of goods suspected of infringing upon IPRs of various kinds, including trademarks, patents, copyrights, Olympic logos and World Exposition logos, were seized by customs. Trademark infringing goods accounted for 96.7% of the total detained goods. 619,800 patent-infringing items of goods were detained, valued at 61.7018 million yuan, up by 89.77% and 60.48% respectively year on year. In 2018, the customs nationwide detained 1,745 shipments of IPR infringing goods at freight channel, among which 1,692 shipments were ex officio detained by customs, accounting for 96.96% of the total shipments. 19.8027 million IPR infringing items were detained, accounting for 99.07% of the total goods; 53 shipments of IPR infringing goods were detained upon request by right holders, accounting for 3.04% of total and involving over 4.7137 million items of IPR infringing goods, accounting for 0.93% of the total. The customs nationwide detained 45,500 shipments of IPR infringing goods at postal channel, up 156.33% year on year and involving 283,700 items. The number of items in each shipment fell from 49.7 in 2017 to 6.23 in 2018, corresponding to the growing trend where IPR infringing goods were sold in small parcels.
Since 2017, 19 IPR courts, as approved by the Supreme People’s Court (SPC), have been set up in 17 provinces. The latest one in Haikou was approved by SPC in April 2019, according to Lin Guanghai, Vice President of the Civil Adjudication No.3 of SPC (IPR Division). “Specialized IPR courts are internal bodies of local intermediate people’s courts rather than independent courts. However, such courts have jurisdiction over cross-regional cases within the province, which will help unify trial standards in technical cases and create world-class business environment,” said Lin. On January 1, 2019, IPR Court of SPC was set up as a standing adjudication body, responsible for the trial of civil and administrative IPR cases of second instance with strong technical background such as patents.
The State Administration for Market Regulation (SAMR) and China National Intellectual Property Administration (CNIPA) jointly released the 2019 Plan of “Iron Fist” Action on IPR Law Enforcement to crack down on trademark and patent infringements. It is proposed in the Plan that more efforts are to be made on investigation and handling of illegal acts related to the trademark infringement, patent counterfeiting, GI and distinctive marks infringement and consolidating the law enforcement in the fields of e-commerce, key goods trading markets and foreign investment, in a bid to increase the law-violation costs, treat both domestic and foreign enterprises equally and protect the IPRs of holders home and abroad in a fair manner. It is also requested in the Plan that the law enforcement should be improved at local areas in terms of its timeliness, professionality, systematicity, participation and deterrence, by specifically enhancing the organization and leadership, innovating law enforcement measures, and pressing ahead with strict, regulation-based, fair and civilized law enforcement.
A Beijing court fined a Chinese wine dealer for infringing the trademark rights of famed wine brand Lafite. The Beijing Intellectual Property Rights Court made the ruling on the trademark infringement lawsuit brought by Chateau Lafite Rothschild. The court ruled that Guangdong Shantou Fajiala Trade Co, Ltd violated Lafite's rights to the trademark and orders it to pay two million yuan (about 297,000 U.S. dollars) in damages to the company and other expenses. Laofanke, a smaller company that distributes a wide range of retail products other than wine, does not need to pay the damages, the court ruled.
China National Intellectual Property Administration (CNIPA) announced the launching of Operation Blue Sky, a two-year-long campaign targeting illegal acts of the patent attorney profession, such as doing business without a license, representing abnormal patent applications, registering qualification for work without actual work, and soliciting in underhanded ways. Patent firms will be randomly checked by randomly dispatched enforcement officers and results of the checks will be released on a single platform. Those suspected of criminal acts will be transferred to the police.
Cooperative customs mechanisms have been established in more than 130 countries and regions, with more than 190 agreements signed, including with major trade partners such as the United States, the European Union, Russia, Japan and South Korea, said Jin Hai, deputy director for general affairs at the General Administration of Customs. To more effectively fight cross-border violations of intellectual property rights, Chinese customs will improve information sharing and exchanges of data with other countries and regions.
State Councilor Wang Yong urged more efforts on cracking down upon intellectual property rights (IPR) infringements and counterfeit goods to protect the legitimate rights and interests of consumers and market entities. Wang urged punishment on those who produce counterfeit goods and who are involved in repeated IPR infringements, adding that the cost of violating laws should be raised, and the protection of IPR should be reinforced. Efforts should also be made to improve regulation methods and promote cross-border law enforcement cooperation so as to make great achievements on cracking down upon IPR infringements and counterfeits, Wang added.
IV. Events and Campaigns
On April 22, the Supreme People’s Court (SPC) held a press conference for the celebration of 2019 IP Publicity Week. SPC released the white paper named Intellectual Property Protection by Chinese Courts in 2018 (both in Chinese and English) and announced ten major cases and fifty typical cases of IPR judicial protection by Chinese courts in 2018. The number of IPR-related cases nationwide increased by a large margin in 2018. In particular, new civil, administrative and criminal cases accepted by the national courts totaled 334,951, up 41.19% over 2017. The administrative and civil IP cases of first instance increased by 53.57% and 40.97% respectively.
On April 25, 2019, the opening ceremony of the Technology and Innovation Support Center (TISC) of the World Intellectual Property Office (WIPO) and the signing ceremony for a talent training project were held in Nanjing University of Science and Technology (NUST). TISC is a specialized agency set up and vigorously promoted by the United Nations. Seven qualifiers, including NUST, are selected out as the first batch of pilot units.
On the morning of May 25, 2019, the 15th China (Wuxi) International Design Expo opened in Wuxi, “the city of design” in China. Themed as “New Design, New Wisdom, New Life”, the Design Expo brought together well-known enterprises, design institutions and trade associations at home and abroad and mainly exhibited the latest achievements in the design field. 134 domestic and foreign exhibitors and over 60 international guests attended the Design Expo.
The 22nd Meeting of IP5 Deputy Heads of Office was held in Inchon, South Korea on June 11. During the meeting, the deputy heads of IP5 listened to work reports of the five offices for the past year on classification, global files, work sharing, improvement of IP5 cooperation mechanism and procedures, emerging technology and the Patent Harmonisation Experts Panel, discussed on cooperation of the five countries with regional re-examination and invalidation institutions, and exchanged views on the influence of and preparation for emerging technology/artificial intelligence and the future of IP5 cooperation, two strategic issues that may be discussed on the Meeting of IP5 Heads of Office and the IP5 Industry Meeting.
The protection of intellectual property rights (IPR) in the digital economy requires the collaboration of all stakeholders across borders, Chinese and British speakers agreed at Alibaba's Business and IPR Protection Summit. "We are committed to maintaining a robust international IP (intellectual property) network. We greatly value the close collaboration that we enjoy with the China IP offices and our e-commerce partner Alibaba, with which we are co-hosting this event," said Ros Lynch, copyright and IP enforcement director at the Intellectual Property Office of the United Kingdom (UKIPO).
Tao Kaiyuan, vice-president of the Supreme People's Court (SPC) of China met with Erik Wilbers, director of the Arbitration and Mediation Center of the World Intellectual Property Organization (WIPO) on June 6 in Beijing. Tao welcomed Wilbers and his delegation. She outlined the cooperative history between the SPC and WIPO, adding that they have maintained sound cooperation since the signing of an MoU in 2017 on judicial cooperation and exchanges. It's critical to explore a diverse dispute settlement mechanism for building a modern society management system and China is always committed to it, said Tao. The SPC is expected to strengthen cooperation with the WIPO in many areas including IP information sharing, case studies, personnel exchanges and organization of international forums, said Tao, adding that she hopes the WIPO's alternative dispute resolution will spread in China. Wilbers appreciated the meeting and spoke highly of the cooperation between China's courts and the WIPO.A symposium was held just before the meeting to discuss the application of WIPO's mediation in IP litigation, attended by the SPC officials, representatives of some local courts, Wilbers and his delegation. Wilbers said he learned a lot in the symposium and that China's diverse disputes settlement mechanism impressed him.
V. Data and Statistics
China made progress in intellectual property last year, with growing comprehensive development and in particular, improved application of intellectual property, said a report by China's National Intellectual Property Administration. The report showed the country's IP comprehensive development index reached 257.4 in 2018, an increase of 17.9 percent from the previous year and ranking the eighth out of 40 major IP powers, up from 13th in 2017. The report also pointed out existing problems in the country's IP development, including a lack of high-value patents, imbalanced regional development and a tough external business environment.
On May 15, the Office of the National Leading Group on Fight against IPR Infringement and Counterfeiting released the 2018 Report on the Latest Development of IPR Protection and Business Environment in China, highlighting China's new development and progress in terms of continuously deepening reform, protecting IPR and optimizing business environment. China edged into top 20 for the first time at Global Innovation Index 2018 rankings as showed by Global Innovation Index 2018 by the World Intellectual Property Organization (WIPO). World Bank also marked China 3rd among the Economies with the Most Notable Improvement and top the East Asia and Pacific region in Doing Business 2019.
Environment-related patent applications in China have surged over the past decade. The country ranked first globally in patent filings between 2008 and 2017. The annual average growth in patent filings from China stood at 34.15 percent in the physical pollution control sector and 31.74 percent in the segment of soil and underground water remediation. In other technological sectors of air pollution prevention, environmental monitoring, water pollution control, and solid waste treatment and disposal, the average annual growth in Chinese patent filings surpassed 24 percent.
A Chinese publisher has launched an artificial intelligence (AI) translation system for patent documents, claiming more than 90 percent accuracy, China Daily reported. It can translate Chinese into English, Japanese and German and vice versa, according to the Beijing-based Intellectual Property Publishing House. Its accuracy in two-way translation between Chinese and Japanese has reached 95 percent, the publisher said. It took more than a decade for the publishing house to develop the system, which adopts the natural language processing algorithms and a computational model to process and optimize the specific terminology and sentence pattern in patent documents. The application of such systems presents a huge market because it can help researchers and patent reviewers save time and money, said the report.
The United Nations Conference on Trade and Development (UNCTAD) said on May 29 that one of its recent reports on the creative economy shows that China’s trade in creative goods and services is outstripping those of other countries and regions. This makes it the “driving force behind a prosperous creative economy over the past 15 years”, said UNCTAD in a statement. The report tracks the country’s performance in the trade of creative goods and services between 2002 and 2015 and finds that China is the biggest single exporter and importer. UNCTAD said that China’s trade in creative goods between 2002 and 2015 grew exponentially, at an annual rate of 14 percent.
0n June 2, the State Council Information Office released a white paper, titled China's Position on the China-US Economic and Trade Consultations, elaborating the China-US economic and trade consultations and stating China's position. The Paper contains about 8,300 words and is composed of three parts. According to the paper, economic and trade friction proved by the US damages the interests of both countries and of the wider world; US has backtracked on its commitments in the China-US economic and trade consultations and China is committed to credible consultations based on equality and mutual benefit. China encourages and respects voluntary technical cooperation between Chinese and foreign firms based on market principles. It strongly opposes forced technology transfer and takes resolute action against IP infringement. Accusations against China of forced technology transfer are baseless and untenable, the White Paper stressed.
According to the Statistical Communique of National Economy and Social Development 2018 released by the National Bureau of Statistics, the R&D expenditures recorded 1.9657 trillion yuan, increasing by 11.6% over 2017 and surpassing the average level of 15 EU countries. In 2018, China accepted 55,000 international patent applications filed under PCT. As of the end of 2018, China has owned 8,381,000 valid patents, with 10,000 population holding 11.5 invention patents. In 2018, technology contracts signed totaled 412,000, valued 1.7697 trillion yuan and up 31.8% over 2017.
China has been stepping up its fight against intellectual property right (IPR) infringement, according to the country's top procuratorate at a press conference. Procuratorates across China approved the arrest of 5,627 suspects involved in 3,306 IPR infringement cases in 2018, a year-on-year increase of 31.7 percent, according to the Supreme People's Procuratorate (SPP). A total of 8,325 suspects involved in 4,458 such cases were prosecuted last year, 22.3 percent more than in 2017.
China has made marked progress in intellectual property development, with its international ranking improving from 13th position in 2017 to No 8 last year among 40 major countries by IP composite index, according to a recent report. The annual report was released by the Intellectual Property Development & Research Center, affiliated with the National Intellectual Property Administration. It created two IP development assessment systems - one domestic and one international - composed of an array of indexes at different levels.