This country-specific Q&A provides an overview to intellectual property law in China.
It will cover intellectual property rights, licensing, enforcement, establishing infringement or liability, and challenges to intellectual property.
This Q&A is part of the global guide to Intellectual Property. For a full list of jurisdictional Q&As visit http://www.inhouselawyer.co.uk/index.php/practice-areas/intellectual-property/
What different types of intellectual property rights exist to protect: (a) Inventions (e.g. patents, supplementary protection certificates, rights in trade secrets, confidential information and/or know-how); (b) Brands (e.g. trade marks, cause of action in passing off, rights to prevent unfair competition, association marks, certification marks, hallmarks, designations of origin, geographical indications, traditional speciality guarantees); (c) Other creations, technology and proprietary interests (e.g. copyright, design rights, semiconductor topography rights, plant varieties, database rights, rights in trade secrets, confidential information and/or know-how).
(a) Inventions (e.g. patents, supplementary protection certificates, rights in trade secrets, confidential information and/or know-how);
Invention patents, utility model patents, rights in confidential information and know-how as trade secrets.
(b) Brands (e.g. trade marks, cause of action in passing off, rights to prevent unfair competition, association marks, certification marks, hallmarks, designations of origin, geographical indications, traditional speciality guarantees);
Trademarks and certain brand-related actions pursuant to the Anti-Unfair Competition Law.
(c) Other creations, technology and proprietary interests (e.g. copyright, design rights, semiconductor topography rights, plant varieties, database rights, rights in trade secrets, confidential information and/or know-how).
Copyright, design patents, semiconductor topography rights, plant varieties, geographical indications, and rights in confidential information and know-how as trade secrets.
What is the duration of each of these intellectual property rights? What procedures exist to extend the life of registered rights in appropriate circumstances?
Trademarks: 10 years from the date of registration, renewal applications may be made every 10 years after initial registration;
Copyright: For works belonging to corporate entities, 50 years from the date of first publication or creation (if never published); for works belonging to individuals, the term of protection shall be the lifetime of the author and 50 years after their death. There are no procedures at this time that extends the lift of copyright;
Invention patents: 20 years;
Utility model patents: 10 years;
Design patents: 10 years;
Semiconductor topography rights: 10 years after registration or first use, whichever is earlier;
Plant varieties: 20 years for vines, forest trees, fruit trees and ornamental trees, 15 years for others, from the date granted.
(Please note that in this article when we use patents it refers to invention, utility model and design patents unless otherwise stated).
Who is the first owner of each of these intellectual property rights and is this different for rights created in the course of employment or under a commission?
Trademarks: The first owner is generally the first to file an application at the China Trademark Office (CTMO).
Copyright: Generally, the copyright in a work shall be owned by its author. The author of a work is the person who created the work. Where a work was created according to the will and under the charge and responsibility of a legal person or other organization, the legal person or other organization shall be deemed to be the author thereof. In the absence of evidence to the contrary, the person, legal person or other organization named on a work as its author shall be the author of the work.
Any work created by a person for completing a job assignment to them by a legal person or other organization (the "Employer") is a work made during employment, and the copyright in such work shall be generally owned by the work's author, provided that the Employer has the prior right to use such work within the scope of its business activities. Within two years after the completion of a work made during employment, the author may not permit, without the consent of the Employer, any third party to use the work in the same manner in which it is used by the Employer.
For any of the following works made during employment, the author shall enjoy the right of authorship, and the Employer shall enjoy other rights under the copyright and may reward the author:
- Engineering design plans, product design drawings, maps, computer software, and other works made during employment, which were created mainly by using the material and technical conditions provided by the Employer and for which the Employer undertakes responsibility; and
- Other works created during employment and the copyright thereof shall be owned by the Employer pursuant to laws, administrative regulations or a contract.
The ownership of copyright in a commissioned work shall be subject to the terms of the contract entered into between the commissioning party and the commissioned party. Where the contract does not expressly provide for the copyright ownership or where there is no contract, the copyright shall be owned by the commissioned party.
Patents: Generally, the creator is the first owner of the relevant IP rights. However, the default position is that employers are the first owner of patents (unless specified otherwise) created in the course of employment provided they were created primarily using the employer's resources as part of the employee’s normal duties.
Which of the intellectual property rights described above are registered rights?
Invention patents, utility model patents, design patents, semiconductor topography rights, plant varieties, geographical indications and trademarks are registered rights.
Copyright registration is not compulsory, but advisable as good evidence to prove authorship and ownership.
Who can apply for registration of these intellectual property rights and, briefly, what is the procedure for registration?
Domestic and foreign companies, other organizations and/or individuals can apply for registered rights.
Trademarks: Applications should be made to the China Trademark Office (CTMO).
Copyright: If a party elects to record their copyright works in China, an application should be filed to the Copyright Protection Centre of China (CPCC).
Patents: Patent applications and registration of semiconductor topography rights and geographical indications should be made with the State Intellectual Property Office (SIPO). Applications for plant variety rights are filed with the State Forestry Bureau or the Ministry of Agriculture.
How long does the registration procedure usually take?
Trademarks: Around 12 months after filing;
Copyright: If elected, around 2 months after filing;
- Invention patents: Around 2 to 4 years after filing;
- Utility model patents: Around 1 year after filing;
- Design patents: Around 4 to 9 months after filing.
Do third parties have the right to take part in or comment on the registration process?
Trademarks: Yes, third parties may oppose trademark applications published in the gazette after preliminary examination. The period for opposition is 3 months from the date of publication;
Copyright: If elected, no;
Patents: For invention patents, a third party can submit observations and prior art to SIPO to challenge a patent application after a patent application is published but not yet granted. This does not apply to utility model patents and design patents since they are not subject to substantive examination.
What (if any) steps can the applicant take if registration is refused?
Trademarks: The applicant can ﬁle a review to the Trademark Review and Adjudication Board (TRAB). If the refusal is upheld by TRAB, the applicant can further appeal to Beijing Intellectual Property Court (in the first instance) and Beijing Higher People’s Court (in the second instance). Under certain conditions, the applicant may even further appeal to the Supreme People’s Court (for retrial), if dissatisfied with the final decision made by the Beijing Higher People’s Court (in the second instance).
Copyright: (if elected): Not applicable
Patents: For patents, the applicant can file a Request for Re-examination to the Patent Re-Examination Board (PRB) at SIPO. If the PRB decision is a refusal, the applicant can bring an administrative litigation before the Beijing Intellectual Property Court to challenge the decision.
What are the current application and renewal fees for each of these intellectual property rights?
Trademarks: The basic ﬁling fee for up to 10 goods/service items within the specification per mark per class is 300RMB . An additional official fee of 30RMB will be charged for each additional item beyond the 10th item in the specification. The filing fee is 1,500RMB for collective mark / certiﬁcation mark (per mark per class). The renewal fee is 1,000RMB per mark per class.
Copyright: If elected, the ﬁling fee depends on the type of work and ranges from free to 2,000RMB. There are no renewals.
- The filing fee for invention patents is 950RMB with a substantive examination fee of 2500RMB. Annuities for invention patents are charged as follows:
- Years 1 to 3 – 900RMB
- Years 4 to 6 – 1200RMB
- Years 7 to 9 – 2000RMB
- Years 10 to 12 – 4000RMB
- Years 13 to 15 – 6000RMB
- Years 16 to 20 – 8000RMB
- The filing fee for utility model patents is 500 RMB. Annuities for utility model patents are charged as follows:
- Years 1 to 3 – 600RMB
- Years 4 to 5 – 900RMB
- Years 6 to 8 – 1200 RMB
- Years 9 to 10 – 2000 RMB
- The filing fee for design patents is 500RMB. Annuities for design patents are as follows:
- Years 1 to 3 – 600RMB
- Years 4 to 5 – 900RMB
- Years 6 to 8 – 1200 RMB
- Years 9 to 10 – 2000 RMB
- The filing fee for invention patents is 950RMB with a substantive examination fee of 2500RMB. Annuities for invention patents are charged as follows:
What are the consequences of a failure to pay any renewal fees and what (if any) steps can be taken to remedy a failure to pay renewal fees?
Trademarks: Renewal applications must be made within 12 months before the expiry date of the 10-year renewal term. There is a 6-month grace period during which a renewal application will incur a late filing fee of 250RMB.
Copyright: If elected, there are no renewal fees.
Patents: Failure to pay the annuity on time incurs a surcharge of up to 25%, which must be paid within 6 months of the annuity deadline. If no payment is made within 2 months after the deadline for surcharge payment, SIPO will issue a notice of termination. The patent right will be terminated unless the applicant replies to the termination notice within 2 months by paying a 1,000RMB restoration fee.
What are the requirements to assign ownership of each of the intellectual property rights described above?
Trademarks: Assignments must be filed at the CTMO and take effect from the date they are published in the Trademark Gazette.
Copyright: It is optional to register a copyright assignment with the CPCC. If elected, the copyright assignment agreement along with other formalities are required. A transfer of copyright shall require the conclusion of a written contract and should include the following main details:
- The title of the work;
- The types of right(s) being transferred and the geographic coverage of the transfer;
- The transfer price;
- The date and method of payment of the transfer price;
- Liability for breach of contract; and
- Other details which the parties consider necessary.
Patents: Assignments must be in writing, stating the names of the parties, defining the rights, signed/ chopped by the parties, and then filed at SIPO. For assignments involving invention or utility model patents/ applications, the assignment is also subject to technology exports regulation when the assignor is a domestic entity/ individual, while the assignee is a foreign entity/ individual.
Is there a requirement to register an assignment of any of these intellectual property rights and, if so, what is the consequence of failing to register?
Trademarks: Failure to register an assignment of trademark will result in an ineffective assignment.
Patents: Registration is essential for a patent assignment to take legal effect. The assignment only becomes legally effective from the date of registration.
What are the requirements to licence a third party to use each of the intellectual property rights described above?
Trademarks: The trademark registrant may, by concluding a trademark licensing contract, authorize other persons to use the registered trademark. The licensor shall supervise the quality of the goods on which the licensee uses the licensor's registered trademark, and the licensee shall guarantee the quality of the goods on which the registered trademark is used. The party authorized to use others' registered trademark shall indicate the name of the licensee and the place of origin on the goods that bear the registered trademark. When granting others to use the registered trademarks, the licensor shall file the license of the trademarks with the Trademark Office for records, which shall announce the same. Without putting the licensing of the trademark on records, the trademark shall not be used to defend the bona fide third party.
Copyright: Anyone that wishes to use another's work shall conclude a licensing contract with the copyright owner of the work, unless otherwise stipulated by Copyright Law. A licensing contract shall include the following main details:
- The type(s) of right(s) being licensed;
- Whether the license is exclusive or non-exclusive;
- The geographic scope and term of the license;
- The amount and method of remuneration;
- Liability for breach of contract; and
- Other details which the parties consider necessary.
Patents: Licences must be in writing and clearly set out the rights and subject matter. Cross-border license agreements are subject to technology imports and exports regulation.
Is there a requirement to register a licence of any of these intellectual property rights and, if so, what is the consequence of failing to register?
Registration of license agreement is not compulsory, but may be required as a basis for IP enforcement procedures such as customs recordals or for financial reasons such as making payments internationally.
Are exclusive and non-exclusive licensees given different rights in respect of the enforcement of the licensed IP, and if so, how do those rights differ?
Exclusive licensees and non-exclusive licensees enjoy different rights when it comes to enforcement of the licensed IP. Exclusive licensees can enforce the licensed IP independently, without consent of the IP owner. Sole licensees can enforce the rights in a joint action with the licensor, and can also enforce the rights independently if the IP owner does not take action. Non-exclusive licensees can enforce the licensed IP only if they have explicit authorization from the IP owner.
Are there criminal sanctions for infringement of any intellectual property rights, and if so, what are they and how are they invoked?
Criminal sanctions (fines and/or imprisonment) apply to severe infringing activities relating to copyright, trademarks, patents and trade secrets. Severity is determined by reference to the profit obtained by the infringement, loss incurred by the rights owner, quantity of infringing products and any other factors the court deems relevant.
Depending on the data available, fines of up to approximately 5 times the amount of illegal profit or 100% of the illegal revenue are issued at the court's discretion. The maximum prison sentence is 7 years for trademarks, copyright or trade secrets and 3 years for patents.
What other enforcement options are available for each of the intellectual property rights described above? For example, civil court proceedings, intellectual property office proceedings, administrative proceedings, alternative dispute resolution.
a) Civil court proceedings are available for all the intellectual property rights in Section A.
b) Administrative proceedings are available for all the intellectual property rights in Section A.
c) The .cn and Chinese domain names, general website addresses, wireless website addresses and SMS website addresses that are registered within two years of creation can be settled by the Online Dispute Resolution Centre under the China International Economic and Trade Arbitration Commission.
d) Customs seizure actions are available in relation to trademarks, patents and copyright. In practice, Customs are most proactive in terms of seizures when the trademark has been recorded with Customs.
e) Large trade fairs in China can have complaints centres (e.g. the Canton Fair) where it is possible to file complaints in respect of patents, copyright and trademarks to get infringing products removed.
What is the length and cost of such procedures?
a) Civil proceedings solely involving domestic parties should take 6 months from the court docketing/accepting the case to handing out a ﬁrst instance judgment. Extensions of up to 6 months may be granted upon approval by the president of the court. Further extensions require higher court approval. No time limits exist for trials involving foreign parties, which generally last 6 to 9 months depending on complexity. The timeline may be longer if additional situations/proceedings are incurred by any interested party or there is a backlog at the court.
Appeals must be ﬁled to the immediate superior court and appeal decisions should conclude within 3 months of the date they are placed on the appeal court's trial docket. The president of the court may grant extensions in special circumstances.
A party may apply for a retrial within six months after the date on which the judgment or ruling becomes legally effective or the date the party becomes aware (or ought to have been aware) of the relevant facts to apply for a retrial at the immediate superior court or the court which made the effective judgment or ruling.
Costs vary, normally they include a case filing fee charged by the court, official fees charged by the public notary and other organizations for possible evidence collection work, service fees charged by the attorneys, translation fees (for foreign parties) and other disbursements (such as travel expenses).
b) Administrative departments carry out regular infringement investigations when requested to do so by an IPR holder. Administrative proceedings have no speciﬁc timeframe but are usually felt to be quicker than civil proceedings and, if the administrative department is proactive, can be completed within a month or so. Costs also vary depending on the complexity of the specific cases and the actual time spent by the attorneys.
c) Domain name disputes submitted to the Online Dispute Resolution Centre are usually granted an award within 60 days. Costs depend on the number of arbitrators. If just one arbitrator is appointed, the party who ﬁled the complaint bears the cost. If more than one is appointed, the costs are shared equally. The official fee for one domain name dispute handled by one arbitrator is 8000RMB. The service fee is charged on an actual time spent basis.
Where court action is available, please provide details of which court(s) have jurisdiction, how to start proceedings, the basics of the procedure, the time to trial, the format of the trial, the time to judgment and award of relief and whether any appeal is available.
Two factors determine jurisdiction in China: where the defendant is domiciled and where the infringing act takes place.
In late 2014, China established specialist IP courts in Beijing, Shanghai and Guangzhou to hear the following IP disputes within the courts' respective jurisdictions:
- Civil and administrative actions involving patents, semiconductor topographies, plant varieties, complex trade secrets, and copyright relating to computer software;
- Administrative actions against a State Council department or a People's Government of county level or above for an administrative act involving copyright, trademark, and unfair competition; and
- Civil actions involving well-known trademarks.
Intermediate People's Courts, which sit at the same level as specialist courts, in the Beijing, Shanghai and Guangdong regions no longer accept cases concerning the abovementioned actions, with the exception of the Guangdong-based Shenzhen Intermediate People's Court, which has its own IP tribunal. District courts in these regions no longer accept actions concerning items (1) and (3) above. In regions without a specialist IP court, Intermediate People's Courts will hear (1) to (3) above.
In addition, the Beijing IP Court has jurisdiction over ﬁrst instance administrative cases relating to objections against: (a) licensing and conﬁrmation of validity of patents and trademarks; (b) compulsory licence decisions and compulsory licence fees; (c) any other act by a public authority involving licensing and conﬁrmation of intellectual property rights.
15 Specialist IP tribunals with cross-regional jurisdiction have also been established in Zhengzhou, Tianjin, Changsha, Xi’an, Hangzhou, Ningbo, Jinan, Qingdao, Fuzhou, Hefei, Shenzhen, Nanjing, Suzhou, Wuhan and Chengdu to hear IP cases in these (and adjacent) regions.
Plaintiffs must ﬁle pleadings at the court with jurisdiction. Provided the conditions to bring an action are met, the court shall place the action on its trial docket within seven days of receipt and notify the parties of its acceptance. If the conditions are not satisﬁed, the court will announce its decision not to accept the case within seven days of the case being ﬁled.
After the case is accepted by the court, the court shall send a copy of the plaintiff’s complaint to the defendant within five days, and the defendant shall file a defense, if any, within 15 days from receipt of the copy of the plaintiff’s complaint. When the defendant files a defense, the people's court shall send a copy of it to the plaintiff within five days from its receipt.
The parties will exchange evidence. If the court thinks it necessary, there will be a separate evidence exchange hearing. Usually the court will also conduct conciliation for the parties on a voluntary and lawful basis before the court hearing. If conciliation fails, the court hearing will be arranged, and the judgment will be issued accordingly.
Simple IP trials usually last 1 day, complex trials can be longer. Courts try civil cases in public, except those involving State secrets, private matters of individuals (including trade secrets), or where the law stipulates otherwise.
At trial, the court will ﬁrst verify the litigants, set out the cause of action, notify litigants of their rights and obligations and enquire whether the parties have submitted applications or abstentions. Trials begin with a court investigation which involves hearing statements by the litigants, and then examining witnesses (if any) and documentary evidence. Then the trials enter into the court debate stage, starting from oral statements by the plaintiff and his agents ad litem, then defense by the defendant and his agents ad litem, oral statement or defence by the third party and his agents ad litem (if any), and then debate between the two sides.
At the end of the court debate, the presiding judge shall ask each side, first the plaintiff, then the defendant, and then the third party (if any), for their final opinion respectively. Following this, the court will hear submissions from all sides. The parties may engage in mediation or settlement prior to judgment. There is no ﬁxed timeline from trial to written judgment (and, occasionally, this can take a signiﬁcant amount of time).
Once the judgment becomes effective, it is enforceable by the court of ﬁrst instance or a court at the same level as the court where the property subject to execution is located.
Judgements, Relief and Appeal
Cases concerning only domestic parties should conclude within six months of the date the case was accepted. Cases involving foreign IP owners have no ﬁxed timeline but ideally take 6-9 months.
If a party refuses to accept a judgment of first instance of a local people's court, he shall have the right to file an appeal with the people's court at the next higher level within 15 days after the date on which the written judgment was served.
What customs procedures are available to stop the import and/or export of infringing goods?
Customs authorities inspect both imported and exported goods. The Customs Law of China prohibits the export or import of goods from or to China that infringe upon the IPR of another. Customs undertake regular checks, and may stop the import/export of infringing goods of their own accord.
Rights holders may voluntarily record their rights and licensees at Customs. This procedure is a much more eﬀective way of ensuring infringing goods are seized. Nevertheless, it is important to provide Customs with as much intelligence as possible concerning any infringing activity to maximise the chances of seizure.
Are any non-court enforcement options or dispute resolution mechanisms mandatory in respect of intellectual property disputes in any circumstances? If so, please provide details.
Administrative enforcement and customs procedures are available as explained in the answers to questions 17 and 20.
What options are available to settle intellectual property disputes?
Besides the options stated in question 17, disputes may also be settled via mediation using a mediation agreement. Parties may submit the mediation agreement to court to obtain a mediation award. The mediation award is enforceable.
What is required to establish infringement of each of the intellectual property rights described above? What evidence is necessary in this context?
Trademarks: Infringement firstly requires evidence that the plaintiﬀ owns the relevant trademark rights. The plaintiﬀ must prove the defendant is using a mark that is identical to a registered trademark on the same goods without the authorization of the trademark registrant or using a mark that is similar to a registered trademark on the same goods, or using a mark that is identical with or similar to a registered trademark on similar goods, which may lead to customer confusion. Proof of use can include product packages, sale contracts, sales invoices, offline/online sales records, advertising materials, products bearing the mark, etc. Evidence of similarity should be supplied in the form of a comparison with the plaintiﬀ's mark.
The Anti-Unfair Competition Act can be the basis of an action in respect of various infringing actions and unauthorized use of another's brand. Article 6 of the Act provides that unfair competition includes:
- Unauthorized use of a mark that is identical or similar to the name, packaging or decoration of another business's commodity, which has influence to a certain extent.
- Unauthorized use of another business's corporate name (including its shortened name, trade name, etc.), the name of a social group (including its shortened name, etc.), or the name of an individual (including his or her pen name, stage name, translated name, etc.), which has influence to a certain extent;
- Unauthorized use of the main domain name, website name or webpage, which has influence to a certain extent; and
- Other confusing acts that are sufficient to enable people to mistake its products for another business's products or believe certain relations exist between its products and any business's products.
It is necessary to provide evidence that the plaintiﬀ's product name, packaging, decoration, corporate name (including its shortened name, trade name, etc.), main domain name, website name or webpage, etc. was suﬃciently unique or similar to create a link in consumers' minds. This is similar but distinct from proving well-known trademark status, which is a much higher standard.
Evidence could be documentary evidence, audio-visual materials, electronic data, witness testimony, expert opinion and inspection records and examination, etc. It is common to submit documentary evidence as proof of infringing activities with onsite notarization or notarized purchases serving as evidence of manufacture/sale of infringing goods.
Copyright: Infringement requires evidence the plaintiﬀ owns the relevant work which is capable of copyright protection and the defendant has copied a whole or substantial part of the copyright work without permission. Ownership can be preliminarily proven through copyright statements asserting ownership, photographs of the work, a copyright registration certificate or an agreement governing copyright ownership.
Trade Secrets: Actions require evidence of breach of China's Anti-Unfair Competition Act. To achieve this, the plaintiﬀ must show that the defendant improperly obtained their business secrets by theft, promise of gains, intimidation or other improper means. Disclosing, using or allowing others to use the business secrets improperly obtained will also amount to a breach. The plaintiﬀ must prove the relevant trade secrets have been properly contained to remain confidential.
Patents: Infringement requires evidence the plaintiff owns the relevant patent right or is a proper licensee that are entitled to bring an action. For invention or utility model patents, the plaintiff must prove that the defendant has, for commercial purposes, manufactured, used, offered for sale, sold or imported a product which infringes the patent in suit. Invention patent infringement includes the use of a process, offering for sale, selling or importing a product directly obtained through a process which infringes the patent. Plaintiffs may argue construction both literally and/or using the doctrine of equivalents. In relation to a design patent the plaintiff must prove the defendant, for business purposes, manufactured, offered for sale, sold or imported a product which infringes the patented design (i.e. it is the same or substantially similar to the design patent).
How does the court acquire any necessary information (fact or technical) and in what circumstances does it do so? In particular a) Is there a technical judge, a judge with technical experience, a court appointed expert, an expert agreed by the parties, and/or parties’ expert witness evidence? b) What mechanisms are available for compelling the obtaining and protecting of evidence? Is disclosure or discovery available?
a) Is there a technical judge, a judge with technical experience, a court appointed expert, an expert agreed by the parties, and/or parties' expert witness evidence?
In China, most judges do not have technical background, but sometimes judges with technical experience are available for IP trials on a non-compulsory basis. Courts may appoint experts for technical fact-finding. It should be noted that party-led expert evidence is not the norm in China (although becoming more regular in complex patent cases).
The specialist IP courts in Beijing, Shanghai and Guangzhou and some intermediate courts have begun to appoint technical investigation officers for hearing complex patent cases. The investigation officers can offer opinions on the technical issues in the cases and answer judges’ questions on technical issues.
b) What mechanisms are available for compelling the obtaining and protecting of evidence? Is disclosure or discovery available?
Disclosure/discovery is unavailable in China. Parties have no obligation to voluntarily disclose documents whether positive or negative to the case.
Courts may grant an Evidence Preservation Orders (EPO) against a party to obtain specific evidence. An EPO will be granted if the applicant demonstrates that the evidence is at risk of loss or may be difficult to obtain from the defendant in future. Non-compliance with an EPO may lead to a fine or detention, depending on the seriousness of the breach. The most serious cases may constitute a criminal offence, punishable by up to three years in prison and a fine. Detention is rare in IP cases.
How is information and evidence submitted to the court scrutinised? For example, is cross-examination available and if so, how frequently is it employed in practice?
Cross-examination by a party's counsel of fact witnesses and/or expert witnesses is available in China in instances where such evidence is led. However, this by no means happens in all IP cases. In practice, China's legal regime prefers documentary evidence, scrutiny of which takes place via court debate led by counsel.
What defences to infringement are available?
General defences include challenging the validity of IP rights.
For patents, defences to infringement also include prior art defence, which applies if the alleged infringing technology or design belongs to the prior art or is a prior design, and prior use defence, which however is limited to the scope of alleged infringer’s practicing the concerned patent prior to the filing date of the patent.
For unregistered rights (i.e. copyright), defendants can argue the right does not amount to a copyright work and/or there has been no copying (or they had permission from the owner to copy).
For registered rights defendants can use the standard defences.
For trademarks, infringement defences usually include arguing the dissimilarity of the marks and/or goods/services, no confusion/misleading will be caused, and may also occasionally include to argue the OEM use, fair use, or prior use with certain influence under Article 59 of PRC Trademark Law. For sellers, they may also argue that they have no knowledge of the infringing goods by proving the legality of acquiring such goods and pointing out the provider as per Article 60 of PRC Trademark Law, to avoid fines and/or other punishments except to be ordered to cease selling the goods.
Who can challenge each of the intellectual property rights described above?
Any individual, corporation or organization can challenge these rights, but an interest is required in order to challenge trademarks with opposition or invalidation actions based on prior rights.
When may a challenge to these intellectual property rights be made (e.g. during any registration process or at any time during the subsistence of the right)?
Trademarks: When an application has been given preliminary approval, an opposition can be filed against the mark within 3 months since its publication in the gazette. After the rights are granted, invalidation against the registered mark based on prior rights can be requested within 5 years since the date of publication for registration. In the event of malicious registration, owners of well-known trademark may exempt from the five-year duration. An application for cancellation due to non-use can commence after a mark has been published for registration for 3 or more years.
Copyright: A challenge to copyright is usually made by the party who is attacked for copyright infringement in civil court proceedings.
Patents: Observations and prior art documents can be submitted to SIPO after a patent application is published but not yet granted. After the rights are granted or registered, an invalidation request can be filed, even for an expired patent.
Briefly, what is the forum and the procedure for challenging each of these intellectual property rights and what are the grounds for a finding of invalidity of each of these intellectual property rights?
Trademarks: An opposition shall be filed at the CTMO, and it usually takes around 12-18 months from filing to completion of the opposition. An invalidation request shall be filed at TRAB, and it usually takes around 12-18 months from filing to completion of the invalidation. A non-use cancellation shall be filed at the CTMO, and it usually takes around 9-12 months from filing to completion of the opposition. Grounds for non-use cancellation are the registered mark has been ceased in use in the latest three or more years.
Patents: Invalidation requests relating to patents must be filed to the re-examination board of SIPO. The grounds for invalidation are as follows
- Invention and utility models patents: being unpatentable subject matter, lacking novelty and/or inventiveness over the prior art, double patenting, amendments extending beyond the original disclosure, non-compliance with requirements of confidentiality examination, and/or non-compliance with formality requirements, e.g. insufficient disclosure and clarity.
- Design patents: being the same or substantially similar as a single reference or bearing no obvious differences to a single reference or multiple references in combination (i.e. the prior design corpus).
Are there any other methods to remove or limit the effect of any of the intellectual property rights described above, for example, declaratory relief or licences of right?
Faced with a formal threat of action for intellectual property infringement, a person can apply to court for a declaration of non-infringement.
What remedies (both interim and final) are available for infringement of each of the intellectual property rights described above?
Remedies include preliminary and permanent injunctions, damages, public apologies, destruction of any infringing products and tools or moulds used for the infringing activities.
What are the costs of enforcement proceedings and is any kind of costs recovery available for successful parties? Is there a procedural mechanism enabling or requiring security for costs?
Litigation fees, attorney's fees, notarisation fees, and other expenses arising from the proceedings can be claimed, to be borne by the losing party. The costs awarded to the successful party are usually ordered at the court's discretion and in most cases the fees recovered are still at a low percentage, but the amounts are increasing in recent years.
There is no analogous concept of a security for costs application in China. However, a plaintiff may apply for an Asset Preservation Order against a defendant to freeze money assets during proceedings. Any frozen assets can be used to pay any damages and/or costs awarded by the court.