China’s patent system became modernized in 1984 under Deng Xiaoping’s Economic Reform Policy.  From 1978, China transformed from a planned economy to a market-oriented economy.  During the 1980s, the Chinese Intellectual Property system was established through a series of laws: the Trademark Law in 1982, the Patent Law in 1984 and the Copyright law in 1990.

At a glance, the fourth newly drafted amendment to the Peoples Republic of China Law seem to aim to bring the Chinese Law further in line with international standards and agreements, such as provided for by TRIPS. The proposed amendments further decentralize the role of the State Counsel, by empowering the Patent Administration Department and creating an All-China Patent Attorneys Association to regulate the industry at pawn level.

Further positive developments would be clarification of the quantum of penalties payable by infringers and a newly introduced type of contributory infringement in the form of joint liability, for internet providers found to be knowingly assisting in the infringement of a patent right.

Turning to some of the proposed amendments, newly amended Article 14 provides for clarification on the determination of a reward for an employment invention-creation. Article 25, being the intrinsic requirements for the granting of patents, provides for an exclusion on the prohibition of the granting of a patent for a method of diagnosis or treatment of diseases where such methods relate to bred animals.

Article 42 introduces the extension of the duration of a design right from 10 years to 15 years. Article 60 introduces empowering legislation for the confiscation and destruction of infringing products and provides said clarification on the quantum of fines. Article 64 seems to introduce the term wilful infringement and Article 65 provides for increased quantum damages for aforesaid wilful infringement.

Newly added Article 70 introduces internet service provider joint liability, if the internet service provider fails to take the necessary measures after it has received eligible and effective notification of same. Newly introduced Article 76 mandates the Patent Administration Department to promote the exploitation and utilization of patents and to regulate the services of marketing activities and/or operation. Newly added Article 78, provides for a back door for an inventor of an employment invention-creation to obtain a licence should such institution fails to carry out exploitation of the resulting granted patent.

In conclusion, the proposed amendments certainly hint at positive developments in Chinese law and may be seen as to promote increased enforceability of patent rights and further promote self regulation of the industry.

Publication Name: Summary and implications of the fourth newly drafted amendment to the Peoples Republic of China Law in regards to inventions, utility models and designs.

Date: May, 2015

Practice Area: Patents