On October 17, after revision by the Standing Committee of the National People's Congress of the PRC, revised "Patent Law of the People's Republic of China" was approved. The new patent law will come intoeffect on June 1, 2021.
According to the Chinese press reports, the revised patent law mainly includes three key contents:
● The first is to strengthen the protection of the legitimate rights and interests of patentees, including increasing the compensation for patent infringement, improving the system of burden of proof, improving pre-litigation behavior preservation measures, improving patent administrative protection, adding the principle of good faith, and adding the duration of patent rights Compensation system and relevant provisions of early settlement procedures for drug patent disputes.
● The second is to promote the implementation and use of patents, including improving the employee inventions system, adding a new patent open licensing system, and strengthening patent conversion services.
● The third is to improve the patent authorization system, including further improving the design protection related system, increasing the application of the novelty grace period, and improving the patent right evaluation report system.
Specifically，in order to further strengthen the protection of intellectual property rights, this revision of the Patent Law adds a new punitive compensation system. The people's court can determine within one to five times the amount calculated based on the loss suffered by the patent right holder, the benefit obtained by the infringer, or the multiple of the patent license fee. The revised Patent Law also increased the statutory compensation by the upper limit to 5 million yuan and the lower limit to 30,000 yuan.
Further, in order to meet the actual needs of enterprises, this revision of the Patent Law has further improved the design-related systems.
➥ The first is to explicitly grant partial design patent protection.
➥ The second is to extend the protection period of design patents; extend the protection period of design patents to 15 years.
➥ The third is to increase the domestic priority system for design patent applications; it is clarified that applicants who file a domestic patent application on the same subject within six months from the first domestic patent application for a design can enjoy priority.
Moreover, in order to better respond to emergencies and extraordinary situations such as epidemic prevention and control, a newly added "grace period" type provision to address the Covid-19 pandemic which permits initial disclosure of inventions for public benefit to address national emergencies without compromising the novelty of an invention in a patent application.
Please find below the full content of the amendments to the revised Patent Law:
The Revised Patent Law
(Effective June 1, 2021)
Article 2 For the purposes of this Law, invention-creations mean inventions, utility models and designs.
Inventions mean new technical solutions proposed for a product, a process or the improvement thereof.
Utility models mean new technical solutions proposed for the shape and structure of a product, or the combination thereof, which are fit for practical use.
Designs mean, with respect to a product, new designs of the overall or partial shape, pattern, or the combination thereof, or the combination of the color with shape and pattern, which are rich in an aesthetic appeal and are fit for industrial application.
Article 6 An invention-creation that is accomplished in the course of performing the duties of an employee, or mainly by using the material and technical conditions of an employer shall be deemed an employment invention-creation. For an employment invention-creation, the employer has the right to apply for a patent. After such application is granted, the employer shall be the patentee. The entity can dispose of the right to apply the patents and patent rights for service inventions and creations in accordance with the law and promote the implementation and utilize of related inventions and creations.
For a non-employment invention-creation, the inventor or designer has the right to apply for apatent. After such application is granted, the said inventor or designer shall be the patentee.
For an invention-creation that is accomplished by using the material and technical conditions of an employer, if the employer has concluded a contract with the inventor or designer providing the ownership of the right to apply for the patent or the ownership of the patent right, such provision shall prevail.
（Changed Current Article 14 to Article 49）
Article 15 The unit that is granted the patent right shall reward the inventor or designer of an employment invention-creation. After such patent is exploited, the inventor ordesigner shall be given a reasonable amount of remuneration according to the scope of application and the economic results.
The state encourages entity granted patent rights to implement property rights incentives, adopting equity, options, dividends, etc., to enable inventors or designers reasonably share the benefits of innovation.
Article 20 Applying for patents and exercising patent rights shall follow the principle of honesty and credit. Do not abuse patent rights to harm the public interest or the legitimate rights and interests of others.
Anyone who abuses patent rights, excludes or restricts competition, which constitutes a monopolistic act, shall be dealt with the Anti-Monopoly Law of the People's Republic of China.
Article 21 The patent administration department under the State Council and its Patent Review Board shall, according to the requirements of objectivity, fairness, accuracy and timeliness, handle patent applications and requests in accordance with law.
The patent administration department under the State Council shall strengthen the construction of a patent information public service system, release patent-related information in acomplete, accurate and timely manner, provide basic patent data, publish patent bulletins regularly, and promote the dissemination and utilization of patent information.
Before a patent application is published or announced, the staff members of the patent administration department under the State Council and the persons concerned shall be obligated to keep such application confidential.
Article 24 Within six months before the date of application, an invention for which an application is filed for a patent does not lose its novelty under any of the following circumstances:
(1) When the country is in the emergency circumstance, the first disclose for the purpose of protecting the public interest.
(2) It is exhibited for the first time at an international exhibition sponsored or recognized by the Chinese Government;
(3) It is published for the first time at a specified academic or technological conference; and
(4) Its contents are divulged by others without the consent of the applicant.
Article 25 Patent rights shall not be granted for any of the following:
(1) scientific discoveries;
(2) rules and methods for intellectual activities;
(3) methods for the diagnosis or treatment of diseases;
(4) animal or plant varieties;
(5) the nuclear transformation methods and substances obtained by means of nuclear transformation; and
(6) designs that aremainly used for marking the pattern, color or the combination of the two of prints.
Article 29 If, within twelve months from the date the applicant first files an application for an invention or utility model patent in a foreign country, or within six months from the date the applicant first files an application for a design patent in a foreign country, he files an application for a patent in China for the same subject matter, he may enjoy the right of priority in accordance with the agreements concluded between the said foreign country and China, or in accordance with the international treaties to which both countries have acceded, or on the principle of mutual recognition of the right of priority.
If, within twelve months form the date the applicant first files an application for an invention or utility model patent in China,or within six months from the date on which any applicant first filed in China an application for a patent for the design, he files an application for a patent with the patent administration department under the State Council for the same subject matter, the applicant may enjoy the right of priority.
Article 30 An applicant who requests the right of priority for an invention or utility model patent shall submit a written declaration at the time of application and submit, and submit a copy of the patent application document of it's first filed, within 16 months from the date of filing the first application.
An applicant who requests the right of priority for a design patent shall submit a written declaration at the time of application and submit and submit a copy of the patent application document for it's first filed, within three months.
There the applicant fails to submit a written declaration or fails to submit a copy of the patent application document at the expiration of the specified time limit, the applicant shall be deemed to have waived the right of priority.
Article 41 The patent administration department under the State Council shall establish a patent review board. If a patent applicantis dissatisfied with the decision made by the Patent Administration Department under the State Council on rejecting of the application, he may, within three months from the date of receipt of the notification, file a request with the patent administration department under the State Council for review. After review, the patent administration department under the State Council shall make a decision and notify the patent applicant of the same. If the patent applicantis dissatisfied with the review decision made by the patent administration department under the State Council, he may take legal action before the people's court within three months from the date of receipt of the notification.
Article 42 The duration of the invention patent right shall be 20 years and that of the utility model patent right shall be ten years and of the design patent right shall be ten years respectively, and the duration of the design patent right shall be 15 years, all commencing from the date of application.
If the granted invention patent is not granted within four years from the date of application and three years after the date of the request for substantive examination, the patent administration department under the State Council shall, at the request of the patentee, give an extension of a patent term to compensate for the unreasonable delays in the granting of the invention patent, except for unreasonable delay caused by the applicant.
In order to compensate for the delays caused by regulatory review and approval of the new drug, the patent administration department under the State Council shall, at the request of the patentee, restore a maximum of five years to the patent of a new drug approved in China, and the total patent life for the new drug cannot exceed 14 years from the new drug’s marketing authorization approval date.
Article 45 Beginning from the date the patent administration department under the State Council announces the grant of a patent right, if a unit or individual believes that such grant does not conform to the relevant provisions of this Law, it or he may request that the patent administration department under the State Council declare the said patent right invalid.
Article 46 The patent administration department under the State Council shall examine the request for declaring a patent right invalid and make a decision in a timely manner and notify the requesting person and the patentee of its decision. The decision on declaring a patent right invalid shall be registered and announced by the patent administration department under the State Council.
A person that is dissatisfied with the patent administration department under the State Council's decision on declaring a patent right invalid or its decision on affirming the patent right may take legal action before a people's court, within three months from the date of receipt of the notification. The people's court shall notify the opposite party in the invalidation procedure to participate in the litigation as a third party.
Article 48 The patent administration department under the State Council and the department in charge of patent work of the local people’s government shall, in conjunction with relevant departments at the same level, take measures to strengthen patent public services and promote patent implementation and utilization.
Article 49 If an invention patent of a State-owned enterprise or institution is of great significance to national or public interests, upon approval by the State Council, the relevant competent department under the State Council or the people's government of the province, autonomous region, or municipality directly under the Central Government may decide to have the patent widely applied within an approved scope and allow the designated units to exploit the patent, and the said units shall pay royalties to the patentee in accordance with the regulations of the State.
Article 50 If the patentee voluntarily provides a written statement to the Patent Administration Department under the State Council to confirm the patentee’s willingness to license any entity or individual whoever is interested in implementing his patent, and to specify the standard and details of the royalty payment, the Patent Administration Department under the State Council shall takes an announcement and implements open licensing. If an open licensing statement is made for utility model or design patents, it shall be provided a patent right evaluation report.
If the patentee withdraws the open license statement, it shall be submitted with a written statement and be announced by the Patent Administration Department under the State Council. If the open license statement is withdrawn by announcement, the validity of the open license granted earlier shall not be affected.
Article 51 Any unit or individual who wishes to implement an open-licensed patent shall make a written statement to notify the patentee, and pay the license fee in accordance with the announced licensing fee payment method and standard. After that, the patent implementation license was obtained.
During the implementation period of the open license, the annual patent fee paid by the patentee shall be reduced or exempted accordingly.
The patentee who implements open licensing may grant a general license after negotiating with the licensee on the license fee, but shall not grant an exclusive or exclusive license for the patent.
Article 52 Where the parties have disputes over the implementation of an open license, the parties shall negotiate and resolve them; if they are unwilling to negotiate or the negotiation fails, they may request the Patent Administration Department of the State Council for mediation, or they may apply to the People's Court Prosecute.
Article 66 If a dispute over patent infringement involves an invention patent for the method of manufacturing a new product, the unit or individual manufacturing the same product shall provide evidence to show that the manufacturing method of their own product is different from the patented method.
If a dispute over patent infringement involves a utility model patent or a design patent, the people's court or the administration department for patent-related work may require the patentee or the interested parties to present a patent right assessment report prepared by the patent administration department under the State Council through searching, analyzing, and assessing the relevant utility model or design, which shall serve as evidence for trying or handling the patent infringement dispute; the patentee, the interested party or The accused infringer may also take the initiative to issue a patent evaluation report.
Article 68 A person who counterfeits the patent of another person shall, in addition to bearing civil liabilities in accordance with law, be ordered by the patent enforcement department to put it right, and the department shall make the matter known to the public, confiscate his unlawful gains and, in addition, impose on him a fine of not more than five times the illegal income; if there are no unlawful gains, a fine of less than RMB 50,000, a fine of less than 250,000 yuan may be imposed on him; and if a crime is constituted, criminalresponsibility shall be pursued in accordance with law.
Article 69 The department responsible for patent enforcement shall, based on the evidence it has obtained, investigate and deal with suspected patent counterfeiting, it shall have the right to take the following measures:
(1) Inquire the parties concerned, and investigate the circumstances related to the suspected illegal act;
(2) Conduct on-the-spot inspection of the places where the suspected illegal act is committed;
(3) Consult and duplicate the relevant contracts, invoices, account books and other related materials;
(4) Check the products related to the suspected illegal act;
(5) Detain the products that are proved to be produced by the counterfeited patent.
When the administrative department of patents handles patent infringement disputes at the request of the patentee or interested parties, it may take the measures listed in items (1), (2), and (4) of the preceding paragraph.
When the department in charge of patent enforcement and the administration department for patent-related work perform its duties as prescribed in the preceding paragraph, the parties concerned shall provide assistance and cooperation, instead of refusing to do so or creating obstacles.
Article 70 The Patent Administration Department of the State Council may handle patent infringement disputes that have a significant national impact at the request of the patentee or interested parties. The administrative department of patents of the local people's government shall handle patent infringement disputes at the request of the patentee or interested parties, and may handle the cases of infringement of the same patent right within the administrative area in a combined manner; for cases of cross-region infringement of the same patent right you can request the administrative department of the local people's government at a higher level to handle it.
Article 71 The amount of compensation for patent right infringement shall be determined according to the patentee's actual losses caused by the infringement. If it is hard to determine the actual losses, the amount of compensation may be determined according to the benefits acquired by the infringer through the infringement. If it is hard to determine the losses of the patentee or the benefits acquired by the infringer, the amount of compensation may be determined according to the reasonably multiplied amount of the royalties of that patent. For intentional infringement of the patent right, the circumstances may be more than one time and less than five times the amount determined according to the above method.
If the losses of the patentee, benefits of the infringer, or royalties of the patent are all hard to determine, the people's court may, on the basis of the factors such as the type of patent right, nature of the infringement, and seriousness of the case, determine the amount of compensation within the range from 30,000 yuan to 5 million yuan.
The amount of compensation should also include the reasonable expenses paid by the right holder to stop the infringement.
In order to determine the amount of compensation,the people's court may order the infringer to provide the account books and information related to the infringement when the right holder has tried itsbest to provide evidence and the account books and information related to the infringement are mainly in the hands of the infringer; Where false accounting books and materials are provided or provided, the people's court may refer to the claims of the right holder and the evidence provided to determine the amount of compensation.
Article 72 If the patentee or interested party has evidence to prove that another person is committing or is about to commit a patent infringement and hinders the realization of the right, which, unless being checked in time, may cause irreparable harm to his lawful rights and interests, he may, before taking legal action, file anapplication to request for property preservation, order certain actions, or the people's court order to have such actceased.
When filing such an application, the applicant shall provide guarantee. In the event of failure to provide guarantee, the application shall be rejected.
The people's court shall make a ruling within 48 hours from the time of its acceptance of the application. If an extension is needed under special circumstances, a 48-hour extension may be allowed. If a ruling is made to order to have the relevant act ceased, it shall be enforced immediately. The party that is dissatisfied with the ruling may file once for review, and the enforcement shall not be suspended during the period of review.
If the applicant does not take legal action within 15 days from the date the people's court takes measures to have the relevant act ceased, the people's court shall lift such measures.
If the application is wrong, the applicant shall compensate the losses suffered by respondent due toceasing of the relevant act.
Article 73 To check a patent infringement, when evidence might be lost or might be hard to acquire thereafter, the patentee or interested party may, before taking legal action, file an application with the people's court for evidence preservation according to law.
If the people's court takes preservation measures, it may order the applicant to provide guarantee. If the applicant fails to provide guarantee, the application shall be rejected.
The people's court shall make a ruling within 48 hours from the time ofits acceptance of the application. If it rules to take preservation measures, such a ruling shall be enforced immediately.
If the applicant does not take legal action within 15 days from the date the people's court takes preservation measures, the people's court shall lift such measures.
Article 74 The period of limitation for action against patent right infringement shall be two years, commencing from the date when the patentee or interested party knows or should have known of the infringement and the infringer.
If an appropriate royalty is not paid for using an invention during the period from the publication of the invention patent application to the grant of the patent right, the period of limitation for taking legal action by the patentee for requesting payment of royalties shall be two years, commencing from the date when the patentee knows or should have known of the use of that patent by another person. However, the period of limitation for action shall commence from the date when the patent right is granted, if the patentee knows or should have known of the use before the patent right is granted.
Article 76 During the drug marketing review and approval process, the drug marketing authorization applicant and the relevant patentee or interested party have disputes over the patent rights related to the drug applied for registration. Relevant parties can file a lawsuit with the people’s court and request a judgment on whether the drug-related technical solution applied for registration falls within the scope of protection of other’s drugpatent rights. The drug regulatory authority under the State Council may decide whether to suspend in accordance with the effective judgment of the people’s court within the prescribed time limit. The decision to approve the marketing of related drugs.
A drug marketing authorization applicant and relevant patentees or interested parties may also request administrative rulings from the patent administration department of the State Council regarding patent disputes related to the drugs applied for registration.
The drug regulatory department of the State Council, in conjunction with the patent administration department of the State Council, shall formulate specific linkages between the approval of drug marketing approval and the resolution of patent disputes in the drug marketing license application stage, and shall be implemented after the approval of the State Council.
(Omited Current Atricle 72)
Article 79 The administration department for patent-related work shall not be involved in recommending patented products to the public or engage in any other similar business activities.
If the administration department for patent-related work violates the provisions of the preceding paragraph, its immediate superior or the supervisory authority shall order it to rectify, and confiscate its unlawful gains, if any; if the circumstances are serious, the principal leading person directly in charge and the other persons directly responsible shall be given saction in accordance with law.
Article 80 Where a staff member of the government department engaged in administration of patent-related work or of a relevant department neglects his duty, abuses his power, or commits irregularities for personal gain, which constitutes a crime, he shall be pursued for criminal responsibility in accordance with law. If the case is not serious enough to constitute a crime, he shall be given a saction in accordance with law.
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