2019 IP EVENTS

China IP,[Patent]

 

JAN

 

Draft Amendments to Patent Law Released for Comment

On Jan 4, the Draft Amendment to the Patent Law of the People's Republic of China was released on the website of the National People's Congress for comments. The Draft Amendment was submitted to the 7th meeting of the Standing Committee of the 13th NPC for deliberation. The Draft strengthened the protection of the legitimate rights and interests of patentees, promoted the implementation and application of patents, and put a number of practices that were mature enough into legal norms. To increase the intensity of compensation for patent infringement, the cost of violating the law, and fully demonstrate the deterrent effect of the law, the Draft proposed to stipulate that if the circumstances of intentional patent infringement are serious, the amount of compensation may be determined as one to five times the amount calculated according to the losses suffered by the right holders, the benefits obtained by the infringers or the reasonably multiplied amount of the royalties of the patents. In cases where it is difficult to calculate the amount of compensation, courts may determine the amount of damage between 100,000 Yuan to 5 million Yuan. In terms of perfecting the patent licensing system, the Draft proposed to establish a new domestic priority system for applying design patents, optimize the procedures for claiming priority, and extend the protection period of design patents from 10 years to 15 years. The Draft also defined the principles of good faith and prohibition of abuse of rights, and extended to the scope of protection of patents for innovative drugs.

The 9th China IP Annual Forum

From Jan 12 to 13, the 9th China IP International Annual Forum & 2019 Annual Conference of In-house IP Managers was held in Beijing. With the theme of "New Era, New Frame and New Balance", the Forum focused on the new path of innovation for Chinese enterprises, and the development of intellectual property rights, under the era of changes. At the forefront of the intellectual property industry and fully grasping the trends of development and the IP industry, the Forum attracted representatives from IP department of governments, experts, scholars, representatives of IP service agencies, as well as IP managers from hundreds of enterprises from China, the US, France, the UK, Japan and other countries and regions. The total number of participants was more than 800.

The Establishment of the Intellectual Property Tribunal of the Supreme People's Court

On Jan 1, the IP Court of SPC was established in Beijing. Zhou Qiang, chief justice and president of SPC, unveiled the IP Court. The establishment of IP Court was to further unify the adjudication standards of IP cases, equally protect the legitimate rights and interests of all market subjects in accordance with the law, and strengthen the judicial protection of IPRs. Since Jan 1, the IP Court had performed its statutory duties, hearing mainly patent and other professional and technical, civil and administrative IP appeal cases.

E-Commerce Law

On Jan 1, the E-Commerce Law of the People's Republic of China was formally implemented, which regulated the behavior of E-commerce operators, including individuals. The E-Commerce Law stipulated that e-commerce operators, including procurement service providers, are required to register as market entities and pay taxes in accordance with the law. When E-commerce operators engaged in cross-border e-commerce, they shall abide by laws, administrative regulations, and relevant state guidances on import and export. E-commerce platform business operators shall establish and improve credit evaluating systems, publicise credit rating rules, and provide consumers with a channel through which they can evaluate the commodities sold or services provided on the platform, otherwise they may be fined up to 500,000 Yuan.

Reach for Gold

On Jan 24, WIPO announced the theme of 2019 World Intellectual Property Day–Reach for Gold: IP and Sports. April 26, 2019 was the 19th World Intellectual Property Day. The WIPO website points out that sports has become a multi-billion dollar global industry and that business relationships based on intellectual property rights help protect the economic value of sports. According to WIPO's introduction, this year's World Intellectual Property Day would explore how innovative creations and IPRs that encourage and protect innovative creations can contribute to the development of global sports; how sports enterprises use patents and designs to promote the development of new sports technologies, new materials, new training methods and new equipment, so as to help improve sports performance and attract sports enthusiasts all over the world; how sports stars can generate income by their own brands and working with brand sponsors; how broadcasting rights lay the foundation for the relationship between sports and television and other media, making it easier for sports enthusiasts to have access to sporting events; how technological advances in robotics and artificial intelligence drive changes in sports.

50 Million Yuan

On Jan 4, the unfair competition and trademark infringement case of Guangzhou Hongri Gas Appliances Co., Ltd. (Hongri) v. Guangdong Ruishang Electrical Appliances Co., Ltd. (Ruishang) and eight other defendants were heard. The Guangzhou Intellectual Property Court held that Ruishang's use of the "Hongri E" trademark on gas stoves, range hoods, water heaters, and other products infringed upon the rights and interests related to the brand name "Hongri" held by Hongri, and the related acts constituted unfair competition. The court ruled Ruishang to stop the infringement immediately and remove the infringing trademarks on its inventory, and together with other dealers to compensate Hongri the economic loss of 50 million Yuan and reasonable rights protection costs of 450,000 Yuan. This was the highest amount of compensation ruled by the Guangzhou Intellectual Property Court since its establishment.

Internet Court

Jan 8 was the 100-day anniversary of Guangzhou Internet Court's establishment. Over the past 100 days, Guangzhou Internet Court had put 1,861 cases on file and concluded 951, and the first batch of 13 judges had closed 73 cases per capita. The intelligent trial platform had received more than 3 million visitors, received 2,903 applications for filing, and the subject matter involved was more than 120 million Yuan. Among them, 44.01% of the applications for filing were automatically received during off-working hours. 46% cases were Internet copyright infringement disputes, contract disputes of financial loan accounting for 26%. The remaining cases were mainly related to online shopping contract disputes, small loan contract disputes, Internet service contract disputes, the use of the Internet to infringe upon other people's personal rights, property rights disputes and so on. In mid-February, Guangzhou Internet Court launched the judicial blockchain platform to solve the difficulty of obtaining electronic evidence. Guangzhou Internet Court was established on September 28, 2018, the third Internet court established in China after Hangzhou and Beijing Interenet Courts.

Acceptance Windows

On Jan 31, the Trademark Office of CNIPA issued the Announcement on Approving the Establishment of the Seventh Batch of Trademark Acceptance Windows, the seventh batch of 12 industrial and commercial and market regulatory departments, including the Miyun Branch of Beijing Municipal Market Supervision Administration, to set up trademark acceptance windows, which would officially start operation on Feb 1, 2019 to carry out the acceptance and registration of trademark applications. The 12 trademark acceptance windows are: Miyun (Beijing), Ulanqab (Inner Mongolia), Huangpu (Shanghai), Yangpu (Shanghai), Xiangyang Free Trade Zone (Hubei), Yichang Free Trade Zone (Hubei), Xixian New Area (Shaanxi), Yangling Demonstration Zone (Shaanxi), Jiayuguan (Gansu), Jinchang (Gansu), Wuwei (Gansu), Linxia (Gansu).

Meiling

Four companies used the "Meiling" trademark on suspended ceilings, bathroom heaters and other products, and used the word "Meiling" in the enterprise names, for which Hefei Meiling Co., Ltd. sued them to the Beijing Intellectual Property Court. After hearing, the court held that in this case, the four defendants had a division of labor and communication of meaning, their ways of infringement were similar, which constituted joint infringement and should be held liable in accordance with the law. The evidence showed that the benefits gained by the four defendants from infringing acts and the losses caused to the plaintiff were far higher than the plaintiff's claim of 3 million Yuan, so the compensation claimed by the plaintiff was fully supported by the court. The four defendants should jointly and severely bear the liability of 3 million Yuan for compensation.

 

FEB

The Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area Issued

On Feb 18, the Central Committee of CPC, and the State Council issued the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area, which called for strengthening the protection and application of IPR in optimizing the regional innovation environment. The Outline proposed to strengthen Guangdong-Hong Kong-Macau Greater Bay Area's cooperation in IPR protection and professional training in an all-round way, relying on the regional IP cooperation mechanisms between Guangdong and Hong Kong, Guangdong and Macao, and the Pan-Pearl River Delta. The administrative law enforcement and judicial protection of IPR should be better strengthened, to better realize the role of institutions such as the Guangzhou Intellectual Property Court, and strengthen IP law enforcement in key areas and links such as e-commerce, import and export. International cooperation in the creation, application, protection and trade of intellectual property rights should be strengthened to establish and improve a mechanism for cross-border cooperation in intellectual property cases. Relying on the existing trading venues to carry out intellectual property transactions to promote the rational and effective circulation of intellectual property rights and carry out the cultivation of a standardized market for IP protection and the commitment of "genuine goods". Full play should be given to the radiating role of IP service development zones to promote the integrated development of high-end IP services and regional industries, and promote the settlement of IP disputes through non-litigation dispute resolution (including arbitration, mediation, negotiation, etc).

Institutional Adjustment of CNIPA

In accordance with the reform and deployment of the central organs, the former Patent Reexamination Board of CNIPA was merged into the Patent Office of CNIPA, while the Trademark Office of the former State Administration for Industry and Commerce (SAIC), Trademark Review and Adjudication Board, and Trademark Examination and Cooperation Center were integrated into the Trademark Office of CNIPA. After the restruction, the examination of patents and trademarks would be carried out in the name of CNIPA.

China and the US Conclude the 7th Round of High-Level Economic and Trade Consultations

On Feb 24, the 7th round of China-US High-level Economic and Trade Consultations concluded. The two sides implemented the consensus reached by the two heads of state during their Argentina meeting late last year, and had in-depth communication on topics of mutual concerns including technological transfer, IPR protection, non-tariff barriers, the service industry, agriculture, trade balance and implementation mechanism. US President Donald Trump announced on Twitter that he would postpone the plan to raise tariffs on Chinese imports on Mar 1. This round of consultations had taken another important step forward in promoting the settlement of economic and trade frictions between China and the US. In the last round of consultations, the two sides reached a consensus in principle on major issues and discussed a memorandum of understanding on bilateral economic and trade issues, while in this round, the two sides mainly discussed trade balance and structural issues, and substantial progress was made on specific issues. From consensus in principle to substantive progress, from agreement consultations to text negotiations, China-US Economic and Trade Consultations had paid more attention to details and had been getting closer to the goal of reaching an agreement. In recent years, IPR protection has been included in the list of achievements of the China-US consultations many times, which had made substantial progress in this round of consultation, fully reflecting the consistency of the aspirations of the two sides and the overlap of interests.

Annual Data

The CNIPA released annual statistics on patents, trademarks, geographical indications and layout-designs of integrated circuits in 2018. Data showed that in 2018, the number of applications for invention patents in China was 1.542 million, and a total of 432,000 invention patents were authorized, of which 346,000 domestic invention patents were granted. In 2018, the top three domestic enterprises (excluding Hong Kong, Macao and Taiwan) in the number of invention patents granted in China were: Huawei (3369), China Petrochemical (2849), OPPO (2345). By the end of 2018, the number of invention patents in China reached 1.602 million, an increase of 18.1% over the same period last year; the number of invention patents per 10,000 population reached 11.5. In 2018, the number of PCT international patent applications accepted was 55,000, an increase of 9.0% over the same period last year. The number of domestic valid trademark registrations (excluding foreign registrations in China and through Madrid System) reached 18.049 million, an increase of 32.8% over the same period last year. The number of applications for international trademark registration through Madrid System exceeded 6,000, an increase of more than 25% over the same period last year. A total of 2,380 geographical indication products and 4,867 registered geographical indication trademarks were approved.

5G Plan

Beijing issued the Beijing 5G Industry Development Action Plan (2019-2022), which put forward that in the next five years, major projects and activities, such as the Beijing sub-city center, Beijing's new airport, the 2019 Beijing World Expo, the 2022 Beijing Winter Olympic Games, and the upgrading along Chang'an Street, would become the demonstration of 5G applications. The Plan took demand traction, innovation-driven, key breakthroughs, and advanced layout as the development principles, and put forward development goals in aspects of network construction, technological development, and industrial development. The goal of network construction was that by 2022, Beijing telecommunication operators would invest more than 30 billion Yuan in 5G to achieve 5G network coverage in the functional core areas, and sub-centers of the city.

Import and Export

The growth rate of China's service exports reached an eight-year high in 2018, and imports and exports maintained a high growth rate in December, according to the official website of the Ministry of Commerce. In 2018, IP royalty imports totaled 235.52 billion Yuan, up 22%; and exports totaled 36.8 billion Yuan, up 14.4%. Exports of technical services totaled 115.35 billion Yuan, up 14.4%, while imports totaled 83.92 billion Yuan, up 7.9 %. The scale of service import and export reached a record high, with its structure being continuously optimized, and the quality improved. The import of IP royalties increased significantly, with the demand and export competitiveness of high-end productive services increasing simultaneously. It showed that China's demand for high-end productive services has been strong, while the export competitiveness of high-end productive services was also improving.

Software Copyright

China's software copyright protection platform was officially released on January 18 at the Annual Meeting of China's Software Industry Association, The Chinese software copyright protection platform was jointly developed by the China Software Industry Association and Unitrust Time Stamp Authority, which aimed to enhance the IP protection awareness of Chinese software enterprises, strengthen their independent protection ability, solve the difficulties in confirming the right of software and providing proof. The platform took the legally valid trusted time stamp authentication as the main means, which could be authenticated in real time in the code generation, design and development stage, and issued legally valid trusted time stamp authentication certificate for the software work in time. Through the website, API interface and mini programs provided by the platform, software developers could obtain proof of ownership in a few seconds to achieve the purpose of rapid, immediate and effective self-protection of IPR. The official website of the China Software Industry Association, as the entrance to China's software copyright protection, would continue to open service portals all over China in the future, and any enterprise and individual can obtain software copyright protection services through Internet.

 200 Million Yuan

According to preliminary statistics, customs across China detained a total of 44,500 batch of inbound and outbound infringing goods in 2018, involving 22.94 million pieces of infringing goods worth 200 million Yuan, according to data released by the General Administration of Customs. The batch, quantity and value of infringing goods seized by customs in 2018 increased by 132.1%, decreased by 43.4%, and increased by 11.1% respectively over the previous year. In 2018, the Customs launched a four-month "Longteng" special campaign to protect IPRs of enterprises with advantages in exporting IPRs, confiscating 385 batches of suspected infringing import and export goods, involving 3.09 million pieces of goods worth 61.14 million Yuan. The Customs together with the State Administration of Market Supervision and other departments, launched a 2018 Special Action Plan on Supervision of Online Market "Sword at the Internet Campaign" to crack down on infringement and violation of the law in the Internet field. In addition, the Customs also made great efforts to promote regional customs law enforcement cooperation, establish a rapid response to major cases and major infringement risk information, and establish a linkage mechanism for the detection and distribution of cases, so as to prevent the act of infringing and counterfeit goods circulating to other ports. The Customs also conducted joint supervision with the Ministry of Public Security on major cases such as the export of integrated circuits and sports shoes. In terms of international cooperation, in 2018, the Customs also strengthened exchanges with countries and regions along the "Belt and Road Initiative" on IPR protection.

 

MARCH

 

New Regulation on Patent Agency Come into Effect on Mar 1

The revised Regulation on Patent Agency would enter into force as of Mar 1. The Regulation meet the requirements of streamlining administration and delegating powers, combining decentralization and management, and optimizing services and the needs of optimizing the business environment, stimulating market vitality and social creativity. The Regulation was made according to the actual situation of the patent agency industry, improving the practice access of patent agencies and patent agents, enhancing the practice norms of patent agents, refining the inspection and supervision system, and legal liability, providing institutional support for the healthy development of the patent agency industry. By the end of 2018, China had 18,668 patent agents and 2,195 patent agencies, with more agencies capable of providing foreign-related services, patent early warning, analysis, licensing, pledge financing, litigation, mediation. There were more than 1,000 agencies engaged in PCT application. After the promulgation of the New Regulation, CNIPA had actively carried out promotion and implementation work, and would complete the revision of relative rules as soon as possible. CNIPA would continue to raise the level of supervision of the industry, ensure that the New Regulation is implemented in place, and provide strong support for innovation-driven development.

 

The Government Work Reports of the Two Sessions Add Content Related to IPR

On Mar 15, the second session of the 13th National People's Congress concluded in Beijing. The meeting heard and examined the government work report delivered by Premier Li Keqiang of the State Council. The report had 83 amendments concentrated in six areas: ensuring and improving people's livelihood, accelerating scientific and technological innovation, deepening reform in key areas, promoting rural revitalization, strengthening pollution prevention and ecological construction, and continuously releasing the potential of domestic demand. The govenment would continue to reduce the time for patent examination and trademark registration. In addition, the government would reform and improve the financial support mechanism, establish a science and technology innovation board that would pilot an IPO registration system, encourage the issuing of special bonds for innovation and entrepreneurship, expand the use of intellectual property pledge financing, and and support the growth of venture capital investment.

First Case Heard in Public at the Intellectual Property Court of SPC

On Mar 27, the Intellectual Property Court of the Supreme People's Court held a public hearing on the dispute over infringement of invention patent rights among the appellant Xiamen Lucas Automotive Parts Co., Ltd. (Lucas) and Xiamen Fuke Automotive Parts Co., Ltd. (Fuke), and the appellee Valeo Systemes D'Essuyage, and Chen Shaoqiang, the defendant in first instance. This was the first case heard in public since the Intellectual Property Court of the SPC was officially established on Jan 1, 2019. Luo Dongchuan, vice president of the SPC, chief judge of the Intellectual Property Court of SPC, personally served as the presiding judge of this case. The case in first instance was the first partial judgment made by Shanghai Intellectual Property Court. It also discussed the relationship between partial judgment and temporary injunction, for the first time, and made clear the applicable conditions and rules when the two systems coexist. After the trial, the Intellectual Property Court of SPC ruled that the appeal request of Lucas and Fuke could not be established and was rejected, and the decision made by Shanghai Intellectual Property Court was upheld. The compensation would be decided by the Shanghai Intellectual Property Court.

Foreign Investment Law

On Mar 15, the second session of the 13th National People's Congress passed the Foreign Investment Law of the People's Republic of China, which is China's first basic law in the field of foreign investment. The Law would come into force on Jan 1, 2020. The Law made clear provisions on issues of common concern to foreign investors, such as intellectual property protection and technology transfer, sending a signal to the world that China continues to promote trade liberalization and investment facilitation. It stipulated that China protects the intellectual property rights of foreign investors and foreign-invested enterprises, protects the legitimate rights and interests of intellectual property right holders and relevant right holders, and shall investigate legal liability for intellectual property infringement in strict accordance with the law.

Copyright Registration

On Mar 1, the website of the National Copyright Administration released the National Copyright Registration Report in 2018. Remarkable achievements had been made in promoting the transformation of copyright achievements throughout China, and the ability of creation and innovation of all kinds of works and software had been greatly improved. According to statistics, the total number of copyright registrations in China reached 3,457,338 in 2018, an increase of 25.83% compared with 2017 (2,747,652). A total of 2,351,952 works were registered nationwide in 2018, an increase of 349,986 over the number of works registered in 2017 (2,001,966), a growth rate of 17.48 percent. A total of 1,104,839 computer software copyright registrations were completed in 2018, an increase of 48.22% over the same period last year.

China Audio-Video Copyright Association

On Mar 21, the monopoly dispute of nine KTV companies in Guangdong v. China Audio-Video Copyright Association (CAVCA) was heard in Beijing Intellectual Property Court. The dispute originated from an announcement issued by CAVCA in November 2018, in which CAVCA informed KTV terminal producers and karaoke operators to delete more than 6,000 unauthorized songs, otherwise they may face the risk of prosecution. During the trial, the two parties argued around whether CAVCA's acts involved in the case violated the provisions of Article 17, paragraph 1, subparagraphs (4) and (5) of the Anti-Monopoly Law, whether CAVCA had a dominant position in the market, whether the act involved in the case was an act of bundled transaction, whether it limited unreasonable transaction conditions, whether the relevant litigation request put forward by the plaintiffs belonged to the circumstances stipulated in Article 34 of the Regulations on Collective Administration of copyright, whether it should be reported to the relevant departments of the State Council, and whether the plaintiffs' prosecution should be rejected.

New Plant Varieties

According to data from the Protection of New Varieties of Plants Office of State Forestry and Grassland Administration, by the end of 2018, China had accepted a total of 3,715 applications for new plant varieties and granted 1,763 new plant variety rights at home and abroad. Among them, 904 applications were accepted and 405 granted in 2018. From 1999 to 2017, domestic applicants obtained 1,170 new plant variety rights, accounting for 86.16% of the authorized total. 10 foreign countries obtained 188 new plant variety rights in China, accounting for 13.84%, of which Germany, the Netherlands and France ranked top three, with 57, 46 and 30 plant variety rights respectively. The new plant varieties authorized by foreign variety owners were mainly in the genus rosa and ornamental plants. The number of applications and grants of new variety rights of forestry plants in China had increased significantly in recent years, indicating that the protection of new varieties of forestry plants in China had entered a period of rapid development.

Parfums Christian Dior

On March 7, Parfums Christian Dior's (Dior) trademark registration rejection case was selected as one of the "Top ten cases promoting the rule of law in 2018". On Apr 26, 2018, the SPC held a public hearing on Dior v. Trademark Review and Adjudication Board of the State Administration for Industry and Commerce on the administrative dispute over trademark registration rejection. The final judgment of the SPC held that the sued decision made by the Trademark Review and Adjudication Board violated the principle of legitimacy of administrative procedures and may harm the reasonable expected interests of the administrative counterparty. The first and second instance courts did not correct this properly, so the court ruled to revoke the judgments of first and second instance, and ordered the Trademark Review and Adjudication Board to make a new review decision on the trademark involved in the case.

Shenzhen Regulation

Since Mar 1, The Regulation of Shenzhen Special Economic Zone on the Protection of Intellectual Property Rights was formally implemented. The Regulation was China's first comprehensive and the strictest regulation on the protection of IPRs. The highlights of the Regulation included: First, the construction of a credit punishment mechanism for violations of IPRs in judicial adjudication, administrative penalties, government investment, procurement and bidding, and support for reward activities. In addition, information that violates IP compliance commitments should be taken into the public credit information system. Second, it stipulates that infringement units will not be allowed to undertake government investment projects within five years; Third, strengthening multiple disputes resolution mechanisms, such as litigation docking and administrative mediation. Fourth, establishing a technical investigator system for administrative law enforcement. Fifth, expanding the scope of application of direct orders to stop infringement. Sixth, clarifying the calculation of illegal business volume of violations of IPRs.

 

APRIL

 

First Administrative Case of Patent Right Invalidation

On Apr 23, the Intellectual Property Court of SPC publicly heard the administrative dispute over the invalidation of the invention patent right among the appellants Beijing Baidu Netcom Technology Co., Ltd. and Beijing Sogou Technology Development Co., Ltd. v. the Patent Reexamination Board of CNIPA. The case was the first administrative case of patent right invalidation tried by the Intellectual Property Court of SPC, but the court did not pronounce a verdict in court after the trial. The case stemmed from a patent lawsuit between the two companies involving the deletion function of input method. In November 2015, Sogou sued Baidu to the Beijing Intellectual Property Court on the grounds of infringing its patent rights. The court of first instance ruled that the Baidu input method fell into the scope of protection of the patent involved and should immediately stop the infringement. Baidu appealed, yet the verdict was upheld. While dealing with the patent lawsuit, Baidu launched a patent invalidation procedure. In February 2018, the former Patent Reexamination Board made a decision to maintain the validity of the patent right involved in the case. Baidu filed an administrative lawsuit with the Beijing Intellectual Property Court, requesting to rescind the sued decision. In January 2019, the court revoked the sued decision. Baidu and Sogou both refused to accept the judgment and filed an appeal to the SPC.

Revision of Trademark Law and Anti-Unfair Competition Law

On Apr 23, the 10th meeting of the Standing Committee of the 13th National People's Congress decided to amend eight laws, including the Trademark Law and the Anti-Unfair Competition Law. The revision of the Trademark Law involved six provisions, four of which were regulations of malicious trademark registration, providing a direct, clear and operable basis for cracking down on trademark registration. The revision of the Anti-Unfair Competition Law was another revision after November 2017, involving only four provisions.

2019 High Level Forum on China Intellectual Property Protection

On Apr 24, the 2019 High Level Forum on China Intellectual Property Protection opened with the theme of "strengthening the protection of intellectual property and fostering a harmonious business environment" in Beijing. Shen Changyu, director of CNIPA pointed out that the theme of this year's forum met the actual needs of China's development and was of great practical significance. In 2019, centering on strengthening IPR protection, CNIPA would focus on five major tasks: formulating a strategic outline for a powerful country in IPR, developing and implementing plans for the construction of an IPR protection system, improving laws and regulations on IPRs, strengthening IPR source protection, and innovating IPR protection mechanisms.

Issued by Six Departments

On Apr 19, the General Administration of Market Supervision, together with the Ministry of Public Security, the Ministry of Agriculture and Rural Affairs, the General Administration of Customs, the National Copyright Office, and CNIPA, issued the Measures for Strengthening Intellectual Property Law Enforcement in Online Shopping and Import and Export, to further improve the ability of IP law enforcement and strengthen the investigation and punishment of IP infringement with close cooperation among departments, and earnestly safeguard the legitimate rights and interests of the right holders and the market order of fair competition. In view of the current online and offline integrated operation, cross-region and chain of torts in the field of online shopping and import and export, the Measures put forward six measures: strengthen law enforcement supervision in accordance with the law, broaden the sources of clues, strengthen the coordination and linkage of law enforcement, vigorously promote the convergence of administration and criminal methods, improve the social co-governance mechanism, and establish a job security system.

VCG

On Apr 10, six places around the world released the first photo of a black hole in human history. Later it was discovered on VCG's website that the copyright of the black hole photo was marked as owned by VCG. VCG mentioned in the description of the photo that "this picture was an editorial picture, if it was to be used for commercial purposes, please call or consult the customer representative." Then it was found that the Chinese national flag and national emblem were marked as copyright owned by VCG. The Tianjin Internet Information Office immediately ordered VCG to stop transmitting relevant information and take measures to eliminate the bad influence. On Apr 18, the Tianjin Internet Information Office revealed that it had imposed a heavier fine on VCG for spreading illegal and harmful information, with a fine of 0.3 million Yuan.

Settlement between Qualcomm and Apple

On Apr 16, Qualcomm and Apple announced that they had reached a settlement agreement to remove all lawsuits around the world. Qualcomm and Apple have reached a patent licensing agreement and chip supply agreement for a period of six years with an option to extend for two years, which will take effect on Apr 1, 2019, Qualcomm said in a statement. The settlement included: Apple would pay patent license fees to Qualcomm; Apple would make a one-time payment to Qualcomm; the two sides reached a multi-year chip supply agreement; and the two sides withdrawn all lawsuits around the world, including claims involving Apple's contract manufacturers. Since the start of the "patent war" between Qualcomm and Apple in 2017, Qualcomm and Apple have filed dozens of increasingly fierce patent lawsuits worldwide. In the past few months, Apple has received two bans in China and Germany.

Tmall Copycat

The Intellectual Property Division of the Zhejiang Higher People's Court heard the case of 17 "Tmall copycat companies" registered by Zhou, rejected the appeal of the 17 companies, and upheld the original verdict. It demanded that the 17 companiess involved immediately stop infringement and eliminate impact, and compensate Alibaba Group Holdings Co., Ltd. and Zhejiang Tmall Network Co., Ltd. for economic losses of 1.5 million Yuan. The court held that the trademark of "Tmall" involved has been well known by the relevant public and can be recognized as a well-known trademark. Guangdong Tmall Food and Beverage Management Co., Ltd. highlights the use of the "Tmall" logo at its facade, constituting trademark infringement. Guangdong Tmall Food and Beverage Management Co., Ltd., its sub-companies and Zhou registered and used the word "Tmall" in company management and advertising, constituting an act of unfair competition. Taking into account such factors as the popularity of the trademark involved, the nature and circumstances of the infringement, and the reasonable costs for safeguarding rights paid by Alibaba and Tmall, the court held that the amount of compensation determined by the court of first instance was legal and reasonable, so it ordered that the appeal be rejected and the original verdict upheld.

Sword at the Internet Campaign 2019

At the 2019 China Internet Copyright Protection and Development Conference on Apr 26, the National Copyright Administration, the State Internet Information Office, the Ministry of Industry and Information Technology, and the Ministry of Public Security jointly launched "Sword at the Internet Campaign 2019" to crack down on online copyright infringement and piracy. Special rectification of copyright would be carried out in key areas such as media integration and development, cinema films, streaming media, and picture markets. This was the 15th consecutive "Sword at the Internet Campaign" special action carried out in China. This campaign would carry out the following five key rectification in six months: deepen media integration and develop copyright protection, strictly rectify online copyright of cinema, films, strengthen the key supervision of copyright of streaming media, standardize the operation order of copyright protection in the picture market, and consolidate the achievements of copyright governance in key areas of the network.

Generic Drugs

On Apr 23 and 24, AstraZeneca filed two consecutive drug patent infringement lawsuits in China, targeting generic drug companies. Some analysts believed that before the arrival of the patent cliff in 2019, domestic generic drug companies had been following up. Since China had not yet established an effective drug patent linkage system, it could be foreseen that large-scale drug patent infringement litigation would break out.

 

 

MAY

 

Report on the Latest Development in IPR Protection and Business Environment in China Released

On May 15, the Information Office of the State Council held a press conference to introduce the Report on the Latest Development in IPR PRotection and Business Environment in China (2018). Gan Lin, deputy director of the State Administration of Market Supervision and Administration, Gan Shaoning, deputy director of CNIPA, and representatives of the Supreme People's Court and the General Administration of Customs introduced the relevant situation at the press conference. Gan Lin said that in 2018, in accordance with the requirements of institutional reform, China optimized and integrated the duties of intellectual property administration, newly established the State General Administration of Market Supervision and Administration, and regrouped CNIPA. Trademark and patent administration, and administrative law enforcement were unified, major breakthroughs have been made in the reform of intellectual property trials. The Supreme People's Court had set up Intellectual Property Court, and 17 higher people's courts, 113 intermediate people's courts and 129 grass-roots courts had implemented the "three-in-one" reform in the trial of civil, administrative and criminal cases of intellectual property rights.

Growth Rate of IP Royalties Reaches 11.7%

China's service imports and exports totaled 1.29198 trillion Yuan in the first quarter of 2019, an increase of 2.6 percent over the same period last year, according to service import and export data released by the Ministry of Commerce on May 9. Service exports totaled 463.49 billion Yuan, up 10.3%. Service imports totaled 828.49 billion Yuan, down 1.3%. The deficit was 365 billion Yuan, down 14.3%. Data showed that in the first quarter, exports of knowledge-intensive services such as IP royalties, telecommunications, computer and information services, other commercial services, and insurance services grew by 52.4%, 15.1%, 14.1% and 11.7%, respectively. The rapid growth of the export of knowledge-intensive high-end services showed that the competitiveness in the field of productive services in China had gradually improved, the high-quality development characteristics of service trade had emerged, and the export of knowledge-intensive high-end services had become a highlight.

The Ministry of Finance and CNIPA Jointly Promote the Construction of IP Operation Service System

On May 7, the Ministry of Finance and CNIPA jointly issued the Notice of Building the Intellectual Property Operation Service System to continue to select a number of key cities with high concentration of innovative resources, strong radiation-driven role, and urgent needs for intellectual property to support regional development, and the construction of intellectual property operation and service system in 2019. The government would support 150 million to 200 million Yuan for each key city, which can be used to support the construction of intellectual property operation service system by means of award replacement, government purchase of services, equity investment. The Notice refines the performance objectives of related works in IP supporting regional development, improving the quality of IP output, improving the ability to use IPRs, and expanding IP financial services.

China Brand Day

On May 10, the 2019 China Brand Day opened in Shanghai. Since 2017, China has designated May 10 each year as China Brand Day, and the first China Independent Brand Expo and International Forum on Chinese Brand Development was held in Shanghai in May 2018. The theme of 2019 China Brand Day was "Chinese Brand, World Sharing". There were 16 trade associations and 13 independent brand consumer goods experience zones set up in Shanghai, as well as nearly 200 independent brand enterprises displayed their domestic products, covering four major consumer goods areas, such as light industry, textiles, automobiles, and electronic information. According to Fortune's list of the world's top 500 companies in 2018, 120 Chinese companies have been shortlisted, ranking second in the world.

Pre-examination Platform

The preliminary examination management platform of the National Intellectual Property Protection Center launched in the China (Guangdong) Intellectual Property Protection Center, and would be gradually put into operation in intellectual property protection centers all over the country. The pre-examination management platform has the characteristics of full process, intelligent, customizable, cloud service, and integrates the functions of electronic application, registration filing, rapid pre-examination of patent application, automatic classification, rapid pre-examination of invalid request for review, rapid pre-examination of patent evaluation report processing, credit management, intelligent auxiliary examination, which can realize the electronic management of the whole process and provide the National Intellectual Property Protection Center with unified government services of rapid authorization, and determination of power. The pre-examination management platform is mainly divided into the electronic application system and the protection center pre-examination management system.

Technical Investigators

Since May 1, Several Provisions of the Supreme People's Court on Technical Investigators' Participation in Legal Proceedings of Intellectual Property Cases had been formally put into force, and the court would implement the system of technical investigators in handling technical intellectual property cases. The provision makes it clear that the people's courts may appoint technical investigators to participate in litigation activities when handling professional and highly technical intellectual property cases, such as patents, new plant varieties, layout and design of integrated circuits, technical secrets, computer software, monopolies. Technical investigators are equivalent to the trial support staff of the judge's assistants, to assist judges in understanding and identifying professional and technical issues involved in cases. The technical investigation opinions can be used as references for the collegial panel to determine technical facts, and the collegial panel shall be responsible for the determination of the technical facts in accordance with the law.

Global Settlement

According to the Guangdong Higher People's Court, through litigation mediation, Huawei Technology Co., Ltd. and Samsung (China) Investment Co., Ltd. reached a global settlement in a series of infringement disputes involving standard essential patents, reached a patent license agreement framework on the cross-licensing of standard essential patents between the two sides around the world, and recently launched follow-up work such as the withdrawal of relevant cases. Huawei and Samsung had held several rounds of negotiations on patent cross-licensing since 2011, but no substantial progress had been made. Since then, the two sides had filed more than 40 lawsuits in China and relevant countries respectively. On Jan 11, 2018, the Shenzhen Intermediate People's Court issued a first-instance judgment on two of the patent infringement cases, finding that the 4G smart terminal products produced and sold by Samsung in China infringed Huawei's two patent rights. Samsung was not convinced and appealed to the Guangdong High People's Court. During the second instance trial, Huawei and Samsung made significant progress in patent technology licensing negotiations after multiple mediations held by the court, and finally reached a global settlement.

Prohibition Order Postponed

On May 20, the US Department of Commerce issued a 90-day temporary license for Huawei, which ensured that Huawei would be able to continue to update its software on its phones for the next three months despite the suspension of cooperation with Google and other companies. Earlier, US President Donald Trump signed an executive order on May 15 requiring US companies to obtain special permission from Washington to sell products to Huawei. Because the extreme difficulties to obtain a license, this would in effect prevent US hardware and software makers from selling related products to Huawei. On May 20, Google suspended some of its cooperation with Huawei, including the transfer of hardware, software and technical services, but services obtained through open source licenses were not included. On the same day, four of the world's leading chip companies and suppliers, Intel, Qualcomm, Xilinx and Broadcom also announced that they would suspend cooperation and deals with Huawei. Reuters commented that the Commerce Department's move marks that the ban on Huawei could have direct, far-reaching and unintended consequences.

Artificial Intelligence

The Beijing Internet Court publicly heard the case of Beijing Film Law firm v. Beijing Baidu Netcom Technology Co., Ltd. on infringement of the right of attibution, the right of integrity, and the right of information network dissemination. The court ruled that the contents of the articles involved in the case generated intelligently by computer software did not constitute works, but also pointed out that their relevant contents could not be used freely, and Baidu's unauthorized use of the articles involved constituted infringement. Baidu was ordered to compensate the economic losses and reasonable expenses totaling 1,560 Yuan. This judgment was the first time that the people's court had responded to the copyright protection issues related to the intelligently generated content of computer software, and had made a beneficial exploration on the copyright protection issues under the background of artificial intelligence and big data application era. The focus of the dispute was whether the content intelligently generated by computer software could constitute a work. In this regard, the Beijing Internet Court held that the completion of the creation of natural persons should still be a necessary condition for written works in the field of Copyright Law.

 

JUNE

The Measures for the Qualification Examination of Patent Agents Enter into Force on June 1

The State Administration of Market Supervision and Administration had promulgated the Measures for the Qualification Examination of Patent Agents. The Measures would enter into force on June 1, 2019, and the Measures for the Implementation of Patent Agents Qualification Examination, the Rules for Patent Agent Qualification Examination and the Measures for Dealing with Disciplinary Violations in Patent Agent Qualification Examination issued in 2008 would be abolished. The Revised Regulation on Patent Agency had already came into effect on March 1, 2019, and the practice access system for patent agents had been greatly revised accordingly. As a regulation of supporting departments, the Measures subsequently revised the registration conditions for the examination and the materials to be submitted, stipulating that all Chinese citizens who obtained at least a college degree in science and engineering, and obtained a diploma or degree certificate could take the examination, thus lowering the threshold. In recent years, the number of applicants for the national patent agent qualification examination shown a trend of increasing year by year. After the number of applicants exceeded 30,000 for the first time in 2016, the number of applicants in 2018 reached nearly 40,000. The number of people who passed the examination also increased year by year, reaching 5,232 in 2018. By the end of 2018, the number of licensed patent agents in China had reached 18,668.

Six Major Tasks in IP in 2019

On June 17, Office of the State Council Inter-Ministerial Joint Meeting for Implementing the Intellectual Property Strategy issued the Promotion Plan for the in-Depth Implementation of the National Intellectual Property Strategy and the Acceleration of the Building of a Powerful Intellectual Property Nation in 2019, defining the six key tasks and 106 specific measures for promoting the implementation of the national intellectual property strategy in 2019. In deepening IPR reform, specific measures include integrating policies, projects and platforms for patents, trademarks and geographical indications, promoting the interconnection of major policies, unifying service windows and work processes, and promoting the realization of "One-stop Office" for intellectual property related applications. In terms of strengthening the protection of IPR, it is proposed to improve laws and regulations, strengthen the construction of a long-term mechanism for protection, strengthen the administrative and judicial protection of IPR. It also puts forward specific measures such as cooperating with the deliberation of the Amendment to the Patent Law (draft), further promoting IPR protection of "Internet +", and organizing special law enforcement actions on infringement and counterfeiting.

5G Licenses Officially Issued

On June 6, the Ministry of Industry and Information Technology officially issued 5G licenses to China Mobile, China Telecom, China Unicom and China Radio and Television Network Co., Ltd., which meant that after nearly six years of 4G commercial use, domestic telecom operators finally obtained the qualification to launch 5G commercial use. China had officially entered the first year of 5G commercial use, and the pace of operators' work related to the deployment of 5G would be accelerated. Prior to this, China Mobile, China Telecom and China Unicom had deployed 5G trial commercial areas in many places. On Apr 23, China Unicom officially launched its 5G experimental network in seven cities. China Unicom also become the first Chinese operator to provide consumers with a 5G experience. The 5G standard is a unified international standard jointly developed by the global industry, and the standard essitial patents declared by China account for more than 30%. In the technology trial stage, Nokia, Ericsson, Qualcomm, Intel and other foreign enterprises have been deeply involved, with the joint efforts of all parties, China 5G already has a commercial foundation.

160 Million Fine

On June 5, the official website of the State Administration of Market Supervision and Administration issued a decision that a fine of 162.8 million Yuan was imposed on Changan Ford for implementing the vertical monopoly agreement. According to the decision, since 2013, Changan Ford had set a minimum resale price for downstream dealers in Chongqing by formulating a price list, and signing a price self-discipline agreement, setting a minimum price for downstream dealers during the auto show and online, in violation of the provisions of the Anti-Monopoly Law prohibiting operators from reaching a monopoly agreement with their counterparties to resell goods to a third party. In the course of the investigation, Changan Ford did not provide evidence to prove that its relevant actions were in line with the exemption under Article 15 of the Anti-Monopoly Law. As a result, the above behaviors of Changan Ford deprived the downstream dealers of pricing autonomy, excluded and limited the competition within the brand, and actually weakened the competition among brands, harming the fair competition in the relevant markets and the legitimate interests of consumers. According to the Anti-Monopoly Law, the General Administration of Market Supervision fined Changan Ford 4% of its sales in Chongqing in the previous year.

Artificial Intelligence Governance

On June 17, National Governance Committee for the New Generation Artificial Intelligence issued the Governance Principles for the New Generation Artificial Intelligence Developing Responsible Artificial Intelligence, which put forward a framework and action guidelines for artificial intelligence governance, highlighting the theme of "developing responsible artificial intelligence". In view of the rapid change of artificial intelligence technology and the fact that the old policies could not solve the new problems, the Governance Principle put forward the principle of "agile governance". In addition, the Governance Principle also put respect for privacy in a very important position, requiring that while fully protecting individuals' right to know and choose, boundaries and norms should be established in all aspects of the collection, storage, processing and use of personal information.

Patent Litigation

China IP Forum of Practical Issues–Difficulties in Patent Litigation was held in Beijing on June 23. Two themes discussed were procedural optimization of patent invalidity litigation, and high compensation, injunctive relief and prejudgment in patent infringement litigation. The forum attracted more than 150 people from judicial institutions, legal service institutions, university researchers and enterprise managers to participate in the discussion. Zhou Xiang, vice president of the Intellectual Property Court of Supreme People's Court pointed out in his speech that the optimization of the procedure of patent invalidation litigation is not only a hot topic in China's ongoing fourth revision of the Patent Law, it is also in line with the current development trend of international intellectual property governance system reform and institutional competition.

Business License Disclosure System

On June 10, the General Administration of Market Supervision officially launched the electronic business license disclosure system. Through this system, business operators who have applied for an electronic business license can more easily achieve online disclosure, and the system can ensure that the disclosure information is true, authoritative, real-time updated and cannot be tampered with. If the enterprise logs in to the electronic business license disclosure system, fill in the website information correctly and submit it as prompted, the system will generate the disclosure link, and embed the link into the enterprise website or the relevant e-commerce platform online store. Online disclosure is made easy and the disclosure will be unified throughout the country. The E-Commerce Law, which came into force on Jan 1, 2019, clearly stipulates that e-commerce operators shall continuously disclose business license information in a prominent position on their home page, and shall update the disclosure information in a timely manner; e-commerce platform operators shall regularly verify the authenticity of the disclosure information of the platform operators.

Supreme Counterfeiting

After receiving an application for administrative protection from Chapter4, the intellectual property owner of the American brand "Supreme" in March 2019, the China Trademark Office revoked the two "ITSupremeNow" trademarks registered in China by the Italian brand "Supreme Italia" in June of the same year. In December 2018, Samsung announced that it would launch co-branding products with the well-known brand Supreme in 2019, but the Supreme official statement later denied the claim. In fact, Samsung was not approached by the authentic American brand Supreme, but by Supreme Italia. In 2011, International Brand Firm registered Supreme Italia and other related trademarks before the authentic brand, and later registered the legal identity of its brands through the WIPO. The withdrawal of the Supreme Italia trademarks in China was a landmark victory for Supreme's anti-counterfeiting campaign. However, at present, Supreme had not obtained the trademark right in China yet, it still had 85 trademark applications waiting for approval in China.

Cloud Server

On June 20, the second-instance judgment of the first cloud server intellectual property infringement case was announced. The Beijing Intellectual Property Court rejected all the plaintiffs' claims in the first instance, and Alibaba Cloud did not bear legal liability. In 2015, Loco Joy Games discovered that a game called "I'm MT Free Version" was suspected of illegally copying data packets from its "I'm MT Online" game, and the server leased by the former was provided by Alibaba Cloud. In November 2015, Loco Joy Games sued Alibaba Cloud to the People's Court of Shijingshan District, Beijing. In June 2017, the Shijingshan Court of first instance ruled that Alibaba Cloud constituted an infringement and ordered it to compensate Loco Joy Games for about 260,000 Yuan. Aliyun appealed to the Beijing Intellectual Property Court. In its judgment of second instance, the court responded to some controversial points in the case, such as the legal application of this case, the criteria for judging the qualification notice, what necessary measures should be taken by the cloud server provider, whether Ali Cloud constitutes joint infringement and whether it should bear civil liability.

 

 

JULY

State Council Planned on Further Strengthening Protection of Intellectual Property Rights

On July 17, Premier Li Keqiang of the State Council presided over an executive meeting of the State Council, which made arrangements for further strengthening the protection of intellectual property rights and effectively protecting the legitimate rights and interests of various market entities. It would be necessary to continuously strengthen law enforcement of intellectual property rights and protect the legitimate rights and interests of all kinds of market entities equally, to speed up the formulation and improvement of relevant standards such as patent, trademark and copyright infringement counterfeiting judgment, inspection and appraisal, to highlight key points and strengthen rectification, deepen special actions to crack down on violations of intellectual property rights, and severely punish all kinds of violations of intellectual property rights. International cooperation would be strengthened to protect intellectual property rights and facilitate the protection of overseas rights of enterprises. The process of amending the Patent Law and Copyright Law, a new round of comprehensive revision of the Trademark Law, the detailed rules for the implementation of the Patent Law and the regulations on the Protection of New Plant varieties, should be promoted to substantially increase the cost of breaking the law. It would be necessary to continue to improve the quality and efficiency of intellectual property examination, speed up the construction of an intelligent system for patent examination and trademark registration, ensure that by the end of 2019, the goal of reducing the examination cycle of high-value patents to 17.5 months and the average cycle of trademark registration to less than five months would be reached. At the same time, the quality of intellectual property authorization and registration should be improved, and the increase of patents in high-value and core areas should be promoted. This was the ninth time that the key word "intellectual property" had been mentioned at executive meetings of the State Council since 2018. This executive meeting made comprehensive arrangements for the protection of intellectual property rights from the perspectives of enforcing intellectual property rights, punishment mechanism for infringement, and promotion of the use of intellectual property rights.

Intellectual Property Court of SPC Started Circuit Trial

On July 23, the Intellectual Property Court of the Supreme People's Court went to Nanjing to try a series of disputes over infringement of invention patent rights. This was the first circuit trial carried out by the Intellectual Property Court of the Supreme People's Court. Earlier, the Supreme People's Court revealed that in view of the fact that its scope of jurisdiction covers the whole country, the Intellectual Property Court of the Supreme People's Court would specially establish the circuit trial system and, according to the circumstances of cases, go to the court where the case is located or the seat of the original court to hear the case. This aimed to facilitate litigation by the parties and at the same time promote the rule of law of intellectual property rights.

Adjust Conditions for Reducing Patent Fees

The Ministry of Finance and the National Development and Reform Commission issued the Notice on Reduction and Exemption of Some Administrative and Administrative Charges, stipulating that reduction would be implemented from July 1, 2019. The notice adjusted the conditions for reduction of patent fees as follows: the conditions of patent applicants and patentees who may apply for reduction of patent fees are adjusted from individuals with an average monthly income of less than 3500 Yuan (42,000 Yuan per year) in the previous year to individuals with an average monthly income of less than 5000 Yuan (60,000 Yuan per year) in the previous year; Enterprises with taxable income of less than 300,000 Yuan in the previous year are adjusted to enterprises with taxable income of less than 1 million Yuan in the previous year.

Overseas Guidance

On July 10, the National Overseas Intellectual Property Dispute Response & Guidance Center established under the guidance of the Intellectual Property Protection Department of the CNIPA was inaugurated. The center aimed to focus on the difficulties in dealing with overseas intellectual property disputes, to build channels for the collection and release of information on overseas intellectual property disputes at the national level, to establish a guidance and assistance mechanism for Chinese enterprises to deal with overseas intellectual property disputes, to improve enterprises' awareness and ability to deal with intellectual property disputes in the process of "going out". Lu Pengqi, vice chairman of the China Council for the Promotion of International Trade, said that competition through legal means such as intellectual property rights and compliance had increasingly become a common practice of international competitors, especially multinational corporations in developed countries. The CCPIT attached great importance to and looks forward to strengthening in-depth cooperation with the CNIPA to jointly serve the overseas protection of intellectual property rights and disputes of Chinese enterprises.

Professional Title

On July 1, the Ministry of Human Resources and Social Security issued the Guiding Opinions on Deepening the Reform of the Professional Title System for Economic Professionals in an all-round way. The Guiding Opinions emphasizes the addition of intellectual property professional titles, which are directly named after the profession. According to the Special Technical Department of the Ministry of Human Resources and Social Security, at present, the primary and intermediate titles of economic professionals were acquired through examination, while senior professional titles are mainly obtained through evaluation. The Guiding Opinions proposed that the titles of intellectual property professionals at all levels are: "assistant intellectual property specialist", "intellectual property specialist", "associate senior intellectual property specialist" and "senior intellectual property specialist". The addition of intellectual property professional titles would further promote the development of China's intellectual property industry.

IPO Dilemma

On July 3, the CNIPA issued a document and announced the written decision of the request for examination of invalidation No. 40759 and 40829. The decision showed that two patents of General Protecht "ZL201020681902.3, power outlet safety protection device" and "ZL201010297882.4, support sliding safety door" had all been declared invalid. In December 2018, General Protecht sued the Bull Group and Nanjing Central Jincheng Storage and Supermarket Co., Ltd. as co-defendants, filed a patent infringement lawsuit with the Nanjing Intermediate People's Court, involving the above two patents, one of which was an invention patent, the other was a utility model patent. The lawsuit between General Protecht and Bull Group was divided into 10 cases, and the amount of compensation claimed by General Protecht reached an astonishing amount of 1 billion Yuan in this series of cases. Two patents related to General Protecht had been invalidated, alleviating the IPO dilemma of Bull Group, which may usher in the most important turning point in its development history.

Parallel Import

On July 9, the Nansha District People's Court of Guangdong Free Trade Zone publicly sentenced the first batch of parallel import trademark infringement and unfair competition cases in Guangdong Free Trade Zone. The plaintiff Opel claimed that its "OBO" series of brand lightning protectors sold in mainland China were imported from Germany and sold by itself or through regional authorized distributors, and that the lightning protectors sold by Shifu Company with the trademark involved were not sold by Opel or its dealers. Defendant Shifu said that the products involved were all produced by enterprises authorized by the German company OBO, which were imported from legitimate dealers in Singapore through legal customs declaration procedures, and that the products involved were authentic rather than counterfeit. The court found that Shifu's parallel import of the products involved was not illegal and rejected all the claims of the plaintiff. The nature of intellectual property disputes over parallel imports had always been controversial in judicial practice. The handling of these cases would not only provide valuable trial experience for similar cases, but also play a guiding role in the business model of related industries.

Block Chain Certificate

On July 15, the intellectual property service platform built by Hangzhou Internet Notarization Office based on judicial alliance chain was officially launched. Based on block chain technology, the platform provided electronic data online depositing and issuing services, and docks with Hangzhou Internet Court, Judicial Expertise Center, Internet Notarization Office and other judicial departments, to effectively shorten the time for collection and issuance of evidence, improve the credibility of storage data, and give full play to notarization functions. In May 2019, the Ministry of Justice revised and promulgated the Rules on Notarization Procedure (Revised Draft for Soliciting Opinions), adding provisions on online notarization and electronic notarization, advocating and encouraging notarization organizations to implement paperless network services, to enhance the experience of notarization services. For this reason, the intellectual property service platform of Hangzhou Internet Notarization Office combined blockchain technology with notarization legal services to form a blockchain electronic certificate business model.

Enterprise Anti-corruption

On July 16, 360 Company issued an internal notice: confirmed by the company's ethics committee, Huang Jing, senior director of the intellectual property department, accepted bribes from a number of agents, was suspected of crime of acceptance of bribes by a non-state functionary. Since 2019, Alibaba, Baidu, JD.com, Meituan, ByteDance, Didi, 58 Group and so on had all carried out large-scale anti-corruption work. To this end, Alibaba set up the integrity compliance department to investigate corruption, prevention and compliance management, and JD.com set up an integrity JD.com website.

 

AUG

Support Shenzhen to Build a Leading Demonstration Zone and Explore Intellectual Property Securitization

On Aug 18, the CPC Central Committee and the State Council issued the Opinions on Supporting Shenzhen in Building a Pioneering Demonstration Zone for Socialism with Chinese Characteristics. The Opinion supports Shenzhen in exploring the securitization of intellectual property rights, standardizes and orderly builds an intellectual property rights trading center for intellectual property rights and scientific and technological achievements, requires speeding up the implementation of the innovation-driven development strategy, supports Shenzhen's innovative advantage of strengthening the deep integration of industry and learning. Building a comprehensive national science center with Shenzhen as the main position, will play a key role in the construction of Guangdong-Hong Kong-Macau Greater Bay Area International Science and Technology Innovation Center. In addition, the Opinion also supports Shenzhen in building major innovation carriers such as 5G, artificial intelligence, cyberspace science and technology, life information and biomedical laboratories, and exploring the construction of an international science and technology information center and a new mechanism of the Academy of Medical Sciences, explores the securitization of intellectual property rights. In recent years, Shenzhen had formulated a series of important policies and measures around the goals of strengthening the protection and application of intellectual property rights, optimizing the comprehensive innovation ecosystem, creating an ecological zone for innovation and entrepreneurship, implementing the strictest protection of intellectual property rights, and building a strong city of intellectual property rights, which would continue to promote the improvement of the business environment and high-quality economic development.

The State Council deepens the Reform of Streamlining Administration and Optimizing Services

On Aug 12, the Chinese government website issued the Notice on the Issuance of the National Video-conference on Optimizing the Business Environment's Plan for the Division of the Key Tasks and Labor in Deepening the Reform of "Streamlining Administration and Optimizing Services". Among them, the work related to intellectual property rights is arranged as follows: promote the construction of the credit system in the field of intellectual property rights, study and formulate measures for the management of the list of objects for joint punishment of serious breach of trust in the field of intellectual property (patents); strengthen the credit supervision of trademark preemptive registration, malicious registration and abnormal patent applications; study and formulate relevant regulations to regulate trademark registration applications (CNIPA); try to establish a unified modern chattel guarantee system, and strive to integrate all kinds of chattel registration and rights guarantee registration system by the end of 2020, so as to realize the registration of enterprise guarantee on one platform, and all relevant departments shall implement background supervision according to their duties (led by the People's Bank of China).; promote electronic trademark and patent applications, the examination cycle of high-value patents will be reduced to 17.5 months by the end of 2019, the average examination cycle of trademark registration will be reduced to five months, and the backlog of invention patent examination will be reduced by 100,000 (CNIPA).

Adjust Conditions for reducing Patent Fees

On Aug 1, the Ministry of Science and Technology issued Guidelines for the Construction of National New Generation Artificial Intelligence Open and Innovation Platform. The document pointed out that it would further promote the construction of a new generation of artificial intelligence open and innovation platform, and promote China's artificial intelligence technological innovation and industrial development. The new generation of artificial intelligence open and innovation platform would be led by technological leaders in the artificial intelligence industry, and scientific research institutes and universities will be encouraged to participate in the construction and provide intellectual and technical support. In principle, each specific subdivision area should build a new generation of national artificial intelligence open and innovation platform, and different open and innovation platforms should be clearly distinguished and focused on the subdivision areas. Some industry experts said that the Guidelines show that China's new round of national artificial intelligence open innovation platform construction is about to be rolled out in an all-round way. The new generation of artificial intelligence industry would play a more extensive role in supporting the national economy, and its application scenarios could cover all fields related to the national economy and people's livelihood.

Standard Implementation Certification

On Aug 30, the Notice by the General Office of CNIPA of Regulating the Standard Implementation Certification of Intellectual Property Rights Management System was officially issued. According to the Notice, CNIPA would strengthen the accuracy of policy support for intellectual property standard inplementation certification, speed up the improvement of standard implementation certification services in the field of intellectual property rights, uniformly standardize intellectual property standard implementation certification guidance, consultation and training services, and severely crack down on intellectual property standard implementation certification incentives and arbitrage. The Notice stressed that all localities should bare zero tolerance for collusion and arbitrage in the process of intellectual property standard implementation certification, actively accept and check the clues of various complaints and reports, and focus on investigating and dealing with a number of institutions that violate the rules. and expose typical cases with strong public reaction and bad social influence.

Centralized Examination

On Aug 30, CNIPA issued the Notice of Issuing Measures for the Administration of the Centralized Examination of Patent Applica,ti,ons (for Trial Implementation). The Notice pointed out that in order to implement the State Council on Issuing the Program for the Division of the Key Tasks of the Several Opinions of the State Council on Building a Powerful Intellectual Property Nation under New Conditions, it would be necessary to establish a centralized examination system for patent applications in key industries with advantages, and formulate Measures for the Administration of the Centralized Examination of Patent Applications (for Trial Implementation). According to the Notice, centralized examination refers to the patent examination mode of centralized examination around the patent application portfolio of the same key technology, at the request of the applicant or the provincial intellectual property administration department, in order to enhance the understanding of the overall technology of the patent application portfolio, improve the effectiveness of the notice of examination opinions, and improve the examination quality and efficiency.

Face Swapping

ZAO, a mobile app featuring face-swapping video, had attracted wide attention because it rainsed concerns about privacy, reputation, intellectual property and other issues. The app, developed by Changsha Deep Fusion Network Technology Co., Ltd., allows users to upload or take their facial photos to swap with faces from films and televisions. The app soon became one of the top downloads in app stores. Although the app carried out non-public figure verification and portrait rights verification, and stated in the copyright notice on the use of its material, "short videos and emoji materials, except for which ZAO cooperates with in copyright, all come from users' spontaneous uploads, and ZAO does not enjoy the commercial copyright of the materials." but the app still aroused public skepticism. Some insiders questioned the risk of infringement of video copyright and portrait rights at the product level, while more people expressed concerns about the security risks of the application.

Normative Registration

On Aug 30, the State Administration of Market Supervision issued Several Provisions on Regulating Trademark Registration Applications (Draft for Soliciting Opinions). The draft clearly defined the specific measures to regulate the malicious trademark registration application behavior that is not for the purpose of use, which is conducive to further standardizing the trademark registration behavior and maintaining the normal trademark registration management order. On Apr 23, 2019, the 10th meeting of the Standing Committee of the 13th National People's Congress adopted a decision on amending the Trademark Law, focusing on regulating malicious trademark applications and hoarding registration, and increasing penalties for violations of the exclusive right to the use of trademarks. Some provisions of the Trademark Law have been amended, and the revised provisions would come into effect on Nov 1, 2019. In order to cooperate with the revision of the Trademark Law and maintain the management order of trademark registration, according to the Trademark Law and the Regulations on the Implementation of the Trademark Law, the State Administration of Market Supervision and Administration has studied and drafted Several Provisions on Regulating Trademark Registration Applications (Draft for Soliciting Opinions), refining the contents of the revision of the Trademark Law at the operational level.

Pharmaceutical Administration

On Aug 26, the 12th Meeting of the Standing Committee of the 13th National People's Congress adopted the newly revised Pharmaceutical Administration Law, which would come into force on Dec 1, 2019. This was the first comprehensive revision of the Pharmaceutical Administration Law after 18 years. The revision includes 34 projects related to the cancellation of GMP/GSP certification, drug listing license holder system, drug traceability system, drug vigilance system, online sale of drugs and other issues of concern to the industry. The newly revised Pharmaceutical Administration Law set a number of provisions to encourage innovation, such as giving priority to the review and approval of clinically urgently needed drugs, new drugs for the prevention and treatment of major infectious diseases and rare diseases, and drugs for children. For the treatment of diseases that are seriously life-threatening and have no effective means of treatment, as well as drugs urgently needed in public health, drug clinical trials have data showing the curative effect and can predict their clinical value, it may be approved with conditions, and the relevant matters must be specified in the drug registration certificate. At present, Department of Drug and Cosmetics Registration is stepping up efforts to formulate follow-up supporting policies and documents.

Judicial Application

On Aug 17, the Beijing Internet Court held a press conference on Judicial Application of Internet Technology, issued the White Paper on Judicial Application of Internet Technology, unveiled the Center for Judicial Application of Internet Technology, hired technical experts from think tanks, and showed a number of practical judicial application scenarios of Internet technology. The White Paper introduced basic concepts, fundamental objectives, characteristic mechanisms and achievements of the informatization construction of Beijing Internet Court. It also selected and introduced ten typical technological applications in the informatization construction: legal knowledge graph, block chain, instant messaging, face recognition, image recognition, voice recognition, cloud video, micro-service construction, data security exchange and cloud computing. The press conference showed four practical judicial scenes of mobile micro-court, balance chain, screen sharing and intelligent document generation, and demonstrated the practical results achieved by Beijing Internet Court in convenient litigation, changing litigation mode, innovating certificate storage methods, and improving trial quality with the support of science and technology.

 

SEPT

 

The 10th China-ASEAN Intellectual Property Office Directors' Meeting held in Hangzhou

On Sept 2, the 10th China-ASEAN Intellectual Property Office Directors' Meeting was held in Hangzhou. Shen Changyu, director of CNIPA, presided over the meeting and delivered a speech. Shen Changyu pointed out that 2019 marked the 10th anniversary of the signing of the Memorandum of Understanding on China-ASEAN Cooperation in the Field of Intellectual Property, and both China and ASEAN had made rapid progress over the past decade. In the past year, China's intellectual property management system and operating mechanism had been historically reconstructed, and new and remarkable achievements had been made in the creation, protection, application, service and management of intellectual property rights. The meeting heard a report on the implementation of the China-ASEAN IPR Cooperation Plan 2018-2019, and examined and approved the China-ASEAN IPR Cooperation Plan 2019-2020. According to the new plan, China and ASEAN would further expand and deepen cooperation in improving the quality and efficiency of intellectual property examination, personnel training and exchanges. The 11th China-ASEAN meeting of Directors of intellectual property offices will be hosted by Vietnam Intellectual Property Office in Da Nang, Vietnam in 2020.

The 10th China Intellectual Property Annual Conference opened in Hangzhou

On Sept 2, the 10th China Intellectual Property Annual Conference (CIPAC) with the theme of "IP, evolving with the New Era" opened in Hangzhou. Upgraded from China Patent Annual Conference to the China Intellectual Property Annual Conference, it covered patents, trademarks, geographical indications, and focused on operation, service, rights protection, legislation, judicial and other aspects. CIPAC closely revolved around the theme, holding a series of activities, such as opening ceremony and keynote speeches, 15 forums, round-table discussions, press conferences. The participants discussed the ecological chain of intellectual property operation under economic globalization, trademark management strategy and brand value realization, international trade and overseas protection of intellectual property rights, commercial operation of geographical indications in global trade, and intellectual property administrative adjudication system interpretation and practice in depth. CIPAC also held patent information services and product exhibitions, trademark exhibitions and Chinese geographical indications exhibition.

The Revision of the Patent Examination Guidelines Will Come into Effect on Nov 1

On Sept 23, CNIPA issued the Announcement on Revising the Guidelines for Patent Examination (No. 328). The Announcement showed that in order to meet the needs of the rapid development of new technologies, respond to the new demands of innovative subjects on examination rules and modes, and improve the quality and efficiency of patent examination, CNIPA decided to amend the Patent Examination Guidelines, which would come into effect on Nov 1, 2019. In recent years, some questions had been raised about the examiners' use of the "three-step method" and common sense in creative evaluation. On Apr 4, 2019, CNIPA published the Revised Draft of Patent Examination Guidelines (Draft for Soliciting Opinions) and its explanation, which systematically revised the relevant parts of the examination guidelines on creativity, including further clarifying the general path of understanding inventions, standardizing creative comment ideas, strengthening the burden of proof of examiners, in order to respond to the needs of society in a timely manner and promote the improvement of the quality of patent application and examination.

Patent Award

The Guangdong Provincial Market Supervision Administration issued the Detailed Rules for the Implementation of the Guangdong Provincial Patent Award Measures, which would come into force on Sept 1, 2019, and would be valid for five years. The revised contents of the Detailed Rules are mainly divided into three categories, including: (1) revising the name of awards and adding relevant awards. (2) Increasing the number of Guangdong patent awards and the amount of awards. The gold awards has been increased from 15 to 20, and the number of prizes has been increased from 100,000 Yuan to 300,000 Yuan. Excellence awards have been increased from 55 to 60, and the prize has been increased from 50,000 Yuan to 100,000 Yuan. 40 silver awards have been added, the prize is 200,000 Yuan. For individuals who have won the Guangdong Outstanding Inventors Award, the prize has been increased from 20,000 Yuan to 100,000 Yuan. (3) Adjusting the award amount of China Patent Award. The enterprises and individuals that have won the China Patent Silver Award or the China Silver Design Award shall be given a reward of 500,000 Yuan for each item, and for the enterprises and individuals that have won the China Patent Excellence Award or the China Design Excellence Award, the bonus shall be adjusted from 500,000 yuan to 300,000 yuan.

Circuit Mediation

The Intellectual Property Court of the Supreme People's Court conducted circuit trials in Jinan and Tai'an, Shandong Province, successfully mediating the invention patent dispute between the appellant NT2C Group Co., Ltd., the appellees Shandong Huixing Science and Technology Development Co., Ltd., and Juye Yuantai Real Estate Co., Ltd., contributed to the substantive resolution of the civil and administrative disputes over the intellectual property rights involved. This was the first time that the Intellectual Property Court of the Supreme People's Court conducted circuit mediation. The parties involved in the same patent dispute successively filed two civil lawsuits and requested for invalidation of the patent, the contradictions being intertwined and complicated, and the parties located in various parts of Shandong, made it idifficult for courts to try. To this end, the seventh collegial panel of the Intellectual Property Court of the Supreme People's Court decided to conduct circuit mediation. In the past month, the Intellectual Property Court of the Supreme People's Court had conducted three circuit trials and successively went to Jiangsu, Guangdong, Shandong and other provinces to handle cases on the spot.

Professional Claims

On Sept 3, the Symposium on Professional Claims, jointly attended by market regulators, China Consumer Association and business representatives, was held in Beijing. Representatives from all walks of life and experts attending the meeting believed that in the past three months, China had issued two articles calling for cracking down on "malicious reporting of illegal profit-making activities" and "racketeering in the name of 'anti-counterfeiting'," which has sent a clear policy signal. On May 9, the CPC Central Committee and the State Council issued the Opinions on Deepening Reform and Strengthening Food Safety, proposing that "malicious reports of illegal profit-making activities should be severely cracked down on in accordance with the law." On Aug 8, the General Office of the State Council issued the Guidance on Promoting the Healthy Development of the Platform Economy, calling for effective protection of the legitimate rights and interests of platform economic participants and cracking down on extortion in the name of "cracking down counterfeiting." Since the beginning of 2019, market regulators in many places have successively introduced comprehensive management measures to curb the reporting of malicious complaints against "professional claims"; local courts have also announced a number of "professional claims" cases involving extortion.

Conversant Wireless Licensing

On September 16, the Nanjing Intermediate People's Court made a judgment of first instance in three cases in which Huawei Technology Co., Ltd., Huawei Device Co., Ltd., and Huawei Software Technologies Co., Ltd. sued Conversant Wireless Licensing S.A.R.L over non-infringement of patent rights and standard essential patent royalties, confirming the standard essential patent license rates involved by Huawei and Convinson. The court clearly defined the licensed patents, licensed products and licensed acts involved in the case, and did not support Huawei's request to confirm that the manufacturing, sale and promise to sell mobile terminal products in China did not infringe upon the three invention patents enjoyed by Conversant. The core of the dispute was the license fee, which, after hearing, the court finally adopted the top-down method of calculating FRAND license rates. It was the first dispute over standard essential patent license fees adjudicated by the Nanjing Intermediate People's Court.

Internet of Things

The Hangzhou Internet Court accepted the unfair competition dispute brought by the plaintiff Shenzhen Science and Technology Co., Ltd. against Shanghai Digital Technology Co., Ltd., Shanghai Technology Co., Ltd., Shanghai Internet of things Co., Ltd., Hangzhou Technology Co., Ltd. In this case, the plaintiff believed that the defendants transferred the users who belonged to the plaintiff to the platform operated by the defendants by improper means, which seriously violated the legitimate rights and interests of the plaintiff and should bear the corresponding legal liability in accordance with the law. The plaintiff asked to order the four defendants to stop unfair competition, apologize and jointly compensate for the economic losses and reasonable expenses totaling 4.98 million Yuan. This was the first case involving intellectual property dispute of the Internet of Things filed and accepted by the Hangzhou Internet Court. In the environment of the Internet of things, how to reasonably define the boundaries of the rights and obligations of all parties, how to accurately judge whether the act involved in the case constitutes unfair competition, how to determine the subject of liability and the amount of compensation when the tort is established, were the focus of this case.

China Railway High-speed

In response to the application by foreign enterprises to revoke the registered trademark of "CRH" of China's Railway High-speed, the Beijing Intellectual Property Court held that the previous decision of the Trademark Appeal Board to revoke the "CRH" trademark did not have enough basis, and the decision of the first instance judgment was reversed, asking the Trademark Appeal Board to make a new decision. "CRH" is the abbreviation of "China Railways High-speed". At present, the bodies of all high-speed trains in China are sprayed with obvious "CRH" logos. The trademark right of "CRH" logo is registered and enjoyed by China Academy of Railway Sciences Corporation Limited. Earlier, a British company asked the Trademark Appeal Board to revoke the trademark on the grounds that the China Academy of Railway Sciences did not use the trademark in accordance with the law. After examination, the Trademark Appeal Board decided to revoke the trademark rights in advertising, market research and other items of the trademark. The China Academy of Railway Sciences was not satisfied with the decision and sued to the Beijing Intellectual Property Court.

 

OCT

 

Several Opinions on Further Doing a Good Job in the Utilization of Foreign Investment

On Oct 30, the State Council issued Several Opinions of the State Council on Further Doing a Good Job in the Utilization of Foreign Investment. The Opinions required to focus on ensuring the national treatment of foreign-invested enterprises, create an open, transparent, and predictable environment for foreign investment, continuously deepen the reform of streamlining administration and optimizing services, and further do a good job in the utilization of foreign investment. The Opinions put forward a total of 20 policies and measures in four aspects, emphasizing the improvement of the working mechanism of intellectual property protection, the establishment of a rapid collaborative protection of intellectual property rights and the joint punishment mechanism of credit, and the continuous promotion of arbitration and mediation of intellectual property disputes and the diversified settlement mechanism of intellectual property disputes. It required to improve the procedures for the revocation of registered trademarks, improve the protection system of geographical indications, improve the e-commerce intellectual property protection mechanism, improve the e-commerce platform patent infringement determination notice, removal rules, improve the patent law enforcement and rights protection cooperation scheduling mechanism in e-commerce field, actively use standardized methods to strengthen intellectual property protection. The Opinions also made it clear that the above work was the responsibility of the Ministry of Commerce, the General Administration of Market Supervision, CNIPA, and the people's governments at the provincial level in accordance with the division.

The State Council Promulgated the Regulation on Optimizing Business Environment

On Oct 22, Premier Li Keqiang of the State Council signed Decree No. 722 of the State Council, announcing that the Regulation on Optimizing Business Environment had been adopted at the 66th Executive Meeting of the State Council on Oct 8, 2019, and would enter into force as of Jan 1, 2020. China's first law on optimizing the business environment has been formally issued. The Regulation conscientiously summed up China's experience and practices in optimizing the business environment in recent years, solidified the reform measures that have been proved to be effective, satisfied by the people, and supported by the main body of the market with laws and regulations, focusing on the shortcomings of China's business environment and the difficulties reflected by the main body of the market, and making corresponding provisions on the international advanced level for improving the system and mechanism. Article 15 of the Regulation stipulates: "China establishes a system of punitive damages for intellectual property infringement, promotes the establishment of a rapid and coordinated protection mechanism for intellectual property rights, and improves the diversified settlement mechanism of intellectual property disputes and the assistance mechanism for safeguarding intellectual property rights to strengthen the protection of intellectual property rights. China will continue to deepen the reform of trademark registration and patent application facilitation, and improve the efficiency of trademark registration and patent application examination." In view of the issue of intellectual property protection, a series of policy combinations would be introduced in the near future.

Substantial Progress Made in Sino-US Trade Negotiations

From Oct 10 to 11, Liu He, member of the Political Bureau of the CPC Central Committee, vice premier of the State Council, and Chinese leader of the Sino-US Comprehensive Economic Dialogue, held a new round of high-level Sino-US economic and trade consultations in Washington with US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin. Under the guidance of the important consensus between the heads of state, the two sides held frank, efficient and constructive discussions on economic and trade issues of common concern. The two sides made substantial progress in agriculture, intellectual property protection, exchange rate, financial services, expansion of trade cooperation, technology transfer, dispute settlement and other areas, discussed the arrangements for follow-up consultations and agreed to work together towards a final agreement. This Sino-US trade talk had made phased progress, but there were differences between the two sides in the field of high technology, intellectual property rights and market system, and there were still uncertainties in the follow-up negotiations.

Preferred Place

Chen Jinchuan, vice president of the Beijing Intellectual Property Court, revealed in the Summary of Foreign Intellectual Property Cases of the Beijing Intellectual Property Court that, since its establishment in Nov 2014, according to the analysis of the trial data of foreign-related cases up to the first half of 2019, the number of foreign enterprises' mutual litigation in Beijing increased, reflecting that Beijing was gradually becoming a "preferred place" for intellectual property protection. The standard of compensation for intellectual property damage had been continuously improved, and the protection of intellectual property rights had been continuously strengthened. Over the past four and a half years, the Beijing Intellectual Property Court has accepted 13,736 foreign-related intellectual property cases (excluding Hong Kong, Macao and Taiwan), accounting for 21.1% of the total caseload. The number of cases received showed an increasing trend year by year, with the average case received increased of about 8.4% and the average case closed increased of about 40.4% annually. The Beijing Intellectual Property Court had a high proportion of foreign-related cases involving a wide range of regions, reflecting the close ties between Beijing and the national economy, and the world. Among them, most of the technical cases involved new technologies and new industries, and there were also many cases involving international well-known trademarks and trade names.

WeChat Screenshot

Shenzhen Nanshan District People's Court accepted a series of cases of copyright infringement and unfair competition disputes among Tencent Technology (Shenzhen) Co., Ltd. and Shenzhen Tencent Computer System Company Limited, v. a Shenzhen network technology company. This series of cases was the first involving copyright infringement and unfair competition of software involving WeChat screenshots. Tencent Technology and Tencent Computer complained that nine mobile applications run by the defendant, such as screenshot app and dialogue generator, can generate screenshots of red packets, money transfers, wallets, conversations, friends' information exactly the same as the WeChat application interface. The defendant also provided a screenshot generator tool for the web version with the same function on its website operated. The above acts infringed upon the copyright of the two plaintiffs, such as the right of reproduction, the right of distribution and the right of information network dissemination, and constituted unfair competition. The two plaintiffs demanded that the defendant immediately stop the infringement, eliminate the impact and compensate for losses in 9 cases totaling 10.31 million Yuan.

The Battle of Jordan

On Oct 16, the Supreme People's Court retried the administrative dispute between the plaintiff Michael Jeffrey Jordan (American basketball star) and the defendant, the Trademark Review and Adjudication Board of the State Administration for Industry and Commerce, and the third party, Jordan Sports Co., Ltd. over a trademark. SPC held that Michael Jeffrey Jordan had the right to portrait of his sports images, but Jordan Sports's humanoid trademark logo did not reflect Jordan's personal characteristics, was not identifiable, and did not damage Jordan’s right to portrait. Jordan Sports registered the "Danqiao" trademark in 1991 and changed its name to Jordan Sports in 2000. In 2012, Jordan asked for the cancellation of 78 related registered trademarks of Jordan Sports on the grounds that Jordan Sports violated his right of personal name. The Trademark Review and Adjudication Board rejected his application, and Jordan continued to file administrative lawsuits, which lasted for about eight years.

Hong Kong Patent

Original Grant Patent System would be introduced in Hong Kong to provide another way for patent applicants to seek standard patent protection in Hong Kong. The amendments to the Patents Ordinance and the Patent Rules in Hong Kong were gazetted on Oct 11, 2019, and the new patent system would come into effect on Dec 19 of the same year. Under the new system, patent applicants can file standard patent applications directly in Hong Kong, which is no longer limited to the current "re-registration" system, that is, applicants must first submit the corresponding application in a designated patent office outside Hong Kong. The new patent system also optimized the short-term patent system and prohibited the use of certain misleading or confusing titles or descriptions related to patent practice in Hong Kong. The Hong Kong Commerce and Economic Development Bureau said that the implementation of the new patent system would be a milestone in the development of Hong Kong's patent system and would help promote Hong Kong's development into an innovation and intellectual property trading centre.

Association Monopoly

The State Administration of Market Supervision issued a written decision on administrative punishment of the Heze Automobile Industry Association organizing the operators of the industry to reach a monopoly agreement. The decision pointed out that in accordance with Article 49 of the Anti-Monopoly Law, the Shandong Provincial Market Regulatory Bureau organized a case investigation on the suspected monopoly agreement reached by the Heze Automobile Industry Association in July 2018, and made an administrative penalty decision on Oct 18, 2019, to impose a fine of 300,000 Yuan on the Association. This was the first case in which the market regulatory authorities in Shandong Province penalized the monopolistic behavior of trade associations. The decision also pointed out that in recent years, the Association had taken itself as the main body on the grounds of fierce competition in the automobile sales industry, market chaos, and a variety of auto shows, issuing notices, convening meetings of member units, organizing member units to sign letters of commitment. Member units were required not to participate in other auto shows, otherwise they would not be allowed to participate in association activities, or their membership would be canceled.

Geographical Indication

On Oct 31, CNIPA issued the Notice on the Determination of the Project to Promote the Use of Geographical Indications in 2019. The Notice pointed out that in 2019, the project to promote the use of geographical indications would focus on geographical indications to help poverty alleviation, which would be determined after voluntary declaration by local intellectual property offices, examination and recommendation by provincial intellectual property offices, and comprehensive evaluation and publicity by CNIPA. In the next step, CNIPA would strengthen guidance and support for selected projects, strengthen follow-up management, sum up experience in a timely manner, do a good job in publicity and promotion, and ensure that the implementation of the project would be carried out well and quickly. China would take the lead in forming a number of advanced experiences and successful cases in which geographical indications accurately help poverty alleviation, enhance brand value, and promote industrial development. By the end of September, 2019, China had registered 5,135 certification trademarks of geographical indications (including 192 from abroad), approved 2,380 products of geographical indications (including 61 from abroad), and approved 8,351 enterprises for the use of official geographical indications, with a related output value of more than one trillion Yuan.

 

NOV

 

Newly Amended Trademark Law Enter into Force on Nov 1

On Nov 1, the newly amended Trademark Law would come into force. This amendment involved a total of six articles, focusing on strengthening trademark use obligations, standardizing trademark agency behavior, regulating trademark malicious application for registration. On Apr 23, the Standing Committee of the 13th National People's Congress adopted a decision to amend the Trademark Law. This revision of the regulation of malicious registration mainly involved three aspects. The first was to strengthen the obligation to use the trademark and add the provision that "applications for malicious trademark registration that are not for the purpose of use shall be rejected". The second was to standardize the behavior of trademark agencies. It was stipulated that trademark agencies shall not accept the entrustment if they know or should have known that the trustors have committed malicious registration, and shall be investigated for responsibility according to law once it is found. Third, it provided penalties for malicious applications for trademark registration and malicious litigation by applicants and trademark agencies. In order to implement the Trademark Law, Several Provisions on Regulating Trademark Registration Application had been issued by the General Administration of Market Supervision in the form of Order No. 17 and would enter into force from Dec 1, 2019.

Claim of 3.7 Billion Rejected in Red Bull Trademark Case

On Nov 25, the ownership of Red Bull’s series of trademarks was ushered in an important legal judgment: the Beijing Higher People's Court of first instance rejected all the claims of Red Bull Vitamin Beverage Co., Ltd., decided that Red Bull's claim to confirm that it enjoyed the legitimate rights and interests of the "Red Bull" series of trademarks involved in the case lacked factual and legal basis. The court's also did not support Red Bull’s request to order T.C. Pharmaceutical Industry Co., Ltd. to pay 3.753 billion Yuan in advertising fees. The fee for accepting the case was 18.8068 million Yuan, and the property preservation fee was 5,000 Yuan, all paid by Red Bull. At present, the two sides had more than 20 cases under trial in Beijing, Chongqing, Foshan, Shenzhen and other places, involving trademark licensing disputes, bankruptcy liquidation, contract disputes. This lawsuit was filed by Red Bull with the Beijing Higher People's Court in 2018. The court filed the case on Aug 30, 2018 and held a hearing in private on Aug 8, 2019.

Request for Public Comments on the Implementation of Foreign Investment Bill

On Nov 1, the full text of the Regulations on the Implementation of the Foreign Investment Bill of the People's Republic of China (draft for soliciting opinions) drafted by the Ministry of Justice, the Ministry of Commerce and the National Development and Reform Commission was published. As a supporting administrative regulation of the Foreign Investment Bill, the Request provided provisions on the basic issues of foreign investment, investment promotion, investment protection, investment management, the transitional arrangements for the existing organizational forms of foreign-invested enterprises, and the legal application of investment in Hong Kong, Macao and Taiwan. The Request clearly stated that China should establish a system of punitive damages for intellectual property infringement, promote the establishment of a rapid and collaborative protection mechanism for intellectual property rights, and improve the diversified settlement mechanism of intellectual property disputes and the assistance mechanism for safeguarding intellectual property rights to strengthen the protection of intellectual property rights of foreign investors and foreign-invested enterprises. It further refined the relevant provisions prohibiting the use of administrative means to compel foreign investors and foreign-invested enterprises to transfer technology, and administrative organs and their staff to strictly protect the trade secrets of foreign-invested enterprises that they know in the course of performing their duties.

5G Congress

From Nov 20 to 23, the first World 5G Congress was held in Beijing. The Congress was co-sponsored by the Beijing Municipal Government, the National Development and Reform Commission, the Ministry of Science and Technology, and the Ministry of Industry and Information Technology, with the theme of "5G Changing the World, 5G Creating the Future". It included three parts: conference forum, exhibition, and application design unveiling competition. The Congress gathered a number of academicians, nearly 100 of the world's most influential scientists in the field of information and communications, as well as more than 30 world-famous 5G upstream and downstream enterprises, including Huawei, JD.com, Chipone, Unisoc. The participants exchanged and discussed cutting-edge technologies, industrial trends, innovation and applications in the 5G field, and created a world's top high-quality platform for 5G industrial cooperation and resource integration through conferences, exhibitions, competitions to promote the collaborative innovation, promotion, application and industrial maturity of 5G technology in the world. The Beijing Economic and Technological Development Zone also issued the 5G Industrial Planning for Beijing Economic and Technological Development Zone and its related Ten Articles of 5G Industrial Policy at the Congress.

Huawei Ban

On Nov 18, the US Department of Commerce decided to extend a temporary general license for 90 days and postponed for the third time a trading ban on existing products and services of Huawei and its affiliates in the US, to avoid the ban adversely affecting American consumers. The US Department of Commerce stated on the same day that US enterprises with a temporary general license could export, re-export and transfer specific and limited products or technologies to Huawei and its non-US subsidiaries within the next 90 days. On May 15, 2019, the US Department of Commerce added Huawei and its 68 subsidiaries to the entity list and issued a 90-day temporary general license on May 20 and Aug 19, respectively, allowing Huawei and its subsidiaries to engage in specific activities to ensure the continuous operation of existing networks in the US and to support existing mobile services in the US. The US Department of Commerce added another 46 Huawei subsidiaries to the entity list on Aug 19.

JD.com V. Tmall

E-commerce giant JD.com’s lawsuit against Tmall's had undergone a major change: two other major e-commerce companies, Pinduoduo and Vipshop, applied to the Beijing Higher People's Court to join the lawsuit as third parties. Prior to this, JD.com sued Tmall for abusing its dominant market position and claimed 1 billion Yuan. According to relevant litigation materials, JD.com applied to the Beijing High People’s Court on Sept 12, 2019, requesting to notify Vipshop and Pinduoduo to participate in the lawsuit as third parties. On Sept 26, Vipshop and Pinduoduo submitted an application to the Beijing High People’s Court, requesting to join the lawsuit as third parties. On Oct 9, the Supreme People's Court published an objection to the jurisdiction of the case online, putting JD.com's lawsuit of exclusive trading against Tmall in public view. Some analysts believed that the lawsuit between JD.com and Tmall, which had entered litigation procedure, provided a judicial perspective for the phenomenon of exclusive trading in Internet business activities that had been debated for many years but had not reached a consensus. How to define the competitive behavior among Internet e-commerce platforms and the final trial conclusion of the first anti-monopoly lawsuit in e-commerce circle, would have a vital impact on the sustained and healthy competition development of the e-commerce industry.

Well-known Trademark

On Nov 15, the CNIPA issued the Notice on Strengthening the Investigation and Handling of Well-known Trademark Protection in Trademark Violation Cases. The Notice put forward clear requirements for further strengthening the protection of well-known trademarks in cases of trademark violations: first, it is necessary to investigate and deal with illegal cases involving well-known trademarks in strict accordance with the statutory authority and time limit, and trademark violation cases involving the protection of well-known trademarks shall be under the jurisdiction of the intellectual property administration departments of counties (cities, districts) directly under the jurisdiction of the city (prefecture or state) or approved provinces, and specify the time limit for filing, preliminary verification, and verification. Second, it is necessary to effectively standardize the identification application and use of well-known trademark, through the guidance of the filing authorities to fill in the application form, to examine and verify the completeness and authenticity of evidence materials, and the business guidance and review of provincial departments to standardize the application for recognition of well-known trademark. Third, it is necessary to highlight the key points and earnestly strengthen the protection of well-known trademarks, standardize the timely protection of well-known trademarks approved in the investigation and handling of trademark violations, the invocation protection of well-known trademarks with administrative protection records, and strengthen the administrative protection of well-known trademarks with emphasis on well-known trademarks in the investigation and handling of trademark infringement and counterfeiting cases.

LG v. Hisense

On Nov 4, LG Electronics sued Hisense for patent infringement in a California district court. LG alleged that the vast majority of Hisense TVs sold in the US infringe its four patents. The lawsuit involved technologies to improve the user interface and improve data transmission speed based on Wi-Fi, including LED lamp assembly technology, user interface technology, clearer display image technology and technology to improve the data transmission rate of TV Wi-Fi. The semi-annual report of Hisense Electric Appliances in 2019 showed that under the situation of global market shocks and macro-environmental fluctuations, the company's global key markets still made great breakthroughs. During the reporting period, Hisense and Toshiba TVs together accounted for 20.9% of the Japanese market, surpassing Sony and Panasonic; the company's TV sales in North America grew by 34.26% year-on-year, of which grew by 65.08% in the US market.

Talent Sharing

On Nov 7, the Intellectual Property Court of the Supreme People's Court held the Symposium on the Construction and Development of Pluralistic Technological Fact-finding Mechanism, which reported the construction and development of diversified technological fact-finding mechanism in Chinese courts in the past five years. It also announced the completion of the National Court Technical Investigation Talent Database, the establishment of National Court Technical Investigation Talent Sharing Mechanism, and issued the Technical Investigator Work Manual (2019). The formally established National Court Technical Investigation Talent Database was prepared and built by the Intellectual Property Court of the Supreme People's Court, who brought together the Intellectual Property Court of the Supreme People's Court, the Intellectual Property Courts of Beijing, Shanghai, and Guangzhou, as well as the technical investigation officers and technical consulting experts of the intellectual property courts of Nanjing, Suzhou, Hangzhou, Qingdao, Hefei, Tianjin, Wuhan, and Zhengzhou, covering nearly 30 sub-technical areas that were common in technical intellectual property cases.

 

 

DEC

 

China's Statement on the First stage of Sino-US Economic and Trade Agreement

On Dec 13, the Information Office of the State Council held a press conference at which the China’s statement on the First Stage of the Sino-US Economic and Trade Agreement was issued. The statement pointed out that through the joint efforts of the economic and trade teams of China and the US, the two sides had reached agreement on the text of the First Stage of the Sino-US Economic and Trade Agreement on the basis of the principles of equality and mutual respect. The text of the Agreement included preamble, intellectual property rights, technology transfer, food and agricultural products, financial services, exchange rate and transparency, trade expansion, bilateral assessment and dispute settlement, and final provisions. The two sides agreed that the US would fulfill its commitment to abolish tariffs in stages on Chinese products and realize the transformation of tariffs from rising to lowering. At the press conference, Wang Shouwen, vice minister of the Ministry of Commerce and deputy representative of international trade negotiations, pointed out that China and the US held in-depth discussions on strengthening intellectual property protection and reached consensus in several aspects, including the protection of trade secrets, intellectual property issues related to drugs, the extension of patent validation period, geographical indications, the fight against piracy and counterfeiting on e-commerce platforms, the fight against the production and export of pirated and counterfeit products, the fight against malicious trademark registration, and the strengthening of intellectual property judicial enforcement and procedures.

Official Release of Geographical Indications of China

On Dec 3, CNIPA officially issued the official Geographical Indication of the People's Republic of China and launched an electronic platform for accepting applications for the protection of geographical indication products. The Geographical Indication of PRC is the official sign established by CNIPA to indicate that the geographical indication products using this GI has been registered and approved by CNIPA. According to China's Trademark Law, Patent Law and other relevant provisions, CNIPA registers special geographical indications for the record and brings them into the protection of official signs. The Measures for the Administration of the Use of Special Geographical Indications were being openly solicited for public opinions and would be formulated and promulgated separately by CNIPA. The electronic acceptance platform for geographical indication product protection applications was launched, which integrated identity registration and certification of applicants, submission of application materials, preliminary examination of provincial intellectual property administration departments, experts' online technical review organized by CNIPA, online feedback review opinions, online announcement. It could provide omni-directional and full-process services for geographical indication product protection applicants, such as consulting policies and regulations, notice announcement, and online application.

Several Provisions on Regulating Trademark Registration Applications Enter into force on Dec 1

The State Administration of Market Supervision and Administration issued Several Provisions on Regulating Trademark Registration Applications, which would enter into force as of Dec 1, 2019. On April 23, the Standing Committee of the National People's Congress examined and adopted the decision to amend the Trademark Law, which would come into effect on Nov 1, 2019. To implement the provisions of the Trademark Law, there are 19 provisions on regulating trademark application for registration from four aspects: First, to emphasize that the principle of good faith must be followed in applying for trademark registration and engaging in trademark agency business; Second, to enumerate the factors to be considered in the examination of malicious applications for trademark registration; The third is to severely punish malicious trademark registration and illegal agency behaviors; The fourth is to optimize trademark registration services. A fine of three times the illegal proceeds and a maximum of no more than 30,000 Yuan would be imposed on malicious trademark applicants; a maximum fine of 100,000 Yuan would be imposed on trademark agencies that helped to engage in malicious applications, and the terms of suspending its acceptance business would be serious. The provisions also provided for other measures to deal with malicious trademark registration, in order to form a long-term mechanism to severely crack down on malicious trademark registration.

BIP Asia

On Dec 5, the 9th The Business of IP Asia Forum opened in Hong Kong. Speaking at the opening ceremony, Margaret Fong, president of the Hong Kong Trade Development Council, said that mainland China is still the engine for the growth of global intellectual property applications. Hong Kong is famous for its commerce, trade, finance and innovation, and it will continue to be the center for the generation and trading of intellectual property rights, including technology transfer, licensing, franchising and copyright trading. Hong Kong can provide important support and links with the international market in intellectual property activities in mainland China and even in Asia. Carrie Lam, chief executive of the Hong Kong Special Administrative Region, said that the SAR government had submitted a bill on trademark registration to the Legislative Council, and the judiciary set up a roster of intellectual property experts in May to facilitate the appointment of expert judges in intellectual property cases. Hong Kong would launch a new patent grant system in two weeks' time.

Operation Kunlun

Since the launch of Operation Kunlun, by the end of November 2019, public security organs across China had cracked 27,800 cases of crimes involving food and drug rings, and intellectual property rights, smashed more than 11,300 black factories, workshops and manufacturers, and destroyed more than 5,200 criminal gangs. 48,000 criminal suspects were arrested, with a total value of 28.3 billion Yuan involved, and 132 criminal gangs were eliminated. Since July, the Ministry of Public Security had deployed public security organs throughout China to carry out Operation Kunlun to crack down on food and drug ring crimes. Local public security organs, in conjunction with market supervision departments, agricultural departments and rural governments, and ecological environment departments, had launched fierce attacks against crimes in the field of food and medicine ring, and intellectual property rights, focusing on a number of major and important cases, effectively cracking down on the arrogance of criminals. On Dec 3, the Ministry of Public Security organized public security organs across China to simultaneously carry out the Kunlun Operation, and the promotion and display of the results of the joint action on food safety in 141 cities.

Concentrated Sentencing

From Dec 9 to 13, the Intellectual Property Court of the Supreme People's Court held a concentrated sentencing week to publicly announce sentences on some benchmarking cases altogether. During the event, the Intellectual Property Court heard six cases in public, and invited deputies of the National People's Congress, members of the CPPCC National Committee, special consultants, special supervisors, etc., and broadcasted live in texts on platforms such as the China Court Network, the official Weibo of the Supreme People's Court. On Dec 9, the Intellectual Property Court of the Supreme People's Court publicly sentenced two civil and administrative cases involving the same patent. After hearing the two cases, the appeals were rejected and the original verdicts were upheld. In the trial of these two cases, the Intellectual Property Court for the first time explored the simultaneous trial of administrative cases and civil infringement cases involving the same patent, in order to give full play to the function of the court, made a beneficial attempt to realize the docking of patent administration and civil litigation procedures and adjudication standards.

WIPO Ruling

On Dec 18, the Hangzhou Internet Court issued a public verdict on the dispute over the ownership and infringement of the network domain name between the plaintiff Li and the defendant Banco BPM Societ à per Azioni, and found that Li’s request to confirm that his claim that he had the legitimate rights and interests to the domain names bancobpm.com and banco-bpm.com was lack of factual and legal basis, and rejected his claim in accordance with the law. The case was the first network domain name ownership and infringement lawsuit heard by the Hangzhou Internet Court because the domain name holder was not satisfied with the ruling of the international domain name dispute resolution provider WIPO. Banco BPM Societ à per Azioni was an Italian enterprise and the disputed domain name was an international top-level domain name with the suffix ".com", and the dispute had been dealt with by the WIPO Arbitration and Mediation Center. The plaintiff filed a lawsuit with the Hangzhou Internet Court because he was not satisfied with the decision of the WIPO Arbitration and Mediation Center.

New Plant Varieties

On Dec 11, the Supreme People's Court publicly sentenced Cai Xinguang v. Guangzhou Runping Commercial Co., Ltd. on the infringement of new plant varieties right. The case was the first dispute over the right of new plant varieties accepted by the Intellectual Property Court of the Supreme People's Court. Cai Xinguang, the owner of a new plant variety, sued the supermarket Runping for selling Sanhong honey pomelo fruit, which constituted an infringement on the right of new plant variety, requiring the latter to bear tort liability in accordance with the law and pay 500,000 Yuan in compensation. The court of original instance did not support Cai Xinguang's claim. The judgment of the second instance found that Cai Xinguang's claim that the fruit of the alleged infringement of honey pomelo was the breeding material of a new variety of Sanhong honey pomelo plant did not support that the sales behavior of Runping constituted infringement, and the appeal was rejected and the original judgment was upheld. The judgment in this case played an important guiding role in the definition of the scope of protection of new plant variety rights, and the examination and determination of the alleged infringement.

Libra Chain

On Dec 2, the Beijing Internet Court held a press conference on Libra Chain application access technology and management norms with the theme of regulating the use of blockchain, and issued the technical and management norms of Libra Chain application access. Since its establishment one year ago, the Beijing Internet Court had actively explored and established the Libra Chain electronic evidence platforms filed by the State Internet Information Office, and took the lead in adopting blockchain intelligent contract technology to realize the implementation of "one-click filing". It had become a model for the application of blockchain technology in the judicial field. The Beijing Internet Court adhered to the construction concept of neutrality, openness, security, and controllability, vigorously promoted the deep integration of blockchain technology and judicial innovation, and gradually explored its Libra Chain model of "one chain, dual use, three regulations, and four managements". Next, the Beijing Internet Court would explore more specific application scenarios of the blockchain.

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