Interpretation of the Supreme People's Court and the Supreme People's Procuratorate on Some Issues of Law Application in Handling the Criminal Cases Involving Intellectual Property

(Passed respectively at the 1331st Session of the Adjudication Committee of the Supreme People’s Court on Nov. 2, 2004, and the 28th Session of the 10th Procuratorial Committee of the Supreme People's Procuratorate on Nov. 11, 2004）
(Fashi No.19【2004】)

Issue organs: The Supreme People’s Court and the Supreme People’s Procuratorate
Issue code: Fashi No.19【2004】
Issue date: Dec. 8, 2004
Effective date: Dec. 22, 2004
Expiry date:
Category: State Laws and Regulations

In order to punish crimes of infringement upon intellectual property and safeguard socialist market economic order, an interpretation on some issues of law application in handling the criminal cases involving intellectual property is hereby issued in accordance with the Criminal Code of the People’s Republic of China (hereinafter referred to the Criminal Code):

Article 1: Where any person uses, without the authorization of the owner of a registered trademark, a trademark that is identical with the registered trademark in question in respect of the same sort of goods, any of the following cases shall be deemed as “of a serious nature” as prescribed in Article 213 of the Criminal Code, and the person shall be sentenced to imprisonment for a definite term of no more than three years or criminal detention, with a concurrent fine, or exclusively to a fine;

1.having an amount of illegal business value of over 50,000 yuan, or an amount of illegal income of over 30,000 yuan;

2.counterfeiting two or more registered trademarks, with an illegal business value of over 30,000 yuan or an illegal income of over 20,000 yuan; and

3.other serious circumstances.

Any of the following cases shall be deemed as “of a very serious nature” as prescribed in Article 213 of the Criminal Code, and the offender shall be sentenced to imprisonment of a definite term from no less than three years up to seven years and a concurrent fine on conviction of Crime of Counterfeiting Registered Trademarks.

1.having an illegal business value of over 250,000 yuan or an illegal income of over 150,000 yuan;

2.counterfeiting two or more registered trademarks, with a business value of over 150,000 yuan or an illegal income of over 100,000 yuan; and

3.other very serious circumstances

Article 2: Where any person sells goods that, as he knows well, bears a counterfeited registered trademark with a total sales volume of over 50,000 yuan, a number that is deemed as “relatively large” as prescribed in Article 214 of the Criminal Code, the person shall be sentenced to imprisonment for a definite term of no more than three years or criminal detention, with a concurrent fine, or exclusively to a fine upon conviction of Crime of Sales of Goods with Counterfeited Registered Trademark;

Where the total sales volume is over 250,000 yuan, a figure that is deemed as “huge” as prescribed in Article 214 of the Criminal Code, the person shall be sentenced to imprisonment for a definite term from no less than three years up to seven years, and concurrently to a fine upon conviction of Crime of Sales of Goods with Counterfeited Registered Trademark.

Article 3: Where any person falsifies, or makes without authorization, representations of the registered trademark of another person, or sells such representations, any of the following circumstances shall be deemed as “of a serious nature” as prescribed in Article 215 of the Criminal Code, and the offender shall be sentenced to imprisonment for a definite term of no more than three years or criminal detention or control, with a concurrent fine, or exclusively to a fine upon conviction of Crime of Illegally Making Representations of Registered Trademarks or Crime of Selling Illegally Made Representations of Registered Trademarks;

1.falsifying, or making without authorization, over 20,000 pieces of representations of a registered trademark of another person or selling such representations, with a total illegal business value of over 50,000 yuan, or a total illegal income of over 30,000 yuan;

2.falsifying, or making without authorization, over10,000 pieces of representations of two or more registered trademarks of another person or selling such representations with a total illegal business value of over 30,000 yuan, or a total illegal income of over 20,000 yuan; and

3.other serious circumstances;

Any of the following cases shall be deemed as “of a very serious nature” as prescribed in Article 215 of the Criminal Code, and the offender shall be sentenced to imprisonment for a definite term from no less than three years up to seven years and a concurrent fine on conviction of Crime of Illegally Making Representations of Registered Trademarks or Crime of Selling Illegally Made Representations of Registered Trademarks.

1.falsifying, or making without authorization, over 100,000 pieces of representations of a registered trademark of another person or selling such representations, having a total illegal business value of over 250,000 yuan, or reaping a total illegal income of over 150,000 yuan;

2.falsifying, or making without authorization, over100,000 pieces of representations of two or more registered trademarks of another person or selling such representations, having a total illegal business value of over 250,000 yuan, or reaping a total illegal income of over 100,000 yuan; and

3.other very serious circumstances;

Article 4: Where any person counterfeits the patent of another person, any of the following circumstances shall be deemed as “of a serious nature” as prescribed in Article 216 of the Criminal Code, and the person shall be sentenced to imprisonment for a definite term of no more than three years or criminal detention, with a concurrent fine, or exclusively to a fine upon conviction of Crime of Counterfeiting Patents.

1.having an illegal business value of over 200,000 yuan or an illegal income of over 100,000 yuan;

2.causing a direct economic loss of over 500,000 yuan to the patentee;

3.counterfeiting two or more of another person’s patents, having an illegal business value of over 100,000 yuan, or reaping an illegal income of over 50,000; and

4.other serious circumstances;

Article 5: Where any person, for the purpose of reaping profits, has committed one of the copyright infringements as prescribed in Article 217 of the Criminal Code, with a total illegal income of over 30,000 yuan, he or she shall be deemed as “having gained a relatively large amount of illegal income”; any of the following circumstances shall be deemed as “other serious circumstances”, and the violator shall be sentenced to imprisonment for a definite term of no more than three years or criminal detention, with a concurrent fine, or exclusively to a fine upon conviction of Crime of Copyright Infringement:

1.having an illegal business value of over 50,000 yuan;

2.reproducing and distributing literary, musical, filmed, televised, or video works, computer software, or other works without the permission of the copyright owner with a total number of over 1,000 copies of such copyrighted works; and

3.other very serious circumstances;

Where any person, for the purpose of reaping profits, has committed one of the copyright infringements as prescribed in Article 217 of the Criminal Code, with a total illegal income of over 150,000 yuan, he or she shall be deemed as “having gained a huge amount of illegal income”; any of the following cases shall be deemed as “other very serious circumstances”, and the offender shall be sentenced to imprisonment for a definite term from no less than three years up to seven years, and concurrently to a fine upon conviction of Crime of Copyright Infringement:

1.having an amount of illegal business value of over 250,000;

2.reproducing and distributing literary, musical, filmed, televised, or video works, computer software, or other works without the permission of the copyright owner with a total volume of over 5000 copies of such copyrighted works; and

3.other very serious circumstances;

Article 6: Where any person, for the purpose of reaping profits, has committed one of the acts as prescribed in Article 218 of the Criminal Code with a total illegal income of over 100,000 yuan, he or she shall be deemed as “having gained a huge illegal income”, and shall be sentenced to imprisonment for a definite term of no more than three years or criminal detention, with a concurrent fine or exclusively to a fine upon conviction of Crime of Selling Illegally Reproduced Copyrighted Works.

Article 7: Where any person who has committed one of the acts as prescribed in Article 219 of the Criminal Code and caused a total loss of over 500,000 yuan to the right-holder of trade secrets shall be deemed as “having brought significant losses to the right-holder of trade secrets”; and the offender shall be sentenced to imprisonment for a definite term of no more than three years or criminal detention, with concurrently a fine, or exclusively to a fine upon conviction of Crime of Trade Secrets Infringement.

Where any person that has caused a total loss of over 2,500,000 yuan to the right-holder of trade secrets shall be deemed as “having caused very serious consequences” as prescribed in Article 219 of the Criminal Code and the violator shall be sentenced to imprisonment for a definite term from no less than three years up to seven years with a concurrent fine upon conviction of Crime of Trade Secrets Infringement.

Article 8: “Identical trademark” as prescribed in Article 213 of the Criminal Code refers to the trademark which is completely the same as the original registered trademark, or basically has no difference in visual appearance from the original registered trademark, so as to be sufficiently misleading to the public.

“Use” as prescribed in Article 213 of the Criminal Code refers to the act of putting a registered trademark or a counterfeit registered trademark on goods, their packages or containers, instruction manuals, or exchange manuals; or utilize a registered trademark or a counterfeit registered trademark in advertisements, exhibitions or other business moves.

Article 9: “Sales volume” as prescribed in Article 213 of the Criminal Code refers to the amount of gained earnings and due income from selling goods that bear counterfeit registered trademarks.
Any of the following cases shall be deemed as “committed knowingly” as prescribed in Article 214 of the Criminal Code:

1.selling goods that, as he knows, bears modified, transposed, or covered registered trademarks;

2.selling goods that bear a counterfeit registered trademark after being subjected to administrative penalty or civil liabilities for such an act;

3.counterfeiting, or modifying the authorization file of the registered trademark owner, or knowing such counterfeiting or modification; and

4.other circumstances where the actor knows, or shall know the goods that he or she sells bear counterfeit registered trademarks;

Article 10: Any of the following acts shall be deemed as “counterfeiting other person’s patents” as prescribed in Article 216 of the Criminal Code:

1.putting the patent number of another person on the goods or their packages manufactured or sold by the actor without permission from the patentee;

2.using, without permission of the patentee, the patent number of the patentee in question in advertisements or other promotional materials as to mislead the consumers to mistake the used technology therein for that of another person;

3.using, without permission of the patentee, the patent number of the patentee in question in contracts as to mislead the other party to mistake the used technology therein for that of another person; and

4.counterfeiting or modifying the patent certificate, patent document, or patent application document

Article 11: Circumstances under which charging, directly or indirectly, through such acts as chargeable advertising shall be deemed as “for the purpose of reaping profits” as prescribed in Article 217 of the Criminal Code.

The phrase of “without the permission of copy right owners” as prescribed in Article 217 of the Criminal Code refers to such circumstances under which the actor fails to obtain authorization from the copyright owner, or counterfeits or modifies the copyright authorization document, or goes beyond the scope of copyright authorization.

Spreading to the public, through information networks, literary, musical, filmed, televised, or video works, computer software, or other works, shall be deemed as “reproducing and distributing” as prescribed in Article 217 of the Criminal Code.

Article 12: “Illegal business value”, as mentioned in this interpretation, refers to the value the actor realizes in the process of committing intellectual property infringements through manufacture, storage, transportation, or sales of goods. The value of the sold infringing goods shall be computed according to the actual selling price; and the value of the manufactured, stored, transported or unsold goods shall be computed according to the tagged price or the average actual selling price of the sold infringement goods. In case no tagged price is available or the selling price cannot be found out, the value of the goods in question shall be computed according to median market price;

In case the offender has committed multiple intellectual property infringements without administrative sanction or criminal punishment being imposed thereon, the amount of illegal business value, illegal income or sales volume shall be computed accumulatively. .

“Piece” as mentioned in Article 3 of this interpretation refers to a representation of a registered trademark with complete trademark pattern.

Article 13 Where any person that commits the Crime of Counterfeiting Registered Trademark as prescribed in Article 213 of the Criminal Code, and sells goods that bear the counterfeit registered trademark in question as to constitute a crime, the person shall be subject to punishment in accordance with Article 213 of the Criminal Code upon conviction of Crime of Counterfeiting Registered Trademark.
Where any person that commits the Crime of Counterfeiting Registered Trademark as prescribed in Article 213 of the Criminal Code, and sells goods that, as he knows, bear a counterfeit of the registered trademark of another person as to constitute a crime, shall be subject to concurrent punishment for the several crimes.

Article 14 Where any person that commits the Crime of Copyright Infringements as prescribed in Article 217 of the Criminal Code, and sells such infringement duplicates as to constitute a crime, shall be punished in accordance with Article 217 of the Criminal Code upon conviction of Crime of Copyright Infringements.

Where any person that commits the Crime of Copyright Infringements as prescribed in Article 217 of the Criminal Code, and knowingly sells such infringing duplicates as to constitute a crime, the offender shall be subject to concurrent punishment for the several crimes.

Article 15 When a unit commits the acts as prescribed in Article 213- 219 of the Criminal Code, it shall be subject to triple the punishment for individual offenders.

Article 16 Where any person that supplies any other person who, as he knows, has committed intellectual property infringements, with loans, funds, accounts, invoices, proving documents , licenses or production or business sites, or such conveniences or assistances as transportation, storage, and export or import agency services, shall be deemed and punished as accomplices of Crime of Intellectual Property Infringements.

Article 17 All former judicial interpretations on intellectual property infringements that constitute discrepancy with this interpretation shall not be applicable on the passage of this interpretation.