2020 Fourth Amendments to China’s Patent Law
The fourth amendment of the Chinese Patent Law (CPL) has been approved by China's National People's Congress on October 17, 2020, which will take effect on June 01, 2021. After the 2008 amendments, China has approved the current amendments to the CPL. Below is a brief summary of the Top 5 Changes in the newly amended CPL.
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1. Amendments to Design patents
The introduction of partial designs and extension of the design patent term are the two noteworthy amendments to the design patent in China.
a. Article 2.4 Amendments:
Changes to Article 2.4 of the CPL allow the partial design patent. This amendment is in line with international practice such as in the USA, Europe, UK, Japan, etc., and hence, convenience for international applicants where partial designs are allowed.
b. Article 42.1 Amendments:
The term of a design patent has extended to 15 years from 10 years of current practice. This amendment will help clear the way for China to join the Hague Agreement, which stipulates a minimum of 15 years of protection term of design patents for the member countries.
2. Amendments to patent term compensation
The article 42.2 amendment is another significant change in the present amendments of CPL relating to the patent term compensation. The applicant may now request for patent term compensation for the unreasonable delays during prosecution of the patent when the patent is granted after four (4) years from the filing date of the patent application and three (3) years from the date of filing of a request for substantive examination. The delays caused by the applicants are exempted. This amendment is similar to the patent term adjustment of the US patents by the USPTO.
3. Amendments to patent term compensation
For pharmaceutical patents, patent term extension and patent linkage system are the most important changes in the present amendments.
a. Article 42.3 Amendments:
In order to compensate for the long regulatory evaluation and approval period of a new drug, the new CPL has introduced a pharmaceutical patent term extension. The total patent term extension period is a maximum of 5 years. However, the total patent term, including the extension shall not exceed 14 years following regulatory approval. This provision is in line with the US practice of providing the patent term extension of the US patents comprising drug products.
b. Article 76.3 Amendments
By way of the present amendments, China will be introducing a patent linkage system for pharmaceutical patents. According to the new CPL, a patentee and or interested party can bring a patent infringement dispute before the court or the China National Intellectual Property Administration (CNIPA)against a party who is seeking marketing approval for a drug that falls within the scope of a patent recorded in the “Chinese Marketed Drug Patent Information Record Platform.”China's pharmaceutical regulatory body (China's FDA) will work with the CNIPA to make detailed guidelines on the patent linkage system.
4. Enforcement or Increased patent damages
In the new CPL, measures have been taken relating to punitive damages, statutory damages, and evidence disclosure obligations.
a. Article 71.1 Amendment:
In case of serious willful patent infringement, the court may set the damages up to five times the original damages like punitive damages.
b. Article 71.2 Amendment:
By way of this amendment, the statutory damages have been increased from RMB one million to RMB five million.
c. Article 71.4 Amendment:
The new CPL has introduced a preliminary evidence disclosure obligation. In order to determine the damages, the court may order the defendant to provide the relevant account books and materials. In case the defendant does not disclose or provides false account books and materials, the court may determine the damages based on the patentee's request or evidence.
5. License system or Reduced/Exempted Annuity Fees
Articles 50 – 52 provisions present an “open license” system. The patentee can voluntarily declare and record its intention to "open license" its patents to any entity or individual with the Patent Administration Department of the State Council and set the license fees and terms for public records. During the open license period, the patent annuities shall be reduced or exempted.
In conclusion, the upcoming changes will strengthen patent rights in China. The amendments will have an impact on areas of patent prosecution, litigation, and exploration.