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Important Amendments to Chinese Patent Law

Guest post from Deshan Li, Ph.D., Executive Vice President and Senior Partner at Unitalen Attorneys at Law.

On October 17, 2020, the amendments to the Patent Law were adopted by the Congress, which will come into effect as of June 1, 2021. The main points of the amendments that will have substantial influences on patent practice are outlined below.

Enhanced Patent Protection

If a defendant’s infringement is found to be willful and serious, a court has the discretion to increase damages up to five times the amount of the compensatory award.

If the evidence submitted by the plaintiff is not sufficient to determine the compensatory damages according to actual loss of the plaintiff, illegal profit of the defendant or established royalties, the court can award the plaintiff statutory damages of up to RMB 5 million. (Note that the current upper limit is RMB 1 million.)

The statute of limitations for a patent infringement is 3 years from the date when the plaintiff knew or should have known the act of infringement. (Note that the current statute of limitations is 2 years.)

Patent Term Adjustment

If, due to unreasonable delays of CNIPA, an invention patent is issued 4 years after the filing date and 3 years after requesting substantive examination, the patentee can request CNIPA to extend the term of the patent in accordance with the unreasonable delays.

Updated: The request should be filed within 3 months from the announcement of grant of the patent.

To ensure that regulatory review of a new drug will not unduly consume life of a patent which covers the new drug, the patentee can request CNIPA to extend the term of the patent by less than 5 years. The total protection term after the regulatory approval is obtained should be less than 14 years.

Updated: The request should be filed within 3 months after the regulatory approval is obtained.

Patent Linkage

If, during regulatory review of a new drug, the patentee of a patent alleges that the patent covers the new drug and a court or CNIPA is requested to adjudicate on whether the patent is infringed, the regulatory review can be stayed according to the decision of the court or CNIPA.

Improved Design Protection

The protection term for design patents is 15 years from the filing date. (The current term is 10 years.)

Updated: Only applications filed on or after June 1, 2021 will have a protection term of 15 years.

Partial designs can be protected. (Currently, only designs of the whole product can be protected.)

Comments: Unfortunately, the Implementing Regulations and the Examination Guidelines regarding partial designs have not been issued. To be safe, we would suggest filing two sets of drawings: 1) all components are drawn with solid lines; 2) components that you want to protect are drawn with solid lines and the other components, with dashed lines.

The applicant can claim priority from a first filed domestic design application within 6 months from its filing date. (Currently, it is impossible to claim domestic priority for design applications.)

Comments: You may use this to file a second application on or after June 1, 2021, claiming the priority from the first application, so that you could have a protection term of 15 years.

Open Licensing

A patentee can file with CNIPA a declaration in which he expresses his will to license his patent to any third party and states the amount of royalties and how the royalties should be paid. After CNIPA publishes the declaration, if any third party is interested in using the patent, he can write to the patentee and pay royalties according to the declaration to obtain an open license from the patentee.

If the patent is a utility model or a design, the patentee should submit a patentability assessment report.

The open licensing declaration can be withdrawn. The withdrawal will not negate the legal effect of existing open licenses.

During the period of open licensing, annuities of the patent can be decreased or waived.

Miscellaneous Amendments

If, when filing an invention patent application or a utility model patent application, the applicant claims priority from an earlier filed application, he should file with CNIPA a copy of the priority application within 16 months from the filing date of the priority application. (Currently, the copy should be filed within 3 months from the filing date of the invention patent application or the utility model patent application.)

Updated: Only applications filed on or after June 1, 2021 could enjoy the 16 month deadline.

If an invention is first disclosed for public interest when a national emergency occurs, the applicant can enjoy a grace period of 6 months.

Nuclear transformation methods cannot be patented.

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