It seems that another friend of mine is interested in these “entries” and I was suggested to write something about the protection of Intellectual Property Rights in China, So today I will introduce this new theme.
Establishing a business in China usually implies the usage of certain IPR which the owners wishes to protect in order to maintain their competitive advantage over competitors. Virtually all businesses, both Chinese and foreign, are at risk from piracy, industrial espionage or some other forms of IPR infringement. The Chinese market is booming, and unfortunately this also means that a variety of forms of IPR abuse are also flourishing.
Despite the fact that China has made some significant progress on Intellectual Property Rights enforcement and protection, concerns about infringement remain a major problem when investing in China. Foreign companies when establishing a presence in this market, before to commercialize their products must be sure they can protect their IP assets, and if the case to file a request for recordal with the SIPO (http://www.sipo.gov.cn/sipo_English2008/ ) or with the appropriate Chinese agencies and authorities for those rights to be enforceable in China. Copyrights do not need to be registered but registration may be helpful in enforcement actions.
Since joining the World Trade Organization (WTO), China has strengthened its legal framework and amended its IPR and related laws and regulations to comply with the WTO Agreement on Traded-Related Aspect of Intellectual Property Rights (TRIPs). Despite stronger statutory protection, China, as noted above, continues to be a haven for counterfeiters and pirates. According to one copyright industry association, the piracy rate remains one of the highest in the world (over 90 percent) and U.S. companies lose over one billion dollar in legitimate business each year to piracy. On average, 20 percent of all consumer products in the Chinese market are counterfeit. If a product sells, it is likely to be illegally duplicated. U.S. companies are not alone, as pirates and counterfeiters target both foreign and domestic companies.
A brief summary of China’s patent, trademark, and copyright laws are described below.
Patent: The relevant patent legislation in China is the Patent Law (http://www.lehmanlaw.com/resource-centre/laws-and-regulations/intellectual-property/patent-law-of-the-peoples-republic-of-china-2001.html ), the Regulation for Implementation of the Patent Law, and the Measures on the Administration of Patent Agencies. The Patent Law provides protection for inventions (both products and processes), utility model, and designs.. Under the Patent Law, any foreign individual or enterprise without an office in China and wishing to apply in China for a patent must use an authorized Chinese patent agent to file the application on his/her behalf. To comply with TRIPs, the latest amendment extended the duration of patent protection to 20 years from the date of filing a patent application. Chemical and pharmaceutical products, as well as food, beverages, and flavorings are all now patentable. China follows a first to file system for patents, which means patents are granted to those that file first even if the filers are not the original inventors. This system is unlike the United States, which recognizes the “first to invent” rule, but is consistent with the practice in other parts of the world, including the European Union. As a signatory to the Patent Cooperation Treaty in 1994, China will perform international patent searches and preliminary examinations of patent applications. Patents are filed with China’s State Intellectual Property Office (SIPO) in Beijing, while SIPO offices at the provincial and municipal level are responsible for administrative enforcement.
Trademark. China’s trademark law was first adopted in 1982 and subsequently revised in 1993 and 2001 and again in 2008. Chinese law prohibits the use or registration of any trademark for identical or similar goods that is a “reproduction, imitation or translation of another person’s trade mark not registered in China and likely to cause confusion.” In the case of non-identical or dissimilar goods, the law bans the imitation of the “well-known mark of another person that has been registered in China, misleads the public and it likely to create prejudice to the interests of the well-known mark registrant.” However, here it is not my purpose to focus my attention of the content of this particular legislation. Here it is worth to remember that China joined the Madrid Protocol in 1989, which requires reciprocal trademark registration for member countries, which now include the United States. China has a ‘first-to register’ system that requires no evidence of prior use or ownership, leaving registration of popular foreign marks open to third party. However, the Chinese Trademark Office has cancelled Chinese trademarks that were unfairly registered by local Chinese agents or customers of foreign companies. Foreign companies seeking to distribute their products in China are advised to register their marks and/or logos with the Trademark Office ( http://www.saic.gov.cn/sbjenglish/ ). Further, any Chinese language translations and appropriate Internet domains should also be registered. As with patent registration, foreign parties must use the services of approved Chinese agents when submitting the trademark application, however foreign attorneys or the Chinese agents may prepare the application.
Copyright. China’s copyright law was established in 1990 and amended in October 2001. The new implementing rules came into force on September 15, 2002. Unlike the patent and trademark protection, copyrighted works do not require registration for protection. Protection is granted to individuals from countries belonging to the copyright international conventions or bilateral agreements of which China is a member. However, copyright owners may wish to voluntarily register with China’s National Copyright Administration (NCA) to establish evidence of ownership, should enforcement actions become necessary.
Unfair Competition. China’s Unfair Competition Law provides some protection for unregistered trademarks, packaging, trade dress and trade secrets. The Fair Trade Bureau, under the State Administration for Industry and Commerce (SAIC) has responsibilities over the interpretation and implementation of the Unfair Competition Law. Protection of company names is also provided by SAIC. According to the TRIPs Agreement, China is required to protect undisclosed information submitted to Chinese agencies in obtaining regulatory approval for pharmaceutical and chemical entities from disclosure or unfair commercial use. China’s State Drug Administration and Ministry of Agriculture oversee the marketing approval of pharmaceuticals and agricultural chemicals, respectively
What it is described above, delineates the framework for IPR protection in China. I hope these information can be of some help for our readers. In any case this topic will be discussed again in the future.
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– Cristiano Rizzi