1 Legal framework

1.1 What are the sources of patent law in your jurisdiction?

The Chinese patent regime aims to:

  • protect inventions;
  • encourage innovation;
  • promote the dissemination and application of inventions; and
  • promote the development of science and technology, to meet the needs of socialist modernisation.

The principal sources of law are as follows:

  • The Patent Law is a special law that includes provisions on issues such as the requirements for patent prosecution; the duration, cessation and invalidation of patent rights; the enforcement of patent rights; legal remedies and similar issues.
  • The Implementing Regulations of the Patent Law provide more detailed requirements and formalities, such as the patent application procedure and procedures for enforcement.
  • The Guidelines on Patent Examination set out detailed requirements and procedures on the examination of patent, utility model and design applications, and the re-examination and invalidation thereof.
  • The Civil Procedure Law and the Interpretation of Application of the Civil Procedure Law set out up-to-date court procedures for patent litigation in China.
  • The Administrative Procedure Law sets out the procedure for administrative lawsuits.
  • Interpretations I and II of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Cases Involving Patent Infringement Disputes set out the trial procedure for patent infringement disputes.

In addition, China is a party to the following international treaties:

  • the Paris Convention for the Protection of Industrial Property;
  • the Patent Cooperation Treaty;
  • the Agreement on Trade-Related Aspects of Intellectual Property Rights; and
  • the Convention Establishing the World Intellectual Property Organization.

1.2 Who can register a patent?

The applicant and the registrant of a patent are generally the same, unless the right to register the patent has been assigned to a third party. Both Chinese and foreign natural and legal persons may file a patent application. A foreign applicant must satisfy one of the following conditions:

  • Its home country has concluded an agreement with China under which each country affords patent protection to nationals of the other;
  • Its home country is party to the Paris Convention for the Protection of Industrial Property or a member of the World Trade Organization; or
  • Its home country provides patent protection to foreign person on the basis of the principle of reciprocity.

Usually, the inventor of the patent is also the applicant, except in the following cases:

  • The inventor has assigned the right to file the patent application to another natural or legal person by contract;
  • The patent application is filed by the heirs of the inventor as a result of inheritance; or
  • The law directly grants the right to file the patent application to another party. For example, in the case of a service invention, the entity which the inventor serves will file the patent application.

2 Rights

2.1 What rights are obtained when a patent is registered?

  • Exclusive exploitation: Once a patent or utility model has been granted, except as otherwise provided under the Patent Law, no entity or individual may exploit the patent without the authorisation of the patent holder.
  • Assignment right: The patent holder has the right to assign the patent right to another entity or individual.
  • Licensing right: The patent holder has the right to authorise another entity or individual to exploit the patent and charge an appropriate fee.
  • Indication right: The patent holder has the right to affix a patent indication to the patented product or its packaging.
  • Enforcement right: In case of infringement, the patent holder has the right to request the people's court or the administrative authority for patent affairs to order the cessation of the infringement.

2.2 How can a patent owner enforce its rights?

Where a dispute arises as a result of the unauthorised exploitation of a patent, the parties will first attempt to resolve it through negotiation. If either party is unwilling to negotiate or if the negotiation fails, the patent holder or any interested party may commence legal proceedings in the people's court or request the administrative authority for patent affairs to handle the matter.

In this regard, an ‘interested party' refers to a licensee that has an exclusive licence to exploit the patent right. In other words, in addition to the patent holder, an exclusive licensee may commence an action before the people's court or request the administrative authority for patent affairs to handle the matter. The exclusive licence must be recorded with the Chinese National Intellectual Property Administration.

2.3 For how long are patents enforceable?

The duration of a patent is 20 years, while the duration of utility models and design rights is 10 years, in both cases counted from the date of filing.

3 Obtaining a patent

3.1 Which governing body controls the registration procedure?

The Patent Office of the China National Intellectual Property Administration (CNIPA) is in charge of the patent registration procedure.

3.2 What is the cost of registration?

The fees for registering a patent are as follows:

  • Application fee: RMB 900.
  • Additional charge for claims: RMB 150 per claim from the 11th claim.
  • Additional charge for description:
    • RMB 50 per page from the 31th page of the description (including drawings and sequence list, included).
    • RMB 100 per page from the 301th page of the description (including drawings and sequence list, if included).
  • Publication fee: RMB 50.
  • Priority fee (per priority): RMB 80.
  • Examination fee: RMB 2,500.
  • Stamp tax: RMB 5.
  • Annual fee:
    • First to third year: RMB 900.
    • Fourth to sixth year: RMB 1,200.
    • Seventh to ninth year: RMB 2,000.
    • 10th to 12th year: RMB 4,000.
    • 13th to 15th year: RMB 6,000.
    • 16th to 20th year: RMB 8,000.

The fees for registering a utility model are as follows:

  • Application fee: RMB 500.
  • Additional charge for claims: RMB 150 per claim from the 11th claim.
  • Additional charge for description:
    • RMB 50 per page from the 31th page of the description (including drawings)
    • RMB 100 per page from the 301th page of the description.
      (including drawings)
  • Priority fee (per priority): RMB 80.
  • Stamp tax: RMB 5.
  • Annual fee:
    • First to third year: RMB 600.
    • Fourth to fifth year: RMB 900.
    • Sixth to eighth year: RMB 1,200.
    • Ninth to 10th year: RMB 2,000.

The fees for registering a design right are as follows:

  • Application fee: RMB 500 for no more than designs
  • Priority fee (per priority): RMB 80.
  • Stamp tax: RMB 5.
  • Annual fee:
    • First to third year: RMB 600.
    • Fourth to fifth year: RMB 900.
    • Sixth to eighth year: RMB 1,200.
    • Ninth to 10th year: RBM 2,000.

3.3 What are the grounds to reject a patent application?

The most common grounds for rejection are as follows:

  • The subject matter of the application does not fulfil the definition of an ‘invention' or ‘utility model'.
  • The patent application is contrary to law or social morality, or is detrimental to the public interest.
  • A patent has already been granted for an identical invention.
  • The application has been filed abroad for an invention or utility model developed in China, without a confidentiality examination being conducted by the patent administration department of the State Council.
  • The subject matter of the application does not meet the criteria of patentability (ie, novelty, inventive step and industrial application).
  • The subject matter of the patent is not patentable.
  • The description is not sufficiently clear and complete to enable a person skilled in the art to carry it out.
  • The claims are not supported by the description and do not define the extent of the protection sought in a clear and concise manner.
  • The invention relies on genetic resources whose direct and original source is not indicated in the application documents, or no reason therefor is stated.
  • The application comprises a plurality of inventive concepts.
  • An amendment to the application goes beyond the scope of disclosure contained in the initial description and claims.
  • Essential technical features necessary to solve the relevant technical problem are missing from an independent claim.
  • A divisional application goes beyond the scope of disclosure contained in the initial parent application.

3.4 What programmes or initiatives are available to accelerate or fast track examination of patent applications?

There are different routes to accelerate the examination procedure.

One widely used route is the Patent Prosecution Highway (PPH) programme, which is based on an agreement between the CNIPA and other foreign IP bureaux. If a Chinese patent application has a foreign family application and the foreign family application obtains a positive result from the local IP bureau, a PPH request may be filed based on that result. Once the PPH request is approved by the CNIPA, the first office action will be issued within about one to two months. For some foreign IP bureaux, a Patent Cooperation Treaty PPH programme may also be used.

Another route is prioritised examination. Certain industrial requirements apply for prioritised examination – for example, the subject matter of the patent application must fall within particular industrial fields, or the subject matter of the patent application must have significant importance for the national interest or public interest.

Prioritised examination may be initiated at the request of the applicant or ex officio. If the request is approved, the first office action will be issued within 45 days and prosecution will be completed within one year. For a utility model application, prosecution will be completed within two months.

The third route is pre-examination. The applicant may request pre-examination from its local IP protection centre in China – for example, the Beijing IP Protection Centre. If a positive result is obtained, the applicant may file a formal patent application and the examination procedure will be reduced to three months. Usually, the pre-examination route is available only for local applicants.

3.5 Are there any types of claims or claiming formats that are not permissible in your jurisdiction (eg, medical method claims)?

Some types of claims are not permissible in China.

Specifically, methods for the diagnosis or treatment of disease are not permissible. For example, method claims in the format of "A method for treating a disease X, comprising administering a compound Y" are not permissible; but they could be amended to Swiss-type use claims in a format such as "Use of a compound Y in preparation of a medicament for treating a disease X", which is allowed according to Chinese patent practice. In addition, European Patent Convention (EPC) 2000 claims in a format such as "A compound Y for use in treating a disease X" will generally be understood as product claims, and the use feature in treating disease X may be considered as not defining the compound itself; thus, the compound Y may be rejected for being anticipated or obvious in China. Thus, it is recommended that disease treatment method claims and EPC2000 claims be amended to Swiss-type use claims in China.

In addition, a computer program (eg, in the format of "A computer program for performing a method of…") may be understood as falling within the category of "rules and methods for mental activities", which are not permissible. This could simply be amended to a format such as, "A computer-readable medium storing a computer program, when executed by a processor, performing a method of…", as a computer-readable medium constitutes patentable subject matter.

3.6 Are any procedural or legal mechanisms available to extend patent term (eg, adjustments for patent office delays, pharmaceutical patent term extension or supplementary protection certificates)?

In China, no procedural or legal mechanism is available to extend the patent term.

3.7 What subject matter is patent eligible?

According to Article 2 of the Patent Law, ‘inventions-creations' are inventions, utility models and designs. An ‘invention' is any new technical solution relating to a product, a process or an improvement thereto. A ‘utility model' is any new technical solution relating to the shape or structure of a product, or a combination of the two, which is fit for practical use. A ‘design' is any new design relating to the shape or pattern of a product, a combination of the two or a combination with colour, which creates an aesthetic effect and is fit for industrial application.

Thus, generally speaking, any new technical solution relating to a product, a process (including a use) or an improvement thereto is patent-eligible subject matter.

According to Article 25, however, the following are not patentable:

  • scientific discoveries;
  • rules and methods for mental activities;
  • methods for the diagnosis or treatment of diseases;
  • animal and plant varieties;
  • substances obtained through nuclear transformation; and
  • designs of two-dimensional printing goods, comprising a pattern, colour or a combination of the two, which serve mainly as indicators.

In addition, according to Article 5, inventions-creations that are contrary to law or social morality, or detrimental to the public interest (eg, "A kind of tool for gambling and the method of its use") are not patentable.

3.8 If the patent office does not grant a patent, is an appeal available and to whom?

If the Patent Office rejects an application, the applicant may request re-examination at the Patent Re-examination and Invalidation Examination Department of CNIPA within three months of the date of receipt of the decision.

The main re-examination process under the Patent Law is as follows:

  • On receiving the rejection decision, the applicant may file a request for re-examination within three months. It can also make amendments and/or additional arguments in the request.
  • On receiving the request for re-examination, the Patent Re-examination and Invalidation Examination Department will issue an official receipt after an examination for formalities and the re-examination will commence.
  • In some cases the Patent Re-examination and Invalidation Examination Department may issue a notification of re-examination to indicate its opinions and require the applicant to make further amendments and/or arguments.
  • The Patent Re-examination and Invalidation Examination Department will decide whether to withdraw or uphold the rejection.

If the applicant is not satisfied with the decision of the Patent Re-examination and Invalidation Examination Department, it may commence legal proceedings before the Beijing IP Court within three months of the date of receipt of the decision. If the applicant is not satisfied with the judgment of the Beijing IP Court, it may commence a second trial before the Beijing High Court within 30 days (for a foreign applicant) or 15 days (for a local applicant) of the date of receipt of the judgment.

4 Validity/post-grant review and/or opposition procedures

4.1 Where can the validity of an issued patent be challenged?

The validity of an issued patent may be challenged before the Patent Re-examination and Invalidation Examination Department of the Chinese National Intellectual Property Administration (CNIPA).

There are no post-grant procedures in China other than the invalidation procedure. In other words, there are no post-grant review or opposition proceedings in China.

4.2 How can the validity of an issued patent be challenged?

As from the date of the announcement of grant of the patent right by the Patent Administration Department under the State Council, if any party considers that the grant of the patent right does not conform with the relevant provisions of the Patent Law, it may file a request for invalidation of the patent with the Patent Re-examination and Invalidation Department of the CNIPA.

The Patent Re-examination and Invalidation Department will examine the request for invalidation of the patent right promptly, decide whether to allow it and notify both the patent holder and the party seeking invalidation accordingly.

If the patent holder or the party seeking invalidation is not satisfied with this decision, it may commence legal proceedings before the Beijing IP Court within three months of receipt of notification of the decision. The Beijing IP Court will order the other party to appear as a third party in the legal proceedings. After trial, the Beijing IP Court will issue its judgment.

Accordingly, if any party is not satisfied with the judgment of the Beijing IP Court, it may commence a second trial before the Beijing High Court within 30 days (for a foreign applicant) or 15 days (for a local applicant) of the date of receipt of the judgment.

4.3 What are the grounds to invalidate an issued patent?

  • The subject matter of the application does not fulfil the definition of an ‘invention' or ‘utility model'.
  • The patent application is contrary to law or social morality, or is detrimental to the public interest.
  • A patent has already been granted for an identical invention.
  • The application has been filed abroad for an invention or utility model developed in China, without a confidentiality examination being conducted by the patent administration department of the State Council.
  • The subject matter of the application does not meet the criteria of patentability (ie, novelty, inventive step and industrial application).
  • The subject matter of the patent is not patentable.
  • The description is not sufficiently clear and complete to enable a person skilled in the art to carry it out.
  • The claims are not supported by the description and do not define the extent of the protection sought in a clear and concise manner.
  • The invention relies on genetic resources whose direct and original source is not indicated in the application documents, or no reason therefor is stated.
  • An amendment to the application goes beyond the scope of disclosure contained in the initial description and claims.
  • Essential technical features necessary to solve the relevant technical problem are missing from an independent claim.
  • A divisional application goes beyond the scope of disclosure contained in the initial parent application.

4.4 What is the evidentiary standard to invalidate an issued patent?

  • The evidence and the facts of the case must be relevant.
  • The evidence must be legitimate – that is:
    • it must meet the formal requirements prescribed by law;
    • it must have been acquired in conformity with the provisions of laws and regulations; and
    • there must be no other illegal circumstance that will prejudice the effectiveness of the evidence.
  • The evidence must be authentic. This will involve a consideration of the following:
    • whether the evidence is an original or, if a photocopy or duplicate, whether it matches the original;
    • whether the provider of the evidence has an interest in the matter;
    • how the evidence was collected;
    • how the evidence was generated;
    • the contents of the evidence; and
    • other factors which may affect the authenticity of the evidence.

4.5 What post-grant review or opposition procedures are available for third parties to challenge the validity of a patent?

There is no post-grant review procedure or opposition procedure in China, as mentioned in question 4.1.

4.6 Who can oppose a granted patent?

Please see question 4.5.

4.7 What are the timing requirements for filing an opposition or post-grant review petition?

Please see question 4.5.

4.8 What are the grounds to file an opposition?

Please see question 4.5.

4.9 What are the possible outcomes when an opposition is filed?

Please see question 4.5.

4.10 What legal standards will the tribunal apply to resolve the opposition or challenge, and which party bears the burden of proof?

Please see question 4.5.

4.11 Can a post-grant review decision be appealed and what are the grounds to appeal?

Please see question 4.5.

5 Patent enforceability

5.1 What makes a patent unenforceable?

A granted patent may be unenforceable if any of the following defences is successfully established:

  • The defendant used, offered for sale, sold or imported patented products or products directly obtained under a patented process after those products were sold by the patent holder or by a licensee.
  • The defendant made identical products or used an identical process, or made necessary preparations to do so, prior to the date of patent application and has continued to do so only within the original scope.
  • A foreign means of transport which temporarily passes through the territory, territorial waters or territorial airspace of China uses the relevant patents in accordance with an agreement concluded between China and the country in which the foreign means of transport originated, or in accordance with an international treaty to which both countries have acceded, or on the basis of the principle of reciprocity, for its own needs, in its devices and installations.
  • The defendant used the relevant patents solely for the purposes of scientific research and experimentation.
  • The defendant produced, used or imported patented medicine or patented medicinal equipment for the purpose of providing the information as required for administrative examination and approval, and produced or imported the patented medicine or patented medicinal equipment exclusively for that purpose.
  • The patent is invalid.

5.2 What are the inequitable conduct standards?

There are no inequitable conduct standards in China. In particular, there is no strict obligation to disclose material prior art to the Chinese National Intellectual Property Administration (CNIPA) during the prosecution of a patent application.

5.3 What duty of candour is required of the patent office?

CNIPA does not require a specific duty of candour during patent prosecution, such as requiring the applicant and anyone associated with the preparation and prosecution of an application to "disclose to the Office all information known to that individual to be material to patentability". However, the Patent Law does include a provision requiring patent applicants to submit corresponding reference material when substantive examination is requested.

6 Patent infringement

6.1 What Constitutes Patent Infringement?

Article 11 of the Patent Law provides that:

After the grant of the patent right for an invention or utility model, except where otherwise provided for in this Law, no entity or individual may, without the authorization of the patentee, exploit the patent, that is, make, use, offer to sell, sell or import the patented product, or use the patented process, and use, offer to sell, sell or import the product directly obtained by the patented process, for production or business purposes.

After the grant of the patent for a design, no entity or individual may, without the authorization of the patentee, exploit the patent, that is, make, offer to sell, sell or import the product incorporating its or his patented design, for production or business purposes.

Article 60 of the Patent Law also provides that "the exploitation of a patent without the authorization of the patentee, that is, the infringement of the patent right of the patentee".

6.2 Does your jurisdiction apply the doctrine of equivalents?

Yes, as in the United States, the Chinese courts generally recognise two types of infringement: literal infringement and infringement under the doctrine of equivalents. Literal infringement requires that the infringing product meet every limitation of the infringed claim exactly.

Infringement under the doctrine of equivalents generally occurs where the infringing product does not infringe every literal detail or limitation of the infringed claim, but nevertheless contains elements that are insubstantially different from one or more elements of the claimed invention and which retain the essential functionality.

6.3 Can a party be liable if the patent infringement takes place outside the jurisdiction?

Generally, the Patent Law applies to infringements that take place within the Chinese territory.

However, a party that does not carry out an infringing act in China itself may be held liable as a joint tortfeasor if it has acted in concert with another party that has carried out an infringing act in China.

6.4 What are the standards for wilful infringement?

The Patent Law includes no provisions on wilful infringement; however, the draft revised law, which is under approval, includes provisions of wilful infringement, which may incur punitive damages.

6.5 Which parties can bring an infringement action?

According to Article 60 of the Patent Law, the patent holder or any interested party may commence legal proceedings in the people's court or request the administrative authority for patent affairs to handle the matter.

In practice, the parties that can bring an infringement action are the patent holder and its exclusive licensee.

6.6 How soon after learning of infringing activity must an infringement action be brought?

According to Article 68 of the Patent Law, the limitation period for commencing legal proceedings for patent infringement is two years, counted from the date on which the patent holder or any interested party learned or should have learned of the infringement.

6.7 What are the pleading standards to initiate a suit?

The pleading must include at least:

  • the name of the court with which the claim is filed;
  • the name of the plaintiff, its ID number, place of residence and address for service of court documents;
  • the name of the defendant, its ID number and place of residence, to the extent ascertainable;
  • the main facts constituting the cause of action and the time of its actuality;
  • where a patent has two or more claims, the claims based on which the patent has allegedly been infringed;
  • the relief sought; and
  • the value of the subject matter of the suit.

6.8 In which venues may a patent infringement action be brought?

According to Article 5 of Several Provisions of the Supreme People's Court on Issues concerning the Application of Law in the Trial of Cases on Patent Disputes, an action involving patent infringement falls under the jurisdiction of the people's court at the place where the infringement was committed or the place of the defendant's domicile. The place where the infringement was committed includes:

  • the place where allegedly infringing products were manufactured, used, offered for sale, sold or imported;
  • the place where a patented method was used;
  • the place where products made using a patented method were used, offered for sale, sold or imported;
  • the place where products infringing a design patent were manufactured, offered for sale, sold or imported;
  • the place where counterfeiting was committed; and
  • the place where the consequences of the foregoing infringing activities occurred.

6.9 What are the jurisdictional requirements for each venue?

According to Article 2 of Several Provisions of the Supreme People's Court on Issues concerning the Application of Law in the Trial of Cases on Patent Disputes, a first-instance patent dispute falls under the jurisdiction of:

  • an intermediate people's court at the place where the people's government of the province, the autonomous region or the municipality directly under the central government is located; or
  • an intermediate people's court designated by the Supreme People's Court.

In 2014, three IP courts were opened in Beijing, Shanghai and Guangzhou. In addition, by the end of December 2019, 20 IP court divisions within intermediate courts had been set up in major cities to hear patent civil cases at first instance.

6.10 Who is the fact finder in an infringement action?

There is no jury system in China. The judge is the fact finder in an infringement action. The judge has the power to seek assistance from a technical investigator appointed by the court.

6.11 Does the fact finder change based on venue?

As stated in question 6.10, the judge presiding over the case is the fact finder.

6.12 What are the steps leading up to a trial?

The main steps leading up to trial are as follows:

  • The plaintiff files a complaint.
  • The people's court serves the complaint on the defendant within five days.
  • The defendant files its defence (if any) within 15 days (30 days for foreign defendants).
  • The people's court serves the defence on the plaintiff within five days.
  • Evidence is exchanged.
  • Pre-trial hearings are conducted.

6.13 What remedies are available for patent infringement?

Currently, the patent holder or an interested party may enforce its patent by commencing patent infringement litigation before the court or filing a patent administrative complaint before the local market supervision and administration bureau. In addition, if the suspected infringing products are exported or imported, applying for customs recordal of the patent and customs seizure is another potential remedy.

6.14 Is an appeal available and what are the grounds to appeal?

According to the Decision of the Standing Committee of the National People's Congress on Several Issues concerning Judicial Procedures for Patent and Other Intellectual Property Cases, where a party appeals the first-instance decision in an IP-related civil case involving professional technologies – including patents, utility models, new plant varieties, layout designs of integrated circuits, know-how, computer software or monopolistic intellectual property – the Supreme People's Court will accept and try the appeal.

There are no formal limitations on the grounds for appeal and any judicial determination of the trial court may be appealed. The grounds for appeal vary according to each case and the decision that is being appealed. Prima facie, an appeal is preferred if:

  • the verdict is contrary to the factual position;
  • the law was incorrectly applied; or
  • the ends of justice are not met.

7 Discovery

7.1 Is discovery available during litigation?

The legal system in China is a written law system, which means that the parties in a lawsuit are not obliged to follow the principle of disclosure. In other words, there is no standard discovery procedure in China.

7.2 What kinds of discovery are available?

In most circumstances, in order to enforce IP rights in China, the plaintiff bears the burden of proof through notary purchase. A notary purchase is usually carried out with a notary public as witness; thereafter, the suspected infringing products will be sealed as evidence in the lawsuit.

In accordance with Article 61 of the Patent Law, where an infringement dispute relates to a patent for a manufacturing process, any entity or individual that manufactures an identical product must furnish proof to show that a different process was used to manufacture its product.

Where an infringement dispute relates to a utility model or design, the people's court or the administrative authority for patent affairs may ask the patent holder or any interested party to furnish an evaluation report on the utility model or design conducted by the Patent Administration Department under the State Council after conducting search, analysis and evaluation of the relevant utility model or design, and use it as evidence for hearing or handling the patent infringement dispute.

7.3 Are there any limitations to the amount of discovery allowed?

As stated in question 7.1, there are no limitations to the amount of discovery allowed.

8 Claim construction

8.1 When during a patent infringement action are claim terms defined by the tribunal?

Claim construction issues are addressed by the collegiate panel of the Chinese National Intellectual Property Administration or the judge. The judgment usually follows the trial of the invalidity procedure. There is no specific Markman hearing procedure for claim construction in China.

8.2 What is the legal standard used to define claim terms?

According to Articles 2 and 3 of Interpretations of the Supreme People's Court on Certain Issues Concerning the Application of Law in the Trial of Patent Infringement Cases, the people's court shall determine the content of the claim specified in Paragraph 1 of Article 59 of the Patent Law according to what is stated in the claim, and by taking into account how the person with ordinary skill in the art would comprehend the claim through a reading of the specification and drawings. The people's court may use the specification, drawings, relevant claims in the written claims and patent examination files to define the claim terms. If the specification has specifically defined the claim terms, such express definitions shall prevail. If the meaning of a claim still cannot be determined, the court may define the claim terms by taking into account reference books, textbooks, other well-known documents and the general understanding of persons with ordinary skill in the art.

8.3 What evidence does the tribunal consider in defining claim terms?

The evidence considered during a claim construction proceeding may be classified into two categories: intrinsic and extrinsic. Intrinsic evidence includes the claim language, specification, drawings and patent examination files. If an analysis of the intrinsic evidence alone removes any ambiguity as to the meaning of the disputed claim term, the court will not consider any extrinsic evidence. Extrinsic evidence includes all evidence external to the patent and patent examination files, such as expert testimony and opinions and other sources such as dictionaries, textbooks and articles.

9 Remedies

9.1 Are injunctions available?

Yes, preliminary injunctions are available in China in patent infringement cases.

If the patent holder or an interested party can prove that others are infringing or likely to infringe the patent, and that such infringement will cause irreparable harm to its lawful rights and interests unless prevented or stopped in a timely manner, the patent holder or interested party may file an application with the people's court for cessation of the infringement prior to litigation.

When filing such an application, the applicant must provide a guarantee. If the application is erroneous, the applicant must compensate the respondent for losses suffered as a result of the injunction.

The people's court will issue its ruling within 48 hours of receipt of the application. If an extension is needed due to special circumstances, a 48-hour extension may be allowed.

It is compulsory for the applicant to deposit a bond equivalent to the value of the goods to be seized.

9.2 What is the standard to obtain an injunction?

If the patent holder or an interested party can prove that others are infringing or likely to infringe the patent, and that such infringement will cause irreparable harm to its lawful rights and interests unless prevented or stopped in a timely manner, the patent holder or interested party may file an application with the people's court for cessation of the infringement prior to litigation.

9.3 Are damages available?

Yes, damages are available where infringement is established.

9.4 What types of damages are available?

  • Actual damages, such as the plaintiff's lost profits or profits earned by the defendant; and
  • Punitive damages, which may be granted in case of wilful infringement.

9.5 What is the standard to obtain certain types of injunctions?

See question 9.1.

9.6 Is it possible to increase or multiply damages due to a party's actions?

Yes. Although damages in China are generally intended to compensate the patent holder for the loss that it has suffered as a result of the infringing acts, a punitive compensation system has been proposed in the draft revisions to the Patent Law. The statutory compensation for IP infringements will also be increased.

9.7 Are sanctions available?

If a party to infringement proceedings fails to comply with a court order during the proceedings, then sanctions may be imposed by the court. There are also very serious sanctions for failure to comply with an injunction.

9.8 What kinds of sanctions are available?

The courts have wide discretion to impose sanctions on a party if it breaches a court order during the proceedings.

If an injunction is granted against a party following trial and that party does not comply with the injunction, it may be found guilty of the crime of refusing to satisfy a judgment or ruling. This can lead to substantial fines and the imprisonment of the defendant (or its officers).

9.9 Can a party obtain attorneys' fees?

Yes, the general rule in civil litigation in China is that the successful party can recover its reasonable costs (including attorneys' fees) from the unsuccessful party. However, the courts have wide discretion in relation to cost orders.

9.10 What is the standard to obtain attorneys' fees?

The principal rule with respect to attorneys' fees is that the loser pays. The basis for this calculation is the actual costs incurred, but the courts apply scrutiny in this regard and the amount eventually granted is usually lower than the actual fees incurred.

10 Licensing

10.1 What patent rights can a party obtain through a licence?

Different types of patent licences, affording different patent rights, are available as follows:

  • Exclusive licence: Only the licensee has the exclusive right to the patent – that is, only the licensee can make, sell and use the patented product or use the patented method. The licensee has an independent right of action and can directly sue before the court in case of infringement.
  • Sole licence: The licensor agrees not to grant any additional licences, but retains the right to exploit the patent – that is, both the patent holder and the licensee can make, sell and use the patented product or use the patented method. The licensee can sue before the court in case of infringement if the patent holder does not exercise this right.
  • Non-exclusive licence: The licensor can grant additional licences and retains the right to exploit the patent. There is no limit on the number of additional licences that may be granted. Licensees have no right to sue.

10.2 What limits can a patent owner impose on a licence?

In general, the limits that a patent holder can impose on a licensee relate to matters such as:

  • the type of licence (exclusive, sole or non-exclusive);
  • the licence fee and the basis for its calculation;
  • the territory (eg, certain countries or global);
  • the scope of the rights granted;
  • the duration of the licence; and
  • restrictions on sub-licensing.

With regard to technical improvements made in China, some provisions can be found in the Foreign Investment Law.

11 Antitrust

11.1 Are there any limits on patent protection due to antitrust laws?

Article 55 of the Anti-monopoly Law of the People's Republic of China provides that:

This law shall not apply to the conduct of business operators to exercise their intellectual property rights according to the laws and relevant administrative regulations on intellectual property rights; however, this Law shall apply to the conduct of business operators to eliminate or restrict market competition by abusing their intellectual property rights.

Therefore, there may be some limits regarding abusive patent conduct.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.