A session of the National People's Congress in China voted and passed a new law that came into effect on 1 January 2021. Importantly, the new law contains several provisions related to intellectual property (IP).
Of interest to future patent infringement cases, the new law contains one particular provision for punitive damages for intentional infringement. Previously, and as is often the case in many other jurisdictions, any damages that are awarded by the court would hardly be sufficient to cover the actual loss suffered. Additionally, the loss of market share is also not covered by damages awarded, and the actual loss therefore well exceeds the awarded damages. The new change serves to address this issue as its purpose is to align the Chinese patent laws with their trade mark laws that already make provision for punitive damages. Similarly, a draft amendment has also been passed to allow for punitive damages to be available for copyright infringement.
This collection of law amendments now offers applicants a greater arsenal of legal weapons that serve to strengthen and enhance IP rights and their protection. Where the actual losses suffered were previously not sufficiently covered by the damages awarded by the courts, these new changes will now ensure that the penalties for infringement could potentially be higher than the gains that could be acquired through violations.
These new changes have certainly reinforced IP protection in China, and those seeking to protect their IP should be encouraged by China now clearly favouring the infringed and clamping down on the infringer.
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