China's new patent law brings some of the major changes in the context of infringement and procedural issues. The new patent law came into force in June 2021. The new law has increased the damages up to five times in the context of willful infringement and serious circumstances. Previously, the damages were RMB 30,000 and have been increased to RMB 5,000,000. The new patent law has increased the domain of China National Intellectual Property Administration (CNIPA) whereby it will handle patent infringement disputes nationwide. Moreover, it has also changed the handling of local patent administrative authorities where they can handle patent infringement disputes by a combination of cases involving the same patent rights. This will help in more effective regulation of abuse of patent rights. One of the major changes is the inclusion of a patent linkage system which will help in the early resolution of a patent dispute, where it builds an effective link between the patent office and regulatory authority for the drug. This will help in the resolution of the patent dispute at an early stage. Another important change is the inclusion of patent term extension for new pharmaceuticals patent. Any delay in the examination process will be compensated with the patent term adjustment. The design patent will get a 15 years protection term. The new law grants 6 month novelty grace period to the invention in response to any national emergency.

Encourages Innovation

This new patent law encourages innovations to a much extent which can be seen in the number of patent applications filed in 2020 which reached 5.19 million. 530,000 patents were granted, utility models were 2,377,000 and designs were 770,000. With more utility patents, it is important that the company needs to be aware of any potential infringement risks so that the high damages can be avoided under the new patent law. The new changes need to be processed with CNIPA. This patent law in force makes the scenario of an environment of strengthened patent enforcement and punishment for infringers. The substantial effect that this new law brings is to have a strong action against the abuse of patent rights where it is expected that the inventors will be protected for their invention more efficiently in the procedural aspects.

Beneficial for the owner of the design patent, the design patent will be more commercially viable owing to the increase in the patent term of 15 years. This way the design patent will get longer protection and the owner can exclude others to make, sell within that time frame, making it placed in a better position in the market. But the extended period will only apply to those design patents with the filing date after May 31, 2021. The partial design which was not patentable subject matter can now be patent filed in China for protection which undoubtedly broadens the scope of protection for various creative companies. With the incoming of new China's patent law, it will surely increase the activity of design patents in the market.

Drug industry

Talking about the patent term extension concerning the drug industry, the patent term extension will be beneficial for the same. The patentee will claim before the CNIPA for the extension within three months from the date of approval of the request for a new drug marketing license. But this will only be available when the "Implementing Regulations" come into effect. The patent linkage system will have a positive effect on an early response action. Not only for the original manufacturer, but it will also be helpful for the generic manufacturer to challenge the drug patent efficiently. This will result in drug innovative company to be prepared for potential disputes raised by generic manufacturers. In general, this will have an overall positive effect on the patent regulation in China.

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