Recently, rapid Chinese demand for domestic design products is paving regulation reforms in intellectual property rights (‘IPR’) protection.
Both qualitative and quantitative growth in the design market is advocating the protection of intellectual property as fundamental in sustaining the industry within China.
The Chinese authority promptly acknowledged this issue and with the fourth amendment of the “The Patent Law of the People’s Republic of China” (“Patent Law”), approved by the Standing Committee of the National People’s Congress on October 17, 2020, reformed legislation to comprehensively protect patents and intellectual property. The newly amended law recently came into force on 1st June 2021 and for designers offers several tools to protect innovation.
The main amendments can be summarised as follow:
1. From generic design protection to partial design protection.
In the evolution of the design industry and continuous innovation, the revised Patent Law aligns with the current design landscape. The revised Patent Law increases the design scope, specifically, both the design product in its entirety and constituent parts (partial protection) can be patented.
Previously, only complete products could be patented, whilst under the revised Law patent protection can be applied to the indivisible components of the design. For example, for the design of a ceramic teacup with an original motif on the handle, patenting the handle of the motif offers sufficient protection, the patent of the entire cup is no longer required.
Such amendment aligns with the best practices of the European Union, the United States, and other major economies in the world, and offers an effective approach in combatting counterfeits.
2. The design protection term increases to 15 years
The validity term for design patents extends from 10 to 15 years. In this way, the Patent Law aligns with the requirements for accession to the Hague Agreement. The Hague Agreement requires at least 15 years term for the international registration of industrial designs.
3. The national priority on patents
For design patent applicants who have filed the first design patent application in China, the Patent Law allows the priority for the second design patent application. Specifically, a design patent application shall be filed within 6 months to claim the right of priority for a second Chinese design patent application.
4. Introduction of the Open License
The Patent Law grants patent holders to provide an open license for non-exclusive usage during the period. Patent holder shall notify the State Council of the intent to provide an open license with a written declaration. For patent holders who adopt an open license, the annual patent fees paid by the patentee will be reduced or exempted.
5. Tighter sanctions for counterfeiters
Finally, the revision stipulates stricter penalties for the counterfeiting of patented goods. Statutory damages for patent infringement have been significantly increased, from RMB 10,000~1,000,000 to RMB 30,000~5,000,000 and related illegal earnings shall be confiscated. In addition, The statute of limitation extends by one year: the patentee has 3 years to file a complaint against the patent infringement, as opposed to the previous 2 years.
If you have questions or would like to know more about the corporate services available to you from Horizons, please contact us at +86 21 5356 3400 or email talktous@horizons-advisory.com.
This content appears as a courtesy of Horizons Corporate Advisory, a proud member of the China Collaborative Group (CCG Association). It is informational in nature and does not constitute legal advice or establish an attorney-client relationship between you and its author, publisher or any member of CCG. For more information, please visit www.horizons-advisory.com.
