Patent Litigation 2020

Last Updated February 10, 2020

Macau

Law and Practice

Authors



Riquito Advogados provides legal services to a diverse range of clients in various industries, but has a particular focus on corporate clients. The firm has five qualified lawyers and offices in Macau SAR and Lisbon, Portugal, with key practice areas of corporate/M&A, contracts/contractual investment, restructuring, litigation and arbitration, IP, foreign investment, corporate finance, real estate, aviation, private equity, project finance, labour and taxation.

There are two main legal documents that regulate intellectual property rights in Macau: i) the Legal Regime of Industrial Property; and ii) the Regime of Copyright and Related Rights. This survey will be limited to industrial property (in particular to invention patents), hence to an overview of the relevant provisions of the Legal Regime of Industrial Property.

Intellectual property rights for the protection of inventions are regulated in the Legal Regime of Industrial Property, which includes, inter alia, protection via invention patent, via utility patent and via industrial model and design.

An invention patent refers to a new technical solution for a product, a method or an improvement to existing technologies.

A utility patent refers to new technical solutions for issues of shape, structure or their combination, in products.

The registration of an industrial model or design refers to the protection of the shape, pattern, colour or their combination, applied in the new design of a product, which is aesthetic and capable of being applied at industrial scale.

Respective protection for these types of patents is based on statutory law. 

For both invention patents and utility patents, the grant procedure is regulated by the Legal Regime of Industrial Property and consists of the following steps:

  • the applicant files a request with the Economic Bureau of Macau (Direcção dos Serviços de Economia; DSE) and pays the application fees within eight working days from the submission date;
  • the DSE shall proceed with the formal examination of the application within two months from submission;
  • if no irregularities are found on formal examination the application will be published in the Official Gazette within 18 months from the date of application, if there are irregularities the applicant is notified to rectify them within two months from the DSE’s notice;
  • interested parties may oppose the registration, starting from the announcement in the Official Gazette and until the date of grant;
  • afterwards, the applicant shall request substantial examination within seven years from the date of the application;
  • the notice of grant will be published in the Official Gazette if there is no opposition or the opposition is found to be without merit; and
  • if no appeal is filed against the grant of patent, within one month after the publication in the Official Gazette, the DSE will issue the registration certificate.

The grant procedure for industrial models and designs is similar to the one provided for invention patents and utility patents, as detailed above.

Please refer to 1.2 Grant Procedure regarding the timeline for the grant procedure.

For applicants who do not hold a Macao SAR Resident Identity Card, or are not legal entities registered in the Macao SAR and incorporated according to the laws of the Macao SAR, legal representation is necessary to initiate grant proceedings. Inventors may appoint an agent through the issuance of a power of attorney to: (i) a lawyer registered with the Macao Lawyers Association; (ii) an individual holding a Macao SAR Resident Identity Card; or (iii) a legal entity registered in the Macao SAR. This power of attorney must have the signatories’ identity, capacity and powers, duly certified by a notary, and must be accompanied by a certified translation in case it is not issued in one of the official languages of the Macao SAR.

For applicants who hold a Macao SAR Resident Identity Card, or are legal entities duly registered in the Macao SAR, no attorney’s representation is mandatory to initiate grant proceedings.

The average cost for granting an invention patent is MOP3,300, including registration fees as well as fees regarding the substantial examination. The average cost for granting a utility patent is MOP2,900. For industrial models and designs, it is MOP3,500.

For invention patents and utility patents, the duration of the patent shall be 20 years from the date of the application.

For industrial models and designs, the duration of the registration shall be five years from the date of the application, renewable for periods of five years up to a maximum of twenty-five years.

For invention and utility patents, the owner has the exclusive right to use the patent in the Macao SAR and the right to oppose any acts that constitute a breach of the patent rights. In particular, this includes the right to prevent third parties, without his or her consent, from manufacturing, offering, storing, marketing or using a product covered by the patent, or importing or holding such products for any of those purposes.

On the other hand, the titleholder has the obligation to use the patent in the Macao SAR; otherwise, the Chief Executive of the region can grant a mandatory non-exclusive licence of that patent.

For industrial models and designs, the registration of an industrial model or design shall grant its titleholder the exclusive right to use the model or design and to prevent its use by third parties without his or her consent. Third parties are in particular prevented from offering, placing on the market, importing, exporting or using any product into which that industrial model or design is incorporated, or to which it is applied, as well as from the storage of any such products. Contrary to what is stipulated in the patents, lack of use of industrial models or designs does not entail a potential grant to third parties without the titleholder’s consent.

According to the Legal Regime of Industrial Property, there is no protection after the maximum term of an intellectual property right has lapsed.

Please refer to 1.2 Grant Procedure.

Upon publication of the application in the Official Gazette, and until the date when the rights are granted, third parties have the right to approach the DES in writing with objections to the patentability of the invention subject to registration. This opposition shall be notified to the applicant, who may reply within two months in the case of an industrial model or design, and four months in the case of an invention or utility patent.

Two decisions are possible in light of an opposition: either the objection is founded, or not. In the first case, the DSE shall dismiss the registration or proceed to partial granting in accordance. In the latter case, the DSE will grant the intellectual property right in full, as requested.

In cases of dismissal of an application to grant intellectual property rights, the applicant may, in accordance with the Macau Administrative Procedure Code (Código de Procedimento Administrativo; CPA), submit an administrative claim to the DSE, requesting a review of the decision. However, such a claim does not suspend the deadline for the applicant to appeal to the courts.

According to the Legal Regime of Industrial Property, the judicial appeal against any DSE decisions to grant or not grant IP rights, shall be lodged within one month of the date of publication of the decision in the Official Gazette, or the date of issuance of the respective certificate (if earlier and requested by the appellant). Subject to particulars, the applicant or the titleholder of the intellectual property right in dispute, the claimants, and the successors of any of them, as well as, in general, every individual or entity directly and effectively harmed by the decision is entitled to submit such an appeal.

Pursuant to Article 51 of the Legal Regime of Industrial Property, lack of payment of annual fees (anuidade) is sanctioned with the expiry of the relevant right (caducidade).

Intellectual property matters fall under the jurisdiction of civil courts and, therefore, the Code of Civil Procedure is applicable to litigation arising therefrom, in particular in respect of requests for a declaration of invalidity of intellectual property rights, or indemnity claims.

Voluntary arbitration may also be entered into by the parties, should they expressly wish to submit the issue to this alternative form of dispute resolution. Please also see 9.1 Type of Actions for Intellectual Property.

Breach of intellectual property rights may also entail criminal liability, pursuant to Articles 289 to 294 of the Legal Regime of Industrial Property. For example, obtaining benefit for oneself or for a third party within the context of a business activity, without the consent of the titleholder of the respective industrial property right, is punishable by imprisonment for up to two years or a fine. From 60 to 120 days would be typical in the following cases:

  • manufacturing artefacts or products protected by a patent or semiconductor product topography;
  • use or application of methods or processes protected by a patent or by a semiconductor product topography; or
  • importing or distributing products obtained by any of the means referred to above.

Under the general provisions of the Macau Civil Procedure, any individual or legal entity with the necessary capacity may file a lawsuit to protect a violated right, or one that is at risk of being violated by an opposing intellectual property right, provided they are a legitimate party holding a legitimate interest in the proceedings.

This includes the right to request the grant of interim injunctions against the enforcement of intellectual property rights.

Lawsuits concerning intellectual property matters are generally filed with the Judicial Base Court, but may go up to the jurisdiction of the Court of Second Instance and of the Court of Final Appeal, depending on a variety of legal and procedural requirements expressly provided for in the law.

Currently, there are no specialised bodies for the resolution of intellectual property disputes, they are handled by the civil courts.

Prior registration of the patent with the DSE is necessary to be considered a legitimate plaintiff in a lawsuit for enforcement of industrial property rights. For the purpose of awarding damages, the mere act of requesting an intellectual property certificate will, after due publication in the Official Gazette, temporarily grant the holder the same legal protection as the definitive intellectual property certificate, provided it is ultimately issued by the authorities.

Legal representation in court is required for most cases. Lawsuits with a tax value exceeding MOP100,000, enforcement proceedings with a tax value exceeding MOP1 million, and appeals processes always require legal representation. Only lawyers admitted to the Macau Lawyers Association are allowed to represent the parties in a court of law.

Where legal representation is not mandatory, the parties may choose to represent themselves or be represented by a trainee lawyer.

It is possible for any of the parties to obtain interim injunctions prior to or during the proceedings. There are several protective or preventive measures to secure rights at risk and, although none of those specifically provided for in the Macau Code of Civil Procedure explicitly applies to intellectual property rights, a so-called “common measure” may be requested from the court on the conditions that:

  • the right (ostensibly) exists;
  • there is a well-founded fear that another person may cause serious and irreparable damage to that right; and
  • the protective or preventive measure is suitable to protect it.

As is the case with interim injunctions, there are no specific means of protection explicitly available to the opponent in a lawsuit concerning intellectual property matters, although a common protective or preventive measure may be requested from the court, provided that the same conditions listed in 2.7 Interim Injunctions are met.

There are no special limitation provisions that apply in intellectual property matters.

Certain mechanisms are available to obtain evidence and information from the other party or from a third party, such as depositions, interrogatories, requests for production of documents, and expert reports and testimony. In principle, any person aware of any facts or in possession of any evidence relevant to the proceedings is legally bound to co-operate with the court upon request. This includes, inter alia, providing witness statements and producing documents. Requests for production of documents may be addressed to the other party or to a third party. The requested documents must be clearly identified and their relevance to the matter established before the court issues the order to surrender the document. Hence, this mechanism does not work as a general means of obtaining evidence and information.

Any person, including the opposing party, may be called to testify before the court. Except for limitation as to the number of witnesses allowed, the court will not exercise any prior control on the witnesses or on their relevance to the case. Witnesses who reside in Macau may be compelled by the court, including by force if necessary, to attend the hearing and provide their deposition, without prejudice to certain individuals' right to refusal to testify (eg, by virtue of their personal relationship with any of the parties). Should, at any moment during the hearing, a party become aware that any additional person may have knowledge of facts relevant to the proceedings, it may request that the court add that individual to the list of witnesses, in which case the admission will be at the court’s discretion.

As general rule, each party has the burden to both state the relevant facts and adduce supporting evidence in their pleadings. Amendments to the parties’ pleadings are subject to significant limitations and therefore they are obliged to provide as much detail and to adduce as much supporting evidence as possible.

As alluded to in 2.10 Mechanisms to Obtain Evidence and Information, each party has the burden to both state all the relevant facts and adduce, or request the adducing of, supporting evidence in its entirety in their written pleadings, with few exceptions admitted to this rule. Only facts arising from supervening events or new evidence (including evidence not known to the parties at the time of the pleadings) may be stated and adduced after the written pleadings and only until the trial is complete. Considering the inquisitorial nature of the Macau legal system, the court may request that the parties state the facts or adduce the evidence that the court deems pertinent to the discovery of the truth and necessary for a fair trial and judgment.

Associations or foundations whose purpose is related to the interests in dispute, the Public Prosecutions Office, and Macao SAR citizens are entitled to initiate lawsuits against any public authority for the protection of collective or representative interests such as public health, cultural heritage, or the environment. Should any intellectual property matter fall under these interests, a representative or collective action would, in principle, be possible.

The titleholder of an intellectual property right has the exclusive right to use/ explore that right within the Macao Special Administrative Region and to assert it against those who violate it by preventing third parties from manufacturing, offering, stocking, marketing, or using it without consent Although no opposition can be made to anyone who, in good faith and before the request of the intellectual property certificate was submitted, came to know of the invention by their own means and used it or made effective and serious plans to use it. It should, however, be noted that anyone hoping to benefit from the latter non-contravention provision bears the burden of proof in regard to it.

Under Macao SAR Law, infringement of IP rights is a criminal offence; therefore, in order to commence infringement proceedings, an infringement claim should be reported before the body responsible for public prosecution (Ministério Público), who in turn will open an investigation.

If, during the investigation, sufficient evidence is collected supporting said infringement claim, the prosecution will bring charges against the infringer.

The infringement claim may be reported by any person (or legal entity); however, only the patent owner, licensee(s) (unless otherwise stated within the licensing terms), legally constituted business associations, and the Consumer Council and consumer associations, legally constituted, may intervene in court.

Direct infringement occurs when the patent claims granted are violated; indirect infringement occurs when, without the consent of the rights-holder, a person supplies or offers to supply any unauthorised third party with means, relating to an essential element of that invention, for violating granted patent claims.

In both situations (ie, direct or indirect infringement) the patentee, licensees and certain third parties, as mentioned above, have a claim for injunction and damages.

The scope of protection of an intellectual property right is defined by the patents’ claims, which should be interpreted with the aid of its description and drawings.

Furthermore, in light of the acknowledged difficulty in appreciating the inventive step requirement, the judicial courts of Macau may turn to the doctrine of equivalents in order to define an objective approach. By means of this doctrine, equivalent infringement is possible, consequently expanding the scope of protection for an intellectual property right.

According to Macao SAR Law, intellectual property rights are normally granted to the person (or legal entity) who first filed the invention, and thus benefit that party with prior-use rights. Prior-use rights may also be claimed by anyone who uses any unregistered trademark within a period of time not exceeding six months.

A general rule on exhaustion is also applicable to all intellectual property rights, which prohibits any non-authorised for-profit manufacturing, supplying, storing, importing, or use of a product covered by a patent, or its importation or possession for any of these purposes.

With regard to compulsory licences: the lack or insufficiency of use shall constitute grounds for applying for a compulsory licence if the rights-holder, without good reason or legal basis, after a period of four years from the date of the patent application or three years from the date of granting, has not at all, or has not sufficiently, put the invention into effect.

During annulment and infringement lawsuits, both parties may request for the intervention of a court-appointed expert, as they have a very important role in such proceedings regarding technical inventions.

Once appointed, the court expert(s) is(are) obliged to diligently perform their function, by providing the judge with a report that addresses queries raised by the parties and/or by the judge himself or herself. When ruling on the case, the judge freely assesses the evidence, and thus is not bound by the reports’ findings.

Where a compulsory licence application is approved, the DSE and all involved parties shall each appoint an expert to determine the conditions of the licence and the remuneration to be paid to the patent-holder.

Under Macao SAR Law, a specific procedure for construing the terms of the patent’s claims isn’t required, however the judge may request the parties to address specific aspects regarding validity and infringement.

Patents and utility models can be disputed either by opposition or by an annulment lawsuit.

Within the period of publication of the disclosure notice, until the date of granting of the patent, any third party may file a written opposition to the DSE regarding the patentability of the patent in question.

At the end of this period and once granted, industrial property rights can only be cancelled by the competent courts of Macau (ie, the Court of First Instance) if granted contrary to any of the provisions of the industrial property rights regime, and/or contrary to public policy or to accepted principles of morality.

The main grounds for dispute are as follows:

  • if the invention’s title and its subject matter are not related;
  • if the invention’s abstract has not been described in an adequately clear and thorough fashion, so as to allow an expert to implement it;
  • if the invention’s subject matter is extended beyond the content of the initial application; and/or
  • if the subject matter of the patent is not new or does not involve an inventive step.

If the grounds for dispute concern only parts of the patent, a partial annulment lawsuit is possible, which may result in a partially valid patent, as long as the remaining claims constitute patentable subject matter in themselves.

Patent-holders are allowed to submit a limited amount of amendments requests:

  • until the request for the examination of the patent application is submitted or until DSE receives it;
  • following the submission or receipt of the examination report; or
  • if submitting a divisional application.

Patent-holders may only submit such a request once in each of the above-mentioned situations.

This amendment includes the means to modify the patent’s title and/or abstract, as well as introducing a short commentary, however neither should exceed the original contents of the patent application nor extend its original scope of protection.

Revocation or cancellation and infringement cases are not heard together. As previously mentioned, patent cancellation may only be issued by the competent courts of Macau, and therefore should be filed before the Court of First Instance, which does not hear applications for infringement.

Under Macao SAR Law, patent infringement entails a criminal offence, and thus such a claim should be reported to the body responsible for public prosecution (ie, the Ministério Público), who will open an investigation. Please see 3.1 Necessary Parties to an Action for Infringement for more information.

Currently, there are no special procedural provisions for intellectual property rights proceedings.

As intellectual property matters fall under the jurisdiction of civil courts, there currently are no technical or intellectual property-specialised judges in Macau. The parties have no influence on who is the decision-maker and trial by jury is not provided for in the law. However, both the court and any of the parties may request that expert opinion or guidance be provided in regard to highly specialised issues, for the purpose of which one or more experts will be appointed to deliver a report and provide testimony.

Provided they are in agreement, the parties may choose to settle their dispute at any time, before the judge or privately (in which case they must notify the court of the execution of the settlement and discontinue the proceedings). In any event, it is necessary for the judge to endorse the settlement by confirming each of the parties’ capacity to settle and the matter’s availability for settlement.

As criminal prosecution regarding the infringement of IP rights is of a public nature (ie, irrespective of claim by respective title-holder), settlement between the parties does not entail the termination of related criminal proceedings. 

Two (or more) proceedings, within or outside of the jurisdiction of Macau and including arbitration, dealing with the same intellectual property matters cannot be held simultaneously. Should the court receive notice of action in regard to pendency, the opposing party will be acquitted and tried in the proceedings where it was summoned first, although this acquittal is understood as a mere formality and not as res judicata.

In Macau, the main remedies available for the patentee in an infringement lawsuit consist of search and seizure orders, restraining orders and other types of injunctions, plus damages. Upon receipt of an injunction request, the judge has discretion to order different or additional injunctions.

With respect to damages, the patent-holder must prove the existence of damages, namely actual damages and loss of profits.

A prevailing defendant (ie, where the court rejects the infringement claim) may be entitled to receive court fees and other expenses incurred during the case, which include lawyers' fees (with limitations), costs of experts (if any) and court fees.

Additionally, the defendant may also claim for compensation for damages should the court accept the defendant’s claim that the counterparty commenced litigation in bad faith (litigância de má-fé).

In Macau, the aforementioned remedies, in 6.1 Remedies for the Patentee, are available for all kinds of intellectual property rights, regardless of type.

If a patent is found valid and infringed at first instance, should the infringer appeal, the first instance decision is preliminarily enforceable. A stay of injunction is only possible under exceptional circumstances, resulting in the frequent rejection of such requests.

The applicant, the holder of the industrial property right, and any person who has been directly affected, may appeal to the Court of First Instance against the decisions issued by the DSE regarding the grant or refusal of an industrial property right, as well as in respect of the transfer, licensing or any other decisions that affects, modifies or extinguishes the industrial property right. 

The appeal shall be filed within one month counting from the publication date of the decision, or from the date of the respective certificate. Please also see 1.8 Remedies Against Refusal to Grant Intellectual Property Right.

The DSE is not considered as the defendant, but it shall be notified of the appeal to provide the details of the administrative proceedings to the court. Opposing parties shall be summoned by the court to, if desired, present their opposition within one month.

If the appeal involves any technical issue which requires further information the court may, at any stage, order that the expert from the DSE, on whose expert report DSE’s decision was based, provide oral clarification.

The decision rendered by the Court of First Instance is not final and may be subject to appeal pursuant to the general rules of civil proceedings.

An appeal filed to both the Court of First Instance and the Court of Second Instance may imply a review of the facts of the case as well as a legal review.

In Macau, there are no specific extra-judicial procedures that a party to an intellectual property matter is supposed to take. In spite of that, according to the usual practices, costs may arise from legal consultancy services, warning letters to the potential IP infringer, opposition to new IP applications with the Economic Bureau, and expert opinion in cases of patent infringement.

Pursuant to Section 6, paragraph 1, r) of Decree-Law 63/99/M (Court Fee Regulation), the court fee for appeal proceedings, referred to in 7 Appeal, is calculated based on the value of the dispute, which is determined by the court according to the economic repercussions of the proceedings for the party responsible for the court fee or, failing that, the economic situation of this party, but is never less than MOP91,000. 

Under Macau law, the losing party is responsible for the costs of litigation, including court fees, expert fees, and any other expenses arising from the proceedings, as well as for the payment of an amount arbitrated by the court in favour of the prevailing party considering the value of the proceedings and complexity of the case, which may be understood as partial reimbursement of the attorneys' fees.

The parties may engage in mediation, conciliation or arbitration as alternative ways to settle an intellectual property dispute. The new Arbitration Law (Law No 19/2019) which follows closely the UNCITRAL Model Law on International Commercial Arbitration will come into force in April 2020. However, the mentioned alternative dispute resolutions are not commonly used for intellectual property infringement cases in Macau.

With regard to assigning an industry property right, Article 11 of the Legal Regime of Industrial Property stipulates that industrial property rights may be assigned, totally or partially, free of charge or for consideration. The same article regulates that an assignment inter vivos shall be in writing, failing which the assignment shall be null and void. The same provision shall apply to rights deriving from applications for the granting of industrial property rights. No special restrictions, beyond what is established by general rules, apply to assignments. According to Article 402 of the Civil Code, the assignment can be finished by a contract or any other legal instrument allowed by law.

Pursuant to Article 11 of the Legal Regime of Industrial Property, there is no additional requirement further to the general rules on assignment of rights and contractual positions. Article 57 of the Legal Regime of Industrial Property stipulates that, after the contract assignment, there is a burden of registration of the fact of assignment to better protect the right of the one who acquires (ex vi Article 57, No 2).

Pursuant to Article 12 of the Legal Regime of Industry Property, except where there is express legal limitation, industrial property rights may, with or without consideration, be licensed for exploitation in whole or part and, when for a limited duration, for all or part of that duration. The same provision should apply to rights deriving from industrial property right applications, but a refusal to grant such rights shall imply the forfeiture of the licence. The exploitation contract licence shall be in writing, falling which the assignment is null and void (ex vi Article 212 of the Civil Code).

As for assignments, there are no special requirements for licensing. Article 13 of the Legal Regime of Industry Property stipulates some restrictions of the licensee. Unless otherwise provided in the licence/contract, the exploitation licence shall be deemed non-exclusive. This means that the owner of the industrial property right doesn’t forswear the right to grant any other exploitation licences for the rights to which the licence refers.

Article 13 also provides that, except where there is a stipulation to the contrary, it is presumed that:

  • the granting of an exclusive exploitation licence shall not preclude the owner from also directly exploiting the industrial property right covered by the licence;
  • the right obtained through the exploitation licence may not be assigned without the written consent of the industrial property right owner; and
  • no sub-licences may be granted without the written authorisation of the of industrial property right owner.

The Legal Regime of Industry Property does not foresee a special procedure for licensing an industry property right.

However, the parties shall request the DSE-registration of the grant of licence, pursuant to Article 57 of such regime, which is recorded in the IP title. 

Riquito Advogados

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Av. Comercial de Macau
Macau SAR

+853 2838 9918

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www.riquito.com
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Law and Practice

Authors



Riquito Advogados provides legal services to a diverse range of clients in various industries, but has a particular focus on corporate clients. The firm has five qualified lawyers and offices in Macau SAR and Lisbon, Portugal, with key practice areas of corporate/M&A, contracts/contractual investment, restructuring, litigation and arbitration, IP, foreign investment, corporate finance, real estate, aviation, private equity, project finance, labour and taxation.

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