Inventions in China, if narrowly interpreted, are protected through two means, including invention patents, and utility models. If a broad meaning is adopted for inventions – ie, work products, achievements, or results of R&D activities in general, technical secrets are also a form of proprietary intellectual property rights protected under the Chinese law. Invention patents and utility models are proprietary rights which can only be generated through prosecution. Technical secrets, treated as undisclosed inventions, are protectable if they remain confidential. In addition to the above-mentioned types of intellectual property rights, China also grants patent rights for industrial designs which relate more to aesthetic appearances rather than inventions.

As a civil law jurisdiction, China mandates specific legal provisions for the protection of intellectual property rights. These laws encompass the Civil Code of the People’s Republic of China, Patent Law of the People’s Republic of China (Patent Law), and Anti-Unfair Competition Law of the People’s Republic of China, among others. Meanwhile, the Supreme People’s Court of the People’s Republic of China annually releases landmark cases focusing on the protection of patents and trade secrets, serving as crucial guidance and reference for practical application.

Patent rights in inventions and utility models arise only upon successful prosecution. Invention patents have to pass both preliminary examination and substantive examination for the eventual granting. For the utility model, only a preliminary examination is required. Patent applications submitted for prosecution, whether for invention patents or utility models, should include a request form, a specification along with its abstract, and a claims document. The application must explicitly detail the name of the invention or the utility model, the name(s) of the inventor(s), the applicant’s name and address, and other pertinent information. The specification must comprehensively describe the invention or utility model to enable a person skilled in the relevant technological field to implement it effectively. The abstract should succinctly outline the primary technical aspects of the invention or utility model. The claims must distinctly and succinctly outline the sought-after scope of patent protection in line with the specifications.

Concerning trade secrets, no specific application is required. If the information in question qualifies as technical, operational, or other commercial information not known to the public and holds commercial value, and if the right-holder has implemented corresponding confidentiality measures, it can be protected under the law.

Currently, there are no specified time limits for the patent authorisation process. In practice, the preliminary examination period for utility models and industrial designs typically takes around four to 12 months, after which rights-holders can obtain authorisation upon preliminary approval. For invention patents, there’s usually an initial examination period of two to four months, followed by the possibility to request a substantive examination within three years from the application date. Presently, the average duration for substantive examination of invention patents is approximately 16 months. The specific examination timeline depends on the complexity of the invention’s technology, the quality of the patent application documents, the examiner’s understanding of the invention, the examiner’s work schedule, and the back-and-forth correspondence time between the examiner and the patent agent.

For Chinese enterprises, they aren’t required to engage a specific agency for patent applications. However, foreign individuals, foreign enterprises, or other foreign organisations without habitual residence or business offices in China need to entrust a legally established patent agency to handle patent applications and other patent-related matters in China.

The application fee for an invention patent is CNY900, while it’s CNY600 for utility models and industrial design patents. Additional application surcharges apply if the claims exceed 11 or the specification surpasses 31 pages. Additionally, the China National Intellectual Property Administration (CNIPA) charges a publication printing fee of CNY50 and CNY80 for each claim. The substantive examination application fee for invention patents is CNY2,500.

The term of invention patents is 20 years from the application date in China. China provides exclusive rights protection for utility models for ten years. For design patents, China amended the Patent Law in 2020, extending the protection duration to 15 years. That is, for design applications submitted on or before 31 May 2021, China grants a maximum of ten years of patent rights protection. For applications submitted after that date, China offers exclusive rights protection for 15 years from the application date.

In cases of unreasonable delays during the authorisation process for pharmaceutical patents and invention patents, patent holders can apply for compensation for the patent term, not exceeding five years. The total effective patent term after the approval of new drugs for marketing does not exceed 14 years.

After patent authorisation, the patent holder possesses the exclusive right to utilise their patent and any unauthorised implementation by others is prohibited, preventing them from making, using, offering for sale, selling, or importing the patented product without permission. This also extends to using the patented process and utilising, offering for sale, selling, or importing a product directly derived from the patented process for production or commercial purposes. Furthermore, the patent holder reserves the right to license others to implement their patent in exchange for licensing fees, as well as the authority to transfer or waive their patent rights. The patentee is also entitled to affix the patent label on the patented product or its packaging. Additionally, when the patentee’s rights are infringed, they have the right to seek protection from administrative authorities or the courts.

There is an obligation to pay patent annuities as stipulated. Moreover, the patent applications and the exercise of patent rights should adhere to the principle of good faith. Patent rights must not be abused to the detriment of the public interest or the lawful rights and interests of any other person.

In China, there are currently two situations where a patent holder can obtain extended protection after the expiration of their patent term.

Where a patent for an invention is granted four years from the date of filing of the application and three years from the date of filing of the request for substantial examination, the patent administrative department of the State Council shall, at the request of the patentee, provide patent term extension for unreasonable delay in the patenting process for the invention, except for unreasonable delay caused by the applicant.

For the purpose of making up the time required for the assessment and approval of the marketing of a new drug, the patent administrative department of the State Council may, at the request of the patentee, provide a patent term extension for an invention patent relating to the new drug approved for marketing in China. The extension may not exceed five years, and the total effective term of the patent after the new drug is approved for marketing shall not exceed 14 years.

From the date of publication of a patent application until the granting of the patent is announced, any individual may present objections to the CNIPA, providing reasons, regarding patent applications that do not comply with the provisions of Patent Law.

The CNIPA does not impose mandatory requirements for the format or documentation of public opinions submitted. Any objections raised by individuals concerning invention patent applications that do not comply with Patent Law should be recorded within the respective application documents for the examiner’s consideration during the substantive examination. The essence of public opinions lies in retrieving relevant documents pertaining to the targeted patent, and determining whether contrasting documents affecting the novelty and inventiveness of the targeted patent application can be found. This factor significantly influences the examiner’s consideration of public opinions. Particularly, the discovery of pre-existing technology related to the targeted patent that the examiner did not retrieve, or other directly relevant non-patent literature, substantially enhances the likelihood of success for public opinions to be acknowledged.

If the patent applicant disagrees with the decision of the CNIPA to reject the application, they may, within three months of receiving the notification, request a review of the decision from the CNIPA. Following the review by the CNIPA, a decision will be rendered and communicated to the patent applicant. Should the patent applicant remain dissatisfied with the review decision of the CNIPA, they may, within three months of receiving the notification, bring a lawsuit before the People’s Court.

For those who haven’t paid or fully paid the annual patent fees, the patent holder is not allowed to grant licences. The CNIPA should notify the patent holder to make up the overdue payments within six months from the due date, along with payment of late fees. The late fee amount is calculated as 5% of the full annual fee for each month of delay beyond the specified payment period.

If the fees remain unpaid upon expiration, two months after the expiration date, the examiner shall issue a notice of patent rights termination. The patent holder has two-and-a-half months from the date of receiving the termination notice to request the restoration of rights from the CNIPA. During the periods of waiting fee payment and restoration of rights, the patent rights are not invalidated, and the patent holder can maintain their rights’ validity through certain actions. If the patent holder does not initiate the restoration process or if the restoration request is not approved, the patent office must proceed with the invalidation process and publish it in the Patent Gazette four months after issuing the termination notice.

Once a patent has been granted, any proactive amendments to the application documents received after the issuance of the patent grant notification will not be considered by the CNIPA.

During the patent invalidation phase, patent holders are permitted to make corresponding modifications to the patent documents. However, these alterations must adhere to the following criteria: (i) they must not alter the core theme of the original claims; (ii) they must not expand the protection scope of the original claims beyond what was authorised; (iii) they must stay within the range specified in the original specification and claims; and (iv) generally, they should not add technical features not included in the authorised claims. Thus, modifications during patent invalidation typically involve the deletion of claims, the removal of technical aspects, further refinement of claims, and correction of evident errors.

A patent owner or interested parties, such as a licensee with sole licensee rights or a third party explicitly authorised by the patent owner, can either file a lawsuit before the People’s Court or file a complaint before the CNIPA or a local patent office seeking resolution.

Furthermore, for cases involving patent counterfeiting, aside from assuming civil liability as stipulated by law, the department responsible for patent enforcement can order corrective action and public notification. Such actions can be taken by administrations for market regulation or customs. Generally, patent infringement will not constitute a criminal offence.

In China, several mechanisms, including opposition actions, patent invalidation procedures, declaration of non-infringement lawsuits and compulsory licensing procedures, are in place to assist third parties to remove the effects of the technical intellectual property right.

For opposition action and patent invalidation proceedings, any entity or individual may initiate such a proceeding and there is little restriction under the law for the qualification of a complainant and the institution of the proceeding. Opposition actions must be initiated from the date of publication of a patent application until the granting of the patent is announced. For patent invalidation proceedings, any entity or individual, from the date the CNIPA announces the granting of a patent, who believes that the grant of such patent does not comply with the relevant provisions of the law, may request the CNIPA to declare the invalidity of the patent.

For the declaration of non-infringement lawsuits, specific prerequisites must be met. If the patent owner issues a warning of patent infringement to another party, and upon written notification from the warned party or stakeholders urging the exercise of litigation rights, if within one month of the receipt of written notification or within two months from the date of the written notification’s dispatch, the patent owner neither withdraws the warning nor initiates legal action, the warned party or stakeholders can file a lawsuit in the People’s Court requesting confirmation that their actions do not infringe upon the patent. The People’s Court is obliged to accept such cases.

For compulsory licensing, the Patent Law provides specific circumstances in which such licensing can be granted. For example, after three full years from the patent grant date or after four full years from the patent application filing date, the patentee fails to exploit or fully exploit the patent without a justified reason or if the patentee’s exercise of patent rights is deemed monopolistic, causing adverse effects on competition and necessitating mitigation or elimination. In cases of national emergency, extraordinary circumstances, or public interest demands, the CNIPA may also grant compulsory licensing. Moreover, in the interest of public health, the CNIPA may issue compulsory licensing for a patented medicine, allowing its production and export to countries or regions complying with relevant international treaties acceded by China.

In circumstances where a subsequent invention or utility model significantly advances technologically and economically compared to an earlier granted patent, and the later invention’s exploitation depends on the earlier one, upon request from the later patentee, the CNIPA may grant compulsory licensing to exploit the earlier invention or utility model. If compulsory licensing is granted according to the above, the CNIPA may, at the earlier patentee’s request, also grant compulsory licensing. These provisions underscore the flexibility and adaptability of China’s intellectual property framework to address various situations.

Jurisdiction over technical IP cases in China falls within the authority of the specialised Intellectual Property Courts and Intermediate People’s Courts. Currently, Intellectual Property Courts have been established in Beijing, Shanghai, Guangzhou, and Hainan Free Trade Port to centrally handle the technical IP cases within their territorial jurisdiction. In other areas, specialised IP tribunals are established within the Intermediate People’s Courts to handle these cases. Under the Chinese law, technical IP covers invention patents, utility models, new varieties of plants, layout designs of integrated circuits, technical secrets, and computer software.

The first instance design patent cases are reviewed by the specialised Intellectual Property Courts and Intermediate People’s Courts. With special approval from the Supreme People’s Court, a primary court may also review a design patent case. However, this special treatment does not apply to the administrative action of a design patent case.

The first instance Soft IP cases are generally reviewed by the primary courts with the exception that the determination of famous trade marks are copyright cases relating to computer software, and are subject to the jurisdiction of the Intermediate People’s Courts. With special approval from the Supreme People’s Court, a primary court may also review a determination of a famous trade mark case.

Appellate proceedings for the technical IPs, regardless of whether they were adjudicated by Intermediate People’s Courts or High People’s Courts in the first instance, are under the direct jurisdiction of the Intellectual Property Court of the Supreme People’s Court. Cases involving design patents are handled by High People’s Courts.

In China, the judgment issued by a court in an appellate proceeding is final and effective. Still, a party may challenge this judgment through a retrial proceeding. But the review for the institution of the retrial proceeding is stringent. Usually, the retrial case is filed before the higher court of the court adjudicating the appellate proceeding. If that court is the Supreme People’s Court itself, then the party needs to file the retrial proceeding before the Supreme People’s Court.

In China, in addition to the court system introduced above, certain administrative bodies also have the authority to resolve intellectual property disputes. For example, local patent offices are given the authority to handle patent infringement cases. However, they can only award injunctive relief and have no power to determine damages. Customs may also take actions based on IP infringement claims. In practice, customs are more active in trade mark counterfeiting cases and there are only a couple of patent infringement cases in the most recent decade in which the customs took action and issued a sanction order. In recent years, local administrations for market regulation are also active in cases of enforcing trade secrets.

In patent infringement cases, a patent holder or a licensee may have the right to file a lawsuit in the People’s Court, necessitating the provision of relevant ownership proof such as the recordal of the patent or licence with the patent office by the parties involved. However, it is not required to issue a formal demand letter, warning letters, or engage in mediation beforehand.

For patent administrative procedures in China, foreigners, foreign enterprises, or other foreign entities without a habitual residence or business office in China, seeking patent applications or handling other patent-related matters, must engage a legally established patent agency. Chinese individuals or entities applying for patents or dealing with other patent-related affairs domestically may also engage a legally established patent agency.

Regarding patent litigation procedures, foreign parties involved in civil litigation may appoint their country’s nationals as litigation agents or engage their country’s lawyers in a non-advocate capacity as litigation agents. However, when foreigners, stateless individuals, foreign enterprises, or organisations need an attorney in court proceedings, they must engage an attorney qualified in the People’s Republic of China.

In urgent cases where the lack of interim measures could result in irreparable harm to the applicant’s legitimate rights or hinder the enforceability of a judgment, without contravening public interests, the patent holder may apply for a preliminary injunction, also known as pre-litigation preservation measures. This request is made to the People’s Court having jurisdiction over the domicile of the respondent or the court with jurisdiction over the case. The applicant requests the court to immediately halt the infringing actions of the respondent. Several circumstances are generally considered urgent:

• imminent unlawful disclosure of the applicant’s trade secrets;
• impending violation of the applicant’s rights, such as publication rights or privacy rights;
• unlawful disposal of the disputed intellectual property;
• infringement of the applicant’s intellectual property in time-sensitive events like exhibitions; and
• impending or ongoing infringement on time-sensitive popular programmes or content.

The potential opponent can challenge the necessity of an injunction, especially when not implementing preservation measures would cause irreparable harm to the applicant’s legitimate rights or impede the enforceability of a court decision. Simultaneously, the potential opponent can also raise objections through filing a patent invalidation application, questioning the stability of the validity of the rights involved.

If a preservation order has already been issued, the potential opponent can submit an appeal for review, and the People’s Court will review and deliver a ruling within ten days of receiving the review application. Moreover, if the applicant’s request contains errors, the potential opponent may seek compensation for any losses incurred due to the preservation measures.

The statute of limitations for patent infringement lawsuits is three years, calculated from the date when the patent holder or related stakeholders became aware or should have been aware of the infringement act and the infringer. However, if more than 20 years have passed since the rights were harmed, the People’s Court will not provide protection. Under exceptional circumstances, the People’s Court may, upon the request of the rights-holder, decide to extend this period.

It is worth noting that the statutory limitation period can be interrupted upon a patent owner’s action to enforce or claim its right. In practice, issuance of a cease-and-desist letter, request of patent licence negotiations, and initiation of an infringement lawsuit are the most common approaches to interrupt a statutory limitation period. Upon such an event, the three-year period will be recounted.

In practice, it is also not uncommon to see that parties can heavily dispute the date when the patent holder or related stakeholders became aware or should have been aware of the infringement act and the infringer. The Supreme People’s Court has adopted a rather loose standard for this date. For example, in some cases, the date of notarised purchase of the infringing product was considered as the date to start the calculation of the statutory limitation period.

In situations where evidence might be at risk of destruction or future unavailability, parties can request evidence preservation from the People’s Court during legal proceedings, and the court can proactively implement preservation measures. If urgent, interested parties may apply for evidence preservation before initiating a lawsuit or arbitration to the court in the location of the evidence, the respondent’s domicile, or the court with jurisdiction over the case. For urgently needed evidence preservation, the court must issue a ruling within 48 hours, while the timeline for other evidence preservation rulings depends on the specific circumstances.

Parties seeking evidence preservation should submit their application to the People’s Court before the expiration of the evidential submission deadline. The application should outline the basic details of the evidence requiring preservation, the reasons for seeking preservation, and the proposed preservation measures. The court typically assesses the potential risk of evidence loss or unavailability from several angles: (i) whether the applicant has provided preliminary evidence supporting their claim; (ii) if the evidence can be gathered by the applicant themselves; (iii) the likelihood of evidence loss or future unavailability and its impact on proving the relevant facts; and (iv) the impact of potential preservation measures on the custodian of the evidence. If evidence preservation might cause harm to others, the People’s Court should demand the applicant to provide appropriate guarantees.

In China, whether in intellectual property proceedings or non-intellectual property proceedings, lawsuits must meet the following conditions:

• the plaintiff must be a citizen, legal person, or other organisation directly related to the case;
• here must be a clearly identified defendant;
• specific claims, facts, and reasons must be presented; and
• the case must fall within the jurisdiction of the People’s Court and be within the scope of civil litigation.

Once these conditions are met, the People’s Court will accept the case without examining its substantive content. After the People’s Court accepts the case, parties can negotiate or the People’s Court can set a deadline for evidence submission, allowing the parties to continue presenting evidence within that period. Before the conclusion of the first-instance court debate, parties may change their claims. During the second-instance proceedings, if parties wish to add new litigation claims, the People’s Court of the second instance may, based on the principle of voluntary participation, mediate on the newly added claims or counterclaims. If mediation fails, the parties are informed to file a separate lawsuit. If both parties agree for the People’s Court of the second instance to adjudicate these matters together, the court may issue a joint ruling on them.

In China, the Civil Procedure Law provides that where the subject matter of the litigation is the same type and a party or both parties to a lawsuit comprise(s) multiple persons, generally more than ten, a representative may be elected to participate in the proceedings. However, this is extremely rare in intellectual property-type cases, considering that the defendant’s behaviour is usually different in IP litigation, making difficult to satisfy the constituent elements of the representative action. For class action, there is currently no specific legal provision relating to it.

In addition, the People’s Procuratorate, in fulfilling its duties, can initiate civil public interest litigation to address acts infringing upon societal public interests within the realm of intellectual property. For instance, if a party counterfeits other videos without obtaining permission from the registered trade mark rights-holder, resulting in potential safety hazards for unspecified purchasers and harming societal public interests, the Procuratorate can use this as grounds to initiate public interest litigation.

In the fourth amendment of the Patent Law in 2021, China introduced the principle of good faith and creditability. This entails that the application and exercise of patent rights must adhere to the principles of good faith and creditability, prohibiting the abuse of patent rights to undermine public interest or the legitimate rights of others. Instances where patent rights are abused to exclude or restrict competition, constituting monopolistic behaviour, will be dealt with in accordance with the Anti-Monopoly Law of the People’s Republic of China.

The patentee or an interested party in a patent has the right to bring an action for infringement against the claimed infringing party. The interested parties generally include the licensees and inheritors of the patent right. There is no unified standard among the People’s Courts regarding the requirement of a patent licensee as the plaintiff in an infringement lawsuit. Generally, an exclusive licensee is allowed to file a patent infringement lawsuit alone. A sole licensee can bring a patent infringement lawsuit if the patentee does not do so. A non-exclusive licensee, with authorisation from the patentee, may show as the plaintiff in a patent infringement lawsuit.

A direct infringement of an invention or utility model patent happens when an entity or individual, without permission of the patentee, exploits the patent for production or business purposes, that is, to (i) make, use, promise the sale of, sell or import the patented product; (ii) use the patented process; or (iii) use, promise the sale of, sell or import the product directly obtained from the patented process. A direct infringement of a design patent happens when an entity or individual, without permission of the patentee, exploits the patent, that is, to make, promise to sell, sell, or import the patent bearing the patented design, for production or business purposes.

An indirect infringement of a patent happens when an entity or individual, without permission of the patentee, (i) knowingly provides materials, equipment, components, intermediates, etc, specifically used for patent implementation, to others for patent infringement acts for production or business purposes; or (ii) actively induces others to commit patent infringement for production and business purposes, knowing that the relevant products and methods have been granted patent rights.

The remedies for a prevailing patentee in the patent infringement lawsuit typically include cessation of infringement, compensation for loss, elimination of adverse effects and rehabilitation of reputation, and making an apology. One who indirectly infringes a patent shall be liable jointly and severally with the direct infringer.

For a patented process, not only the act of using the patent process, but also using, promising the sale of, selling or importing the product directly obtained from the patented process constitutes infringement. Therefore, even if parts of the allegedly infringing process are practised outside China, there might be a patent infringement if some of the above acts occur in China.

The scope of protection of an invention or utility model patent shall be determined by the content of the claims, and the specification and drawings may be used to interpret the claims. The scope of protection of a design patent shall be determined by the design of the product shown in the drawings or photographs, and the brief introduction may be used to interpret the design.

For an invention or utility model patent, the protection scope of claims shall be determined based on all technical features recorded in the claims, including the technical features identical or equivalent to those in the claims. Equivalent features are those using essentially the same means to achieve essentially the same functions and effects as the technical features recorded in the claims, and can be associated by a person having ordinary skill in the art without the need for inventive labour when the accused infringement occurs.

To interpret the claims of the patent involved, its examination archives may also be taken into account, which include (i) the written materials submitted by the patentee in the process of prosecution, re-examination and invalidation, and (ii) the notice of examination opinions, meeting records, oral hearing records, patent re-examination decision, and the patent invalidation decision made by the CNIPA.

China offers various non-infringement defence avenues for accused infringers, each with its applicable scenarios and conditions.

For the FRAND principle, if a patent holder intentionally violates their commitment to fair, reasonable, and non-discriminatory licensing obligations during standard setting, resulting in the failure to reach a patent implementation licensing agreement, and the accused infringer demonstrates no apparent fault during negotiations, courts generally do not support the rights holder’s claim to cease standard implementation actions.

For prior-use rights, if the accused has already manufactured the same product, used the same method, or made necessary preparations for manufacturing or using the product before the patent application date and continues to do so within the original scope, this defence applies.

For laches, if the patent holder or related stakeholders become aware or should have been aware of the infringement act and the infringer, and no lawsuit is initiated within three years from this awareness or within 20 years from the infringement act, the defendant can raise a defence based on the expiration of the statute of limitations.

For patent exhaustion, if a product derived directly from a patented product or method is sold by the patent holder or authorised entities or individuals, subsequent use, promised sale, sale, or import of that product is deemed as infringement.

For equitable estoppel, in patent infringement disputes, if a patent applicant or rights-holder surrenders a technical solution through modifications to the claims or specification during the patent authorisation or invalidation process and subsequently attempts to incorporate it within the scope of patent protection, courts do not support this action. However, if the rights-holder proves that the limitations made to the claims, specification, or drawings during the patent authorisation process were explicitly denied, courts should recognise that such modifications did not lead to the abandonment of the technical solution.

A party may apply to the People’s Court for a person with expertise to appear in court to offer an opinion regarding an identification conclusion or regarding a specialised technical issue.

A person with expertise is not a witness. Opinions offered by a person with expertise in court on the specialised issues shall be deemed as statements of the corresponding party.

There is no separate procedure for construing the claim terms of the patent involved. That is, there is no separate “claim construction” session to determine the meaning of the claim language. However, during the trial, when parties have disputes concerning the protection scope of certain terms used in the asserted claims, the People’s Court will adjudicate it as a disputed issue during the trial.

When the People’s Court tries intellectual property cases with strong technical expertise, it can appoint technical investigators to participate in the legal proceedings. Technical investigators are trial supporting personnel independent of the parties. The technical investigator shall offer proposals on the focus of disputes of technical issues, participate in investigations, hearings and other trial proceedings, offer technical investigation opinions, and assist judges in other technical matters. The technical investigator shall independently issue and sign the technical investigation opinions, and offer the opinions before the case is deliberated. The opinions are not open to the public, and may be taken as a reference for the determination of technical facts by the People’s Court.

China adopts a bifurcated system to review the validity and infringement issues of a patent. That is, the validity of a patent is decided by the CNIPA. The judicial system may only review an invalidity decision issued by the CNIPA and a court can’t decide the validity in an infringement case. Any entity or individual may request the CNIPA to invalidate a patent in whole or in part after the patent is granted, if the entity or individual considers that the granting of the patent does not conform to certain provisions in the Patent Lawa.

The CNIPA shall timely examine the request for invalidation and make a decision. In practice, it usually takes four to ten months to obtain a decision from the CNIPA. Where any party is dissatisfied with the CNIPA’s decision on declaring a patent invalid or maintaining the validity of a patent, the party is entitled to bring a lawsuit to the People’s Court within three months of receipt of the decision notification.

The claimant is entitled to request for invalidation against the whole granted patent or some claims of it. The CNIPA reviews the invalidation request on a claim-by-claim basis, and the validity of the claims not challenged will not be influenced.

In the process of the invalidation examination, the patentee for an invention or a utility model is allowed to amend the claims, provided that the protection scope of the patent is not extended beyond the original scope. However, the patentee is not allowed to amend the specification or the drawings of the invention or utility model patent. The patentee for a design patent shall not amend the drawings, photographs, or brief explanation during the invalidation examination.

Patent invalidation and infringement cases are not heard together. The invalidation request is examined and determined by the CNIPA. If a party is not satisfied with the result, the party could file an administrative lawsuit to Beijing Intellectual Property Court regarding the invalidation decision. The CNIPA is the defendant, and the other party in the invalidation request is the third party. On the opposite, a patent infringement lawsuit is a civil dispute against the claimed infringing party, and such a case shall be filed to a certain Intellectual Property Court or Intermediate People’s Court in the correspondent province with jurisdiction.

The validity of the patent involved is usually crucial to a patent infringement dispute. During the defending period in a patent infringement case, if the defendant requests to declare the patent invalid, and the patent involved is (i) an invention patent, or (ii) a utility model or design patent of which the validity has been reviewed and maintained by the CNIPA, the People’s Court may not stay the litigation. If the patent involved is a utility model or design patent of which the validity has not been reviewed by the CNIPA, and (i) the defendant requests to declare the patent invalid during the defending period, the People’s Court shall stay the litigation except when there is certain evidence reflecting the stability of the patent; (ii) the defendant requests to declare the patent invalid after the defending period, the People’s Court shall not stay the litigation except when necessary.

Intellectual property proceedings adhere to the general procedural provisions of civil and administrative lawsuits. Meanwhile, there are several special provisions on the trial of patent rights proceedings.

A People’s Court shall complete the trial of a civil case under formal procedure within six months after the case is docketed. The term can be extended if necessary. In practice, while it usually takes around one-and-a-half to three years to complete the first-instance adjudication, some complicated patent infringement lawsuits might take several years to complete the first-instance adjudication.

The number of trial hearings depends on the complexity and the procedural requirements of the case. While some patent rights lawsuits only take one hearing, others may need several hearings to complete.

Upon notice by a People’s Court, a witness is expected to testify in court unless under special circumstances where the witness is not able to be present in person. Besides, a party may apply to the People’s Court for a person with expertise to appear in court to offer an opinion regarding an identification conclusion or regarding a specialised technical issue. A party may question a witness or a person with expertise upon permission by the People’s Court.

The remedies for patent infringement are usually decided at the same time as the judicial decisions on the litigation claims.

Patent invalidation requests are reviewed and determined by examiners from the CNIPA with technical backgrounds in the corresponding technical fields. During the judicial period, patent-related disputes are determined by legal judges who may or may not have technical backgrounds. China has established an Intellectual Property Court in the Supreme People’s Court, and four specialised Intellectual Property Courts in Beijing, Shanghai, Guangzhou, and Hainan Free Trade Port. Besides, there are intellectual property tribunals in over 20 Intermediate People’s Courts. The judges in these courts are more experienced in intellectual property rights proceedings. The parties have no influence on who is the decision-maker but can attempt to move the case to an appropriate jurisdiction by “forum shopping” tactics.

It is common for the parties to settle civil cases on intellectual property rights. Typically, when a plaintiff files such a case to a People’s Court, the People’s Court would proceed the case to the pre-litigation mediation process before formally docketing the case. Throughout the whole process of the trial before the final judgment, the People’s Court can organise and assist in mediation. Once a mediation consent judgment is signed by both sides, it shall become legally binding to them.

Besides, if the parties reach a settlement agreement on their own during the litigation process, the People’s Court may, based on the application of the parties, confirm the settlement agreement in accordance with the law and prepare a mediation consent agreement. The People’s Court may appoint assistants or invite relevant entities and individuals to engage in the settlement upon request by the parties.

A patent infringement case might be stayed pending the decision of the invalidation administrative proceedings, see 4.4 Revocation/Cancellation and Infringement. If a claim of a patent, as the right ground of an infringement lawsuit, is declared invalid by the CNIPA, the People’s Court may determine to dismiss the patent infringement lawsuit.

Effective judgments or rulings rendered by foreign courts shall be examined by the People’s Courts before recognition and enforcement in China. Therefore, the determination of a foreign court does not directly influence the litigation proceedings in the People’s Courts.

The remedies for a prevailing patentee in the patent infringement lawsuit typically include cessation of infringement – ie, permanent injunction, and compensation for loss – ie, damages. In cases where the infringement is wilfully committed and severe, punitive damages can also be awarded by a court. Under the Chinese court, permanent injunction is awarded upon the establishment of the infringement and there is no additional requirement for such a remedy.

The damages for a patent infringement shall be determined primarily on (i) the actual loss suffered by the patentee due to the infringement, (ii) the benefits obtained by the infringer from the infringement, or (iii) a reasonable multiple of the patent royalty if the aforementioned amounts are hard to determine. For intentional patent infringement acts with serious circumstances, the judge has the discretion to render punitive damages as not less than one nor more than five times the amount determined above. If the amount of the damages is difficult to approve, the judge has the discretion to render statutory damages between CNY30,000 and CNY5 million by taking into account factors such as the patent type and the features of the infringement. The damages for a patent infringement shall also include the reasonable disbursements of the patentee for preventing the infringement, including the attorney’s fees.

If a party refuses to comply with the effective court decisions, the opposing party may request the People’s Court to enforce the decision. The People’s Court shall have the right to seize, impound, freeze, auction, or sell a portion of the party’s property depending on the actual situation to satisfy the obligations.

A prevailing defendant does not need to bear litigation costs including case acceptance fees, application fees for certain matters, and certain fees arising from the appearance of witnesses, authenticators, interpreters, and adjustment makers in the people’s court.

Normally, a prevailing defendant shall bear its own attorney’s fees. However, in an intellectual property infringement case, if the defendant submits evidence to prove that the plaintiff abused its rights and interest in filing the case, the people’s court may support the defendant’s claim that the plaintiff compensates for the reasonable expenses such as lawyer’s fee, travelling expenses, and board and lodging expenses. The defendant can also file a separate lawsuit claiming such expenses.

The available remedies are applicable to each type of patent.

If the People’s Court orders the defendant to cease the infringement act in the judgment, the order would not be enforceable until the judgment comes into force. Pending an appeal, the court decision of the first instance is not effective and enforceable. However, the plaintiff could apply to order certain conduct of the defendant or prohibit the defendant from certain conduct either before or during the lawsuit, which would prohibit the defendant from further infringing the patent if necessary.

The appellate procedure for patent rights proceedings is normally the same as other civil or administrative lawsuits. However, there are special provisions concerning the appellate jurisdiction of such cases. For appealing cases, the Intellectual Property Court of the Supreme People’s Court determines administrative cases of patent authorisation and validity confirmation, as well as civil cases of patent ownership and infringement involving invention patents and important and comprehensive utility model patents. Other civil cases involving patents on appeal go to the People’s Court that is at a higher level than the court of first instance.

The court of the second instance shall imply a full review of the related facts and applicant statutes in the request for appeal.

The following costs usually arise before filing a patent infringement lawsuit:

• preliminary evidence collection fees for infringement – including the costs of purchasing claimed infringing products and seeking investigation assistance. The costs depend on the difficulty of the case and the price of the claimed infringing products;
• appraisal fees – including costs of technical testing and infringing appraisal. The infringing appraisal is not a must in patent infringement lawsuits;
• notarial fees; and
• attorney’s fees.

For a civil case on intellectual property rights, if there is no disputed amount or price, the case acceptance fee shall be CNY500 to CNY1,000 for each case; if there is any disputed amount or price, the case acceptance fee shall be paid by accumulating amounts in segments according to a certain proportion stipulated by State Council. For each administrative case on patent, the case acceptance fee is CNY100.

The case acceptance fee shall be prepaid by the plaintiff, and the application fees for certain matters in the lawsuit shall be prepaid by the applicant. The above litigation costs shall be borne by the losing party unless the prevailing party bears the costs at their free will.

If the court determines that an infringing act exists and the plaintiff prevails, the damages shall also include the reasonable disbursements of the patentee for preventing the infringement, including reasonable litigation expenses and attorney’s fees. However, a prevailing defendant normally shall bear its own litigation expenses and attorney’s fees except when it proves the plaintiff’s abuse of right in filing the case, as described in 6.2 Rights of Prevailing Defendants.

Alternative dispute resolution is frequently employed to resolve civil disputes involving intellectual property rights. For patent infringement disputes, the parties can negotiate to settle them. If the negotiation fails, the parties can request the competent administrative department to deal with the dispute. Settlement, mediation, and arbitration are also commonly adopted in civil disputes involving intellectual property rights.

To assign the right to apply for a patent or an existing patent right, the parties concerned shall enter into a written agreement, and this agreement has to be registered with the CNIPA. The assignment shall come into force as of the date of registration by the CNIPA. For invention or utility model patent applications or patents, if the assignor is a Chinese entity or individual and the assignee is a foreign entity or individual, a licence or registration showing the approval by China’s international trade regulatory authority shall be submitted during the assignment registration to the  CNIPA.

First, the parties shall duly negotiate and sign a patent assignment agreement in writing. Then the parties shall file a Statement for Change in Bibliographic Data to the CNIPA to change the registered patentee, pay the acceptance fee, and submit the agreement as proof. The assignment comes into force at the date of registration by the CNIPA.

To license a patent, the parties concerned shall conclude a written patent licensing agreement, and it is suggested to submit the agreement to the CNIPA for record within three months of the date when the agreement enters into force. There are three options for licensing:

• non-exclusive licence – the licensor reserves the right to exercise the patent by itself and the right to license any third party to exercise the patent;
• sole license – the licensor reserves the right to exercise the patent by itself but cannot license any third party other than the designated licensee to exercise the patent; and
• exclusive license – only the designated licensee can exercise the patent. Regardless of the type of licence granted, the licensee has no right to license a third party except the entity or individual as stipulated in the licensing agreement to exploit the patent.

The execution of a patent license is finalised when the patent owner signs the written licence agreement with the licensee. At the same time, the patentee is required to submit an application form, identification of the parties, and the agreement to the CNIPA for record within three months. The CNIPA shall announce the contents of the agreement in the Patent Gazette. The absence of record will not invalidate the contract, but it does render the agreement unenforceable against a bona fide third party if not officially recorded.