Jiang Zhipei, PhD
Chief Justice, IPR Tribunal of PRC Supreme Court (retired)
Senior Advisor, Fangda Partners
June 22, 2009
www.chinaiprlaw.cn

Global financial crisis

New judicial opinion

What will we do?...

Latest Development of Judicial Protection on Intellectual Property Rights in China

1. Summary of the Court's Trial in 2008
The Number of Cases Steadily Increases

The Scope of IP Cases has been Further Broadened

The Trial System has been further improved
The Number of Cases Steadily Increases
The Number of Cases Steadily Increases
The Number of Cases Steadily Increases

Last year the Courts concluded 1139 cases which involve foreigners or foreign companies, which is 70.51% in increase over 2007.

The Number of Cases Steadily Increases
There are 1,074 IP administrative cases in total docketed at district courts in China for the first instance trial in 2008, representing an increase of 7.29% increase over 2007.

All the district courts totally concluded 3,326 IP criminal cases for the first instance in 2008.  5,386 offenders were convicted.
The Scope of IP Cases has been Further Broadened
Broaden the scope of civil cases relating to

franchise
peculiar marks
domain name
trade name
intellectual property agency and antitrust matters
The Trial System has been further improved
Supreme People's Court issues a number of judicial interpretations to further clarify the criteria on the applications of law.

71 intermediate courts have been delegated jurisdiction over cases concerning patents,
38 intermediate courts have been delegated jurisdiction over cases concerning new plant varieties,
43 intermediate courts have been delegated jurisdiction over cases concerning layout designs of integrated circuits, and
61 district courts have been delegated jurisdiction over certain kind of IP civil cases.

2. New trends of IP legislation
Compendium of China National IP Strategy

Improve the intellectual property system
Facilitate the creation and application of intellectual property
Improve the protections on intellectual property
Prevent the abuse of intellectual property
Improve the culture of respecting knowledge
2. New trends of IP legislation
Amendment to the China Civil Procedure Law

The revised Civil Procedure Law becomes effective on April 1, 2008.

Some amendments are made in relation to the “procedure of trial supervision and execution”.

2. New trends of IP legislation
Promulgation and Implementation of Antitrust Law

The Antitrust Law becomes effective as of the date of August 1, 2008.

Supreme People's Court circulated the notice emphasizing that antitrust cases shall be heard by IP tribunal of courts.
2. New trends of IP legislation
- The Third Amendment to the Patent Law   

    The third amendment to the Patent Law is a tremendous development of IPR laws in China and the relevant amendments are rather substantial, among which two highlights should be emphasized:

Firstly, the amended Patent Law provides a stricter requirement on the grant of patent right, and novelty standard is adjusted and improved;

Secondly, the amended Patent Law provides more severe administrative punishment measures against patent infringements and raises the amount of statutory damages for infringements.
3. How to Stop and Imprison Counterfeiters
Criminal, administrative, civil remedies

Accusation
Crime of counterfeiting a registered trademark
Crime of selling merchandise under a fake trademark
Crime of illegally manufacturing, and selling another's registered trademark

Burden of proof

4. How to obtain compensation
the proceeds obtained from the infringement during the period of infringement;

the losses suffered by the infringed due to the infringement during the period of infringement;

the appropriate compensation up to the statutory maximum based on the nature of the infringing acts.
4. How to obtain compensation
Reasonable expenses
Investigation fee
Attorney fee…

Evidence preservation & Property preservation

Statutory damages:
RMB 500,000 to RMB 1,000,000
5. The Influence of The Foreign Precedents
Since China is a civil system country, unlike common law jurisdictions such as the United States or England, Chinese courts trial cases according to laws, regulations and judicial interpretations instead of following the precedent cases.

However, foreign IP precedent cases have drawn great attention among the scholars and legal practitioners in China and arouse lots of debates and discussion.  As a matter of fact, foreign IP precedent cases have even influence the establishment of China IP system.

5. The Influence of The Foreign Precedents
Although Chinese courts can not directly adopt foreign precedent cases, they never overlook the reference use of the foreign precedents in the judicial work, and we are pleased to see that this reference use also plays an important role of our IP legal education and International exchange on IP issues.

However, if foreign parties are confronted with IP litigations in China, I always advice them to study more about the Chinese IP laws, international IP treaties that China has joined, and IP precedent cases in China.  Compared to foreign precedent cases, the above should be more helpful in resolving IPR disputes.

Outlook for IP Development in China

Impacts Brought by the Financial Crisis
Factors supporting the rapid economic development in China have changed.
The volume of exportation and importation transactions has decreased.
Our stock markets is in descent.
More and more factories and companies are running under their production capacity.
Layoff has become the highest-click-rate word. 
New characteristics of IP judicial protection
Pay more attention on serving central governmental work and its decisions, in order to ensure the development of the economy.

Enhance convenient for people in the judicial process and increase communication between people and the government offices, keeping honesty of the judicial adjudication and government operation..

Turn to more mediation work, pursuing harmony and balance.

People’s anxious on the shift in policy

Commitment to strengthening IP rights is being tempered by a desire to protect domestic industry in the economic crisis

The changes is for the time being

Pay much more attention to protect IP rights
Reforms and Changes Occurred in China
The Supreme People's Court of China is considering establishing Intellectual Property Appellate Court in Beijing.
More and more qualified legal service professional are growing. 
The improvements and developments of intellectual property protection system will provide a sound legal environment for the stable and rapid economic development of China.

FANGDA PARTNERS

Jiang Zhipei  zhipei.jiang@fangdalaw.com
          judgejiang@china.com
www.chinaiprlaw.cn