Civil Code: Promoting the New Development of Punitive Compensation for Intellectual Property2020-06-20

On May 28th, 2020, the Third Session of the 13th National People's Congress voted to adopt the Civil Code of the People's Republic of China, declaring that China has entered the "era of civil code", which is the first law named after the "code" in the history of new China, creating a precedent for the codification and legislation of China's code.

In this legislation, because the relevant conditions are not mature, the intellectual property rights have not been independently compiled in the Civil Code, but there are still many provisions of intellectual property rights to be noted. For example, the Civil Code has made a general provision on intellectual property rights to guide the intellectual property laws of various branches; in order to strengthen the protection of intellectual property rights and improve the cost of infringement, the Civil Code stipulates that "if the intellectual property rights of others are intentionally infringed, and the circumstances are serious, the infringee has the right to request corresponding punitive compensation."

In recent years, in China's intellectual property law revision and judicial practice, punitive compensation system has emerged in order to strengthen protection. Article 63 of the Trademark Law revised in 2013 clearly stipulates the punitive compensation system for the first time; the Draft of the 4th Amendment of the Patent Law and the Draft of the Amendment of the Copyright Law also contain the relevant provisions on punitive compensation; the Anti Unfair Competition Law revised in 2019 also stipulates the punitive compensation system. The provisions of the Civil Code on punitive compensation system have become the superior law on punitive compensation provisions in the above-mentioned intellectual property separate law, which is of great significance to strengthen the protection of intellectual property in China.

 

 

Trademark Law (2019)

Draft of the Amendment of Patent Law (2019)

Draft of the Amendment of

Copyright Law (2020)

Anti Unfair Competition Law (2019)

Source

Article 63

Article 18

Article 53

Article 17

Content

For willful trademark right infringement, if serious, the multiplied amount of compensation may be determined within the range from one to five times of the amount determined by the above-mentioned principles.

For willful patent right infringement, if serious, the multiplied amount of compensation may be determined within the range from one to five times of the amount determined by the above-mentioned principles.

For willful copyright or copyright-related right infringement, if serious, the multiplied amount of compensation may be determined within the range from one to five times of the amount determined by the above-mentioned principles. Where it is difficult to determine the losses suffered by the right holder, the profits the infringer has earned and the exploitation fee of that patent under a contractual license, the People’s Court may award the damages of not more than RMB 5,000,000 Yuan (about USD707,000) in light of the circumstances of the infringing act.

Operators maliciously carry out ACTS of infringing trade secrets, if serious, the multiplied amount of compensation may be determined within the range from one to five times of the amount determined by the above-mentioned principles.

 

On March 19th, 2020, the general office of the Supreme People's Court issued the notice on printing and distributing the Project Plan of Judicial Interpretation of the Supreme People's Court in 2020. It is planned to complete the project work of "Interpretation on Several Issues of Applicable Law of Punitive Compensation for Intellectual Property Infringement" in the first half of 2021.

It can be predicted that in the near future, punitive compensation system will be introduced into all intellectual property infringement disputes. This is of great benefit to the construction of a powerful country of intellectual property rights, the cultivation of the awareness of the whole society to respect intellectual property rights, and the promotion of the development of innovative and creative industries.

 

Source: China Intellectual Property News, CNIPA

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