The Second Review of the Draft Amendment to the Patent Law2020-07-02

The draft amendment to the Chinese Patent Law was submitted to an ongoing session of the Standing Committee of the National People's Congress, China's top legislature, for a second review on June. 28th.


Promoting the exploitation and application of patents

The exploitation of patents is a key link in transforming innovative achievements into productivity. Article 6 of the second draft, on the basis that it is clear that the entity can dispose of the right to apply for and own a patent of its service invention-creation in accordance with applicable law, regulates "The State encourages the entity granted patent rights to implement property rights incentives and adopt equity, options and dividends to enable inventors or creators to reasonably share the benefits of innovation and promote the exploitation and application of related inventions and creations."


Adding patent open license system

This draft amendment has added a new patent open license system. Section 1 of Article 50 claims that : "Where the patentee declares to the Patent Administration Department under the State Council in written form that it is willing to permit any entity or individual to exploit his or her patent, and clarifies the payment method and standard of the license fee, the Patent Administration department under the State Council shall make the announcement to exploit the open license. Where an open license is filed for a utility model or design patent, a patent right evaluation report shall be provided."

Article 51 stipulates: "Any entity or individual that is willing to exploit an open license patent shall notify the patentee in written form and pay the license fee in accordance with the method and standard of the announcement before obtaining the patent exploitation license. During the period of an open license, the patentee may also grant a general license after negotiating with the licensee for the license fee, but may not give exclusive or sole license."


Adding patent protection for partial design

According to Article 2 of the current patent Law, "Design means any new design of the shape, the pattern, or their combination, or the combination of the color with shape or pattern, of a product, which creates an aesthetic feeling and is fit for industrial application." In addition to safeguarding the patent of a product's overall appearance design, a draft revision also gives protection to a product's partial design as a move to encourage design innovation.


Canceling the minimum amount 100,000 yuan of compensation for patent right infringement

In December 2018, when the first review of the draft was submitted to the seventh session of the Standing Committee of the National People's Congress, the amount of statutory compensation was increased with the range from "10,000yuan to 1 million yuan" to "100,000 yuan to 5 million yuan" ", but during the second review, some members of the Standing Committee of the NPC believe that a considerable proportion of patents (mainly utility models and designs) in practice has a low market value, thus the minimum compensation amount of 100,000 yuan is on the high side, the second review of the draft plans to cancel the minimum amount 100,000 yuan of statutory compensation for patent right infringement.


Extending  the duration of design patent and drug patent

Article 43 of the draft plans to extend the duration of patent right for design from 10 years to 15 years, and to establish a compensation system for duration of drug patent protection  "To compensate for the time for reviewing and approving drugs to the market, the State Council may decide to extend the duration of patent right for innovative medicine patents that are applied for listing simultaneously in China and abroad, and the extension duration may not exceed five years, and the total duration of patent right may not be more than fourteen years after drugs came into the market. "


Source: CNIPA, NPC

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