Juan Su Intellectual Property King & Wood Mallesons
The new Patent Law of the People’s Republic of China will come into effect on June 1, 2021. As far as design patent applications are concerned, the new patent law has several important changes which are worthy of the applicant’s attention when considering of the filing strategies.
Partial design becomes possible
Article 2.4 of the Patent Law is amended to read: “Design” means any new design of the shape, the pattern, or their combination, or the combination of the color with shape or pattern, of the whole or part of a product, which creates an aesthetic feeling and is fit for industrial application.
For a long time, only a design of a whole industrial product is patentable in China, not a design of a part of a product. This is very detrimental to the situation where the new design only accounts for a small part of a product. The new Patent Law liberalizes the protection of partial designs, which means that if an applicant proposes a novel design for an indivisible part of the product, it will be possible to file an application for a design. Although the specific rules have not yet been issued, it is foreseeable that broken lines in the drawings will be acceptable. The applicant may use broken lines to show the whole product and solid lines to show the partial design for protection. This will undoubtedly greatly enhance the protection of industrial designs in the future, and it will be advantageous especially for the protection of graphical user interfaces.
Establishment of domestic priority
The current Patent Law only allows a design application to enjoy a foreign priority. If a product to be launched in the market is slightly changed or a number of similar designs are subsequently launched after a domestic design application is filed, the applicant can only file a new application for the changed/similar designs. The earliest application may be withdrawn or abandoned if not issued yet; otherwise the latter application for design of the actually launched products will risk the potential invalidation. Your own previous design patent will become a prior art once issued.
Article 29.2 of the new Patent Law is amended to read: Where, within twelve months from the date on which any applicant first filed in China an application for a patent for invention or utility model, or within six months from the date on which the applicant first file in China an application for a patent for design, he or it files with the patent administration department under the State Council an application for a patent for the same subject matter, he or it may enjoy a right of priority.
As seen, a domestic priority of industrial design will be recognized, which means that the applicant may file a design application as soon as the initial new design is developed without any worry of possible modifications or more similar designs later for actual products to be launched. The applicant may file another design application(s) if he makes minor modifications or develops more similar designs within six months. That means, the domestic priority can be used to supplement the scope of protection in a timely manner.
The protection period is extended to 15 years
The new Patent Law stipulates that the duration of design patent rights is fifteen years, counter from the date of filing. This is a very significant change and will apply to all Chinese applications submitted on/after June 1, 2021. For a design which was first filed in a foreign country, it is recommended to postpone the submission on/after June 1, 2021 as long as the priority period has not expired. And for a design which was first filed in China, it is theoretically possible to refile a design application enjoying its domestic priority as long as within six months from the first filing date in order to obtain 15-year protection. After all, the difference between the 15-year and 10-year protection periods is quite large.
In addition to the above, there are several amendments involving inventions, utility models and designs, which will also affect the applicant’s design application strategy.
Grace period without loss of novelty
Article 24 of the new Patent Law adds a situation regarding disclosure without loss of novelty, that is, where it was first disclosed for the purpose of public interest when a national emergency or extraordinary state of affairs occurs within six months before the date of filing. In such a situation, the applicant may submit relevant evidences to avoid losing novelty of his new design due to the previous disclosure.
In order to promote the transformation of patents, reduce transaction costs, and improve transformation efficiency, an open licensing system is introduced according to the new Patent Law.
The new added Article 50 reads: Where a patentee voluntarily states in a written manner to the patent administration department under the State Council that he is willing to license any entity or individual to exploit its patent, and clearly indicates the payment methods and standards of the license fee, the patent administration department under the State Council shall publish an announcement for open license. Where an open license statement is filed for utility model or design patent, an evaluation report of patent shall he provided.
The patentee of the open-licensed patent may offer non-exclusive license to the licensee upon negotiation of license fee, but shall not offer exclusive or sole license for the patent.
The open licensing system is an important legal system that promotes the implementation of patent transformation. It is hoped that government public services can solve the problem of information asymmetry between the supply and demand sides of patented technology. Its core is to encourage patentees to open their patent rights to the society, and promote the connection between supply and demand and patent implementation so that the value of patents can be realized to great extent.
Accused infringers may also submit an evaluation report of patent
According to Article 66 of the new Patent Law, not only patentees and interested parties, but also accused infringers may initiatively submit an evaluation report of patent made by the patent administration department under the State Council. This provides an initiative for the accused infringers, especially when the accused infringers have found a prior design that may invalidate the patent.
Infringement compensation and burden of proof
This revision of the Patent Law adds a new punitive compensation system, that is, for intentional infringement of patent rights, if the circumstances are serious, the people’s court may calculate the amount based on the loss suffered by the patent owner, the benefit obtained by the infringer, or the multiple of the patent license fee, and finally determine the compensation within 5 times of the above amount.
At the same time, the statutory compensation amount is increased. The upper limit of the statutory compensation amount is raised to 5 million yuan, and the lower limit is raised to 30,000 yuan.
In terms of evidence rules, when the patent owner has tried his best to provide evidences, but the account books and materials related to the infringement are not possible to reach because of in the hands of the infringer, the people’s court can order the infringer to provide it, thereby reducing the burden of proof on the patent owner.
The above regulations also apply to design patents.
The statute of limitations for infringement is changed to three years
In order to adapt to the implementation of the Civil Code of the People’s Republic of China, the new Patent Law stipulates that the statute of limitations for infringement of patent rights is three years, counting from the date when the patentee or interested parties know or should know the infringement and the infringer.
The revision of the Patent Law will inevitably have a great impact on the applicants’ application strategy. Applicants should make corresponding arrangements in advance according to their product design process, marketing plan and first application submission etc. in order to obtain more favorable protection.