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By Zhao Yan and Daisy Duan King & Wood Mallesons’ Tax Group

On January 1, 2012, the trial of the value-added tax (“VAT”) Transition from business tax to VAT (“VAT Transition”) for transportation and certain modern service industries was implemented in Shanghai. It is a landmark event in Chinese tax reform. In July 2012, the State Council further decided to expand the pilot area to Beijing and seven other provinces and municipalities in stages: Beijing is expected to complete the VAT reform by September 2012; Jiangsu and Anhui provinces are expected to be complete by October 2012; the conversion deadline for Fujian and Guangdong provinces is November 1, 2012; and the deadline for Tianjin Municipality, Zhejiang Province and Hubei Province is December 1, 2012. Furthermore, the VAT Transition pilot areas will continue to be expanded next year and certain industries will be selected as pilots for VAT Transition nationwide.
Continue Reading Brief Analysis on the Impacts of the VAT Transition Pilot Expansion

By Susan Ning and Hazel Yin

On November 16, 2012, the Ministry of Commerce (“MOFCOM“) released the latest data of unconditionally approved notifications of concentrations, including the total number and the list of all transactions with the name of each transaction and the undertakings concerned. According to an earlier piece of press release, MOFCOM will disclose information of unconditionally cleared cases on a quarterly basis1.

From August 1, 2008 when the Anti-monopoly Law (“AML”) became effective to September 30, 2012, MOFCOM cleared 474 cases, of which 458 cases were cleared unconditionally2.
Continue Reading China’s Ministry of Commerce Released List of Unconditionally Approved Notifications of Concentrations

By Susan Ning and Kate Peng

In August 2012, the State Administration for Industry and Commerce published the fifth draft of the Guidelines on Anti-Monopoly Law Enforcement in the Field of Intellectual Property (the “Draft Guidelines“). Although compulsory licensing is not expressly mentioned in the Draft Guidelines, many provisions therein seem to imply it being a possible remedy for relevant monopolistic conducts in the IP field. For example, where a dominant market player’s refusal to license has anti-competitive effects1, a compulsory license could be the right answer to the problem. However, the role to be played by the antitrust enforcement agencies in compulsory licensing is not clearly defined under the current legal system.

There are very limited provisions in the Chinese law with respect to compulsory licensing.
Continue Reading What is the role of an antitrust enforcement agency in compulsory licensing?

By Ariel Ye and Liu Yuwu King and Wood Mallesons’ Dispute Resolution Group

Background

On September 24, China International Economic and Trade Arbitration Commission (“CIETAC”) launched its Hong Kong Arbitration Center (“the Center”) as its first branch outside mainland China. This is a significant step taken by CIETAC in its plan to expand globally.

CIETAC, established in 1956, is the dominant arbitration institution in mainland China and one of the main arbitration institutions in the Asian-Pacific region. For Chinese enterprises, CIETAC is their first choice for an international arbitral institution due to historical and practical reasons.
Continue Reading New Choice for Mainland-Related International Arbitration—Establishment of the China International Economic and Trade Arbitration Commission Hong Kong Arbitration Center

By Ding Xianjie and Steven Yao Tang Lei King and Wood Mallesons’ Dispute Resolution Group

(1) Chaozhou Ge Lan Te Clothes Ltd. vs. Haochang Ltd. (Jiangxi High Court, No.19, 2007)

In this case, the Plaintiff not only brought a claim for protection of copyright, but also sought protection under the Anti-Unfair Competition Law. The Court of first instance held that generally a ‘well-known commodity’, should be identified based on the following elements: Familiarity of the disputed commodity to the relevant public, the timing, sales amount and percentage of market coverage of that commodity sold in the market, the extent of advertisement promotion, the scale of capital investment, the scope of geographical distribution, and authoritative awards received by the commodity, etc.
Continue Reading Protecting of Works of Applied Art under Chinese Judicial Practice(II)

By Ding Xianjie and Steven Yao Tang Lei King and Wood Mallesons’ Dispute Resolution Group

I. “Works of applied art” as defined under Chinese law

Under Chinese law, the term “works of applied art” originates from the Berne Convention for the Protection of Literary and Artistic Works (the “Berne Convention”), in which Article 2 and Article 7 state that all signatory countries should give at least a 25-year protection to works of applied art. After China joined the Berne Convention, the State Council of the People’s Republic of China promulgated the Provisions on the Implementation of the International Copyright Treaties in 1992 (the “1992 Provision”), in which Article 6 provides that the term of protection for foreign works of applied art shall be 25 years, commencing from the creation of the works. Other than the 1992 Provision, the term “works of applied art” is not mentioned in any law or regulation, including the Copyright Law of the People’s Republic of China (the “Copyright Law”) and its implementing regulations.
Continue Reading Protecting of Works of Applied Art under Chinese Judicial Practice(I)

By Monique Carroll and Ariel Ye King & Wood Mallesons’ Dispute Resolution Group

We recently wrote about how foreign investors can use investment treaties to protect investments made abroad from political risk[i]. ‘Political risk’ in foreign investment is the risk that an investment will be adversely effected by a host country’s political or regulatory decisions. We now look more closely at how Chinese investors can gain investment treaty protection.

Whilst developed Western countries have historically been the greatest proponents of investment treaties, China has now entered into more investment treaties than any other country besides Germany. One can assume that the Chinese government’s motivation for agreeing to so many treaties is to increase the protections provided to Chinese investors abroad. It also signals a willingness to provide the same protections to investments made in China.
Continue Reading Guide to obtaining investment protection for Chinese investors

By Richard W. Wigley King & Wood Mallesons’ Intellectual Property Group

In China today, companies which have invested resources in developing their marks encounter numerous problems in protecting and enforcing their trademark rights.  First and foremost, they face counterfeiters who without authorization use their marks on the same or similar goods. In addition, certain companies or individuals will become “trademark pirates” or “trademark squatters” and register marks of a famous brand in China.  While some trademark pirates do this to “free ride” on the brand equity of the brand owner, some trademark squatters may do it in an attempt to “negotiate” payment from the brand owner in exchange for the mark.  However, if the holder of a mark in a foreign market contracts with an original equipment manufacturer (“OEM”) in China for the manufacture of goods bearing said mark solely for export where the rights to said mark in the P.R.C. are held by another entity, are such actions (i.e. the manufacture solely for export of said goods) an infringement upon the P.R.C. trademark holder’s rights?
Continue Reading China’s OEM’s Manufacturing Solely for Export receive Supreme People’s Court’s Guidance on what Constitutes Trademark “Use”

By Mia Qu King & Wood Mallesons’ IP Litigation Group  Shanghai Office.

As a result of the development of the biomedical industry and the Contract Research Organization (CRO) and Contract Manufacturing Organization (CMO) business models, China has become one of the most important outsourcing destination countries, acquiring considerable market share of the global outsourcing market. This paper aims to provide an overview of the intellectual property issues as related to biomedical outsourcing in the Chinese context.

I. Types of outsourcing and their respective legal relationships

In practice, there are many different types of possible relationships between pharmaceutical enterprises and CROs, for example: the revenue and risk sharing model, technology sharing model, cooperative management and development model, general research & development (R&D) model and technology service model.
Continue Reading Intellectual Property Issues of Biomedical Outsourcing in the PRC