CHINA IPR NEWS. CHINA IPR NEWS 1. Top 10 Domestic & Foreign Enterprises by Patent Grants in China 2012

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1 CHINA IPR NEWS 1. Top 10 Domestic & Foreign Enterprises by Patent Grants in China State Council Revises Copyright rules 2 CHINA IPR NEWS 1. Top 10 Domestic & Foreign Enterprises by Patent Grants in China 2012 Top 10 foreign enterprises in terms of invention patent grants in Web Platform for National Intellectual Property Talent information launched 2 TRADEMARK COLUMN The Application of Letter of Consent for Trademark in China 2 LAW COLUMN Discussion on the Pledge of Patent in China 3 Q and A China 5 Scenery of China 5 Top 10 domestic enterprises in terms of invention patent grants in 2012 (not including Taiwan, Hong Kong and Macao) Source: 1

2 2. State Council Revises Copyright Rules In accordance with the decision of the State Council on revising the Regulations for the Implementation of the Copyright Law of the People's Republic of China, whoever commits any infringement as listed in the Copyright Law which also prejudices the social or public interests, where the illegal business volume is over 50,000 Yuan (about USD8100), the administrative department for copyright may impose a fine of 1 to 5 times of the illegal business volume. This revision increases the fine from 3 times to 5 times and adds a lower limit of 1 time. If there is no illegal business volume or the illegal business volume is less than 50,000 Yuan, the maximum fine is raised from 100,000 Yuan to 250,000 Yuan. The State Council also revises the Regulations for the Protection of Information Network Transmission Rights. the clause of a fine of no more than 100,000 Yuan in Article 18 and Article 19 is revised to read where the illegal business volume is over 50,000 Yuan, a fine of 1 to 5 times the illegal business volume may be imposed. If there is no illegal business volume or the illegal business volume is less than 50,000 Yuan, a fine of no more than 250,000 Yuan may be imposed according to the infringement situation. According to the revised Regulations for Protection of Computer Software, for infringement act which also prejudices the social or public interests, the copyright administration department may order to cease infringements, confiscate illegal income, confiscate or destroy the infringing copies, and may impose a fine concurrently. Source: 3. Web Platform for National Intellectual Property Talent information launched Recently, the national intellectual property talent information website was officially lauched..(website: The public may search for information of IP experts and various kinds of talents through this website and get the latest news on work of the national IP talent. The built of the platform pushes the national IP talent information work to a new level. Currently, the platform includes information for expert consultation committee, expert database and leading talent. And, it also provides special column for talent working dynamic, national talent work policies and IP talent work policies. Source: TRADEMARK COLUMN The Application of Letter of Consent for Trademark in China Letter of consent is a written document signed by the owner of an earlier trademark consenting to the registration and the use of an identical or similar trademark, later filed by others on the same or similar goods or services. The letter of consent is acceptable to many IP Offices, for example, the USPTO and UKIPO. There are no express provisions in Chinese Trademark Law for Consent Agreement. However, in practice, the Trademark Review and Adjudication Aboard (hereinafter referred to as TRAB) have been keeping a pragmatic approach to the letter of consent and principally admit the validity of the letter when examining the review case for rejected mark applications. The TRAB had in many cases taken the letter of consent signed by the owner of the cited mark into consideration and concluded that the coexistence of the applicant s mark and the cited mark shall not lead to any confusion to the public, thereby preliminarily approved the registration of the applicant s mark. However, the letter of consent is not always acceptable and it shall satisfy certain requirements. Furthermore, whether the letter of consent could be used for all the review cases, whether it could resolve the conflict forever, need to be analyzed depending on the facts. By Jiayan Xie 2

3 1.Main contents of the letter of consent The letter of consent shall clearly indicate the name and address of the earlier owner and later applicant, the number of the earlier and later marks; the scope of goods or services on which the consent is given; the expression of consent to the registration as well as the use of the later mark (not just the registration), and the signature or seal of the earlier owner. 2.Notarization, legalization, translation of letter of consent If the earlier owner is a foreign company, the signed/ sealed letter of consent shall be notarized by local notary office and legalized by the Chinese embassy or consulate. Then the original documents, together with all the Chinese translations could be filed. If the owner of the cited mark is a Chinese company, it should be notarized. 3.Time limit for submitting the letter of consent According to the rules for review and adjudication, the supplementary evidences should be filed within 3 months after filing the review application, with the exception that the evidence is based on the new facts that occur after the expiration of the time limit or there is any other justifiable reason. In practice, the TRAB will give a period of time to the later applicant to negotiate with the earlier owner and to prepare the letter of consent. Normally a letter of consent could be accepted as long as it is filed before the substantial examination of the case. The applicant therefore has extra 5 to 6 months to process the letter of consent. 4.Conditions to the application of the Letter of consent 5.Possibility to obtain the letter of consent In practice, the owner of cited mark does not always consent to sign the letter of consent. But if differences exist on the goods or services, sales regions, consumers of the two parties, which means they have no or not obvious competitions, the earlier owner might provide their consent. Or, the parties have respective prior rights of trademarks in different countries or on different goods/ services, for a win-win purpose, they could provide the letter of consent to each other. In addition, the letter of consent may also bring some risks. For example, it may expose the mark to the earlier owners and alarm their actions of protection, or it may cost a large amount of money. And, the co-existence of the marks may also weaken the distinctiveness of the mark and the influence of the brand, which deserve to be carefully weighed. LAW COLUMN Discussion on the Pledge of Patent Right in China By Ming Ni 1.The relationship between the contract of patent pledge and the establishment of patent pledge Chinese law approximately adopts the mode of contract plus disclosure (delivery or registration) for the establishment of the security rights. Contract of setting the pledge of patent rights (hereinafter as Pledge Contract) is an important step for the establishment of pledge of patent (hereinafter as Pledge Right). If the applied mark and the cited mark are identical or very similar, the review examiner may possibly not approve its registration even if a Letter of Consent is submitted. Only when the two marks are not so similar and their co-existence will not cause confusion to the public, can the letter of consent be accepted by the examiner. 3

4 The Paragraph Clause 1 of Article 227 in Real Right Law stipulates that, In the case of the pledge of registered trademark rights, patent rights, copyrights or other property rights in the intellectual property, the parties concerned shall conclude a written contract, and the right of pledge shall be established when the relevant competent authority has registered the pledge. Therefore, Chinese Real Right Law clearly distinguishes Pledge Contract and the establishment of Pledge Right. Pledge Contract is a major method to set Pledge Right, and the establishment and the effectiveness of it shall be determined by Contract Law. However, although the establishment of Pledge Right is the consequence of the effectiveness of Pledge Contract, the effectiveness of the contract alone is not sufficient for the establishment of the right, and the procedure of pledge registration is necessary for this end. That is, pledge registration is an essential element for the establishment of a pledge, and such establishment shall be governed by Real Right Law. Such rules on Pledge Right in Real Right Law help to embody the principle of strict compliance with the contract, and also help to protect the interest of the party with good faith. A Pledge Contract shall come into effect once it is settled, so long as it does not violate the mandatory provisions of laws and regulations, and is within public interests. Both parties shall honor the Contract and the pledgee is entitled to register the pledge. In case the pledger refused to cooperate in the course of registration, it shall be deemed as in breach of the contract, and shall be held liable for the default. 2.The relationship between the registration of Patent Pledge and the establishment of Pledge Right cannot be established unless it is registered. This is to say, registration is an essential element for the establishment of such right. Pledge Right shall be deemed established since the date of its registration. China and Japan follow this mode. 3.The relationship between the registration of Patent Pledge and the delivery of patent certificate The Real Right Law stipulates that Pledge Right registration is the disclosure method for such right, and the transfer of patent certificate is not an essential for its effectiveness. Furthermore, the connection between patent certificate, registration, and disclosure in the Patent Law is not enough to signify that the transfer of certificate can effect as the disclosure method. Registration is the only method provided in the Real Right Law with regard to the disclosure method of Pledge Right. Patentee directly dominates all the rights it may have on patent, and opposes any other person. From the perspective of legal principle, this absolutely dominative right shall be disclosed to the public by a certain disclosure method. Since that, registration and disclosure are the ways to proclaim the patent right. The certificate can be deemed as the document to certify the right belonging to the patentee, rather than to set up such patent right. Therefore, regarding the disclosure of Pledge Right, registration is sufficient for that propose. Prospective relevant persons only have to inquire patent register to know the burden on the relevant patent right. The certificate is only used to prove that the patent right exists, and the transfer of the certificate cannot disclose the existence of Pledge Right on the patent right. Therefore, the patent certificate is obviously an ineffective method of disclosure. There are two basic modes of legislation on registration of the Pledge Right. One is registration antagonism, which is, Pledge Right will be established as soon as the Pledge Contract enters into effect, but an unregistered pledge shall not oppose the third party with good faith. The United States, France, the United Kingdom and Taiwan area of China adopt this mode. The other one is registration effectiveness, which means, besides the Pledge Contract settled between the two parties, a Pledge Right 4

5 Q and A China How many patent attorneys and patent agencies in China? How many patent applications were filed through patent agencies in 2012? From USA According to statistics of All-China Patent Agents Association( news_id=2876), as of February 28, 2013, there are 919 patent agencies and 7993 patent attorneys in China. In 2012, a total number of 2,051,000 patent applications were filed in China, of which 1,212,940 cases were filed through the patent agencies, accounted for 59%. (end) Scenery of China Wuyuan, Jiangxi Province As the most Beautiful Village in China, Wuyuan is located in the northeastern part of Jiangxi province. In March, the golden rape flowers are in full bloom in Wuyuan. (Photo taken by Yuejing Li on March 25, 2013) Copyright 2013 Deqi Intellectual Property Law Corporation. All Rights Reserved. Contact us: Tel: Fax: mail@deqi-iplc.com Address: 7/F, Xueyuan Internaional Tower, No. 1 Zhichuan Road, Haidian District, Beijing, P.R.China Postcode: Website: 5