On 17 March 2018, the 13th National People's Congress of the People's Republic of China approved a restructuring plan proposed by the State Council (China's cabinet), which includes organisational and responsibility changes for organs of the State Intellectual Property Office (SIPO). The proposed restructuring of SIPO is considered to be a crucial step towards judicial IP reform in China, which was listed as one of the top priorities by President Xi Jinping last summer at the National Financial Work Conference. During the conference President Xi called on national authorities to enhance IP legislation, improve the quality and efficiency of examinations, and to accelerate the creation of IP protection regimes particularly for burgeoning fields of technology.
The main objective of the reorganisation is to strengthen and harmonise the management and enforcement of patent and trade mark rights by having them overseen by a single authority. One of the most significant changes resulting from the amendments to the Chinese Constitution is that SIPO will no longer directly report to the State Council. Instead, it will be a subordinate agency to a newly established State Market Regulatory Administration (SMRA), which integrates functions previously shared among separate IP administrative organs as well as and the role of supervising food and drug safety and the quality of industrial products. SMRA will also undertake competition policy responsibilities, which was previously apportioned across several different government departments.
According to the approved plan, SIPO will be playing an advisory role to a number of enforcement teams set up under SMRA, while retaining the responsibilities to prosecute and grant patent applications (including handling pre-grant proceedings and post-grant invalidation proceedings). Additionally, SIPO will take over examination and registration of trade marks and absorbing the functions of administering geographical indicators of product origin respectively from the State Administration for Industry & Commerce (SAIC) and the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ). The SAIC will be disbanded, and as a result its subordinates China Trademark Office (CTMO) and Trademark Review and Adjudicative Board (TRAB) will also cease to exist, with their duties to be assumed by SIPO or other branches of SMRA. The National Copyright Administration of China (NCAC) will remain a separate body, however, reporting directly to the Propaganda Department (also known as the Publicity Department) of the Chinese Communist Party.
It is reportedly expected that the consolidation of governmental resource will advance IP rights enforcement in particular, as overlapping enforcement can be streamlined by eliminating unnecessary duplicated tasks (for example in the event a company infringes both patent and trade mark rights at the same time). China's reorganisation of its IP bureaus also appears to be a bid to conform to the structure adopted in other foreign jurisdictions where patent and trade mark affairs are managed by a single governmental IP agency, such as at the United States Patent and Trademark Office (USPTO), Intellectual Property Office of the United Kingdom (UKIPO), the Japan Patent Office (JPO), and Korean Intellectual Property Office (KIPO). The changes therefore will not only help build a more efficient regulatory system, but also facilitate international liaison with other major IP offices.
Given the extent of the proposed reform, it is currently unclear how long implementation will take, but we can be certain that China fully understands the importance of IP in promoting entrepreneurship and innovation both domestically and internationally, and the government is making substantial progress in positioning itself as a serious player in the international stage in terms of IP enforcement.
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