The Thirteenth National People's Congress has released its second draft amendments to the Patent Law (the latest Draft) for comment on July 3, 2020, which is open for public comments until August 16, 2020. The latest draft includes many important issues that have long been debated, such as Patent Linkage and a Supplemental Protection Period. Amendments in the latest draft will improve the level of patent protection and improve the balance between patent protection and public interests.
Enhancement of patent protection is shown in the following articles (all articles numbers in this article is amended articles, namely consistent with the latest draft).
Patent Term Restoration (Article 42)
Article 42 remains the change in the first draft, which is released in 2019, to extend the term of design patents from ten to fifteen years. Although this protection period is still less than the period request by the Berne Convention for protection of works of applied art, namely twenty-five years (Article 7.4), it is still an improvement regarding intellectual property protection.
Moreover, according to Article 42, the patent owner may request the Patent Term Restoration (PTR) for unreasonable delay incurred when granting invention patents. Article 42 also provided PTR for patents on new drug inventions due to the time taken for the review and approval of new drug launches at the National Medical Products Association (NMPA).
Patent Linkage (Article 75)
Introducing patent linkage into the patent law is a significant change in the latest draft. Patent linkage benefits both originators and generic drug manufacturers by linking drug marketing approval to patent status of originator's products with a system. It can help original drug innovation and promote competition between originator and generic drug companies.
Under the proposed provision, a patent holder could challenge its competitors before the Court or the China National Intellectual Property Administration (CNIPA) within 30 days from the date on which the NMPA announces the drug application for permission of marketing authorization. Provided the Court of the CNIPA issued a judgement within nine months of accepting the complaint, the NMPA could grant approval if a chemical drug has passed its technical review.
Statute of limitation (Article 74)
The latest draft changed the statute of limitation for patent infringement from two years to three years. This is consistent with the general statute of limitations under the Civil Code of the People's Republic of China. The extension of the statute of limitation is also conducive to the enforcement of the patent owner's rights.
Further, the following changes highlighted the balance between patent owners, stakeholders and the public interest.
Statutory Compensation (Article 71)
The latest draft remains to increase the maximum amount of statutory compensation from one million yuan to five million yuan, same to the first draft. Additionally, the latest draft cancelled the lowest limit of 100,000 yuan. The cancellation of the lowest limit has incurred extended debate in the IP industry. Some argue that this is against the goal of strictly protecting intellectual property, while others argue that lacking the lowest limit could safeguard the rights and interests of small and medium market entities.
The cancellation of the lowest limit provides the Judge with a higher degree of discretion. Nevertheless, under the national goal of strengthening patent rights protection, this change is not likely to go against the goal of strictly protecting intellectual property in practice.
The special exception of "no loss of novelty"（Article 24）
The latest draft added a special exception to "no loss of novelty". Namely, if a patent is first disclosed for public interest when a national emergency or an extraordinary situation occurs, the patented invention does not lose its novelty during the six months prior to the filing date. This new exception is likely to be issued under the impact of Coronavirus Outbreak regarding drug disclosure.
Incentives of innovation (Article 2.4; Article 15)
The latest draft clarified in Article 2.4 that "partial shape, pattern or combination of products" can be protected as design patents, which helps to solve the problem that the protection of design patents under the current patent law has been limited to the entire product. Additionally, in Article 15, the State encourages inventors or designers to share reasonably the benefits of innovation.
The adaptation time and final content of the amended Patent Law are uncertain. We will keep monitoring and follow up on future changes.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
