The Greater China IP Updates ˇV April 2023

By Lyndon 

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Chinaˇ¦s Supreme Peopleˇ¦s Court Releases Draft Interpretation of Handling Criminal Case of Intellectual Property Infringement

On January 18, 2023, the Supreme Peopleˇ¦s Court issued the Interpretation on Several Issues Concerning the Application of Law in Handling Criminal Cases of Intellectual Property Infringement.  The Interpretation sets thresholds for determining criminal prosecution when the circumstances are serious enough to warrant such action.  Article 213 of the Amended Criminal Law states that using the same trademark as the registered trademark on the same commodity or service without the permission of the owner of the registered trademark, if the circumstances are serious, shall be sentenced to fixed-term imprisonment of not more than three years.  A fine may be imposed concurrently or solely; if the circumstances are particularly serious, a fixed-term imprisonment of not less than three years but not more than ten years shall be imposed, and a fine shall also be imposed.  The Interpretation gives more details as to what is defined as serious and particularly serious circumstances.  Firstly, if the amount of illegal income is more than 30,000 yuan or the amount of illegal business operations is 50,000 yuan, it will be considered as serious.   Secondly, if found guilty of counterfeiting two or more registered trademarks, and the amount of illegal income is more than 20,000 yuan or the amount of illegal business is more than 30,000 yuan, it will also be considered as serious.  When the amount of illegal gains or illegal business operations reaches ten times or more the amount stipulated in the above mentioned regulations, it shall be considered particularly serious circumstances entailing a more serious punishment.

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China Boosts Research and Development

The Australian Strategic Policy Institute recently issued a report comparing the research output of various countries after assessing the defense, space, energy and biotechnology sectors.  It was found that China now has a lead in 37 out of 44 critical and emerging technologies.  Although the U.S. ran a close second in many of the categories, China has benefitted from government funding to surge ahead in high-impact research.  The study, funded by the U.S. Department of State, said that in some fields, many of the worldˇ¦s top 10 research institutions are based in China.  The Institute tracked the most-cited scientific papers, which is a method that can indicate the most likely to result in patents.  For example, China generated almost 50% of the worldˇ¦s high-impact research papers about advanced aircraft engines, including hypersonic missiles, which has resulted in China taking the leading edge in the field.  In the fields of photonic sensors and quantum communication, Chinaˇ¦s research strength could result in it ˇ§going darkˇ¨ to the surveillance of Western intelligence, which has major security implications.  The study summarized that China was likely to emerge with a monopoly in 10 fields, including synthetic biology, 5G, electric batteries and nanomanufacturing.  The Chinese Academy of Sciences, a government research body, ranked first or second in most of the 44 technologies tracked, which spanned defense, space, robotics, energy, the environment, biotechnology, artificial intelligence, advanced materials and other technologies.  Some reliance on foreign research can still be seen in that 20% of the top Chinese researchers were trained in a Five Eyes Country (Australia, Canada, New Zealand, the U.K. and the U.S.).  Nevertheless, the U.S. led global research in high-performance computing, quantum computing, small satellites and vaccines.  The study concluded by recommending western countries to increase spending on research and favor international collaboration with security allies.

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China to Upgrade Status of the China National Intellectual Property Administration

On March 7, 2023, China released the 2023 State Council Institutional Reform Plan.  The National Peopleˇ¦s Congress (NPC) is set to approve the Reform Plan on March 9, 2023.  The Reform Plan will remove the China National Intellectual Property Administration from the State Administration of Market Regulation (SAMR) and make it a top-level agency under the State Council.  The SAMR will continue its enforcement of IP rights.  According to the Press Briefing, ˇ§the levels of creation, utilization, protection, management and service of intellectual property shall be comprehensively improved, and the National Intellectual Property Office administered by the State Administration for Market Regulation shall be adjusted to be directly under the State Council.  Law enforcement functions in such fields as trademarks and patents shall continue to be assumed by the SAMR, and the relevant law enforcement work shall be subject to the professional guidance of the CNIPA.ˇ¨  In addition, the Reform Plan proposes reorganizing the Ministry of Science and Technology and establishing a new National Data Administration under the National Development and Reform Commission.

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