Intellectual Property Protection in China (2005)
Mr. Mao Jinsheng
Director General, State Intellectual Property Office of China (SIPO)
In 2005, a noticeably great improvement was achieved in the field of intellectual property (IP) in China. Three kinds of patent applications accepted by the State Intellectual Property Office (the SIPO) amounted to more than 470 thousand, and the trademark registration applications accepted by Trademark Office (the TMO) under the State Administration for Industry and Commerce (SAIC) were more than 830 thousand. Vigorous reinforcement was made in copyright protection. Prominent effects were obtained in IP customs protection. The public security authorities and the cultural administrations comprehensively launched special campaigns. The protection of new varieties of plants was being perfected. IP judicial protection was strengthened thoroughly. The international exchange and cooperation in IP issues were observed increasingly frequent.
I. High-speed Increase in Patent Applications, Great Achievement in Patent Administration
In 2005, in order to further consummate the system of the patent laws and regulations, the SIPO conducted its preparatory research on the third amendment of the Patent Law and the amendment of the Guidelines for Examination. Meanwhile, the Methods on Compulsory Licensing of Patents related to Public Health was issued which provided a more comprehensive legal support to the possible problems occurring in compulsory licensing of patents related to public health.
In 2005, a total of 476,264 patent applications, and 2,438 PCT international patent applications were accepted by the SIPO. The patent applications in 2005 had the following features: (1) On the basis of the past five year’s successive increase with annual increase rate over 20%, the increase rate of the three kinds of patent applications, which numbered 34.6%, was the highest in the past 18 years. (2) The annual increase rate of domestic applications was 13% higher than that of foreign applications. (3) The increase rate of domestic invention patent applications was higher than that of foreign invention patent applications. The former was 42.1%, and the latter was 24.1%. And the domestic invention applications numbered 93,485, were greater than the foreign applications, which numbered 79,842.
In 2005, 214,003 patents were granted by the SIPO, an increase of 12.5% over 190,238 of 2004. Among the total granted patents, 171,619 were from domestic applicants, an increase of 13.4% over 151,328 of 2004, and 42,384 were from overseas applicants, an increase of 8.9% over 38,910 of 2004.
In 2005, patent administration departments at provincial levels across the country accepted 1,313 patent infringement cases and 284 other kinds of disputation cases. They also dealt with 362 cases of unauthorized use of others’ patents and 2,808 cases of patent counterfeits. In 2005, local patent administration departments dispatched 28,522 enforcing administrator times, checked 10,660 commercial premises and 8,918,943 pieces of goods. Also in this year, 15 cases were transferred to the public security authorities, 23 cases were accepted from other departments and 1,534 times of coordinated enforcement with other departments were launched.
In 2005, 269 applications for the registration of layout design of integrated circuits were received by the SIPO, an increase of 10.2% over the 244 of the previous year. 263 of them were registered and issued related public notices as well as certificates, an increase of 28.3% over 205 of the previous year.
II. Remarkable Progresses in Trademark Protection, Solid Achievements in Special Campaigns
In 2005, all kinds of trademark related applications had a continuous and substantive growth and amounted to 838 thousand, an increase of 76 thousand or 10% over 762 thousand of 2004. The number of trademark registration applications broke through 600 thousand, and came to 664 thousand. The number of applications for all kinds of trademark and trademark registration had maintained the first place of the world during the past four years.
In 2005, 664,017 trademark applications covering both goods and services were accepted by the TMO. Overseas trademark applications added up to 70,635 accounting for 10.63% of the total number, with an increase of 17% than that of 2004.
In 2005, 28,956 registered trademark renew applications, 15,107 registered trademark opposition applications, 52,499 registered trademark change applications, 51,645 registered trademark assignment applications, 6,007 registered trademark revocation & cancellation applications, 16,678 registered trademark licensing contract record applications were accepted by the TMO.
In 2005, there were 312,031 trademark registration applications examined and 258,532 applications approved by the TMO. A total of 39,991 registered trademark change applications, 37,169 registered trademark assignment applications, 24,346 registered trademark renew applications, 42,094 registered trademark revocation & cancellation applications, 2,699 trademark opposition adjudication applications, 13,490 registered trademark licensing contract on record applications were transacted.
In 2005, 177 well-known trademarks were granted by the TMO and the TRAB (Trademark Review & Adjudication Board) of the SAIC. Of these well-known trademarks, 136 were certified in the trademark management cases and 15 were in the registered trademark opposition cases (including one Madrid trademark international registration opposition case) by the TMO, and 26 were certified in the cases of disputes over ownership of trademark by the TRAB. And of the 177 well-known trademarks, 166 were for domestic enterprises and 11 were for foreign enterprises.
In 2005, there were 11,228 trademark review applications received by the TRAB. Of these applications, 8,753 were for review of dismission of trademark registration application, 276 were for review of cancellation of registered trademark, 935 were for review of trademark opposition adjudication, and 1,264 were for review of adjudication on disputation over registered trademark. Through the past year, there were 4,594 trademark review and/or adjudication cases handled by the TRAB. Of these handled cases, 4,050 were for review of dismission of trademark registration application and cancellation of registered trademark, and 544 were for review of trademark opposition adjudication and adjudication on disputation over registered trademark. In 2005, the TRAB acted as a party in 171 administrative litigations of first instance, as well as 86 administrative litigations of second instance.
Various levels of administrations for industry & commerce across the country further strengthened trademark administrative enforcement. A series of serious trademark related cases, which endangered the lives of the people, damaged the interests of the country, and disarranged the economic order of the society, were completely investigated and disposed. According to the statistics, 49,412 trademarks violation related cases covering different categories were investigated and dealt with by various levels of administrations for industry & commerce across the country. Of these cases, 6,770 were foreigner-related, an increase of 23.2% over 5,494 of 2004. And of total trademark related violation cases, 39,107 were trademark infringement & counterfeit involved, in addition to 10,305 normal trademark violations. In all disposed cases, about 5,078.75 pieces (sets) of trademark violation related marks were seized and ruined; 18,414 pieces (sets) of instruments—marks printing moulds and printing plates, etc.—specially used for trademark infringing were seized; 7,346.75 tons of violating goods were seized and destroyed; RMB 342 million was fined; 236 cases and 215 involved persons were transferred to judicial system for criminal liabilities.
In accordance with the State Council’s deployment of special operations on IP protection, the SAIC launched special operations for exclusion right of registered trademark protection in the whole country from July 2004. In the past four concentrated special actions of market regulation conducted in 2005, investigations and disposals were focused on the cases of foodstuff and leechdom trademark infringements, agriculture-involved trademark infringements, well-known trademark infringements by enterprises’ names and primary products trademark and geographical indication infringements. Consequently, the effects of the special operations were further strengthened.
III. Sound Combination of Supervision and Publicity, Vigorous Reinforcement in Copyright Protection
In 2005, cooperating with other related departments, the NCAC launched several campaigns including “Spring Special Crackdown on Pirated Discs”, “Special Crackdown on Pirated Audio-video Products” and “Special Crackdown on Internet Infringement and Piracy”. Meanwhile, copyright administrative management departments at all levels continued to strengthen their daily supervision and management in copyright market.
During the four-month special crackdown on Internet infringement and piracy, which was jointly launched by the NCAC, the Ministry of Public Security (the MPS) and the Ministry of Information Industry (the MII), the copyright administrative management departments at all levels, cooperating with local public security authorities and telecom management departments, investigated and dealt with 172 cases of Internet infringement, confiscating 39 servers used for infringement and piracy as well as illegal income valued RMB 32 thousand. Also in the campaign, 137 web sites were ordered to delete their infringing contents and 29 infringement web sites were ordered to pay the fine of RMB 789 thousand by the end of 2005. 18 suspected criminal cases were transferred to judicial authorities. 14 cases were reported by overseas copyright holders or their organizations, accounting for 50% of 28 important cases.
In 2005, 9,644 cases were received, and 9,380 of the cases, or 97%, were resolved by various levels of copyright administrative authorities across the country. Of all the resolved cases, 7,840 were resolved with administrative punishment, 1,174 were resolved with settlement agreement, and 366 were transferred to judicial authorities. And in the year, more than 107 million pieces of different kinds of pirated products were confiscated. Of all confiscated pirated products, more than 19.08 million were pirated books, about 1.14 million were pirated periodical magazines, 65.87 million were pirated audio-video products, 13.01 million were pirated electronic publications, 7.74 million were pirated software discs, and 90 thousand were other kinds of pirated products.
In 2005, the publicity of copyright protection maintained an in-depth development. In February, cooperating with the General Administration of Press and Publication as well as Beijing Municipal Government, the NCAC organized the activity ---“Keeping watch our home of spirit: the NCAC’s series activities of copyright protection” which was composed of various sections, for instance “A Hundred Singers Sing for Anti-piracy”, “Summit Forum of China Audio-video Copyright Protection” and so on. Also in this activity, China’s Anti-piracy Declaration of Audio-video products were announced. From March to April, in order to help the youth to build up right consciousness about copyright protection, the NCAC, cooperating with other related departments, conducted the activity of the thematic education on copyright protection for middle school students in the whole country---“Say No to the Piracy, I Can Do It”.
In accordance with the guidance of the State Council’s Lead Group of IP Protection and Sino-US Lead Group of Economy and Trade, the NACA and the MII jointly promulgated the Methods on Administrative Protection of Internet Copyright which was issued on April 30, 2005 and formally implemented on May 30.
To help the copyright holders and the public to understand the Regulations on the Collective Management of Copyright which was implemented on March 1, 2005 and to comprehend the system of the collective management of copyright, the NCAC devoted itself to the work of publicity and popularization. At the same time, the NCAC had completed the examination and approval of the re-registration of the China Copyright Society of Works of Music and of the China Copyright Collective Management Society of Audio-video Works by the end of the year, boosting the arrangement and establishment of other collective management organizations such as the China Copyright Society of Works of Literature.
Chinese government continued to strengthen the guidance for copyright trade in the year. The copyright administrative management departments at all levels accelerated the in-depth development of copyright trade by various ways. In the year of 2005, 9,382 items of books copyright were imported into the country by various presses. Comparatively 1,434 items of books copyright were exported and the sum had been observed the zenith for the past few years.
IV. Continuous Enhancement in Enforcement Capability, Prominent Effects in IP Customs Protection
In 2005, placing emphasis on the keystone of “improving the system, strengthening the cooperation, enhancing the capability, enlarging the effects”, Chinese customs offices further reinforced IP customs protection and achieved prominent effects.
In the year, new regulations which were published by the GACC, such as the Proclamation on Confiscation of IPRs Infringing GoodsWhere Relevant Party not be Identified,solved a series of problems about customs legal enforcement. In order to lighten the applicant’s burden in IP customs protection application and simplify the application procedures, the GACC organized the seminar on general security systemin IP customs protection and constituted the preliminary draft of related regulation.
During a decade’s development, the system of IP customs protection central record, which was founded in 1995, had obtained remarkable achievements in the past year. By the end of the year, the number of effective records in the GACC’s IP records database had amounted to 6,307. In 2005, 1,610 IP record applications were processed and 1,469 applications were approved by the GACC.
For the sake of effectively preventing infringement products from importing and exporting as well as continually strengthening international cooperation, the GACC and other country’s customs offices developed fruitful cooperation in the field of information exchange, enforcement training as well as the communication of enforcement experience and staff in 2005. A favorable transverse cooperative mechanism had been set up between the GACC and other IP enforcement administrations, including the Supreme People’s Court (the SPC), the MPS, the SAIC and the SIPO. Meanwhile, Chinese customs offices focused on communicating with enterprises so as to integrate IPRs holders’ information resources with customs enforcement resources. Consequently, potential infringement was effectually depressed and the enterprises were guided to establish their IPRs consciousness.
For the purpose of adapting to the IP customs enforcement requirements put forward by the development of foreign trade, the customs offices of China enhanced the capability and efficiency of checking and seizing infringement products through several improved methods. These methods included collecting information through multiple channels, intensifying consciousness of risk management, studying the changes of infringing tricks in import and export, confirming the major check points in advance, combining the verification of customs declaration materials and bills with the on-the-spot examination, as well as adopting advanced examination equipments extensively such as X-ray machines, etc. In 2005, Chinese customs’ attacks on the import-and-export infringements were more and more accurate.
In 2005, a total of 1,210 import and export IP infringement involved cases, valued RMB 99.78 million, were investigated and dealt with by the customs offices across the country, respective increases of 19% and 18.5% compared with those of 2004. Of these dealt with cases, 1,106 cases were trademark infringement involved, 37 cases were patent infringement involved, and 67 cases were copyright infringement involved. 51 cases were import involved and 1,159 cases were export involved. The structure of the major infringement products was the same as that of the past year. Identically, in the sum of the infringement goods, the sort of costume, footwear and headgear was in the first place and machinery & electronic products and light industry products were respectively in the second and third places.
The customs IP infringement cases mainly involved domestic and foreign prestigious trademarks. In the cases concerning the domestic brands, the Customs Offices of Ningbo city and Shanghai city seized 8,600 sewing machines, valued RMB 1.8 million, which infringed the registered trademark of “Butterfly”; the Customs of Shanghai city seized 2,040 televisions, valued RMB 1.2 million, which infringed the registered trademark of “Hair”; the Customs of Fuzhou city seized 12,575 gasoline generators, valued RMB 4,093 thousand, which infringed the trademark of “Tiger”; the Customs Offices of Xiamen city, Nanjing city and Hefei city seized the products, valued RMB 500 thousand, which infringed several registered trademarks held by China National Cereals, Oils & Foodstuffs Corp. (the COFCO). In the cases concerning foreign brands, the customs offices across the country seized the goods which infringed the trademarks of “NIKE”, “Adidas” and “NOKIA” many times in the year. In July 2005, the Customs Office of Xiamen city seized the exported counterfeit “ARIEL” washing powder which was produced by some company and totally amounted to 120 tons. In November, the Customs Office of Nanjing city discovered the infringement case in which 15 international famous trademarks were involved and 324 boxes of infringement goods including costume, lighters, etc. were seized.
Thanks to the strict control and effective supervision of the customs offices, numbers of trademark infringement and Olympic mark infringement cases discovered during the past years sharply decreased in 2005. The common victims included “Diamond”, “Tigerhead” and other trademarks held by Orient International Corp. and the COFCO. Presently, the IPRs consciousness of relevant enterprises especially those engaged in manufacturing trade was extremely strengthened. When they accepted the OEM orders, a great number of enterprises were able to initiatively inquire whether the contractors held the products’ IPRs or were licensed by IPRs holders. Consequently the unconscious IP infringement was avoided to some extent.
V. All-round Development of Special Campaigns, Gradual Standardization of the Audio-video Market
In 2005, cultural administration authorities throughout the country adopted effective measures to treat strict crackdown on illegal audio-video product businesses and improve the order of the audio-video market with remarkable effects achieved. According to the statistics, in the year, cultural administration authorities throughout the country dispatched over 4.49 million enforcing administrator times, confiscated over 136 million copies of pirated audio-video products and destroyed over 66.21 million copies (discs) of illegal audio-video products. The order of the audio-video market was gradually coming to standardization.
In 2005, the MOC supervised and disposed a series of serious cases in the field of pirated audio-video products. In the case of “4·15” Pirated Audio-video Products Distribution Networks in Sichuan province, over 10 distribution networks were discovered, more than 130 thousand copies of illegal audio-video products were confiscated and the major suspects were approved to be arrested by the procuratorate. In the case of “8·25” Pirated Audio-video Products in Zhejiang province, 4 underground storehouses were demolished, over 420 thousand copies of pirated audio-video products were confiscated and 4 suspects were captured in the act by local public security authorities.