On 3rd July 2020, the National People’s Congress (NPC) of the People’s Republic of China released a second draft of proposed amendments to the PRC Patent Law for public consultation. In response to opinions from various government authorities and experts, the second draft incorporates several important changes of note:

Partial design protection

The draft includes a leap in the definition of design to allow for protection of partial design (which currently only protects the design of a whole product). This is in fact not the first time such amendment has been proposed. The protection of partial design was first suggested in a 2015 draft Amendment, but was then omitted in a 2018 discussion draft of the NPC Standing Committee.

Design applicants will welcome the re-introduction of partial design protection, which closes the loophole to avoid infringement by copying only part of the design of a product. The software industry which files a substantial volume of graphical user interface (GUI) designs should also benefit greatly as currently a GUI itself cannot be filed as a standalone design application and must include the physical electronic device that carries the GUI.

The term of design protection is also proposed to be increased from 10 to 15 years.

Enhance protection for pharmaceutical patents

A proposed mechanism for patent term adjustment would be available for new drugs that are granted marketing approval in China. The maximum extension of patent term should not exceed 5 years and the maximum effective patent term after the launch of a new drug should not exceed 14 years.

The draft also includes a patent linkage regime that allows a patentee and a generic applicant for marketing approval to raise any patent infringement dispute judicially with a People’s Court or via administrative action with a government patent department. Once a decision is handed down (within 9 months from acceptance of the case), the application for marketing approval may then be similarly allowed or rejected accordingly.

Damages and liability for infringement

The statutory damages for patent infringement is proposed to be amended from the previous range of RMB10,000 to 1million to a proposed cap of RMB 5million (with the removal of the minimum damages). Punitive damages of up to 5 times of the assessed amount is also suggested.

The limitation period for patent infringement is to be amended to 3 years, in accordance with other changes in Chinese civil law.

The previous NPC draft proposed that an internet service provider should be jointly liable for any further damages caused by its refusal to delete and remove links to an infringing product. However, it is noteworthy that this provision is not included in the present draft.

Comments on the draft are due by 16 August 2020.