On November 5th 2018, at the inauguration ceremony of the first-ever China International Import Expo held in Shanghai, President Xi Jinping reassured investors, especially foreign enterprises, on the administration’s determination to protect their intellectual property rights in China.
In the speech, President Xi announced that in order to significantly increase the cost of infringing IPR in China, a punitive damages system would be introduced. It is not the first time that the Chinese government has pledged to increase the deterrence effect of the current regimes against IPR infringement. In fact, proposals on introducing punitive damages have been given before, for example, in the draft 4th revision of the Chinese Patent Law which was issued for public consultation back in December 2015. However, now that President Xi has himself highlighted it in a speech, it may mean a change is coming soon.
In another big announcement, made last month by the de facto legislative body in China – the Standing Committee of the National People’s Congress, it was decreed that the Supreme People’s Court will shortly hear all patent appeal cases, as well as other more technical appeal cases such as those involving trade secrets and computer software. An Intellectual Property division dedicated to handling such appeal cases will be set up within the Supreme People’s Court and is planned to commence operations as soon as the start of 2019.
Although the sudden focusing of cases may place a sizable caseload on such a new court and really put it to the test, it is beyond doubt that such a centralization of appeals should enhance the quality and certainly the consistency of rulings on IP cases and hence strengthen the protection of IPR in China.