Good News in China – Faster Approval for Innovative New Drugs Is on the Way

For decades in China, patient access to overseas developed innovative drugs has been partially hampered by the requirement that data be supplied from clinical trials conducted in China (this after the innovator had already completed multiple phases of clinical trials in their country of origin).  Unfortunately, this requirement adds significantly to the time period for approval which can often take as long as eight years.  As a result, China’s Food and Drug Administration (CFDA) has a tremendous backlog of drug approval applications which, in June, stood at 6,000 (compared to a high of 22,000 in 2015).  As a result, between 2001 and 2016, regulators in developed markets approved 433 new drugs whereas China approved just over 100.   Taken together, all of this helps explain why a new drug often appears on the market in China anywhere from five to seven years later than in Europe or the U.S.

Earlier this month, the General Office of the Communist Party of China Central Committee and the General Office of the State Council issued a guideline that allows data from overseas clinical trials to be used directly in the innovative drug and medical device application process.  The guideline notes that companies looking to register innovative drugs or medical devices will need to provide clinical trial data related to any racial divergence relevant to the Chinese market.  Regardless, this change is significant and should considerably shorten the time period for approval of future drugs by several years.  However, one concern is that the guideline did not set a timetable for implementation.

The guideline also includes other measures to speed up approvals for clinically needed drugs and equipment, establish a compulsory licensing system and to make it easier for research institutions to conduct clinical trials.  Additionally, the Chinese government has said that it is also exploring a new system linking drug approvals to patent status (a patent linkage system). 

This announcement comes as China aims to boost its drug industry and shift from generic drugs towards more innovative medicines and medical equipment.  China has the second largest drug market next to the U.S.  The changes proposed by the guideline are intended to make China’s industry more competitive and help meet the clinical needs of its nearly 1.4 billion people, for whom high costs and access to health care are significant issues.

This post was written by Lisa Mueller.

Property Rights Protection Guideline Released in China

On November 27, 2016, China released a guideline outlining steps for the “better” protection of property rights (Guideline).  The Guideline is referred to as the “Opinion of the Central Committee of the Communist Party of China (CRC) and the State Council on improving the property rights protection (PRP) system and lawfully protecting property rights”.  Property rights in China include creditor’s rights, stock rights and intellectual property rights. 

The Guideline is the first state-level guideline on property rights protection and its purpose is to raise social confidence and promote justice in China.  While not rule of law, the Guideline is important as it is a centrally-issued policy.  Policy plays an enormously important and influential role in China and embodies and conveys certain values and often obtains broad results relatively quickly while final law is promulgated.

According to the Guideline, China will provide equal, comprehensive and law-based protection to all kinds of property rights, including intellectual property, and encourages the participation of the public in the process.  Although China has worked over the years to improve property rights, many problems still exist, including infringement on private property by public power (governments) and weak enforcement of intellectual property rights.  The Guideline states that securing property rights will help raise the public’s sense of wealth security, raise social confidence, foster positive expectations while raising the “impetus for entrepreneurship and innovation by various economic entities”.  Moreover, the Guideline further notes that improving such protection will facilitate social justice while maintaining healthy economic and social development.

According to the Guideline, the “essential strategy” that will be used to strengthen PRP is to “comprehensively” promote the “Rule of Law” (rather than the “Rule of Men”).  As a result, ten (10) tasks will be carried out.  One of these tasks involves reinforcing intellectual property (IP) rights (IPRs).  With respect to IPRs, the Guidelines lists several sub-tasks that need to be completed.  These include:

1.      Increasing punishment for infringement of IPRs as well as the upper limits of damages available once liability for such infringement has been established.  The Guideline states that the concept of punitive damages should be explored and established.  Moreover, compensation for infringement should also cover the reasonable expenses paid by the patent holder to stop the infringement.

2.      Establishing a mechanism to collect information on the source of counterfeit products.  Additionally, companies and individuals found to have infringed IPRs will have such information incorporated into their credit records.  Finally, improving the transparency of IP related administrative punishment procedures will be promoted.

3.      Improving the procedures of IPR trials and actively increasing the role of the intellectual property courts.  Moreover, the Guideline suggests consolidating three judicial procedures (civil, criminal and administrative) into one system to enhance the cooperation between administrative and criminal enforcement.

4.      Improving the enforcement mechanisms for foreign-originated intellectual property.  Specifically, the Guideline suggests strengthening the international cooperation of criminal enforcements and the intensity of investigations.  The Guideline suggests severely punishing those engaging in unfair competition in order to strengthen brand protection.  Finally, the Guideline suggests the combination of IP protection in IPR utilization in order to speed up IP transfer and transformation. 

It appears that courts in China are already beginning to implement some of the tasks outlined in the Guidance.  On December 8, 2016, the Beijing Intellectual Property Court (Court) issued a decision in favor of the patentee in a patent infringement action involving a patent claiming a USB key used by banks.  In its decision, the Court agreed with patentee’s claimed damages of 50 million RMB (about $7,241,969 U.S. dollars (USD)), including damages of 48,142,000 RMB (about $6,972,857 USD) calculated by multiplying the amount of each infringing product by a reasonable profit for each product, inferred damages of 858,000 RMB (about $124,272 USD) resulting from the defendant refusing to submit evidence of the volume of its sales as well as reasonable expenses of 1 million RMB (about $144,839 USD) incurred by the patentee in enforcing the patent.   

Please continue to watch the BRIC Wall Blog for further updates on the implementation of the Guidance in China.

This post was written by Lisa Mueller.


An Overview of the USTR’s 2016 Special 301 Report on the State of IPR in China

In this week’s post, the BRIC Wall Blog continues to examine the Office of the United States Trade Representative (USTR) 2016 Special 301 report (Report) reviewing the state of intellectual property rights (IPR) protection and enforcement in U.S. trading partners around the world. The Report details the results of extensive research and analysis, which led to placing eleven countries on the priority watch list and twenty-three on the watch list. China remains on the Priority Watch List, as the environment for protection and enforcement of IPR in China continues to be complex and contradictory. Surveys continue to indicate that many businesses chose not to offer their technology, goods, services, or investments in China. The choice was based on the obstacles that restrict foreign firms’ ability to fully participate in standards setting, the unnecessary introduction of inapposite competition concepts into intellectual property laws, and acute challenges in protecting and incentivizing the creation of pharmaceutical inventions and test data.

In the past year, China’s leadership developed draft reform measures on a range of subjects including copyrights, patents, trade secrets, drug review and approvals, Anti-Monopoly Law enforcement as it relates to intellectual property, and regulations on inventor remuneration. The State Council established the Office of the National Leading Group on the Fight Against IPR Infringement and Counterfeiting, currently chaired by Vice Premier Wang Yang. The group extended its online enforcement campaign in 2015 and has played a positive role in China’s IPR. Further, courts have been established in Beijing, Shanghai, and Guangzhou to study the merits of specialized intellectual property courts over a three year period.

Despite the reform measures, it is difficult to prevent the misappropriation of trade secrets due to deficiencies in China’s primary trade secrets law (found in the Anti Unfair Competition Law, or AUCL) that limit the law’s application; unresolved weaknesses in China’s civil enforcement system including limited injunctive relief and low damage awards; and difficulties in pursuing criminal enforcement, including the need to prove actual damages caused by the theft of trade secrets. In the Report, the U.S. urges China to consider drafting a stand-alone trade secrets law, which would provide an opportunity to address a broader range of concerns than possible as part of a reform to the AUCL.

The Report further indicates that the disclosure of critical intellectual property for foreign information and communication technology (ICT) products and services continues to be required as a condition of access to the Chinese market. The justification for this disclosure is purportedly for security measures. These measures were suspended in 2015, in response to strenuous objections from the U.S., other foreign governments, and the private sector. Furthermore, China’s draft counterterrorism law included provisions that appeared to require telecommunications business operators and Internet service providers to disclose critical proprietary intellectual property to regulators. Objection by the U.S. and others led China to remove some of the troubling aspects in the final version of the law. Similar concerns have arisen in China’s National Security Law and draft insurance sector regulations. The Report states that it is critical that China adhere to its commitments and not simply invoke security concerns in order to require the disclosure of critical intellectual property.

The Report also highlights the concern that certain government measures, policies, and practices that are purportedly intended to hasten China’s development into an innovative economy, instead put foreign right holders at a disadvantage. These measures appear to include the requirement that certain IPRs be developed in China or be owned or licensed to a Chinese party. Through engagement with the U.S., China has committed that:

  1. Technology transfer and technological cooperation shall be decided by businesses independently and will not be used by the Chinese government as a precondition for market access;
  2. It must treat intellectual property rights owned or developed in other countries the same as domestically owned or developed intellectual property rights; and
  3. Enterprises are free to base technology transfer decisions on business and market considerations, and are free to independently negotiate and decide whether and under what circumstances to assign or license intellectual property rights to affiliated or unaffiliated enterprises.

The Report states that the U.S. will continue to push back against existing measures that distort technology transfer.

Additionally, the Report states that online piracy and counterfeiting in China’s massive e-commerce continues to be a wide-spread problem, which results in great losses for U.S. right holders involved in the distribution of a wide array of trademarked products, as well as legitimate music, motion pictures, books and journals, video games, and software. The piracy extends to unauthorized access or copies of, scientific, technical, and medical publications as well. China has the largest internet user base in the world, with the annual sales of goods on the Internet projected at nearly half a trillion U.S. dollars. China’s State Administration for Industry and Commerce (SAIC) reported that more than 40 percent of goods that SAIC purchased online during a 2014 survey were “not genuine”. Furthermore, the USTR’s 2015 Notorious Markets List reported that China is the manufacturing hub of counterfeit products sold illicitly around the world. The effects of these counterfeit goods go beyond lost sales volume and harm to the reputations of U.S. trademark owners, as counterfeit goods potentially threaten the health and safety of consumers around the world. A positive development in 2015 was the reported removal of over 2.2 million unlicensed works at the request of the National Copyright Administration of China. In the Report, the U.S. urges China to accelerate the development of its E-Commerce Law and to ensure that it addresses online piracy and counterfeiting, while providing appropriate safeguards to Internet service providers.

Regarding patent related measures and policies, according to the Report, IPR and technological standards in China heighten U.S. concerns regarding a range of Chinese government policies and practices. Membership or participation rights to foreign parties have been denied by China, which prevent foreign parties from participating in the standards setting process. In addition, there is also the concern that patent holders may be forced to contribute proprietary technologies to standards (and to license them to implementers) against their will. The U.S. secured commitments in the 2015 U.S.-China Joint Commission on Commerce and Trade in which China stated that:

  1. It welcomed the participation of U.S.-invested firms in the development of national recommendatory and social organization standards in China on a non-discriminatory basis; and
  2. Licensing commitments for patents in voluntary standards should be made voluntarily and without government involvement in negotiations over such commitments, except as otherwise provided by legally binding measures.

The Report also disclosed the state of Anti-Monopoly Law (AML) enforcement. Specifically, it stated that Chinese competition authorities may target for investigation those foreign firms that hold IPRs that may be essential to the implementation of certain technological standards. In this regard, the U.S. has secured a number of commitments from China, including that:

  1. The objective of a competition policy is to promote consumer welfare and economic efficiency rather than promote individual competitors or industries;
  2. Enforcement of competition laws should be fair, objective, transparent, and non-discriminatory; and
  3. China’s AML enforcement agencies are to be free from intervention from other agencies in enforcement proceedings.

The Report further states that China also committed to attaching great importance to maintaining coherence in the rules related to IPR in the context of the AML, based on the pro-competitive effects of intellectual property licensing.

With regards to pharmaceutical patents, the Report states that China was once generally consistent in its review of patent applications with the U.S. and leading patent offices in other countries. However, an applicant’s ability to provide supplemental data in support of an application was severely restricted after revisions were made to the interpretations of the guidelines of the Chinese Patent Office. The revisions have resulted in the denial of patents and invalidation of patents that the U.S. and other jurisdictions have granted patent protection to in similar cases. According to the Report, China subsequently agreed to work with the U.S. to follow up on implementation of a revision of its policy on data supplementation in late 2013; however, industry generally reports only partial progress as a result of the change. Furthermore, the U.S. has concerns about the extent to which China provides effective protection against unfair commercial use of, unauthorized disclosure of, and reliance on, undisclosed data generated to obtain marketing approval for pharmaceutical products.

According to the Report, some of China’s proposals for reform appear to contain provisions that would provide regulatory incentives for companies to shift manufacturing to China or participate in selected national projects and programs. Proposals such as these may have lasting negative effects on promoting global innovation and would appear more consistent with forced technology transfer industrial policies.

Although there have been promising developments to IPR protection and enforcement in China, including repeated affirmation of the importance of intellectual property by China’s leadership, an ongoing intellectual property legal and regulatory reform effort, and encouraging developments in individual cases in China’s courts, the Report indicates that substantial issues remain.

In the next post, the BRIC Wall Blog will examine in detail the Report’s findings on the state of IPR in Algeria and Kuwait.

This post was written by Lisa Mueller and Kate Merath of Michael Best.

An Overview of the USTR’s 2016 Special 301 Report

On April 12, 2016, the Office of the United States Trade Representative (USTR) released its 2016 Special 301 Report (Report). The Report is an annual review of the state of intellectual property rights (IPR) protection and enforcement in U.S. trading partners around the world and is conducted by the Office pursuant to Section 182 of the Trade Act of 1974, as amended by the Omnibus Trade and Competitiveness Act of 1988, The Uruguay Round Agreements Act, and the Trade Facilitation and Trade Enforcement Act of 2015 (19 U.S.C. §2242).

The Report identifies a number of wide ranging concerns, including: (1) the deterioration in IPR protection and enforcement in several trading partners; (2) reported inadequacies in trade secret protection in China, India, and elsewhere; (3) troubling “indigenous innovation” policies that may unfairly disadvantage U.S. right holders in markets abroad; (4) the continuing challenges of online copyright piracy; (5) measures that impede market access for U.S. products embodying IPR and U.S. entities that rely upon IPR protection; and (6) other ongoing systemic IPR enforcement issues in many trading partners around the world.

During the 2016 Special 301 process, seventy-three (73) trading partners were reviewed. Following extensive research and analysis, eleven (11) countries were placed on the priority watch list and twenty-three (23) on the watch list. The countries on the priority watch list and watch list are as follows:

Priority Watch List












Watch List 







Costa Rica

Dominican Republic
















In the next series of posts, the BRIC Wall Blog will examine in detail the Report’s findings on the countries included on the priority watch list and watch list.

This post was written by Lisa Mueller.

Foreign Filing Restrictions and Licenses in China – Part 2

This is part 2 in our series examining foreign filing restrictions and licenses in the U.S. and in a number of countries throughout the world. To view part 1, foreign filing restrictions and licenses in the U.S., click here.

Foreign filing restrictions in China

A foreign filing license is always required in China. It is necessary as long as an invention or utility model is developed in China (inventions developed in Hong Kong, Macao and Taiwan are excluded), even if a domestic filing has been made first.

What constitutes “developed in China?” Rule 8 of the Implementing Regulations of the Patent Law (Implementing Regulations) provides some guidance. Specifically, according to this rule, an invention or utility model is considered to be “developed in China” if the “substantive contents” of the technical solution of the invention or utility model have been made or created by an inventor within China. The “substantive contents” of the technical solution can be determined based on the contents of the claims and identification of the inventors. According to Rule 13 of the Implementing Regulations, an “inventor” or “creator” is any person who makes “creative contributions” to the “substantive features” of the invention or creation. Inventors do not include those who solely provide organizational or auxiliary services or support.

According to Article 20.1 of Chinese Patent Law, the Chinese Patent Office (CPO, also known as State Intellectual Property Office of the People’s Republic of China, SIPO) must conduct a “Confidentiality Examination” of any invention or utility model developed in China in advance before an entity or individual files an application for a patent in a foreign country for the invention or utility model.

How is Confidentiality Examination requested?

There are three ways to request a Confidentiality Examination, depending on the type of patent application to be filed.

Method 1: Patent application intended to be filed abroad directly with no corresponding patent application to be filed at the CPO

An Applicant (such as an entity or individual filing a patent application) can file a request with the CPO, called a “Request for Confidentiality Examination of a Patent Application to be Filed Abroad,” and a description of the technical solution of the invention before filing a patent application with World Intellectual Property Office (WIPO) or in a foreign country. Both the request and the description of the technical solution must be in the Chinese language. Any corresponding documents, such as any patent applications to be filed abroad (which can be in their requisite foreign language), may also be submitted for the Examiner’s reference. The description of the technical solution must be identical with the contents of the documents (one or more patent applications) to be filed abroad.

If the technical solution does not need to be kept secret, then the Examiner is required to “promptly” notify the Applicant that the application can be filed abroad. If the technical solution needs to be kept secret, then the Examiner must inform the Applicant that the action of filing abroad will have to be suspended. If this is the result, the Examiner is required to conduct a further Confidentiality Examination.

The timeframe for the Confidentiality Examination is divided into two main parts. The first stage is a four month period, in which the Examiner conducts a preliminary review to determine if the invention is to remain confidential. The Examiner is required to issue a “Notification of Confidentiality Examination of Patent Application to be Filed Abroad” to the Applicant providing notification that further confidentiality review is needed. If such notification is not received within four months from the date of submitting the request, the Applicant can file a patent application for the technical solution in a foreign country. During the second stage of further confidentiality review, the review period will extend to six months from the date of submitting the original request. The Examiner is required to issue a “Decision on Confidentiality Examination of Patent Application to be Filed Abroad” based on the results of the further examination. If the Applicant does not receive this decision by the end of this six month review period, then the Applicant can file a patent application in a foreign country.

Practically speaking, it generally takes about two to four weeks from the date of request to receive a “Notification of Confidentiality Examination of Patent Application to be Filed Abroad.” Once this notification is received, the patent application can be filed in a foreign country. Additionally, under this method, no corresponding application is required to be filed in China.

Method 2: Patent application intended to be filed abroad at or after the corresponding Chinese patent application filed to the CPO

An Applicant can file a patent application in the CPO and request a Confidentiality Examination, at or after filing, prior to filing the application with WIPO or in a foreign country. As with the first case, the contents of the patent applications filed with the CPO and abroad must be identical and filed in the Chinese language. The four and six month periods for notification/decision apply under this procedure as well. Practically speaking, it generally takes about two to four weeks from the date of request to receive a “Notification of Confidentiality Examination of Patent Application to be Filed Abroad”. However, if a request for Confidentiality Examination is filed along with a patent application filing on the same day, the examination period may be shortened to two to five working days

Method 3: International application intended to be filed in the CPO through the Patent Cooperation Treaty (PCT)

An Applicant can file a Patent Cooperation Treaty (PCT) application in the CPO, with the CPO assuming the role as the Receiving Office. Such a request is considered to be a simultaneous request for Confidentiality Examination (a separate request for Confidentiality Examiner does not need to be filed). Under this procedure, at least one Applicant of the international application must have Chinese nationality or a residence in China. If the Applicant is not qualified to file the international application in the CPO, the CPO will forward the application documents directly to the International Bureau (IB), which is the Receiving Office for WIPO. Additionally, this procedure allows for the patent application to be submitted in either Chinese or English.

If the application does not need to be kept secret, then the Examiner handles the international application in accordance with typical PCT procedures. In other words, the CPO will issue a PCT/IB/304 form (“Notification Concerning Submission or Transmittal of Priority Document”) which indicates, among other things, that Confidentiality Examination has been completed. Once the Applicant receives the PCT/IB/304 form, it can file the patent application in a foreign patent office. Practically speaking it takes about four to six weeks to receive the PCT/IB/304 form (depending on how long it takes for the CPO to transmit the priority document to the International Bureau).

However, if the application needs to remain confidential, then the Examiner will issue a “Notification of Not Forwarding Record Copy and Search Copy for National Security Reasons” (Notification) within three months of the filing date. This Notification notifies the Applicant and the IB that the application will not be handled as an international application. The Notification also terminates the international phase and applicants are thereafter not permitted to file the patent application abroad.

Additional information regarding Confidentiality Examination

For each of the three methods of requesting Confidentiality Examination described above, if a patent application relates to the interests concerning national defense and is required to by kept secret, the application is sent to the National Defense Patent Office, which carries out the examination.

If it is believed that a patent application relates to security and other vital interests of China and should be kept secret, an Applicant should indicate such at the time of the filing of the application. In this instance, the patent application should be submitted in paper form (not via the electronic filing system). Additionally, an Applicant can also request that a patent application be kept secret before it is publically disclosed by the CPO.

If a patent application is filed electronically and the CPO determines that it must be kept secret (because the invention relates to the security or other vital interests of the country), examination will be conducted on paper and not using the electronic filing system.

There is no official fee for solely requesting a Confidentiality Examination. Approximately 99.9% of the cases received by the CPO have passed the Confidentiality Examination process and have been permitted to be filed in foreign countries.

The CPO conducts a review on the patent applications/patents to be kept secret every two years and is required to notify an Applicant of declassification of any applications/patents that are no longer required to be kept secret.

Processing after Declassification

When and if a patent application becomes declassified, it is examined and administered as a regular patent application for invention. When and if a granted patent becomes declassified, the decision on its declassification is announced and it is published and administered as a regular patent.


If a foreign filing license is not requested and the patent application is filed abroad, then a patent for the invention will not be granted in China. If the patent application is related to security or other vital state interests, then criminal penalties will result for the Applicant.

Strategic Considerations

Multinational corporations employing global research teams as a part of their research and development must carefully consider their patent application filing strategy for any inventions created and/or developed in China. Some items that should be considered include:

1. Allow yourself as much time as possible to draft your application (especially if you are aware of any impending statutory deadlines). Carefully consider all elements and features of the invention, any potential commercial products and your claiming strategy. For example, if only chemical intermediates were synthesized in China, consider whether or not your claims encompass such intermediates. If you are not claiming intermediates (and your claims do not broadly encompass any such intermediates), the invention may not be considered to have been developed in China and no request for Confidentiality Examination is required. Also allow yourself as much time as possible if, within a year after filing your patent application in China, you intend to add additional information and/or subject matter to your originally filed application.

2. Do a complete and thorough inventorship analysis.

3. Consider whether or not one or more foreign filing licenses will be required from another jurisdiction prior to filing in China. If your application also contains inventors from the U.S., India, Russia, etc., a request for a foreign filing license will be required prior to filing in China.

4. Consider filing a Chinese patent application along with a request for Confidentiality Examination, without paying the official fees for the Chinese patent application. Using this strategy, the period for Confidentiality Examination will be shortened to two to five working days. Because the official fees have not been paid, the Chinese patent application will be deemed as withdrawn and will not be published.

This post was written by Lisa Mueller and Himani Nadgauda of Michael Best and Aaron D. Hurvitz of Kangxin Partners, P.C.

Third Party Observations in China – Part 7 of an 8 Part Series

This is Part 7 of an 8-part series examining post-grant review proceedings, oppositions, and third party observations in the U.S., BRIC and several non-BRIC countries. To see Part 1, Post-Grant Oppositions in Japan, click here. To see Part 2, Third Party Submissions in Russia, click here. To see Part 3, Pre- and Post-Grant Oppositions in India, click here; To see Part 4, Third Party Submissions in the U.S., click here. To see Part 5, Third Party Submissions in Europe, click here. To see Part 6, Third Party Submissions in Brazil, click here.

Public Observations

Rule 48 of the Implementing Regulations of Chinese Patent Law provides that any person may, from the date of publication of an application for invention until the date announcing the grant of the patent right, submit observations to the State Intellectual Property Office (SIPO). Such third party submissions are referred to as “public observations”. Observations can be submitted by any person in its own name or anonymously (such as through a straw man).

Observations can be submitted for invention patents but not for utility model patents.   Any ground of rejection of a patent application can form the basis of an observation. Such grounds can include lack of novelty, lack of inventive step, sufficiency of disclosure, lack of unity, lack of clarity, ineligible subject matter, double patenting, etc.

SIPO has an official form that allows a third party to submit arguments forming the basis of the observations. This form can be submitted electronically, if desired. If a third party wishes to submit documentary evidence (such as evidence of patents, published applications, non-patent literature, etc.) supporting the observations, then the observations and accompanying evidence should be scanned in and submitted electronically. If any evidence is in a language other than Chinese or English, it is recommended that a Chinese translation be provided. There is no official fee for filing observations.

It is recommended that a third party submit observations as early in prosecution as possible (such as prior to issuance of an Office Action) to allow the Examiner sufficient time to consider the observations. A claim chart comparing the features of the claims with the prior art can be submitted to facilitate the Examiner’s understanding of the arguments submitted in the observations.

According to SIPO’s Guidelines for Patent Examination, the public will not be notified of the handling of any observations submitted. In fact, Examiners have discretion to consider observations once received. It is not known what criteria Examiner’s use to determine whether or not to consider observations once received. Additionally, SIPO does not provide any information on the effectiveness or success rate of such observations.

This post was written by Lisa Mueller and Feynman Z. Liang of the Jiaquan IP Law Firm

Revised Seed Law Expected to Come into Effect Soon in China

China has the second largest seed market in the world.  Annually, China uses roughly 12.5 million tons of planting seed. In 2012, the Ministry of Agriculture (MOA) estimated the seed market to be approximately RMB $104 billion (U.S. $17 billion) of which 65 percent was hybrid corn, hybrid rice, vegetable and fruit seeds.

China is in the process of revising its seed law in an effort to develop a stronger domestic seed industry. In January 2014, a revised draft seed law (Seed Law) was completed by the National People’s Congress (NPC) Agriculture and Rural Affairs Committee.  In August 2014, the draft was sent to the State Council for review.  It is expected that the Seed Law will be ready for reading by the Standing Committee of the NPC some time in April 2015.

The draft Seed Law is expected to improve the level of legal protections available for plant varieties.  For example, the draft Seed Law stipulates the content, ownership and grant conditions for plant variety protection (PVP) including application, examination, grant, implementation, infringement and exceptions, the period of protection, termination and invalidation.  Importantly, the draft increases the penalties for the infringement and counterfeiting (such as passing off).  Moreover, the draft reflects some of the advancements of the 1991 International Convention for the Protection of New Plant Varieties Union (UPOV Convention) such as extending the period of protection to 5 years, extending the object of protection from propagation material to receiving goods, etc.

Please watch the BRIC Wall Blog for further updates regarding China’s updated Seed Law.  This post was written by Lisa Mueller.