Many westerners are of the view that in China it is difficult to protect their innovations and, as a consequence, some businesses and people decide to conduct R&D and to file their patent and trademark applications outside of China. Recent advances should allay these fears, however.
The Chinese government established three specialist IP courts at the end of last year due to the huge increase in IP related cases. This great news means that the Chinese legal system will be able to conduct litigation more efficiently. The courts tried to be more transparent by publishing their cases and information online. Additionally, English translations of cases and documents are also being prepared so that international businesses can understand what is happening and how to make use of the courts. These specialized courts are a great development for IP in China and online publication provides useful tools for both local and international businesses. However, the new courts still have considerable room for improvement when compared to the much more mature IP court system in the West. If the courts continue to receive support and attention, the transparency will be an enduring boon.
Within China, the majority of the IP infringement cases (90%) are between Chinese entities. This indicates that Chinese people and businesses have a keen interest and understanding of IP protection and that they want to use legal methods to protect their innovations. This figure can also suggest that Chinese organizations are investing heavily in R&D that needs to be protected.
Furthermore, in disputes between a foreign entity and a Chinese entity, more than 70% of IP cases were won by the foreign entity. This surprising result might be due to the greater understanding of IP protection by the foreign participants or that they recruit better representatives who are more experienced in preparing for such cases. However, I feel this result also shows the courts are clearly not biased by nationalism as they do not favour Chinese litigants. That said, China needs to greatly increase the institutional capability to handle the new cases; there will be a huge demand for Chinese IP legal experts for a long time to come.
I hope that these figures reassure foreign businesses to invest in R&D in China. Businesses will benefit from respecting the cultural differences of the Chinese market, just as China is taking great efforts to increase the fairness of its legal system and to make investment hugely profitable.
The Chinese government established three specialist IP courts at the end of last year due to the huge increase in IP related cases. This great news means that the Chinese legal system will be able to conduct litigation more efficiently. The courts tried to be more transparent by publishing their cases and information online. Additionally, English translations of cases and documents are also being prepared so that international businesses can understand what is happening and how to make use of the courts. These specialized courts are a great development for IP in China and online publication provides useful tools for both local and international businesses. However, the new courts still have considerable room for improvement when compared to the much more mature IP court system in the West. If the courts continue to receive support and attention, the transparency will be an enduring boon.
Within China, the majority of the IP infringement cases (90%) are between Chinese entities. This indicates that Chinese people and businesses have a keen interest and understanding of IP protection and that they want to use legal methods to protect their innovations. This figure can also suggest that Chinese organizations are investing heavily in R&D that needs to be protected.
Furthermore, in disputes between a foreign entity and a Chinese entity, more than 70% of IP cases were won by the foreign entity. This surprising result might be due to the greater understanding of IP protection by the foreign participants or that they recruit better representatives who are more experienced in preparing for such cases. However, I feel this result also shows the courts are clearly not biased by nationalism as they do not favour Chinese litigants. That said, China needs to greatly increase the institutional capability to handle the new cases; there will be a huge demand for Chinese IP legal experts for a long time to come.
I hope that these figures reassure foreign businesses to invest in R&D in China. Businesses will benefit from respecting the cultural differences of the Chinese market, just as China is taking great efforts to increase the fairness of its legal system and to make investment hugely profitable.
References
Ward, A.M. Have the Chinese specialist IP courts made the grade? The IPKat
(retrieved 09/12/2015)
Cao, Y. Hearings of IP disputes exceed expectations. China Intellectual Property – China Daily
(retrieved 09/12/2015)
In my humble opinion, 30% of IP cases that Chinese entity won would be mainly associated with Chinese Utility Models. Actually, I have a headache about how to cope with the models - IPs without substantive examinations.
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