The State Council of the PRC recently approved the draft of Implementation Rules of the Patent Law (the “Rules”) on November 3, 2023 and formally released the new Rules on December 21, 2023. It has been more than 2 years since the amended Patent Law took effects. The new Rules will take effect on January 20, 2024. Although the CNIPA published the draft proposal for the revision of the Rules for public comment immediately after the adoption of the amendments to the Patent Law in 2020, the discussion and approval of the new Rules have taken for 3 years.
The new Rules is expected to be more compatible with the newly amended Patent Law and relevant international treaties that China has joined to fulfil its obligations and further integrate into the international patent protection system. In addition, the Rules also catch up with the pace of developments of the PRC patent system over the past 13 years1, for example, the electronic filing system.
Chang the design system and interface with Hague Agreement
On Feb 5, 2022, China acceded to the Hague Agreement Concerning the International Deposit of Industrial Designs (the “Hague Agreement”) and the Hague Agreement took effect in China on May 5, 2022. In preparation for joining the Hague Agreement, China has amended the articles concerning industrial designs of the Patent Law in order to be in conformity with the Hague Agreement. For example, the Patent Law has extended the patent term of industrial designs to 15 years.
The Hague Agreement specific chapter
In response to this change in circumstance, the Rules also introduce a specific chapter for rules made in accordance with the Hague procedures. This chapter contains the rules for filing an international application for industrial designs with the Chinese National Intellectual Property Administration (the “CNIPA”) and the procedures for the CNIPA reviewing the international application. In principle, the rules introduced here correspond to the articles of the Hague Agreement. The international registration date will be the filing date of the design, while the right for designs will be effective from the date of publication of the design by the CNIPA.
Other changes for designs
The Rules also changed or introduced some rules for design patents. First of all, the amended Patent Law further protects partial designs. Accordingly, the Rules detailed the requirements for filing documents of partial designs2.
In addition, as the amended Patent Law further allows design patent applications to claim domestic priorities, the Rules also detailed in this regard. If the prior application is an invention or a utility model, the applicant may file design applications based on the figures of the prior application. Of course, applicants of a prior design application may file further design applications based on the same subject matter of the prior design application. It should be noted that in the former case, the prior invention or utility model application will not be deemed as withdrawn if a design application claims its priority3.
Patent term compensation scheme
The patent term compensation scheme is one of the highlights of the amended Patent Law. The Rules also detailed in this regard. There are two types of compensations, the compensation for general invention patents and the compensation for new drug related patents.
Compensation for general invention patents
The Patentee shall apply for compensation within 3 months from the grant of the patent. For general invention patents, the term compensated is the actual delay during the application procedure of that patent. The Rules further specify the “unreasonable delay caused by the applicant” in the Patent Law, which are: 1) the applicant failed to respond to CNIPA communications in a timely manner; 2) the applicant requested a delay in examination; 3) incorporation by reference; 4) others. Furthermore the Rule also stipulate reasonable delays, which are 1) if a patent is granted after amendments during the re-examination procedure, the delays caused by re-examination procedure; 2) delays caused by examination interrupt caused by patent application right dispute and patent application reservation in civil litigations4.
Compensation for new drug related patents
The Rules also detailed patent term compensation rules for new drug related patents. The Rules defines the “new drug related patent” as patents related to the product patent, preparation method patent and medical usage patent. The patentee shall file the compensation request within 3 months from the date of obtaining the marketing approval for the new drug in China.
The Rules also provide a formula for calculating the compensation for relevant patents: Compensation = PRC drug administration approval date minus patent application date minus 5 years. In addition, the compensation shall be applied only once to one patent relating to one new drug.
In the draft Rules published for public comment, CNIPA clarifies for the first time the effects of a licence registration, which is against bona fide third parties. In the past, no patent-related rules and regulations specify the effects of a patent licence registration with the CNIPA. We have to refer to the trademark regulations to infer that a patent licence registration with the CNIPA may be used to against a bona fide third party. However, in the formal Rules, the authority remove such expression and again emphasize that a patent license shall be recorded within 3 months since the effective of the license contract.
On another aspect, the Rules also further detailed the provisions of the open licensing system, which was first introduced in the amended Patent Law to further promote the commercialisation of patents. The authorities are currently promoting open licensing among state-owned enterprises and institutions and are gradually establishing an open licensing information platform. We believe that in the foreseeable future, there will be a number of "dormant patents" will enter the open licensing mechanism.
Apart from the changes mentioned above, the Rules have also made some changes to catch up with the pace of development of the patent system in China.
Integrating the Electronic Filing System into specific rules
The current Rules was adopted in 2010, when the electronic filings only accounted for less than 7% of the total patent filing volumes. Now almost all the patent applications are filed via the electronic filing system. In response to this, the Rules also include some provisions regarding electronic filing.
The Rules further clarifies that the figure in the abstract shall be one of the figures to the specification. It thus excludes the possibility of submitting a new figure not included in the figures to the specification as the abstract figure.
Incorporation by reference
Previously, if either the claims or the specifications were missing in a patent application, the application was inadmissible before the CNIPA and no remedy was provided. The new Rules now provides that the applicant may submit the missing claims or specifications by incorporation by reference within 2 months from the filing date or within the time limit set by the CNIPA provided that a priority is claimed. After that, the original filing date is maintained.
The Rules introduces a 2-month period for restoring priorities. The applicant may request the restoration of the priority within 2 months from the date of expiry of the priority if he has just causes.
The Rules also revises the wording of some clauses to further conform to the newly amended Patent Act. In addition, the Rules also reflects the principle of honesty and good faith, and further emphasises the examination of the confidentiality of foreign applications.