213. Regarding questions on patents, in 2003, the number of patent applications filed by US applicants had been 12,221, while the number of Chinese applicants had been 251,238, among which 56,769 had been for inventions, 127,842 for utility models, while 86,627 had been for industrial designs. The statistics relevant to foreign applications in China was available in SIPO's annual report. The report could be browsed on the SIPO website. SIPO did not collect and compile data on foreign patent applications by types. No work was done on examination duration of foreign applications alone.
214. Pursuant to Article 23 and 45 of the Patent Law, any entities or individuals, including foreign nationals, could request a patent right to be declared invalid on the grounds that the patent for design was identical or similar to any design before the date of filing. In addition, pursuant to rule 79 and rule 86 of the implementing regulations of the Chinese Patent Law, where there was a dispute over the ownership of patent rights, the parties concerned could request administrative authority for patent affairs to mediate or institute legal proceedings with a People's Court. Where a People's Court or an administrative authority held that the ownership of the patent right should belong to the plaintiff, the plaintiff could request SIPO to make a registration of change in ownership of the patent right by producing an effective judgement or decision.
215. As for legal protection for layout-designs of integrated circuits, the regulations on protection of layout-designs of integrated circuits and its implementing rules had been promulgated and had come into effect a long time ago. The Supreme People's Court had also formulated a notice on trial of cases concerning layout-designs of integrated circuits, which provided the legal basis on the way of relief to protect the layout-designs of integrated circuits. Up to the present, there had not been any lawsuit on layout-designs of integrated circuits and SIPO had not received any request for settlement on disputes relating to them.
216. A State Food and Drug Administration (SFDA) was now conducting an investigation into the linkage between patent approval and drug approval processes. As for measures taken to protect undisclosed data, pursuant to paragraph 2 of Article 35 of the Implementation Rules on the Drug Law, the SFDA would not approve an application that was based on other applications' undisclosed experimental data. Pursuant to Article 14 of the Methods on Administration of Registration for Drugs, applicants should make a commitment that all the data to be provided had been obtained by themselves, when an application for drugs registration was submitted. Pursuant to Article 21 of the Method on Administration of Registration for Drugs, proof of legitimacy of source would be needed for submission of application for drugs registration if the data had been obtained abroad. Pursuant to Article 22 of the Method on Administration of Registration for Drugs, the SFDA had reserved the right to request the applicant to re-experiment, to prove that the data had been obtained by himself. Pursuant to Article 52, during the verifying period of approval for new drugs, technical requirements for new drugs would not be lowered even if the drug had already entered into the foreign market. That was to say there would be no dependence on data. The SFDA was obliged to keep secret only the experimental data which had been obtained by the applicant alone. Punishment would be exercised pursuant to Article 72 for the leakage of unreleased experimental data. Pursuant to paragraph 3 of Article 35 of the Implementation Rules on the Drug Law, the SFDA would accept applications concerned when public interests were involved or measures had been taken to ensure that the data would not be used for unjustified commercial purpose.
217. One of SIPO's key tasks was to tackle examination backlogs. After adoption of measures such as recruiting a large number of examiners on a continuous basis, updating the automation system and optimising the examination process etc., the average period of examination for patent applications for inventions by SIPO in 2003 had been 30 months., while from January to July in 2004, the average period had been further reduced to 28 months. Otherwise, SIPO had no statistics on the average period of examination in specific technical fields.
218. Regarding the protection of plant varieties, there was no specific plan to implement the UPOV 1991 Act. China had always been increasing the number of new varieties of plants under protection and expanding the scope of new varieties of plants under protection. This list of newly added varieties was available to the public on the website of the Ministry of Agricultural and the State Forestry Administration.
219. Regarding the prevention of misappropriated applications, pursuant to Article 23 and 45 of the Patent Law, any entity or individual including foreign nationals, could request a patent right to be declared invalid. In addition, pursuant to rule 79 and rule 86 of the implementing regulations of the Chinese Patent Law, where there had been a dispute over the ownership of patent rights, the parties concerned could request the administrative authority for patent affairs to mediate or institute legal proceedings with the People's Court.
220. Regarding the improvement of licensing regulations, Articles 24 and 25 of the Regulation on the Administration of Import and Export Technology were reasonable and did not contradict the TRIPS Agreement. Article 28.2 of the TRIPS Agreement provided that patent owners should also have the right to assign or transfer by succession a patent and to conclude licensing contracts. This provision granted the right of licensing patents to the patent owner. However, it did not mean that the licensor did not need to undertake any obligation and that he could license the patent without any restriction. As the transferor held the technology and should know the ownership and the capacity of the technology, it conformed to the principle of equity that the transferor was required to guarantee his legitimate ownership over the technology provided and to guarantee that the technology provided was capable of obtaining the contracted goal. It was also consistent with the principle of tort law that the transferor should bear tort liability if the transferee infringed legitimate rights and interests of others due to use of technology according to the contract. The laws on transfer of technology in many countries had similar provisions, so the said provisions conformed to the international usage and did not impose unreasonable restriction to the honest and bona fide transferor.
221. Turning to protection of trademarks and enterprise names, he first took up the issue of pending opposition and cancellation proceedings at the Trademark Office and their respective pendency. Currently, the Trademark Office of China had over 2,100 pending cancellation proceedings involving registered trademarks that had not been used for over three years and that the pendency was about one year. The office had 29,000 pending opposition proceedings and, in 2002 2003, the average pendency had been about two years. China was now revising its examination guidelines and would publish them after the revision.
222. Regarding the related goods and services in trademarks examination, the Office had adopted the concept of similar goods and services in this process. When examiners made a substantive examination on prior trademark rights, they made cross examination on similar goods or services in different classes. In determining whether they were similar goods or services, factors as the purpose, function and sales channel of the goods or services would be taken into consideration.
223. Turning to the determination of well-known marks, he said that, for the People's Court, the recognition of well-known trademarks was essentially the determination of the facts of the case which was a constituent part of jurisdiction exercised by the People's Court. The decisions made by the People's Court to determine a well-known trademark was in conformity with the international conventions. The Interpretation by the Supreme People's Court of the Application of Laws Dealing with Cases Concerning Dissension on Internet Domain Name and the Interpretation by the Supreme People's Court to the Application of Laws Dealing with Civil Cases Concerning Dissension on Trademark Rights made clear regulations on the issues above. According to statistics, since the amendment of the Trademark Law, Chinese courts had determined 17 well-known cases, three of which concerned foreign brands. According to Article 22 of the Interpretation by the Supreme People's Court on the Application of Laws Dealing with Civil Cases Concerning Dissension on Trademark Rights, the recognition of well-known trademarks should be based on the rules made in Article 14 of the Trademark Law. The People's Court would not verify the trademark when one party of the previous applied to protect a well-known trademark that had been determined by the concerned administrative authorities or by the People's Court, if the other party had no dissension on the well-known trademark concerned. If the other party submitted its dissension, the People's Court would make a re-verification according to Article 14 of the Trademark Law.
224. The Customs of China had no right to determine a well-known trademark if Courts or authorities of the SAIC had already determined a well-known trademark. On a request to the Customs to help enforcement, the Customs would assist in enforcement.
225. There had not been a commonly accepted practice in the recognition of well-known trademarks. However, the revised Trademark Law and its subsequent regulations made clear and detailed prescriptions on this matter, which were completely in conformity with the requirement of the TRIPS Agreement. Therefore, pursuant to these regulations, two factors would be taken as the standard for recognition of well-known trademarks when authorities of public security were dealing with the concerning criminal cases. First, pursuant to the provisions on the determination and protection for well-known marks by the SAIC and the Interpretation by the Supreme People's Court to the Application for Laws Dealing with Civil Cases Concerning Dissensions on Trademark Rights, the status of well-known trademarks should have been granted by the authorities of the SAIC or determined by the People's Court. Second, pursuant to Article 213-215 of the Criminal Law, a well-known trademark in the sense of the Criminal Law should be registered in the Trademark Bureau in China.
226. Turning to the protection of geographical indications ("GIs"), he said that the AQSIQ System of GI protection and the system of GI protection established by the China's Trademark Office in the form of collective and certification trademark were different intellectual property rights protection measures and that applicants could chose either of the two systems voluntarily for GI protection.
227. The State Council had endowed AQSIQ with both the function of general administration and law enforcement. AQSIQ had enforced GI protection for registered GIs (PDOs) in the light of the Law on the Quality of Products, the Law on Standardisation, the Regulations on the Product of Destination of Origin and a compulsory national standard entitled "The General Specifications on Product of Destination of Origin". Supervision and spot checks as well as other law enforcement measures had been taken against counterfeiting of such domestic GIs as Chinese Longjing tea, Shaoxing wine and Longkou Vermicelli. Sanctions were taken against the counterfeiting of Cognac wine in China.
228. In the light of the Law on the Quality of Products, quality and a technical supervision agencies could impose punishment on counterfeiting GI products, while consumers could impose civil liabilities on the misfeasor only in the light of the Law on the Quality of Products, and the Law on the Protection of Consumers' Rights.
229. The application for protection under the GI system of AQSIQ had been carried out on a voluntary basis. Applicants already possessing a trademark, certification or collective mark could also apply for GI protection under the GI system of AQSIQ voluntarily.
230. AQSIQ would follow an active and pragmatic approach to strengthen the communication and the cooperation on GI protection with other countries. Based on consensus between the two parties, AQSIQ and the Ministry of Productive Activities of Italy had signed a memorandum on bilateral cooperation regarding GI protection with a view to enhanced information exchanges and technical cooperation between the two parties.
231. The representative of China said that, since last year's transitional review, there had been no new rules on the protection of enterprise names. Ever since joining the Paris Convention, China had been strictly observing the principle of national treatment providing equal protection for domestic companies' trademarks and marks registered in China by foreign companies. He said that the saying that "foreign enterprises in China did not enjoy the same protection for their well-known marks as domestic enterprises in China" did not have any factual grounds. Since the implementation of provisions on determination and the protection of well-known marks on 1 June 2003, the Trademark Office and the Trademark Review and Adjudication Board had totally determined the status of 153 well-known marks, among which 24 were from abroad, 12 from the US, 12 from other Members. He said that if the registrant of a well-known mark needed a competent authority to determine his mark as well-known based upon the provision of Article 13 of the Trademark Law, he or she should, in line with Article 14 of the Trademark Law and the relevant provisions on the determination and the protection for well-known marks, submit written evidence which he or she believed could prove that his or her mark was well-known. Moreover, there was no uniform requirement for the content or formats of written documents. He said that recently a court in Tianjin had determined the Japanese mark YAMAHA as a well-known mark in a civil case ruling.
232. Turning to copyright issues, the representative of China said that, according to China's Copyright Law, copyright protection was the same even for works appearing in different media. Thus, whether distributed as hard publications or communicated as soft Internet content, all of them could be protected under the Copyright Law. At present, China was actively working on increasing the personnel involved in copyright enforcement.
233. In the Notice on 2004 Special Control Action of fighting against software piracy, the NCAC had explicitly demanded that the administration of enterprises' commercial use of software should be strengthened and that the enterprises which installed, or used pirated software in their computer system or which installed software beyond the scope prescribed in the purchaser's sale contract, should mend their act within a specific time. Otherwise they would be severely punished by the operation of law. Consequently, in case of using pirated software by a commercial institute, the copyright administrative department may impose penalty without a prior judgement of whether the act impaired public rights and interests or not. According to China's Copyright Law the use of pirated software in a Internet cafe was an infringing act, which was also prohibited by law. The "temporary reproduction" issue was being studied by the Chinese Government at present and would be properly dealt with in the Measures for the Protection for the Right of Communication through Information Network, which had been brought into the 2005 legislative agenda of the State Council.
234. Where an ISP did not remove the relevant content regardless of a copyright owner's notice or knowing that the Internet content provider infringed another copyright through network and where this omission impaired public rights or interests, the ISP should be liable for administrative infringement. The National Copyright Administration NCAC and the Ministry of Information Industries were drafting the Administrative Measures on the Protection of the Rights to Communication through Information Network, in which the administrative procedure of notice-and-take-down would probably be included to reduce network piracy. It was expected that these departmental rules would be issued by the end of 2004. According to China's laws and regulations, as well as future Administrative Measures on the Protection of the Right of Communication through Information Network, which was still in draft, the Ministry of Information Industries had the authority to revoke ISPs' business licences.
235. He said that, undoubtedly, China was cautious as well as active about the accession to the two new treaties, the WIPO Copyright Treaty ("WCT") and WIPO Performances and Phonograms Treaty ("WPPT") and China had made great efforts for this goal. The Administrative Measures on the Protection of the Right of Communication through Information Network was being drafted by the NCA and the Ministry of Information Industries and would be issued by the end of this year. In addition to effectively implementing the two new treaties to which China would accede, the State Council had brought these measures into its 2005 legislative agenda.
