25. The representative of China said that while his delegation welcomed the continuous interest in China's IPR situation and had listened carefully to the questions posed by the three Members, he was disappointed that the interventions this year did not differ very much from the ones in the past seven years, apart from the figures cited. His delegation had already stated at past debates that it had strong doubts about the credibility of these figures and their ability to reflect the real situation. In particular, the recent interventions by other developing country Members regarding the confusion of generic medicines and counterfeit medicines in some countries, and customs officials without enough IP expertise and without sufficient support by their IP experts cast further doubt on the reliability of customs figures. His delegation remained ready to further discuss these issues both bilaterally and multilaterally.
26. He also rejected some Members' assertions that China was trying to lower protection for IP because of the financial crisis. He said that he had never heard anything like the statements or notices the European Communities had referred to, neither from his superiors nor from provincial capitals, and he questioned by what intelligence any internal notices may have been obtained by Members. His delegation requested that the European Communities substantiate this assertion by sharing any documents, if that was not against their rules.
27. During the past twenty years China had done a lot to improve its IP protection, not purely in response to external pressures, but as a natural response to China's internal needs, in which IP protection figured as essential and extremely important for building an innovative society. At the same time, China remained open to listen and help other Members to resolve any problems they might have in China. Regarding assertions that companies had serious problems regarding expensive and time consuming civil procedures, he encouraged Members to share more detailed substantial information about these concerns with his delegation, so that the issue could be addressed through the bilateral and multilateral channels. However, his delegation could not respond to assertions that were not substantiated.
28. Another representative of China said that he would respond to the questions and concerns that had been raised under the TRIPS Transitional Review Mechanism. Regarding revisions to laws and regulations in the field of intellectual property rights in China, law enforcement measures and related statistics, he encouraged Members to refer to the information submitted by China under Annex 1A. As for the information not covered by Annex 1A, he referred Members to updates on the website http://www.gov.cn/ and the websites of the relevant government authorities. His remaining responses to Members' questions and concerns would be grouped under the following four headings: Part I: Patents and related questions; Part II: Trademarks and geographical indications; Part III: Copyrights and related questions; and Part IV: Enforcement.
Part I: Patents and related questions:
29. Regarding the examination and approval of assigning a patent or a patent application right to a foreign country, the relevant procedures were provided for in Article 10 of China's Patent Law on technology export, which had been formulated in accordance with the requirements of the Regulations on Technology Import and Export Administration of the People's Republic of China. He said that the present revision would cause no substantive change in these procedures as the revisions were confined to wording, aimed at achieving a more accurate expression of the provision.
30. Regarding the confidentiality examination on filing a patent application in a foreign country, he said that the revised Detailed Implementation Rules of the Patent Law and the Guidelines for Examination would specify the meaning of "the invention or utility model completed in China". According to Article 20(4), if a patent application for an invention or a utility model was filed in a foreign country in violation of the provision of paragraph 1 of this Article, no patent would be granted if a patent application was subsequently filed in China. The provision provided a ground for rejecting a patent application or declaring a patent invalid. Regarding compulsory licences, the revised Article 48(1) should be interpreted as imposing stricter conditions on the granting of a compulsory licence than before the revision, and would therefore reduce the possibility of issuing a compulsory licence. He said that the EC's understanding in this regard was not correct, as there was no stipulation for a so called automatic compulsory licence in China's Patent Law. The "public interest request", as was mentioned in Article 49 of China's Patent Law, was in conformity with the meaning of "in cases of public non commercial use" mentioned in Article 31 of the TRIPS Agreement.
31. The counterplea system concerning existing technology had been established under Article 62 of the revised Patent Law. It meant that, in a patent infringement dispute, if the accused infringer had evidence to prove that the technology or design he exploited was an existing technology or design, no patent infringement would be found. An accused infringer could therefore settle a burdensome dispute over patent rights without having to launch a counterplea or initiating a complex invalidation procedure. The patent right assessment report system for the utility model or design patent had been established in the second paragraph of Article 61 of the revised Patent Law. According to this system, the People's Court or the patent administrative authority could require the patentee or the interested parties to present a patent assessment report in an infringement dispute involving a utility model or design patent. Such a report would assess whether the patent right met the substantive conditions for granting the patent right, which would effectively prevent the right holder from abusing his rights.
32. With regard to the extension of the term of protection of patent rights, China's Patent Law stipulated the term of patent right protection for inventions to be twenty years, and the term of patent right protection for utility models and designs to be ten years. The patent rights terminated upon the expiration of its term and there was no extension of the term of protection for drugs and plant products.
33. As to the term of protection for test data, he said that Article 35 of the Provisions for Implementation of the PRC Law for Drug Control stipulated that "the State protects experimental data and other data that is self obtained, undisclosed and submitted by the manufacturer or seller who obtains the licence of manufacturing or selling the drug containing the new type of chemical composition. Nobody should put such undisclosed experimental data and other data into improper commercial use." Within a period of six years from the day when the manufacturer or seller obtained a licence for manufacturing or selling the drug containing a new chemical composition, the drug supervision and administration authorities would not grant a licence for manufacturing or selling that drug to other applicants who applied for the licence by using the same data without the consent of the applicant who had obtained a licence. This did not apply in cases where the other applicants had submitted their own self obtained data.
Part II: Trademarks and Geographical Indications
34. With respect to the length of trademark examination, he said that following the annual increase in registered trademarks the number of trademarks examined this year by China's trademark authorities had reached one million on 15 September 2009. China had adopted various means to improve the efficiency of trademark examination. In 2009, the time length of trademark examination was shortened from 30 months to 19 months.
35. In 2008, the State Administration of Industry and Commerce (SAIC) had received 17,518 trademark oppositions, of which 10,993 were concluded. He said that, at present, the delay for rulings on trademark oppositions was about 30 months. As for the cases of re examining rejected trademark applications, cases that had been submitted in June 2009 were now being heard so that the time from lodging an opposition to the substantive handling of the case was four months. With regard to cases of re examining trademark oppositions, cancelling re examinations, or trademark disputes, cases filed at the end of 2006 were now being heard, so that the time from lodging a trademark opposition to the substantive handling of such a case was 34 months. According to the rules and practices of the Trademark Review and Adjudication Board, the time from the initiation of substantive handling to the ruling on a case was six months.
36. Regarding joint examination of trademarks, in addition to the application for international registration of marks under the Madrid Agreement, the SAIC applied the principle of "one trademark, one class" to trademark registrations, and conducted a classification examination of trademarks.
37. Regarding well known trademarks, in the process of determining well known trademarks, the SAIC treated trademark owners from China and other countries equally and without discrimination. He said that local governments formulated the measures of determining and protecting famous trademarks based upon local conditions at the provincial level. Therefore, there was no unified national standard for determining famous trademarks and the level of protection for famous brands varied from region to region. As regarded the issue of "export brands", he said that the implementation of the programmes on export brands had already been stopped.
38. Regarding geographical indications, he said that the Chinese Government attached importance to their protection and had established its own geographic indication protection system based on China's national conditions and economic development level. The relevant authorities were actively working to improve the effectiveness of GI protection and China was seeking to strengthen cooperation with other Members in this regard.
39. With regard to GIs for agricultural products, he said that agricultural authorities would not accept GIs for agricultural products that had already been registered with the quality control authorities. Grounds for opposition to an application included the qualifications of the applicant, the scope of regional protection, the product name and the technical standards for quality control. Once a GI for an agricultural product had obtained protection from the agricultural authorities, the registration certificate was effective for a long term and needed no renewal if the registration conditions remained unchanged. The registration information on the agricultural product was open to the public in the GI registration process. Further information was available at the website http://www.aqsc.gov.cn./ The Ministry of Agriculture was further considering the formulation of Management Measures for the Registration and Protection of GIs of Agricultural Products from Foreign Countries in the People's Republic of China.
Part III: Copyrights and related questions
40. He said that the question of how to pay remuneration for the broadcasting of audio products between the time when the Copyright Law was put into effect in 2001 and the time when the Measures for Paying the Remuneration for the Broadcasting of Audio Products at Radio Stations and Television Stations would come into force would be addressed in those measures, which were still in the process of formulation.
41. Regarding the obligations of users of works and audio visual products, it was stipulated in Article 27 of the Copyright Collective Management Regulations that "Unless it is otherwise agreed in the licensing contract, the user should, when paying the royalties to the copyright collective management organization for the work or the audio visual product he uses, provide the name, the name or the title of the right holder and the means, amount, time and other information about its usage of the work or the audio visual product." Article 43 stipulated that in case of a violation of Article 27, where a user refused to provide or falsified information about the use, the copyright administrative department under the State Council would order the user to correct the information and the copyright collective management organization could discontinue the performance of the licensing contract. These stipulations showed that the user had a legal obligation to provide this information, and that failure to do so was sanctioned not only by the administrative authority's order to make the appropriate corrections, but also the possible discontinuation of the licensing contract by the copyright collective management organization.
42. With respect to the current revision of the Copyright Law, he said that this revision was related to the WTO Dispute Settlement Body, and that China was actively working in this regard.
Part IV: Enforcement
43. With regard to the pendency period of administrative cases concerning patents, trademarks or other intellectual property rights, the Administrative Litigation Law stipulated that period to be three months in the first instance, and two months at the appeals stage. He said that compared with other countries, Chinese courts were relatively efficient in this area.
44. With regard to the familiarity of judges with intellectual property law, most Chinese courts at or above the intermediate level had established special IP tribunals as early as the late 1990s and a number of judges familiar with intellectual property rights had already been given their posts. For instance, after the promulgation of the Provisions of the Supreme People's Court on the Jurisdiction over Administrative Cases Concerning Patent, Trademarks and other Authorized and Recognized IP Rights, the Beijing First Intermediate People's Court had posted six judges and eight judicial assistants to its IP tribunal.
45. With regard to the coordination between civil tribunals and intellectual property tribunals, in situations where the IP issues involved in a case under judicial review and in a civil case were the same and both cases were pending, if the trial of the civil tort case depended on the outcome of the judicial review, the civil tribunal could decide to suspend the trial of the civil case.
46. With regard to case initiation standards for criminal IP investigations, the Supreme People's Court and the Supreme People's Procuratorate had promulgated two Interpretations on Several Issues Concerning the Application of Law to Criminal IP Cases in 2004 and 2007, respectively. The Public Security Bureaus (PSB) of China dealt with criminal IP cases in accordance with these regulations.
47. With regard to the effectiveness of IP enforcement in China, he said that the information provided by China in Annex 1 of China's submission had demonstrated the effectiveness of such enforcement. Furthermore, in the dispute DS362 China – IPRs, the panel had not found the thresholds in the Chinese Criminal law to be inconsistent with WTO rules.
48. He said that after the Supreme People's Court and the Supreme People's Procuratorate had jointly promulgated the Judicial Interpretation on IP related Criminal Cases at the end of 2004, the number of IP related criminal cases accepted and heard by courts had increased considerably. In 2007, 3326 IP related criminal cases of first instance had been settled in local courts throughout the country. These decisions had been binding upon 5388 persons, out of which 5386 were convicted. Among the settled cases, 1657 persons had been convicted of IP infringement in 996 cases, 1040 persons had been convicted of producing and marketing fake or substandard commodities in 610 cases, and 2667 persons had been convicted of illegal business operations in 1707 cases.
49. With regard to the calculation methods for the criminal thresholds, he said that in accordance with the relevant provisions in the Interpretation on Several Issues Concerning the Application of Law to Criminal IP Cases jointly promulgated by the Supreme People's Court and the Supreme People's Procuratorate in December 2004, "sales revenues" and "value of the goods" should apply to different criminal IP cases. The concept of "sales revenues" applied to Article 214 of the Criminal Law and was prescribed in the Interpretation in that regard, while the concept of "value of the goods" applied to Articles 213, 215, 216 and 217 of the Criminal Law. In accordance with Article 12 of the Interpretation, the calculation of "value of the goods" did not exclude infringing products at the stages of "production, storage and transportation".
50. With regard to the export of counterfeit and pirated goods, he said that the TRIPS Agreement did not oblige Members to apply border measures with respect to exports and that, therefore, these IP enforcement actions of Chinese customs should not fall under the transitional review mechanism. In addition, IP infringement and international trade of counterfeit and pirated goods were not issues of one particular Members, but a problem facing all WTO Members. He emphasized that China had always paid special attention to its customs cooperation regarding IP protection with the United States, the European Communities, as well as with other Members, and had taken various measures in this regard. These included strengthening law enforcement regarding counterfeit and pirated goods exports, enhancing cooperation with foreign customs in law enforcement, as well as IP education of domestic manufacturers and exporters.
51. With regard to the commercial production and sale of optical disks containing pirated movies and music, the Copyright Law specifically stipulated "legal liability and enforcement measures" for IP infringement in Articles 46 to 52 of its Chapter V. All of these provisions were consistent with the current international rules for copyright. Right holders, who learnt of any commercial production and sale of optical disks containing pirated movies and music or other relevant activities, could seek remedies through the legal channels.