China unveils new blueprint to protect intellectual property

China has unveiled a new blueprint for the protection of intellectual property rights over the next five years, pledging to effectively curb IPR infringement. The five-year plan announces goals for tougher legislation and stronger law enforcement in key sectors. The blueprint comes on the heels of a 15-year master plan released in September, which stated China’s aim of becoming a global leader in IPR protection by 2035. According to the document, China will enforce a punitive compensation system for IPR infringements to curb violations and improve the share of patent-intensive industries and copyright industries in GDP over the next five years. Amendments will be made to the patent, trademark, copyright and antitrust laws, and legislation regarding a product’s geographical indication and commercial secrets will be ramped up.

Shen Changyu, Director of the China National Intellectual Property Administration, said that the blueprint was a concrete road map for IPR development over the next five years. He said that major highlights include adherence to the philosophy that protecting IPR is protecting innovation, as well as laying the groundwork for a stronger protection mechanism across the board. With China’s booming online economy now requiring greater IPR protection, he said the Administration will coordinate efforts both online and offline and respond to challenges, such as the ease with which evidence related to infringement can be destroyed in the information age. The document calls for the improvement of the protective mechanisms covering emerging areas and new business models, including big data, artificial intelligence and gene technology, and aims to boost research into the formulation of data IPR protection regulations.

Protection for intangible cultural heritage will be stepped up, and stronger safeguards for sports, entertainment programs and live-streaming will be implemented. The government will also establish a damage evaluation mechanism for IPR infringements. China will launch a special program for data IPR protection, explore related legislation and promote amendments to relevant laws and regulations. According to the World Intellectual Property Organization (WIPO), China led the world in patent applications last year, with 1.5 million requests filed. The nation issued over 530,000 patents, up 17.1% year-on-year, the highest growth of all WIPO members.

Dong Yu, Executive Vice Dean of the China Institute for Development Planning at Tsinghua University, said IPR has become one of the key pillars of China’s high-quality development. Patent-dependent industries made up 11.6% of China’s GDP last year, with copyright industries accounting for 7.4%. “In addition to leveling the playing field for innovative businesses, a strong protective system will also help improve the consumer market and enhance protection of consumer rights,” Dong said. Yi Jiming, Director of the Institute for International Intellectual Property at Peking University, said the document seeks to better integrate IPR mechanisms with technological innovation and the industrial revolution to increase growth of emerging sectors. Wang Junlin, Partner at the Yingke Law Firm specializing in IPR, said the document will help China refine its punitive compensation mechanism to better solve problems such as the low cost of infringement and the high cost of rights protection. Wang said many smaller firms in China are still infringing IPRs due to a lack of awareness. A punitive compensation mechanism will raise public awareness on respecting IPR and punish severe violators. It will also bolster protection and increase people’s enthusiasm to stand up for their rights,” he added.

China will also play a proactive role in international rule-making concerning intellectual property rights. Gan Shaoning, Deputy Director of the China National Intellectual Property Administration, pledged to “offer equal protection for foreign businesses in China. In the meantime, we must also spearhead the protection of Chinese businesses overseas”. The five-year plan seeks to make it more convenient for Chinese businesses to register IPR overseas by introducing measures including the establishment of stronger international cooperation for IPR review services, an expanded network of rapid patent review, and cooperation in sharing new crop varieties. Guidance will be provided for cross-border e-commerce companies to better help businesses improve their capacity for handling overseas IPR risks, the China Daily reports.

China came first in several intellectual property indicators in 2020. Its patent filings increased 6.9% to nearly 1.5 million, far more than the United States, which ranked second with more than 597,000 applications. Japan took third place with more than 288,500 filings, according to the World Intellectual Property Organization (WIPO). The number of Chinese filings for utility models surpassed 2.9 million, taking up the lion’s share of applications worldwide. More than half of the world's applications for trademarks and industrial designs came from China. In plant varieties, China registered a double-digit year-on-year increase to 8,960 filings, accounting for close to 40% of applications worldwide. Followed by Germany, the U.S. and South Korea, China registered the fastest growth in the number of patents in force last year, reaching 3.1 million. There were more than 8,400 protected geographical indications in force in China last year, also leading the world.