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The challenge of technology

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Software patents are a controversial topic worldwide. Fang Liu of Leader Patent & Trademark Firm outlines the challenges in China

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When looking at global innovation activity and patent creation, the most active field should be information communications technology (ICT), which covers the communication industry, electronic information industry, internet and media industry. Competition around innovation among enterprises is gradually shifting from hardware to software. Product innovation by enterprises is now more focused on updating software functions. As of 2015, there have been millions of software-related patent applications over the world.

The World Intellectual Property Indicators Report published by WIPO indicates that the number of global patent applications in 2014 was 2.57 million, with the key fields in which software patents are involved accounting for at least 15%, such as communications, computers and measurement. The global IT companies ranked by the Institute of Electrical and Electronics Engineers according to their patent strength in 2015 are also those which have the largest number of patent applications in various technical fields. Many companies have accumulated more than 10,000 software patents over the years, and the patent applications of Chinese internet companies are rapidly increasing each year.

Software innovation can receive patent protection or copyright protection in China. For software innovation, although patent examination takes a relatively long time, patents are often chosen because of the strong protection that it offers. A large number of international companies also choose patent protection in China for the vast majority of their software inventions.

SIPO's regulations

The Guidelines for Patent Examination published by SIPO in 2002 provided process-themed patent protection for software inventions. To meet the needs of the industry for claiming rights, the Guidelines for Patent Examination 2006 not only continued to provide process-themed patent protection for software inventions, but also provided apparatus-themed patent protection.

This measure was carried forward in the Guidelines for Patent Examination 2010. Specifically, in addition to process-themed protection for software inventions, China adopted the rules of providing apparatus-themed protection for software inventions. Details are provided in paragraph 2 in Section 5.2, Chapter 9, Part II of the Guidelines for Patent Examination, which clearly states:


"A large number of international companies also choose patent protection in China for the vast majority of their software inventions"


If an apparatus claim is drafted on the basis of computer program flow completely and according to the way completely identical with and corresponding to each step in the said computer program flow, or according to the way completely identical with and corresponding to the process claim reflecting the said computer program flow, i.e., each component in the apparatus claim completely corresponds to each step in the said computer program flow or each step in the said process claim, then each component in the apparatus claim shall be regarded as function modules which are required to be built to realise each step in the said computer program flow or each step in the said method. The apparatus claim defined by such a group of function modules shall be regarded as the function module architecture to realise the said solution mainly through the computer program described in the description rather than physical apparatus to realise the said solution mainly through hardware.

This is a unique requirement on claims of patent protection for software inventions in China. According to the provisions of the Guidelines for Patent Examination, for the claim drafted in such a manner, the corresponding patent specification only needs to give the mode of execution of the software process, with no need for the diagram and mode of execution of the apparatus structure. The apparatus-themed claims applied by China's domestic companies based on their patents on software inventions have basically complied with the above requirements.

In addition, according to the provisions of the Guidelines for Patent Examination, in the case of apparatus protection involving software inventions, if the claim is not drafted in line with the above requirement, the relevant features may be regarded as functional limits, which may block the examination and subsequent grant.

Translation problems

A large number of software patent applications of foreign companies entering China, whether through the PCT system or Paris Convention, are based on the drafting requirements of the original countries and have then been translated into Chinese. These are likely to encounter problems with functional restrictions during examination and the grant may be blocked. The grant may be authorised with sufficient details about the specific mode of execution of the hardware and software in the specification; however, some types of software patent cannot be granted in China. For example, those covering storage media and programs are excluded from protection by the Chinese patent law. Some other patent applications of foreign companies entering China are clearly functionally restricted from the Chinese point of view because of the drafting in the original country or the translation in China.

This means that an applicant for this kind of patent will be asked to amend or delete claims on these areas or the application will be dismissed. For functionally restricted features, however, during patent infringement proceedings in China, Chinese courts will follow the rules of the Supreme Court for trial, and the Supreme Court has issued special provisions.

Article 4 of Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Patent Infringement Dispute Cases (the Interpretation) enacted by the Supreme People's Court of the People's Republic of China on January 1 2010 states:

For technical features described by function or effect in a claim, the People's Court shall determine the content of these technical features according to the specific mode of execution of the functions or effects described in the specification and drawings or an equivalent mode of execution.

This is consistent with related practice in the US and other countries.

A difficult relationship

From the perspective of drafting software patent applications or feature analysis, software is a machine language, with features of invention described with natural language, using the steps of the target language. The entire technology solution is outlined in each step, target or effect. Which kinds of features are technical features? Which are features of functional limit? With the further application of the mobile internet in various fields in China, as well as the government's decision to encourage innovation, more attention is being paid to the requirements of protecting software IP, which has also highlighted relevant issues. In other words, the rapid development of the mobile internet has increased the issues relating to software patents. SIPO experts and professionals are trying to promote the adjustment of the Guidelines for Patent Examination to adapt to the features of software patents.

The development of software technology, however, resembles the relationship between the circuit composed by separate components and the development of an integrated circuit. As some software function modules are gradually improved and popularised, more functions may correspond to various known software function modules. It is likely that specific technical features may correspond to the features of function effects, while software function modules corresponding to different function effects make up the innovative technical proposal. Examining patent applications, assessing the scope of trial, trying to definite patent infringement and patent protection lead to the following problems: Which target or effect feature has actually corresponded to the known software function modules, without submitting the algorithm of the module or internal disposal process in the claim or instructions, to make sure that the requirements of sufficient disclosure in the instruction are satisfied?


"The rapid development of the mobile internet has increased the issues relating to software patents"


For example, a hardware chip corresponding to an electric function can be found in the manual of a hardware chip before the application date. Therefore, the internal circuit structure of the chip is does not need to be given in the instruction for sufficient disclosure. Concerning the software invention claim, who can prove the feature of a certain target or effect is achieved by known software function modules? How can this be proven or checked?

Historically, the patent system began during the first period of industrialisation, namely the period of mechanical industry. Administrative examination, method and term of protection and the court's examination system in relation to the entire patent were established according to the characteristics of mechanical industry. During the second period, which saw the rapid development of electrical and chemical engineering, the patent system was improved and enriched, and the original system of patent protection was basically followed in most areas of the electrical industry, compared with the features of mechanical industry. Some features of invention in the chemical industry had not been available during the period of mechanical industrialisation. Thus, new content that did not exist in mechanical industry was added to chemical industry to enrich the patent system.

With the approach of the third period of industrialisation, taking the information industry (software industry) as an example, software innovation is protected by patents and copyright in most countries. But for software technology and features of the software industry, it seems that patent and copyright protection is not well suited to the industry. Taken as a whole, software innovation is characterised by rapid updates and upgrades, which require shorter examination periods and quicker grants for patents rather than longer protection periods. Copyright only protects the expression of codes rather than innovative software. Therefore, there is no adequate system to protect the intellectual property of software inventions yet, and continuous disputes are caused by various problems. This problem has also aroused controversy in the US and some European countries. Experts should take more consideration of the protection of intellectual property relating to software innovation and devise applicable protective measures.

Fang Liu

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As the founder and senior partner of Leader Patent & Trademark Firm, Fang Liu heads Leader IP’s patent practice. She has engaged in IP matters for over 20 years and has extensive experience in patent drafting, infringement prosecution, invalidation, and consulting. Fang specialises in electronic engineering, telecommunications, network and mechanics.

Fang actively participates in Chinese patent examination policy development and has also taken a key role in some public organisations in the field. She is the executive director of All-China Patent Agents Association, the Secretary General of the Internet Intellectual Property Organization, the Deputy Director of All-China Patent Agents Association Education and Training Committee and the Secretary General of National Intellectual Property Standardisation and Consulting Alliance.

A number of well-known cases handled by Fang Liu have been classified as typical cases by Supreme Judicial Court and Reexamination Board of the PRC, including the well-known WeChat patent dispute case, the TPK mobile phone touch panel patent dispute and the U disk case.


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