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A closer look at the changes to China’s design patent system

Feng Xu of Panawell & Partners explains how the amendments to the Patent Law will impact the activity of domestic and foreign innovators

China's legislature, the Standing Committee of the National People's Congress, passed the fourth amendment to the Patent Law of the People's Republic of China on October 17 2020. The amended Patent Law (hereinafter referred to as the new Patent Law) will come into force on June 1 2021.

Different from Europe, Japan and other countries and regions adopting separate legislation on design, China has incorporated design within the framework of the patent law from the beginning. In this amendment, the new Patent Law has been substantially adapted to the existing design protection system.

To help domestic and foreign innovators and other industry professionals better understand the changes made in China's design system, this article presents a detailed overview of the latest developments in China's design system in four aspects.

Wider protection of designs

The current Patent Law stipulates that a part of a design (or 'a partial design') is not eligible for the design protection. For this reason, dotted lines are, in practice, generally not allowed in a hexagonal or three-dimensional view of a design, which is significantly different from the practice widely adopted in countries and regions like Europe, Japan, and the US. Therefore, it is often required that dotted lines in Chinese design applications claiming priority to these prior extraterritorial applications be traced or turned into solid lines.

Changes of the kind in design elements often cause disputes as to whether a prior extraterritorial application and its subsequent Chinese design application relate to the same subject matter, and this, in turn, affects the latter Chinese design application in its entitlement to the priority and in the determination of its actual filing date. Moreover, mere protection of the overall design incorporated in a product makes it impossible to effectively prevent competitors from imitating only the important elements of a design, and, thus weakens the force of the design protection system.


“This amendment, on the one hand, facilitates international cooperation and coordination, and better prepares China to access to the Hague Agreement”


Article 2 of the new Patent Law stipulates that "A design means any new design of the overall or partial shape, the pattern, or their combination, or the combination of the color with shape or pattern, of a product, which creates an aesthetic feeling and is fit for industrial application." The amendment makes partial designs officially patentable in China.

After the new Patent Law comes into force, domestic and foreign applicants are allowed to apply for the design patent protection for innovations made to parts of their products. In practice, they can show the unclaimed parts in dotted lines (or in other ways), and show the claimed ones in solid lines in the drawings of a design, so as to peep the practice consistent with those in countries and regions, such as Europe, Japan, and the US.

This, on the one hand, will reduce the schema or formal requirements on extraterritorial prior design applications 'landing' in China; and, on the other, eliminate the potential adverse effects caused by the institutional differences between China and the other major countries and regions in the patentable subject matter of the design patent. Furthermore, protection of partial designs incorporated in products will also boost the protection available under the design system and stimulate design innovations.

It should be pointed out that introduction of the partial design system will also possibly make parts of designs lacking novelty or inventiveness patentable, and thus abused. Consequently, it is necessary to work out, at a later stage, associated measures and institutional arrangements with respect to the ways in which parts of designs are examined, their patent rights confirmed, and the scope of protection of such patents reasonably determined.

It is conceivable that the scope of protection of a part of a design will be interpreted in the implementing regulations of the Patent Law or the relevant judicial interpretation to be issued by the Supreme People's Court, and the related provisions concerning the patent examination and grant will be clarified in the Patent Examination Guidelines.

Longer term of design patent

The current Patent Law stipulates that the term of the patent for design shall be 10 years, counted from the date of filing, a term that is significantly shorter than the maximum term of 25 years for the design patents in Europe and Japan. It also fails to meet the requirements of the Hague Agreement Concerning the International Registration of Industrial Designs (the Hague Agreement).

Besides, in respect of many products, it is increasingly common to determine the basic design, consolidate the brand image and inherit it on new products (e.g. family front for the same car brand in different models). So, the scenario is widespread where the protection of a patented design covers, or is inherited in, the design of a next-generation product of product and its next-next-generation. Therefore, from the perspective of the industry, there also exists a practical need for a lengthened term of the design patents.

Article 42 of the new Patent Law stipulates that "The term of the patent for design shall be fifteen years, counted from the date of filing." This amendment, on the one hand, facilitates international cooperation and coordination, and better prepares China to access to the Hague Agreement in the future, and, on the other, represents a positive response to the industry's call for lengthening the term of the design patent.

After the new Patent Law comes into force, domestic and foreign innovators, in the automotive and home appliance industries, for example, can utilise the longer term of the design patents to protect their unique product designs and to strengthening their brand repute. To this end, they need to consider the policy dividends brought by the longer term of the design patent when developing their strategies for patenting their new product designs and for protecting brand from counterfeiting products.

Domestic priority system put in place

The current Patent Law has set forth a domestic priority system for invention and utility model patent applications, which gives domestic applicants the right to file multiple invention and utility model patent applications together or to switch types of the applications.

In current practice, under the law provisions allowing similar designs to be filed together, an applicant can file a combined application for similar designs in China by claiming foreign priority after filing a design application abroad for the first time. However, since domestic priority is not applicable to design patent applications, an applicant who files a design patent in China and then files a design similar to it cannot claim domestic priority and combine the cases on that basis. In addition, after incorporating parts of a design into the claimed subject matter, many applicants are expected to demand conversion between an overall design and some part of it.

Lack of a domestic design priority system would render it difficult for domestic applications to achieve the conversion between an overall design and a part of it, something that is otherwise achievable based on the foreign priority, and the lack results in unequal rights available to the domestic and foreign applicants


“The revised law provision will not only make design dispute resolution more efficient, but also reduce the incidents of unnecessary design disputes”


For this reason, Article 29 of the new Patent Law stipulates that where – within six months from the date on which any applicant filed an application for a patent for a design for the first time in China – he or she files with the patent administration department under the State Council for an application of a patent for the same subject matter, he or she may enjoy the right of priority.

On the one hand, the amendment entitles domestic applicants to the equal rights now available only to foreign applicants, that is, with the help of the domestic priority system, allowing applicants to file a combination application for similar designs and change the subject matter claimed.

On the other, if China joins the Hague Agreement in the future, the established domestic priority system will leave a certain policy space. It would allow domestic applicants to submit Hague international applications and designate China, so that the same application will not be treated differently in connection with the domestic priority to which their entitlement now very much depends on the channels or route of application.

After the new Patent Law comes into force, foreign applicants need to pay attention to the newly introduced benchmarks for determining the domestic priority of designs and the filing strategy adopted by Chinese applicants. This is required to seek their domestic priority as this will certainly affect and change foreign applicants' way with respect to patent clearance and invalidation of patented designs in China. It is expected that the benchmarks for determining domestic priority will be specified and clarified in the Patent Examination Guidelines in the near future.

Patent evaluation report system improved

Since design patents are not subject to the substantive examination, the current Patent Law provides that where any patent infringement dispute involves a patent for design, the people's court or the administrative authority for patent affairs may ask the patentee or any other interested party to furnish an evaluation report on the patent, and use it as evidence in the patent infringement dispute proceedings.

In the current practice, since only patentees or any other interested parties (i.e. licensees) are supposed to furnish a design patent evaluation reports, and it is not quite compulsory for them to do so, cases often arise where right holders would abuse their design patents to hamper the normal production and operation of their competitors by means of litigation, administrative or e-commerce platform complaint.

Article 66 of the new Patent Law stipulates that "The patentee, interested party or alleged infringer may also take the initiative to furnish a patent evaluation report." With this amendment, alleged infringers are included in the list of those who can request the patent administration department under the State Council to issue a design patent evaluation report, thus making the patent evaluation report system procedurally more adequate and impartial, and making more channels or routes accessible to alleged infringers to confront patentees. The revised law provision will not only make design dispute resolution more efficient, but also reduce the incidents of unnecessary design disputes.

It should be pointed out that it is currently unclear as to how the new Patent Law will address certain issues in specific operations. This includes whether the design patent evaluation report can be issued only once, how a design patent evaluation report is issued if multiple parties request the patent administration department of the State Council to issue one at the same time or successively, and how reference materials from interested parties are to be dealt with. These specific stipulations are also expected to be spelt out in the Patent Examination Guidelines.

To conclude, this amendment to the Patent Law, with highlights on the design patent system, has further harmonised the system with international standards. Close attention will be paid to the following developments of the Patent Law amendments – for example, the supporting measures and systemic arrangements associated with the partial designs – and further analysis for domestic and foreign innovators and other industry professionals can be expected.

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Feng Xu

Partner
Panawell & Partners
T: +86 10 8525 3778 871
E: feng.xu@panawell.com

Feng Xu is a partner at Panawell & Partners, and joined the firm in 2017. He earlier worked at the Patent Examination Cooperation Center of the China National Intellectual Property Administration (CNIPA) as an examiner. He later started his career as a patent attorney and attorney-at-law at P C & Associates.

Feng specialises in patent drafting, prosecution, responding to office actions, handling reexamination, invalidation, litigation and infringement analysis in the field of mechanics.

Feng received his bachelor's degree in thermal energy and power engineering, and master's degree in power machinery and engineering from Huazhong University of Science and Technology.

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