Ten major impacts of the revision of the Detailed Rules for the Implementation of the Patent Law on patent practice

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This article mainly explains the ten potential impacts that may be brought about by the revision of the implementation rules of the Patent Law in 2023 on patent practice. ”

来源:IPRdaily中文网(iprdaily.cn)

Author: Pan Cong, Beijing Gao Wen Law Firm

On December 21, 2023, Decree No. 769 of the State Council promulgated the Decision of the State Council on Amending the Detailed Rules for the Implementation of the Patent Law of the People's Republic of China, and the revised Detailed Rules for the Implementation of the Patent Law will come into force on January 20, 2024. The timing of this revision is more than three years after the Patent Law of the People's Republic of China was amended and adopted on October 17, 2020. The revision and improvement of the implementation rules of the Patent Law is of great significance to the practical work of patents, and this article will explain the ten possible impacts from the perspective of business commonality.

PART01

The widespread application of the principle of good faith may increase the number of patent reexamination, invalidation and administrative litigation operations

The revision of the detailed rules for the implementation of the Patent Law introduces the principle of good faith into all aspects of preliminary examination, substantive examination, reexamination and invalidation, which is of great significance for cracking down on abnormal patent applications and encouraging real innovation activities.

However, in practice, there is also the possibility of being mistakenly hit by an irregular patent application. At present, in the practical process of abnormal patent applications, patent applicants are allowed to submit materials for explanation, and some cases may enter the normal trial stage through defense.

In the above scenario, if there are rejection cases in the preliminary and substantive examination stages, it will inevitably increase the number of patent reexamination and even administrative litigation cases. It remains to be seen how the court will view this if the parties to the litigation do not give in.

In the case of patent invalidation, it is foreseeable that the choice of Rule 11 as the ground for invalidation may become more common, which will also lead to business opportunities for administrative litigation. In fact, after the revision of the Patent Law in 2020, there have been cases in practice in which the "principle of good faith" in the first paragraph of Article 20 has been actively applied as a ground for invalidation. The Detailed Rules for the Implementation of the Patent Law take the initiative to include Article 11 as a new ground for invalidation, which in fact further strengthens the possibility of applying the reason for invalidation.

PART02

Examination of an apparent inventive step may reduce the grant rate of utility models and designs

Utility models and designs have traditionally been very easy to authorize, but since only preliminary examination is conducted, the probability of grant is extremely high. However, due to the fact that the annual and cumulative number of patent applications in mainland China has reached a very considerable scale, the patent administration department has increasingly encouraged the improvement of quality and efficiency in recent years.

However, due to the inertia of patent applications and the need for rapid acquisition of rights by enterprises, the number of utility model and design patent applications cannot be reversed in the short term. In this case, the introduction of a clear inventive step examination is of practical value in improving the quality of utility model and design patents.

On the one hand, the examination of obvious inventive step may reduce the grant rate of utility models and designs, and on the other hand, it may also lead to potential controversy.

According to Section 11 of Chapter 2 of Part 1 of the 2023 Patent Examination Guidelines, "the examination of inventive step shall refer to the provisions of Chapter 6, Section 4 of Part 4 of these Guidelines". In other words, the examination standard of obvious inventive step should refer to the examination standard of utility model patents in the invalidation procedure, especially in terms of the field and quantity of prior art, which should be more stringent than that of invention patents. However, in the review of actual cases, it may be difficult to make an objective evaluation of this matter, which may easily lead to disputes. It would not be beneficial for innovation to force a deliberate application of an apparent inventive step to reject a case simply in order to reduce the rate of granting utility models and designs.

PART03

Malicious filing of patent ownership litigation in an attempt to suspend proceedings will be regulated

When a plaintiff files a patent ownership lawsuit (including a patent right and a patent application right), in order to prevent accidents, it usually files a stay procedure with the CNIPA in order to suspend all administrative proceedings related to the patent in question. This situation is relatively common, but how to prevent the situation of malicious filing of patent ownership litigation is difficult to solve under the previous rules.

In particular, in the process of patent infringement or patent invalidation, it is very likely that a patent ownership lawsuit will occur, and the court or administrative adjudication authority will usually wait for the result of the patent invalidation trial before making a final infringement decision. However, if a patent ownership lawsuit occurs at this time, the patent invalidation procedure will be suspended, which may lead to an unexpected situation.

For example, if the plaintiff protects a large number of rights, it may suspend the patent invalidation proceedings initiated by the defendant through a false patent ownership lawsuit during the infringement lawsuit, resulting in the invalidation of the patent cannot be made in a timely manner, so that the plaintiff can take advantage of the delay time gap to obtain rights protection benefits. The defendant can also take advantage of the loopholes in the above system to suspend the invalidation procedure filed by itself in the infringement lawsuit, thereby delaying the patent infringement procedure.

Article 103 of the Detailed Rules adds that "if the patent administration department of the State Council considers that the reasons for suspension put forward by the parties are obviously unsustainable, it may not suspend the relevant procedures". The above content gives the CNIPA the right to make its own judgment, and when it is found that the other party has maliciously filed a patent ownership lawsuit in an attempt to suspend the procedure, it can use the above new provisions and provide corresponding evidence to protect its legitimate rights and interests.

PART04

The incentives and remuneration for service inventions have been increased, and reference will be made to the Law on Promoting the Transformation of Scientific and Technological Achievements

Article 93 of the Detailed Rules will raise the bonus for invention patents to no less than 4,000 yuan, and increase the bonus for utility model or design patents to no less than 1,500 yuan. As a result, the amount of incentives for service inventions has actually increased.

Rule 94 modifies the method of determining remuneration for service inventions, i.e., in the absence of an agreement, reasonable remuneration shall be given in accordance with the Law of the People's Republic of China on Promoting the Transformation of Scientific and Technological Achievements.

The Law on Promoting the Transformation of Scientific and Technological Achievements, revised in 2015 and currently in force, is oriented to "scientific and technological achievements", and its connotation is broader, and Article 45 of it mentions:

"Where the unit that completes scientific and technological achievements does not stipulate or agree with scientific and technological personnel on the method and amount of rewards and remuneration, rewards and remuneration shall be given to personnel who have made important contributions to the completion and transformation of scientific and technological achievements in accordance with the following standards:

(1) Where the scientific and technological achievements of the post are transferred or licensed to others for implementation, not less than 50% of the net income from the transfer or licensing of the scientific and technological achievements shall be withdrawn;

(2) Where the scientific and technological achievements of the post are used as investments, not less than 50 percent of the shares or capital contribution ratios formed by the scientific and technological achievements shall be withdrawn;

(3) Where the scientific and technological achievements of the post are implemented on their own or in cooperation with others, they shall be withdrawn from the operating profits of the scientific and technological achievements for three to five consecutive years after the implementation and transformation are successfully put into production, and the proportion of not less than 5% of the operating profits from the implementation of the scientific and technological achievements shall be extracted each year.

The methods and amounts of rewards and remuneration provided for by research and development institutions and institutions of higher learning established by the State or agreed upon with scientific and technological personnel shall comply with the standards provided for in items 1 through 3 of the preceding paragraph.

State-owned enterprises and public institutions in accordance with the provisions of this Law to give rewards and remuneration to personnel who have made important contributions to the completion or transformation of scientific and technological achievements in their positions shall be included in the total salary of the unit in the current year, but shall not be subject to the restrictions on the total salary of the unit in the current year and shall not be included in the total salary base of the unit. ”

It can be seen that the Law on Promoting the Transformation of Scientific and Technological Achievements actually provides greater support in terms of remuneration for technological achievements than the implementation rules of the Patent Law before the amendment. At present, the revised Patent Law Implementation Rules introduce the Law on Promoting the Transformation of Scientific and Technological Achievements as the basis for calculating remuneration by direct reference and application, which is of great value in subsequent litigation concerning rewards and remuneration for service inventions.

PART05

The declaration rules and filing system for open licenses are more detailed, and attention should be paid to contraindications

After the 2020 revision of the Patent Law, the open license system was added to Articles 50 and 51, and Article 85 of the Detailed Rules has been amended to stipulate the time for the patentee to submit an open license declaration (i.e., it should be submitted after the patent right is granted after the patent is announced) and the matters to be specified in the open license declaration (for example, the content of the open license declaration shall be accurate and clear, and no commercial promotional language shall appear).

Special attention should be paid to the contraindications of open licensing, i.e., Rule 86 mentions: "The patentee shall not grant an open license to a patent under any of the following circumstances:

(1) The patent right is within the validity period of an exclusive or exclusive license;

(2) the circumstances of suspension provided for in Articles 103 and 104 of these Detailed Rules (author's note: suspension of ownership and suspension of preservation);

(3) Failure to pay annual fees in accordance with regulations;

(4) The patent right is pledged without the consent of the pledgee;

(5) Other circumstances that impede the effective exploitation of the patent right. ”

In addition, Article 87 has been added to the Detailed Rules, which mentions that once an open license is reached, attention should be paid to filing with the CNIPA, that is, "where a patent exploitation license is obtained through an open license, the patentee or licensee shall file with the patent administration department of the State Council with a written document that can prove that the license has been reached." ”

PART06

The compensation system for the term of patent rights will make the calculation of the term of patent protection more complicated

Article 42 of the new Patent Law of 2020 stipulates two types of compensation for the term of patent rights, namely, the time limit compensation for late examination (which is relatively rare in practice) and the term compensation system for drug patents. The new "Chapter V Compensation for the Term of Patent Right" has been added to the Implementing Rules, which provides detailed provisions on the compensation for these two types of term compensation.

In terms of Patent Term Adjustment (PTA), Article 77 of these Detailed Rules mentions that "where a request for compensation for the term of a patent right is requested in accordance with the provisions of Paragraph 2 of Article 42 of the Patent Law, the patentee shall submit a request to the patent administration department of the State Council within three months from the date of announcement of the grant of the patent right." Articles 78 and 79 refer to the method of calculation of time limit compensation and the circumstances in which time limit compensation does not apply.

In particular, Article 78 mentions that "reasonable delay: (1) the delay caused by the reexamination procedure in the case of the grant of the patent right after amending the patent application documents in accordance with the provisions of Rule 66 of these Rules, (2) the delay caused by the circumstances specified in Articles 103 and 104 of these Rules (author's note: suspension of ownership and suspension of preservation), ;(3) delay caused by other reasonable circumstances." Article 79 mentions that "unreasonable delay caused by the applicant includes the following circumstances: (1) failure to reply to the notice issued by the patent administration department of the State Council within the specified time limit, (2) postponement of examination of the application, (3) delay caused by circumstances specified in Rule 45 (author's note: incorporation by reference due to erroneous submission of documents;(4) other unreasonable delay caused by the applicant." "In addition, in the case of same-day applications for inventions and utility models, due to the double-claim rule in one case, in the case of the granting of a utility model patent, the examination of the invention patent itself should be delayed, so the term of protection of the invention patent is not subject to compensation.

In terms of patent term extension (PTE), Articles 80 to 84 of the Detailed Rules refine the relevant provisions on patent term compensation for drugs. Among them, Article 80 mentions that "the term "new drug-related invention patents" as used in paragraph 3 of Article 42 of the Patent Law refers to patents for new drug products, preparation methods, and medicinal uses that meet the requirements. ”

Article 81 stipulates that "a request for compensation for the term of the invention patent right related to a new drug in accordance with the provisions of Paragraph 3 of Article 42 of the Patent Law shall meet the following requirements and be submitted to the patent administration department of the State Council within three months from the date on which the new drug is approved for marketing in China:

(1) If there are multiple patents for the new drug at the same time, the patentee can only request compensation for the patent term of one of the patents;

(2) If a patent involves multiple new drugs at the same time, only one new drug can be claimed for compensation for the term of the patent right;

(3) The patent is within the validity period and has not been compensated for the term of the invention patent related to the new drug. ”

Article 82 mentions that "where compensation for the term of a patent right is granted in accordance with the provisions of Paragraph 3 of Article 42 of the Patent Law, the compensation period shall be determined on the basis of complying with the provisions of Paragraph 3 of Article 42 of the Patent Law by subtracting five years from the interval between the date of application for the patent and the date on which the new drug is approved for marketing in China." ”

Article 83 mentions that "during the term of compensation for an invention patent related to a new drug, the scope of protection of the patent shall be limited to the technical solution related to the new drug and its approved indications, and within the scope of protection, the rights and obligations of the patentee shall be the same as before the compensation of the term of the patent right." ”

As a result of the relatively short examination period in the field of common technology in mainland China, the term compensation (PTA) for late examination may be relatively rare in practice. However, due to the particularity of the drug patent term compensation (PTE) system, it may be relatively common, and it is of great significance for the protection of drug-related patents in mainland China in conjunction with the drug patent linkage system. However, objectively, the compensation system for the term of patent rights will make the calculation of the term of patent protection more complicated, especially in the field of drugs, which is worthy of attention.

PART07

The alleged infringer may be the subject of a request for a patent evaluation report

Article 62 of the Detailed Rules mentions that "after the announcement of the decision to grant a patent for utility model or design, the patentee or the interested party or the alleged infringer as provided for in Article 666 of the Patent Law may request the patent administration department under the State Council to make a patent right evaluation report." The applicant may, at the time of registration of the patent right, request the patent administration department of the State Council to make a patent right evaluation report. ”

In other words, from now on, the alleged infringer can also be the subject of a request for a patent evaluation report, which was limited to the patentee and interested parties before that.

Since the patent evaluation report is usually required as the basic material for filing a case in the litigation procedure of utility model and design patents (the requirements for complaints filed by e-commerce platforms are similar), it is relatively rare for the alleged infringer to take the initiative to request the CNIPA to make a patent evaluation report in infringement litigation cases.

However, in practice, it is also possible for the patentee to warn the infringer through a lawyer's letter or other means, in which case the alleged infringer can not only file a lawsuit for confirmation of patent non-infringement, but also protect its rights and interests by requesting a patent evaluation report from the CNIPA. Once the patent evaluation report is negative, it can also be provided to the court as important evidence in a lawsuit to confirm non-infringement.

PART08

Examination of partial designs has been officially initiated and the number of applications will continue to increase

One of the highlights of the 2020 revision of the Patent Law was the introduction of a partial design system, both in response to the needs of innovative actors and in paving the way for accession to the Hague Agreement.

Article 30 of the Amendments to the Rules mentions that "where an application for a partial design patent is made, a view of the entire product shall be submitted, and the content of the part to be protected shall be indicated by a combination of dotted and solid lines or by other means." This provides guidance for drawing views of partial designs in practice.

Since enterprises have been allowed to apply for partial design patents after the revision of the Patent Law in the early stage, a large number of partial design patents have been stagnant even though they have been filed. At present, the issuance of the detailed rules and examination guidelines at the same time is bound to make a large number of partial design patents officially start the examination, and we will also see a large number of partial designs being granted patents, which is bound to attract widespread attention in the industry, and the number of applications can be expected to continue to increase.

In the specific operation link, it is believed that the examination criteria can be more clearly defined through actual cases on how to adjudicate partial designs. Correspondingly, the trial standards for subsequent administrative litigation and infringement litigation will also be gradually improved.

PART09

A patent for an invention or utility model may be used as a national priority text for a design

In practice, when making a patent layout, it is usually recommended that enterprises apply for a patent on the same technical subject as far as possible on the same day. Therefore, inventions, utility models and designs should be filed on the same day as far as possible to prevent the occurrence of conflicting applications, resulting in the risk of inventiveness of the patent.

However, Rule 35 of these Rules mentions that "if an applicant for a design patent claims national priority, and the earlier application is an invention or utility model patent application, he may file a design patent application with the same subject matter for the design shown in the drawings...... If the applicant claims national priority, the earlier application shall be deemed to be withdrawn from the date of filing of the later application, unless the applicant for a design patent requests that the patent application for invention or utility model be used as the basis for domestic priority. ”

This rule makes it possible for an invention or utility model patent to be used as a national priority document for a design, making it possible to file a patent application for an invention or utility model first and then add a design patent.

However, due to the relatively high requirements for views in design patents, if the prior invention or utility model patent cannot display various views of the design, there are doubts about whether the design of the subsequent application can be successfully granted, and subsequent cases need to be observed. At present, it is still recommended that enterprises apply on the same day, or try to provide as many different perspectives as possible in the invention or utility model patent to avoid potential risks.

PART10

The rules for pre-examination and ex officio review in the review procedure have been changed

The amendments to the Detailed Rules delete the relevant provisions on pre-examination in the original Article 62. In the past, in the pre-examination procedure, the original examiner usually made the pre-examination opinion. If the applicant does not make any amendments to the rights in the reexamination procedure or the modification is not significant, the probability of the pre-revocation is generally not too high, making the pre-procedure a mere formality. After this deletion, it provides a certain space for the improvement of the system of pre-procedure.

With regard to ex officio examination of the reexamination procedure, Article 67 of the Detailed Rules mentions that "if the Patent Reexamination Board of the Patent Administration Department of the State Council considers that the request for reexamination does not comply with the relevant provisions of the Patent Law and these Detailed Rules, or that the patent application has other obvious violations of the relevant provisions of the Patent Law and these Detailed Rules, it shall notify the person requesting the reexamination and require it to state its opinions within the specified time limit." If there is no reply within the time limit, the request for reexamination shall be deemed to be withdrawn; if the Patent Reexamination Board and the Patent Administration Department of the State Council find that it still does not comply with the relevant provisions of the Patent Law and these Detailed Rules after making a statement of opinion or making amendments, it shall make a reexamination decision to uphold the original decision of rejection and reject the request for reexamination. ”

Here, Article 67 of the Detailed Rules adds that "there are other obvious violations of the Patent Law and the relevant provisions of these Rules" in the patent application, which may expand the authority of the CNIPA to examine ex officio in the reexamination procedure. Although the "principle of request" and the "principle of ex officio examination" are the basic principles of the Patent Examination Guidelines regarding the trial of reexamination and invalidation cases, in practice, the situation of ex officio examination is not common. It remains to be seen whether this revision will break through the current way of handling in practice, and how such issues will be viewed in subsequent administrative litigation.

To sum up, this article mainly interprets the ten potential impacts that may be brought about by the revision of the implementation rules of the Patent Law in 2023 on patent practice. Due to space limitations, this article does not address issues that are less common in practice, such as problems with priority that lead to an application for restoration of priority or an increase in the right of correction (Rules 36 and 37), omission/interlacing of patent application documents leading to incorporation by reference (Rule 45), cancellation of the 15-day postal day for electronic filing (in practice, the calculation of postal days should be avoided as much as possible, otherwise the deadline will be disputed), Failure to request a review deadline leads to reinstatement of the application (which is not a major mistake in a well-managed agency), a novelty grace period (an expansion of the scope of academic conferences), and so on. This article is written by the author based on current research, and the views in the article only represent the author's views.

(Original title: Ten Impacts of the Revision of the Detailed Rules for the Implementation of the Patent Law on Patent Practice)

来源:IPRdaily中文网(iprdaily.cn)

Author: Pan Cong, Beijing Gao Wen Law Firm

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