China to Abolish Patent Subsidies & Further Regulate Abnormal Patent Filings

China to Abolish Patent Subsidies & Further Regulate Abnormal Patent Filings

Update: VIDEO: China’s Move Against Patent Subsidies

This past January, the United States Patent and Trademark Office (USPTO) published the report, “Trademarks and Patents in China: The Impact of Non-Market Factors on Filing Trends and IP Systems,” which illustrates a record high volume of trademark and patent applications in China. The report indicates the influence of non-market factors such as “subsidies and government mandates” as a contributing factor to the volume, while also cautioning that subsidies likely encourage “parties to seek patents to receive the subsidy rather than to protect an innovation.”

Now, the China National Intellectual Property Administration (CNIPA) has announced that it will be ending those subsidies in a new notice. Additionally, it will be strictly enforcing new requirements and punitive measures to regulate abnormal patent applications. 

Founders Legal’s retained Chinese counsel, Chofn IP reports the latest measures from CNIPA below.

New CNIPA Requirements:

“(1) Any administrative evaluation on the patents should not be on the quantity of patent applications or quantity of granted patents, but more on the quality index;

(2) The patent subsidies at local administrative level should not be granted to pending patent applications. This must be totally abolished by June of 2021; and

(3) Only the granted invention patents (including granted overseas invention patents) may be entitled to patent subsidies, and the amount of subsidies will not exceed 50% of the official fees. Attorney’s fees and annuity fees will not be subsidized. However, this must be totally abolished before 2025.”

CNIPA Abnormal Patent Filings Factors:

“(1) The entities or individuals that file multiple patent applications having obviously the same contents;

(2) The entities or individuals filing multiple patent applications that obviously plagiarized existing prior art or prior designs;

(3) The entities or individuals filing multiple patent applications that contain simple substitutions of various materials, components, ratios, parts, etc.

(4) The entities or individuals filing multiple patent applications that contain obviously fabricated experimental data or technical effects;

(5) The entities or individuals filing multiple patent applications in which product shapes, product patterns or product colors are randomly generated by a computer;

(6) The entities or patent agencies that help the entities or individuals to file patent applications listed in (1) to (5) above.

(7) The entities or individuals that intentionally file inter-related patent applications separately, so as to increase the quantity of patent filings;

(8) The entities or individuals that file patent applications directed to technologies that are obviously inconsistent with their research and development capacities;

(9) The entities or individuals that purchase or sell patent applications in an abnormal manner; and

(10) The entities or individuals filing patent applications that contain embodiments which are obviously against the normal way of improving the technology, such as using a complex structures to achieve simple functions, or combining/stacking conventional features or simple features, etc.”

CNIPA Punitive Measures Against Abnormal Patent Filings:

“(1) No more reduction or waiver of official fees; any official fees that have been reduced or waived will be made up;

(2) The entities and their behaviors will be published on and criticized by the CNIPA website and China IP Newspaper;

(3) The abnormal patent filings will be deducted from the statistics in calculating the quantity of CN patent applications;

(4) The qualifications for applying for the titles or awards of national intellectual property exemplary enterprises or the like will be cancelled;

(5) The local IP offices shall not provide subsidies or awards to applicants and IP agencies filing abnormal patent applications; and even if the subsidies or awards have been issued, such need to be returned; and

(6) The local IP offices shall reinforce the investigation of patent agencies that file abnormal patent applications or disrupt normal patent work.

The above measures showed a strong resolution of CNIPA to adjust patent subsidy policies, so as to improve Chinese patent quality by 2025.”

Contact us for detailed assessments as to what this may mean for your IP rights in China. CLICK HERE TO REQUEST A FREE CONSULTATION.

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