China ‘puzzled’ by EU SEP challenge
The EU has requested a dispute panel to resolve the issue | China argues against the “premature” bid, expressing “strong dissatisfaction” over the EU Commission’s actions.
China has refused to support the European Commission’s request to form an adjudicating panel at the World Trade Organization (WTO) as a quarrel over patents between the two continues to escalate.
In February, the European Commission—on behalf of the EU’s 27 members—launched a legal challenge at the WTO, arguing that China is restricting EU companies from protecting and using their patents.
The dispute concerns the legality of China restricting high-tech patent owners from accessing EU courts.
According to the Commission, EU companies are being deterred from protecting their standard-essential patents (SEP) in foreign courts and anti-suit injunctions—which Chinese courts began issuing in August 2020. These developments prevent patent owners from going to a non-Chinese court to enforce their patents, the Commission argued.
Earlier this month, the EU requested the formation of an adjudicating panel after attempts to resolve the dispute failed.
In response, China has said it “regretted and was puzzled by the EU move and was not in a position to support the panel request”.
In a summary of the WTO’s Dispute Settlement Body’s (DSB) meeting shared yesterday, December 20, the WTO said that its members had considered the EU’s request for a dispute panel.
"With regard to the issue at dispute, China said that it is neither the creator nor the major user of the anti-suit injunction and that the domestic courts of many WTO members, particularly in the EU, have issued a considerable number of injunctions in standard essential patents-related litigations,” said the summary.
According to China, the consultations with the EU were held in good faith and China has continued to engage with the EU after the consultations to attempt to resolve the dispute. In light of this, China said it is “premature” to establish a panel in the dispute.
China said it is “strongly dissatisfied” that the EU has brought this dispute before the WTO and that this move is not helpful in resolving the clash in a positive manner.
“China said it has fully engaged with the EU in good faith but that regrettably, the EU has chosen to request the establishment of a panel rather than continuing engagement with China bilaterally.
“Given the overall circumstance, China believes it is premature to establish a panel but remains open to further engagement with the EU,” said the summary.
The DSB took note of China’s statements and agreed to revert to the matter if a requesting member wished it to do so.
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