Oil & Gas IP Summit: companies face China’s ‘great wall of patents’
A lawyer speaking at an oil and gas industry event has welcomed proposed changes to China’s patent law, but another specialist claimed foreign companies operating there still face the “great wall of patents”.
The proposals, discussed by Qing Xe of law firm Liu, Shen & Associates at the Oil & Gas IP Summit in London, yesterday (January 27), include relaxing the burden of proof that patent owners must meet when filing infringement claims.
They also include setting a new type of damages for infringement.
Meanwhile, in December China opened a court dedicated to IP disputes in Guangdong, and similar courts are expected to launch in Beijing and Shanghai later this year.
Xe said patent owners had become frustrated with the small level of damages awarded in infringement cases. She said they would typically expect to be rewarded between RMB 100,000 ($16,000) and RMB 1 million after patent victories, and between RMB 50,000 and RMB 100,000 following design infringement wins.
Under the current system, judges can only award “compensatory” damages based on the evidence supplied by claimants. But the proposed changes will mean judges can award “punitive” damages for “malicious” infringement, which Xe said is “typically two to three times more than compensatory damages”.
In addition, the burden of proof for claimants in patent infringement cases will be lowered, while the protection term for a design patent will be extended by 15 years, up from five.
But challenges remain for oil companies looking to do business in China, with one specialist (who did not want to be named) telling WIPR that while changes to China’s patent law are welcome, foreign companies face the “great wall of patents”. This refers to the high number of patents filed by Chinese companies in the sector.
She said: “The changes are helpful and they tinker with it [the law], but they do not help with the omnipresent position of Chinese oil companies in patent applications for the manufacturing and supply side of oil.”
She added that the number of patents makes it difficult for oil companies to calculate whether they will infringe existing patents in China.
The Oil & Gas IP Summit runs from January 27 to 28.
