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China considers national IP court for appeals

China’s top lawmaking body is considering the establishment of a Supreme People’s Court to hear appeals on patent and other intellectual property rights.

The move, announced in last October, was expected after the 2014 move that established specialized IP courts in Beijing, Shanghai and Guangzhou. One expert said the court will be similar to the U.S. Court of Appeals for the Federal Circuit.

From regional to national scope

Currently, patent validity claims are heard on a regional basis by the Patent Re-examination Board of the State Intellectual Property Office. The new body, called the Intellectual Property Tribunal, will be within the Supreme People’s Court, making it national in focus.

The Intellectual Property Tribunal will focus on previous rulings dealing with:

  • Patents
  • Patent infringement
  • New plant species
  • Integrated circuit design
  • Trade secrets
  • Software
  • Anti-trust cases.

In addition, China is considering adding to the regional courts in Beijing, Shanghai and Guangzhou with new courts in Shenzhen, Wuhan, Nanjing, Suzhou and Chengdu. These courts will be staffed with judges with IP training and background.

IP a target of presidential ire

President Donald Trump has made intellectual property rights a key point in U.S./China trade relations, saying IP theft has cost the U.S. as much as $600 billion per year.

One common complaint is a quid pro quo system in which U.S. firms are forced to partner with Chinese firms to sell goods in China. That partnership leads to the transfer of technology. A 2015 paper by the Federal Reserve Bank of Minneapolis found that as of 2010, more than half of all technology owned by Chinese firms was obtained by quid pro quo.

Chinese officials dispute Trump’s claim and say IP royalties to the U.S. have risen for years.

In fact, some in China are concerned that Chinese companies will face harsh IP climates when they take China-developed products overseas. Chinese authorities have been counseling companies on how to avoid IP barriers in Europe, Japan and the U.S.

One report shows China’s State Intellectual Property Office received about 1.3 million applications in 2016, more than the offices in the U.S, Japan, South Korea and the European Union combined. The same report shows that in the same year, China’s ZTE, Huawei and BOE filed more patents than Qualcomm, Hewlett-Packard, Intel, LG and Samsung combined.

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