Commerce Ministry organises seminar on intellectual property

The Ministry of Commerce and Industry organised yesterday a workshop entitled ‘Patents and Registration Procedures’ with the participation of a number of intellectual property agents and interested members of the public.

The workshop comes within the framework of the Ministry’s efforts to protect and promote intellectual property rights, and to raise awareness among intellectual property agents and the public about the importance of registering and protecting patents against infringement by registering them at the concerned department at the Ministry. The workshop also shed light on how to register a patent electronically.

The event, attended by a number of experts from the Ministry, featured several topics including a general introduction to patents, the content of the patent application, and procedures relating to the registration of a patent application through the electronic registration system. The workshop concluded with a Q&A session during which experts from the Ministry answered questions regarding patents.


Patent law developments in China

From last year, with the improvement of China’s industrial technological level, as well as tremendous changes in the international competitive environment, China’s patent protection system and patent protection practices were also changed and adapted to the same. With an imminent drug patent link system, patent application ability is being continuously improved, the patent judicial protection system is being further perfected, the amount of infringement compensation has obviously risen, and the punitive damage standard of deliberate infringement is being strongly supported.

The number of patent litigation cases has increased significantly. In 2017, Chinese courts received 213,480 first-instance intellectual property (IP) cases and closed 202,970 cases in total, a rise of 46.04% and 43.13%, respectively from 2016, in which 16,044 cases related to patent rights. In the same period, the IP courts in Beijing, Shanghai and Guangzhou accepted a total of 26,698 IP rights (IPR) cases in the first and second instances, and concluded 22,631 cases. Beijing Intellectual Property Court accepted 1,161 patent administrative litigation cases, an increase of 5.2% on the same period the previous year, and closed 753 cases, an increase of 27.2% on the previous year.

With a tremendous scale in creation and application of various types of IPR, and enhanced values of some IPR, there are IP disputes that are prone to occur frequently, while the supply side of non-litigation dispute resolution mechanisms is insufficient, so that the rigid demand for judicial protection is continuously on the rise.

The IP tribunals have been successively founded to make the patent judicial trials more specialized. After the Supreme People’s Court (SPC) summarized and promoted the practical experience of IP courts in Beijing, Shanghai and Guangzhou last year, the establishment of IP-specialized trial tribunals was approved for cross-regional jurisdiction in 11 cities including Nanjing, Suzhou, Wuhan, Chengdu, Hangzhou, Ningbo, Hefei, Fuzhou, Jinan, Qingdao and Shenzhen to enhance the unification of standards, scales and quality of verdict, and provide better verdict guidelines for the creation and application of IP.

The technical investigator system has been introduced in patent litigation to make patent infringement litigation trials more specialized. In patent case trials, the court often needs to identify a number of technical facts, and conduct in-depth research and comparison of technical solutions. Overcoming complex technical obstacles in the identification of facts is a key point that has long affected enhancement of the quality and efficiency of trials.

In response to this problem, Chinese courts explored establishing a system where technical investigators neutrally perform duties to assist in the trial, and appointed a number of technical investigators from multiple channels such as enterprises and institutions, universities, scientific research institutions, national patent agencies, and patent agent associations. Thus, the “four-in-one” mechanism was jointly participated in by professional people’s jurors, technical investigators and expert assistants, and judicial appraisal agencies for identifying technical facts were constructed to assist judges in cracking technical doubts and clearing technical obstacles to an impartial trial.

The patent link system has been established in view of the fact that patent infringement litigations taking place during the listing approvals of drugs will have certain impact on the approval of generic drugs. In view of the fact that drugs in the process of listing approval may not be examined for patent infringement, drug research enterprises have to resort to legal means to restrain infringements after the listing of drugs by a competitor. However, restricted by the drawbacks of small infringement damage amounts and difficult enforcement under the current patent system in China, such right protections are usually almost in vain.

As stipulated in the Opinions on Deepening the Reform of the Review and Approval System to Encourage the Innovation of Drugs and Medical Instruments issued by the central government, in order to protect the legitimate rights and interests of patentees, reduce the patent infringement risks of generic drugs, and encourage the development of generic drugs, the establishment of a drug review and approval, and drug patent link system, was explored. When an applicant for drug registration submits an application for registration, the applicant must state the relevant patent involved as well as its ownership status, and notify the relevant drug patentee within the specified time limit.

Where there is a dispute over the patent right, the parties concerned may file a lawsuit with the court without aborting the technical review of the drugs during the period. For drugs that have passed technical review, the Food and Drug Supervision Department should make a decision on whether to approve the listing according to the court’s effective judgment, ruling or mediation.

If the effective judgment, ruling or mediation is not obtained within a certain time limit, the Food and Drug Supervision Department may approve the listing. According to the above-mentioned provisions, after the receipt of the notification from the drug listing applicant, the relevant drug patentee who believes that its patent right has been infringed may bring a patent infringement lawsuit to the judicial authority, which to a large extent discourages the generic drug manufacturer to employ the “Bolar case exception” to apply for drug listing before the drug administration department. The establishment and improvement of the drug patent link system may also significantly reduce the time for the drug patent expiration and the drug listing in the near future.

The patent infringement compensation system has been further perfected, which greatly enhances compensation amounts. There are always problems such as difficult investigations and evidence collection, and low amounts of compensation in patent infringement. According to the current patent law, the compensation first follows the “bridge principle”, which is to bridge all the losses of the patentee, and is not punitive to the infringer.

The revised patent law is expected to stipulate that, where the patent right is intentionally infringed, the court may raise the amount of compensation to a maximum of three times, according to the circumstances, scale and damage incurred. As long as the patentee can prove that the competitor is present with intentional infringement (for example the competitor has infringed once and lost the case), a punitive damage judgment may be made against the infringer.

The people’s court may determine the amount of compensation to be more than double and less than three times, based on the above-mentioned method, according to the circumstances, scale and damages incurred from the infringement.

The amount of compensation should also include the reasonable expenses of the rights holder incurred for stopping the infringing act. The amount of compensation should also include reasonable expenses paid by the rights holder to restrain the infringement act.

The Patent Infringement Guidelines (2017), issued by Beijing Higher People’s Court, combine practical needs with the idea of punitive damages for “malicious infringement” behaviour.

The guidelines set out that, where it pertains to malicious infringement, it is possible to support the plaintiff’s appeal within the statutory compensation limit, or determine the amount of compensation at a higher level.

In the judicial practice of patent infringement litigation, compensation for damages to the patentee has increased substantially. For example, in the case of Beijing Watchdata System Company v Hengbao Co Ltd for the infringement of patent rights, Beijing Intellectual Property Court judged that the defendant be compensated for economic losses of RMB49 million (US$7.1 million) and legal fees of RMB1 million, which is the highest amount of damages ever judged since the establishment of the court, and for the first time explicitly supports the time charges of an attorney in the judgment.

Also, in the case of LG v NEC Corporation for the patent for invention titled “Spindle Motor”, Beijing Intellectual Property Court supported the right holder’s compensation request and reasonable expenditure of nearly RMB4 million. In Qingdao, CO-NELE’s case for the patent for a utility model titled “high-efficiency transmission device for planetary stirrer”, supported the rights holder’s compensation request and reasonable expenditure of RMB3.6 million.

In the application of statutory compensation cases, a discretionary compensation mechanism that conforms to the law of the market and meets the requirements for protection of patent rights has been gradually established, so that the amount of compensation for damages matches the market value of the patent right, so as to adapt to the contribution rate of the patent right to the profit of the infringement behaviour.


Winds of change in Argentina

Substantial Amendments in the prosecution of trademarks and patents.

The Decree 27/2018 of January 10, 2018, (here in after the “Decree”) amends certain articles of the current Law of Trademarks and Designations (Law No. 22,362), the Law of Patents and Utility Models (Law No. 24,481), and Decree (Law No. 6673/1963).

The recitals of the “Decree”, indicate the need to implement an administrative procedure for the parties, prior to the judicial instance, for the administrative procedure and resolution of the oppositions IN trademarks, in order to reduce deadlines in obtaining resolutions. In connection with Utility Models and Designs, with the proposed amendments, users may make multiple applications for registration per file, adopt new technologies in the manner of submitting drawings, and request the postponement of publications.

We have prepared a comparison of the present procedures and the changes that are introduced by the Decree, which are not yet in force upon receiving this Newsletter.

Trademarks: specifically referring to the formalities of the registration process of a trademark, article 70 of the “Decree”, states that oppositions to the registration of a trademark must be electronically filed at the National Institute of Industrial Property (hereinafter “I.N.P.I.”), and not in writing as it is currently.

Article 71 of the “Decree”, introduces an important change regarding the opposition procedure in the current Law No. 22,362 of Trademarks and Designations. The aforementioned law foresees in article 16 that 1 (year) after the notification of the opposition “the application shall be declared abandoned in the following cases: (a) If the applicant and the opponent do not reach an agreement allowing for an administrative solution and the applicant does not bring legal action within the period indicated; (b) If legal action is brought by the applicant but the period of limitation expires”. The new article 16, establishes a system by which, 3 (three) months after the notification of an opposition, if the applicant does not obtain it’s removal, the National Trademark Office will be the one in charge of resolving it in an administrative instance.

Likewise, article 17 of Law Nº22,362, states that the procedure to obtain the withdrawal of oppositions is carried out through the initiation of a legal action. The “Decree” modifies said article, as follows: “the procedure to resolve the oppositions, will be fixed by the Application Authority (…)”, and “(…) the resolutions by oppositions issued by the National Directorate of Trademarks will only be subject to direct appeal before the National Chamber of Federal Civil and Commercial Appeals within 30 (thirty) business days of it’s notification. The appeal must be submitted to the I.N.P.I., who will notify the latter and sent to the courts (…)”. Thus, the administrative instance must first be concluded, in order to be able to initiate a legal action to obtain the withdrawal of an opposition.

In regard of Nullities, the “Decree” establishes that “The I.N.P.I., through the National Trademark Directorate, ex officio or at the request of a party, shall resolve in administrative instance the nullity of trademarks which refers to paragraph a) of this article. The resolution of a nullity of a trademark shall be appealable within the term of 30 (thirty) business days as from the notification, only by direct appeal before the National Chamber of Appeals in the Civil and Commercial Federal, which will be filed at the I.N.P.I.”. This change is significant, since Law Nº22,362 in articles 23 and 24, only refers to nullity in a judicial instance.

Presently, Article 26 of Law Nº22.362, states that ” At the request of a party, a trademark shall be declared expired if it has not been used in Argentina within the five (5) years preceding the date of institution of proceedings, unless the non-use was for reasons of overwhelming force. A trademark that is registered and not used in one class does not expire if it has been used to commercialize a good or provide a service included in other classes or if it is part of the designation of an activity. In this connection, the “Decree” states that I.N.P.I., ex officio or upon request, according to the regulations that will be dictated, will declare the revocation of the trademark, even partially, in relation of products or services for which it has not been used in the country within 5 (five) years prior to the expiration request, unless if there were causes of overwhelming force. The resolution of trademark expiration shall be appealable within 30 (thirty) business days since the notification, only by direct appeal before the National Court of Appeals in Civil and Commercial matters, which shall be filed with the I.N.P.I. A trademark registered and not used in a class or for specific products or services shall not expire, if this trademark was used in the commercialization of a product or the provision of a related or similar service to those, even if it was included in other classes, or if it is part of the designation of an activity related to those. Likewise, once the fifth year of the registration of the trademark has been granted, and before the expiration of the sixth year, the owner must submit a Declaration of Use regarding the use that would have been made until that time”.

Article 47 of Law Nº22.362 establishes that “Procedures with the National Directorate of Industrial Property shall be subject to the payment of official fees, the amounts of which shall be determined in the regulations (…). The “Decree” amends said article, granting greater powers to the I.N.P.I., since, according to said decree, ” the latter is empowered to dictate the complementary regulations of this law, regarding the procedure of trademark registrations, in everything that facilitates this procedure, eliminate requirements if they became obsolete in order to, accelerate and simplify the registration process. For this purpose it may, among others, modify the procedure described in the second section of this law; limit the examination of applications to absolute prohibitions or those related to public order, subordinating those relating to it’s approach by third parties; establish the publication for oppositions of third parties subsequent to the granting of the trademark; subordinating the validity of the title to what the I.N.P.I. resolves in case of oppositions that may be received, as well as the expiration of the priority period of the Paris Convention in the event of the existence any priorities unknown at the time of the concession “.

Patents: Article 19 of the Patents and Utility Models Law (Law No. 24,481) states that “A patent application should include: a) The title and the description of the invention; b) The plans or technical drawings necessary for understanding the description; c) One or more claims; d) A summary of the description of the invention and copies of the drawings, to be used only for publication and as technical information; e) Written evidence of the payment of official fees; f) Documents of assignment of rights and priority documents. If 90 (ninety) days elapsed from the date of the filing of the application without accompanying the entire documentation, the latter will be denied without further formality, except cases of overwhelming force duly justified. The lack of filing within the same period of the documents recorded in paragraph f) will cause the loss of the right of the international priority.” The “Decree” amends article d) hereinafter, namely: “To obtain the patent, the following documents must be submitted: A summary of the description of the invention that will serve only for publication and as technical information. After 30 (thirty) consecutive days, from the date of presentation of the application without completing the requirements indicated above, the patent application will be denied without further procedure”.

Likewise, we can again appreciate a reduction in terms established by the recent “Decree”, in that Law No. 24,481 in article 23 establishes that ” During it’s prosecution, a patent application may be changed into an application for a utility model, and vice versa. This change may be made only within 90 (ninety) days of the application date, or within 90 (ninety) days of a requirement by the National Patent Office for said conversion to be made. If the applicant does not perform such conversion within the required period, the application shall be considered abandoned”. The “Decree”, states that in regard to said conversion, the applicant may make it “(…) within 30 (thirty) calendar days counted from the date of filing the application; or within 30 (thirty) calendar days from the date on which the National Patent Administration would have requested the same (…)”.

Article 24 of Law No. 24,481 will also have a reduction in terms, since it currently states that “The National Patent Office shall carry out a preliminary examination of the documents filed and may require the applicant to provide any further details as may be deemed necessary, or to save any omissions therein. If the applicant fails to meet this requirement within a period of 180 (one hundred and eighty days), the application shall be considered abandoned”. The “Decree” shortens that term to 30 (thirty) calendar days.

Another reduction of terms is applicable to article 27 of Law No. 24,481, given that in its last paragraph states that “(…) If after a period of 3 (three) years counted as from the filing date of the patent application, the applicant does not pay the official fee corresponding to the substantive examination, the application shall be considered abandoned”, while the “Decree” establishes the patent abandoned after 18 (eighteen) months of said filing.

Article 32 of Law No. 24,481 is also amended by the “Decree”, given that the granting of patent will no longer be published in a Bulletin, but “on the I.N.P.I.’s website, according to regulations that will be established by the Application Authority “.

Utility Models/Designs: Article 57 of Law No. 24.481 states that “Once an application for an utility model has been submitted, it will be examined if the requirements of articles 50 and 53 have been fulfilled. Once this examination has been carried out, and the verification of the stated in the previous paragraph is completed, or rectified when it is possible, the certificate will be issued”. In this respect, the “Decree” states that “Once an application for an utility model has been filed and after paying the examination rate, the National Patent Administration will examine if the requirements of articles 53 and 55 have been fulfilled. Once this examination is approved it will proceed to publish the application. Within the term of 30 (thirty) calendar days counted from the publication, any person may carry out observations to the utility model application and add documentary evidence. The observations must consist of the lack or insufficiency of the legal requirements for it’s granting. Once this last term has expired, the National Patent Administration will proceed to resolve the request and issue the utility model certificate if applicable. After 3 (three) months from the presentation of the utility model application without the payment of the substantive examination official fees by the applicant, the application shall be considered abandoned.“

Article 68 of Law 24.481 establishes that “When the applications are filed through a legal representative, this one must prove his / her legal capacity through: a) Power of Attorney or certified copy of power that empowers him / her; b) Power of Attorney granted in accordance with the applicable legislation in the place where it is granted or in accordance with international treaties, in case the representative is a foreign legal person; c) In each file that is processed the legal status of the representative must be evidenced, being sufficient a simple copy of the registration certificate, for the case that the power of attorney is registered in the general registry of Power of Attorneys at the I.N.P.I. The “Decree” states that “The representation invoked in applications for patents of invention and / or utility models shall have the characteristic of an affidavit. In case of considering it pertinent, the National Patent Administration may request documentation that proves the nature invoked. In the event that the role of business manager is invoked, the latter must be ratified within a period of 40 (forty) business days after the filing, under penalty of declaring the nullity of the submission “.

Likewise, article 72 of Law Nº24.481 establishes that “The appeal for reconsideration will proceed: a) Against a resolution that denies the granting of a patent or an utility model; b) Against the resolution that gives place to the observations, in the terms of article 29 of the present law. In both cases, it shall be submitted in writing to the President of the I.N.P.I. within a peremptory period of 30 (thirty) days, counted as from the date of the notification of the respective resolution. (…) “. On the other hand, the “Decree” establishes that “The administrative appeal will proceed against the provision that denies a patent application or utility model, which shall be filed before the I.N.P.I. within the peremptory term 30 (thirty) business days as from the date of notification of the respective provision. (…)“.

The Decree-Law No. 6673/63, is also amended by the “Decree”. In it’s article 6, subsection a, Decree-Law N ° 6673/63 establishes that “They cannot enjoy the benefits granted by this decree: a) Those models or industrial designs that have been published or exploited publicly, in the country or abroad, prior to the date of deposit, except in the cases contemplated in article 14 of this Decree. However, it will not be an impediment for the authors to cover the said benefits by having exhibited, either by themselves or through an authorized person, the model or design of their creation in exhibitions or fairs made in Argentina or abroad, with the condition that the respective deposit be filed within a period of 6 (six) months from the opening of the exhibition or the fair”. The “Decree” amends this item as follows: “They cannot enjoy the benefits granted by this Decree-Law: a) Those models or industrial designs that have been published or exploited publicly, in the country or abroad, prior to the date of registration. However, the models or designs divulgated within the 6 (six) months preceding the date of the presentation of the application or priority are considered not known when: 1. Such divulgation would have been direct or indirectly result of acts performed by the author or his / her legitimate successors. 2. The divulgation from a third party by an act in bad faith or incidence; of a breach of contract or other unlawful act committed against the author or legitimate successor. 3. The publication of applications made erroneously or improperly by the management of industrial models and designs.“

Another important change, this time in regard the quantity of requests for models or industrial designs. The “Decree” states that “The application for registration of a model or industrial design, the inclusion in the application of up to twenty (20) industrial models or designs, applications for divisional registrations, postponement of publication, as the renewals mentioned in the previous article, will pay the official fees that will be determined in the respective regulation, whose values will be established proportionally to the value set for the official fees that is received for the original registration of a model or industrial design. The I.N.P.I. is authorized to establish, modify and eliminate official fees, including those applicable to the maintenance of the right of the owner”.

The “Decree” states that “The same application for registration may include up to 20 (twenty) Industrial Models or Designs only when all of them are applied or incorporated into products that belong to the same Class of the International Classification for the Industrial Designs of the Locarno Agreement. If an application that includes more than 1 (one) Model or Industrial Design does not meet the conditions prescribed by the current regulations, the I.N.P.I. may require the applicant to choose between the modification of the initial registration application to fulfill such conditions, or divide the initial registration application into 2 (two) or more divisional registrations, distributing among these ones the industrial models or designs for which protection was requested in the application for initial registration. The divisional applications will keep the date of presentation of the initial application and the benefit of the right of priority if this were appropriate. The rights derived from the models or designs included in an application or in a multiple registration will be independent from each other and, given the provisions of article 15, may be exercised, transferred, taxed, renewed or canceled separately”.

The “Decree” states that “The application for renewal of the registration must be filed within the term of the last 6 (six) months of its validity. The renewal may also be filed within 6 (six) months after said term, with the payment of a different official fee that will be established. “

On the other hand, the “Decree” stipulates that “(…) The resolution rejecting an application for registration shall be appealable before the I.N.P.I. Once the administrative instance has been concluded, the resolution issued by the I.N.P.I. shall be appealable before the Federal Civil and Commercial Court.

Finally, It is important to mention the amendment introduced to article 21 of Decree-Law N° 6673/1963, given that it currently states that “They will be punished with a penalty of three thousand to one hundred thousand pesos: 1. Those who manufacture or have manufactured industrial products that present the protected characteristics by the registration of a model or design or its copies. 2. Those who are aware of its illicit nature, sell, exhibit, import, export or otherwise trade the products referred in the preceding paragraph. 3. Those who maliciously, hold these products or cover their manufacturers. 4. Those who, without having registered a model or design, maliciously invoke it. 5. Those who sell as their own, plans of designs protected by a third party registry. In this case of recidivism the penalties established in this article will be doubled”. On this item, the “Decree” determines: “will be punished with a minimum penalty fee equivalent to the value of the official fees that is received for 50 (fifty) records of industrial models and designs, and a maximum of three hundred and 330 (thirty) of the same rate or tariff: a) Those who manufacture or have manufactured industrial products that have the characteristics protected by the registration of a model or design, or their copies. (…) “. We see that in this way it is sought that the value of the penalty fee is not affected by inflation, keeping its value constantly updated.

We shall keep you updated of the implementation of these changes.