Does China Have Intellectual Property Laws?
The Technical Expert Solution for IP Teams
China has had some form of intellectual property (IP) protection since the 1980s. However, it is still considered a “second-class” nation in terms of its IP laws and enforcement practices. While there are some notable exceptions, the majority of Chinese businesses do not protect their ideas from being ripped off by other companies.
In 1993, China joined the World Trade Organization (WTO), which requires member countries to abide by a minimum set of rules for protecting patents, trademarks, copyrights, and trade secrets. In 2001, China amended its patent law through legislation that went into effect on Oct. 1, 2002. The revised law was based mainly on international treaties and practices including the Patent Cooperation Treaty (PCT), Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), Paris Convention, and the Berne Convention.
Currently, China’s intellectual property laws meet the basic standards set out by the WTO, but they are still lacking compared to a lot of countries in the world. So, the answer to the question, does China have intellectual property laws is technically yes, but that doesn’t mean that businesses are fully protected.
There are a number of problems that businesses will encounter when trying to protect their intellectual property in China. Firstly, applications for trademarks, patents, and copyright are more expensive than they are in other countries. An average filing fee for an application is around $2,000 to $5,000. Since the majority of Chinese businesses are small or medium-sized enterprises (SMEs), that amount could be very hard for them to afford.
It also takes much longer for the process to be completed in China. It’s estimated that it may take up to one year or more to get approval for a patent or trademark because it must be reviewed at multiple stages. This long process can significantly impact businesses that need to protect their intellectual property quickly to prevent competitors from stealing their ideas.
Perhaps the biggest problem with Chinese intellectual property law is the first-to-file system they operate. Just like in the United States, patents can be filed for new inventions in China. However, unlike in the U.S., China does not require applicants to provide evidence of when they first invented their invention before they are granted a patent. This type of system is known as first-to-file and is deemed by many to be anti-competitive because it does not reward inventors for being the first one with an idea or product. Instead, it rewards whoever is first to put their application in. This means that developing new products and ideas can be a risk because somebody else can quickly file before you and you lose rights to your own intellectual property.
The majority of countries around the world use first-to-invent systems where the inventor is granted a patent even if someone else files for one after them. It is up to the person filing to provide evidence of when they first developed the idea. This way, businesses are encouraged to invest resources into research and development and it is harder for other businesses to poach your ideas.
There are also issues in the way that China’s intellectual property laws are enforced. There is only a very limited number of people working to enforce intellectual property laws. Having so few people enforcing legislation makes it extremely difficult for Chinese law enforcement agencies to actually catch counterfeiters in the act or shut down factories manufacturing fake products.
Many businesses also fear getting sued if they try to enforce their intellectual property rights in China because there are still many grey areas in how these laws are enforced, even though China claims that it has become stricter than before. For example, authorities do not consider selling or buying counterfeit goods as a crime. This means that if you catch somebody selling fakes of your product, you cannot file charges against them.
The best option for businesses trying to protect their intellectual property in China is to register their trademarks, patents, and copyrights abroad. This means that if somebody tries to steal your idea or copy your product, you can rely on the international patent system built by the World Intellectual Property Organization (WIPO) to help you enforce your rights.
By registering abroad, foreign businesses will be able to file for their intellectual property rights faster than they would be able to in China because there are no bureaucratic delays at each level of review that an application must go through first. The filing fee is usually much cheaper too because it also includes patents around the world whereas Chinese applications only apply within its borders. If you are unsure, you should seek legal advice from an intellectual property law specialist.