The outbreak of COVID-19 has taken its toll on the global economy. As the first major economy hit by the pandemic, China managed to contain the disease with strong prevention and control measures. At the moment, things are slowly returning to normality in China. This article reviews how the Chinese IP administrative agency and judiciary responded during the past four months.

After Wuhan announced its lockdown on January 23 2020, a first-level emergency response measure was initiated in mainland China as the country stood at a critical stage of combating the disease. The Chinese New Year holiday (from January 24 to 30) was extended to February 2 to reduce mass gatherings and control the spread of the disease. Courts specialising in intellectual property cases, the China National Intellectual Property Administration (CNIPA), and local enforcement administrations responded by changing their work arrangements.

 

Measures by the courts

  • Suspending on-site services

Since February 3, courts in most parts of the country temporarily suspended their services and visits to their premises. Announcement was made in advance and the parties were advised to direct their enquiries and liaise with courts or judges through the internet, telephone and correspondence.

 

  • Adjourning trial

Most courts took the initiative to postpone hearing scheduled in February. Hearing may be adjourned upon request, provided that epidemic prevention and control measures put in place hinder a party or the agent from participation.

 

  • Measures facilitating litigation

Prior to the outbreak of COVID-19, courts had online litigation platforms where the parties can file cases, check the status of cases, and even remotely participate in hearings. The platforms, in lieu of the on-site services, enable courts to provide uninterrupted services to the parties amid the outbreak.

Since late February, courts have started to experiment videoconference hearing. As early as February 19, the Beijing Intellectual Property Court took the lead in hearing cases remotely through the “Cloud Court” system, and on February 25 the Intellectual Property Court of the Supreme People’s Court conducted online hearing on the "Mobile Micro Court" system, with agents in Shanghai, Zhejiang and Anhui.

The Beijing Intellectual Property Court, the first specialized IP court in China, has been accepting cases online only since February 3. Statistics indicate a rise in case filings by mail and online from February 3 to February 28 (online filings grew by 15%).

 

  • Extension of time limit

The parties may request for an extension in case that the time limit elapsed due to the epidemic, and the court may order the parties to provide evidentiary materials where necessary.

 

CNIPA and enforcement authorities

  • Promoting online services and temporary closures

Prior to the outbreak, the CNIPA encouraged applicants to use the e-filing service to submit their trade mark and patent applications, request for patent re-examination and invalidation, receive official notices or reply to office actions, and pay application fees.

The CNIPA’s service windows remain open during the outbreak but with control measures. Anyone who needs to access the window services are obligated to cooperate with an on-site epidemiological investigation and pass the temperature test before entering the premises. Since February 3, most of the CNIPA’s outposts have been offering offline services, like the Beijing and Shanghai outposts, except some having to suspend all face-to-face services due to the mandatory epidemic prevention measures introduced by the local government.

 

  • Postponing and omitting oral hearings

Oral hearing is a routine procedure in the examination of a patent invalidation case. The Patent Reexamination and Invalidation Department of the Patent Office (PRID) of the CNIPA has postponed most of the oral hearings scheduled in February and March. In order to reduce the backlog of cases, the CNIPA screened out cases where facts and arguments could be presented in writing and proceeded to examine these cases without oral hearings. The parties affected by COVID-19 may also request to reschedule the oral hearing or examine the case without an oral hearing.

In the meantime, the PRID has been exploring the possibility of remote hearings. It quickly deployed a patent reexamination remote hearing system and successfully heard a patent invalidation case on February 17.

 

  • Remedies for elapsed time limits

On January 28, the CNIPA released Bulletin No. 350, enumerating the relief procedures for the time limits for patent, trade mark and layout design of integrated circuit rights due to COVID-19. The bulletin is applicable to all parties in countries and regions affected by the disease.

For the time limit for a patent or layout design of integrated circuit that elapsed due to COVID-19, the owner may file an application requesting for the restoration of their rights within a period of two months from the date and up to two years after the expiration date of the time limit at the latest. The applicant shall also submit evidentiary materials and follow the usual formalities.

For trade mark rights, the time limit shall be suspended from the date when the impediment arose and resumed as of the date when such impediment is removed, except as otherwise provided by law. The owner may file an application in writing, with evidence, requesting for the lapsed trade mark to be restored within two months from the date of removal of such impediment.

 

  • Sharing innovation information

The CNIPA had never exercised its power to grant compulsory licences and is most unlikely to do so this time. Instead, by leveraging its access to cutting-edge science and technology, CNIPA conducted searches for the disclosed prior art relating to the prevention and containment of COVID-19 and created a platform to share the information with medical and research institutions as well as the public.

Administrative enforcement plays an important role in the protection of intellectual property in China. Given that most business operation had come to a complete halt amid the outbreak, the number of intellectual property disputes decreased. The government mandated epidemic prevention and control measures also discouraged administrative enforcement activities, except those cases involving counterfeits relating to epidemic prevention and control.

 

Reopening after the peak

China reached a milestone in its battle against the disease on March 18 when for the first time there were no new cases of domestic infections in the country. Since late February, several local health commissions across the country have started reducing their coronavirus emergency response measures to reboot the economy. Local courts and IP administrative agencies tailored their response to cope with the evolving situation.

  • Restoring offline services

Following the successful control of the outbreak, as of early April, the majority of courts and IP administrative agencies had resumed offline services in China. Courts in Shanghai, Guangzhou, among other regions, have resumed on-site case filing and hearing services, except those in Beijing, Tianjin, Hubei and Hebei, where the first level emergency response measures are still in place. With the resumption of offline court hearings in most regions, cases that have been delayed by the epidemic are rescheduled and heard in courts.

To maintain control over the spread of COVID-19, parties are still being encouraged to use online services. Parties choosing offline services still need to have their temperature taken and produce health certificates before entering court premises.

 

  • Online hearings

Courts that have not resumed offline court hearings (like courts in Beijing) have been holding remote hearings, though the number of remote hearings is still less than that of the in-person trials before the outbreak.

Since Beijing still has the highest level of emergency response measures, the PRID remains cautious about conducting in-person oral hearings at the moment. Since late March, the PRID has been conducting oral hearings mainly through the remote hearing system. The oral hearing schedule released by the PRID indicates that the number of oral hearings scheduled in mid-April is almost equivalent to the figure before the outbreak.

 

Outlook

COVID-19 will have a lingering effect on the Chinese and the global economy after its containment. The pandemic prompted the Chinese judiciary and administrative agencies to further encourage the use of online services. Parties and their representatives, especially in patent cases, will experience some challenges before they get used to presenting arguments and evidence in online court hearings.

On the positive side, the epidemic has further boosted the e-commerce industry. On April 7, the Chinese State Council decided to set up 46 new pilot zones for cross-border e-commerce. The organizer, will for the first time, move the China Import and Export Fair (Canton Fair) online. With the rise in online transactions and cross-border trade, IP right owners need to be proactive and prepare themselves.

 

 

The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, any other of its practitioners, its clients, or any of its or their respective affiliates. The article is for general information purposes only and is not intended to be and should not be taken as legal advice. Please contact the author(s) if you have any questions about this article.

 

 

Author(s)

Johnson Li (partner)

 

 

Baihe Liu (senior associate)