WORLD TRADE
ORGANIZATIONIP/C/W/384
11 October 2002
(02-5503)
Council for Trade-Related Aspects
of Intellectual Property RightsOriginal:  English
TRANSITIONAL REVIEW MECHANISM OF CHINA
Communication from China
The following communication, dated 17 September 2002, has been received from the
Permanent Mission of the People's Republic of China with the request that it be circulated to
Members.
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INTELLECTUAL PROPERTY RIGHTS PROTECTION IN CHINA
The Government of People's Republic of China believes that intellectual property rights
protection system is of great importance in prom oting science and technology development as well as
cultural and economic prosperities.  Effective intellectual property protection secures the smooth
operation of the socialist market economy and facilitates international exchanges and cooperation in
the fields of economy, science, technology and culture.  Intellectual property rights protection is animportant component of the policy of reform and opening-up of China.  It is also an important
element in the process of China's construction of a socialist legal system.  Formulation of intellectual
property related laws and regulations in China began at the end of 1970's concurrently with China's
enhanced participation in the activities of relevant international organizations and strengthened
exchanges and cooperation with other countries.  The intellectual property rights protection system in
China has been kept abreast to the latest devel opment and international standards in the world ever
since its establishment.  China's accession to the World Trade Organization (WTO) provides anotheropportunity to further perfect the system establishe d thus far.  To implement the commitments made
in the Accession Protocol and to bring China's intellectual property legislation into full compliance
with the Agreement on Trade-Related Aspects of the Intellectual Property Rights of the WTO (the
TRIPS Agreement), the Chinese Government has launched a massive program to amend and improve
its major intellectual property related laws and regulations and the protection level of intellectualproperty rights in China is further enhanced.  Apart from the efforts in perfecting the legislation,
enormous manpower and resources has also been devoted to the enforcement of the legislation by the
Chinese Government and remarkable progress has been achieved in this respect.IP/C/W/384
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I. OVERVIEW OF CHINA'S INTELLECTUAL PROPERTY RELATED
LEGISLATION
1. 1980's to 1990's - Birth and incremental development of intellectual property related
legislation
China formulated major intellectual property related legislation, including Copyright Law of
the People's Republic of China, Trademark Law of the People's Republic of China and Patent Law of
the People's Republic of China during the period from1980's to the beginning of 1990's.
In the Trademark Law  and its Implementing Regulations that became effective in March of
1983, the provisions regarding trademark filing, examination, registration, etc were brought in
compliance with relevant international practices.  With the deepening of the reform and opening-up
policy and the economic development, China amended the Trademark Law and its ImplementingRegulations in 1993 with the view to effec tively cracking down on trademark counterfeiting,
preventing trademark infringement and protecting the legitimate right of trademark owners.  In this
amendment, the scope of trademark protection was expanded to include trademarks for services, and
rectification procedures were provided in trademar k formality examination in favor of the applicants,
which were in line with the draft TRIPS Agreement then negotiated in the Uruguay Roundnegotiations.  In February of 1993, the Standing Committee of the National People's Congress of
China issued Supplementary Stipulations on Punishing the Crimes of Counterfeiting Registered
Trademarks , which further intensified the punishment on trademark counterfeiting and infringement.
These laws and regulations ensured the effective and sufficient protection to the registered
trademarks.
The Patent Law  and its Implementing Regulations that became effective in April 1985
extended intellectual property right protection to patents of invention creations.  For the purpose of
increasing the patent protection level in China in light of the international standards, the Standing
Committee of the National People's Congress passed the revised Patent Law  on 4 September 1992
with major amendments to its previous version.  To meet the needs for deepening the open-up policy
and promoting science and technology development, the revised Patent Law  extended protection to
any inventions, whether products or processes,  in all fields of technology, with pharm aceuticals,
chemical products, food, beverage etc included.  The protection term was also extended from 15 years
to 20 years from the date of application for patent for invention, and from 5 years to 10 years for
utility model and design patent.  Furthermore, ap art from the extension of protection of a patented
process to cover also the product directly obtained with it, the patent protection was also strengthenedin the revised Patent Law  with the stipulation that importation of patented products must have the
authorization from the patent owner.  The revised Patent Law  also redefined the conditions of
compulsory licensing.  Thus, the patent protection was upgraded to a new level.
The Copyright Law of the People's Republic of China  and its Implementing Regulations
promulgated in September 1990 and 1991 respectively defined the copyright and related rights for
literary, artistic and scientific works.  According to the Law, the copyright protection in China covers
not only the works, oral works, musical, dramatic, choreographic and acrobatic works, works of fine
art and architecture, photographic works, cinematographic works, graphic works, but also computer
software.  China is one of the few countries in the world that explicitly include computer software asthe subject matter for copyright protection.  The State Council of the People's Republic of China also
promulgated Regulations on Protection of Computer Software which set down specific implementing
rules for computer software protection.  This supplementary regulation to the Copyright Law  came
into force in October 1991.
China also formulated other intellectual property related laws and regulations in addition to
those mentioned above.  Regulations on Administrative Protection of Pharmaceuticals  promulgated inIP/C/W/384
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1992 provided certain administrative protection to pharmaceuticals inpatentable before the revision of
Patent Law .  Anti-Unfair Competition Law of the People's Republic of China  promulgated in
September 1993 specified the protection for commercial secrets.  In the 1997 Criminal Law of the
People's Republic of China , criminal liabilities for serious infringing acts against commercial secrets
were defined.  Regulations on Protection of New Varieties of Plants  promulgated in 1997 filled up the
legislative void in this field in China.  1997 Criminal Law of the People's Republic of China  specially
provided for crimes infringing intellectual property right, which carry a maximum jail term of 7 years.
2. Year 2000 up to date - Further improvement and perfecting of intellectual property
related legislation
To implement the commitments made by the Ch inese Government during the course of its
accession to the WTO and to ensure the consistency of China's intellectual property legislation intowith the TRIPS Agreement, from the year 2000 and onwards, China has amended its major
intellectual property related legislation including Patent Law of the People's Republic of China ,
Trademark Law of the People's Republic of China , Copyright Law of the People's Republic of China ,
Regulations on Protection of Computer Software , Implementing Regulations of Patent Law of the
People's Republic of China , Implementing Regulations of Copyright Law of the People's Republic of
China , Implementing Regulations of Trademark La w of the People's Republic of China .  Regulations
on Protection of Layout-Design of Integrated Circuit  has also been enacted.
The revised Copyright Law  extends the scope of protection, clearly defines the right of
performers and producers, adds the provisional measures of property and evidence preservation,stipulates the amount of statutory damages and enhances the administrative sanction on the
infringements that harm the public interests.  All of these amendments have brought the China's
Copyright Law  into full compliance with the requirements of the TRIPS Agreement.
The revised Trademark Law  specifically provides for the protection of geographic indications
and well-known trademarks, expands the scope of eligible subject matter of trademark, stipulates the
right of priority, adds the judicial review to the administrative decisions relating to trademark
registration and strengthens the cracking down on trademark infringement.
The revised Patent Law  consummates the conditions for granting compulsory licences, adds
the provision of judicial review for the administrative decisions regarding patent of utility model and
design.  Regulations on Protection of Layout-Design of Integrated Circuit  issued in April 2001
defines the protection of the layout-design of the integrated circuit.
In the revised  Patent Law , Trademark Law and Copyright Law , preliminary injunctions on
desisting from the infringing acts before the trial have been stipulated to further strengthen the
protection of the right owners.
In addition to the foregoing intellectual property related laws and regulations, China has also
amended Regulations on Administration of Agriculture Chemicals , Regulations on Administration of
Veterinary Chemicals , Regulations on Administration of Feeds and Additives  to include protection for
undisclosed information.
With all these legislative activities, a well-st ructured and sophisticated legal system for
intellectual property rights protection has been successfully established by the Chinese Government
which is in full compliance with the TRIPS Agreement.IP/C/W/384
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II. INTERNATIONAL EXCHANGES AND COOPERATION ON INTELLECTUAL
PROPERTY RIGHTS PROTECTION IN CHINA
From the 1980's, China has acceded to a series of major international conventions, treaties
and agreements relating to intellectual property right protection and the Chinese Government has
faithfully honored its commitments and strictly abided by its international obligations.
1. China's accession to international conventions, treaties and agreements
Since 1980s, China has joined in succession a number of major international conventions,
treaties and agreements on intellectual property rights protection, namely:  the Paris Convention for
the Protection of Industrial Property, the Berne Convention for the Protection of Literary and Artistic
Works, the Universal Copyright Convention, the Ma drid Agreement Concerning the International
Registration of Marks, the Madrid Protocol Concerning the International Registration of Marks, theNice Agreement Concerning the International Classification of Goods and Services for the Purpose of
the Registration of Marks, the Lugano Agreement of Establishing International Classification of
Industrial Designs, the Patent Cooperation Treaty, the Strasbourg Agreement on the International
Patent Classification, the Geneva Convention for Protection of Producers of Phonograms Against
Unauthorized Duplication of Their Phonograms,  the Budapest Treaty on the international
Recognition of the Deposit of Microorganisms for the Purpose of Patent Procedures.
The extensive involvement in the internati onal exchanges and cooperation on intellectual
property rights protection has been a principal approach to draw on the advanced experience from
these international organizations and other countries, and enhanced greatly the capacity and level ofChina's intellectual property rights protection.
2. Bilateral cooperation regarding intellectual property rights protection
While actively participating intellectual property related international conventions, the
Chinese government has also established extensive bilateral cooperative ties with many countries onintellectual property rights protection.  In May 1996, the Chinese Government signed an agreement
with the European Union and launched China-EU Programme on Intellectual Property Right
Cooperation.  This project has sponsored various cooperation activities including bilateral exchanges
in EU, international symposium and seminars in China regarding intellectual property rights
protection.  Scores of government bodies, research institutes and colleges have benefited from this
cooperation programme.  In addition, China has also established bilateral cooperation on intellectual
property right protection with the US, Japan, Italy and etc.
III. ENFORCEMENT OF INTELLECTUAL PROPERTY RELATED LEGISLATION IN
CHINA
The enforcement of intellectual property related legislation in China takes the pattern of
"Parallel channels and Coordinated operation".  Where infringement occurs, the right holders ofintellectual property may either bring a lawsuit to  the court or file a complaint to the governing
administrative bodies.
Administrative bodies for intellectual property rights protection may take various remedy
measures including preliminary injunctions desisting from the infringement and fines.  Administrative
measures are welcomed by right holders for their quick response to the infringing activities and low
cost.  The Quality Brand Protection Committee of Foreign Investment Enterprises in China
acknowledges the great importance attached and effective measures taken by the Chinese Government
at all levels to crack down on counterfeiting.IP/C/W/384
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The Chinese Government at all levels is fully aware of the significance of intellectual
property right protection in promoting economic deve lopment.  Local authorities have promulgated a
large number of regulations strengthening intellectual property right protection in line with those at
national level.  Effective measures including cross-region joint actions have been taken to eliminate
regional protectionism for infringers and to crack down on the illegal practice like counterfeiting.Cooperative networks on trademark enforcement have  been established in the Three Provinces and
One Municipality in East China (Shandong Province, Jiangsu Province, Zhejiang Province, Shanghai
Municipality), the Three Provinces in North-East China (Heilongjiang Province, Jilin Province and
Liaoning Province) and etc.  Cross departme nt cooperation among governmental bodies for
intellectual property right enforcement has been continuously strengthened.  In May 2001, the State
Administration of Industry and Commerce, the Ministry of Public Security and the State Intellectual
Property Office convened the State Council intellectual property right work conference and reachedconsensus on establishing an inter-agency liaison mechanism, information notification and sharing
mechanism, enforcement coordination mechanism, etc.  This kind of cooperation and coordination
among regions and government enforcement bodies has proved to be an effective and forceful tool
against counterfeiting and infringements.
1. Patent right enforcement
In the year 2001, the patent administrative bodies at all levels in China took on 977 patent
disputes in which 888 were concluded.  In all these disputes, 924 were patent infringement, 23 were
disputes over right ownership, and 30 were miscellaneous cases.  80 of the 977 disputes were related
to inventions, 426 were for utility model, and 471 for design patent.  223 out of the 977 disputes wereconcluded with rulings, 487 were concluded with mediation, and 178 were withdrawn or settled by
other means.  The patent administrative bodies also investigated and dealt with 413 cases of
fraudulent patent.
From 1985 to the end of 2001, the total number of patent disputes handled by the patent
administrative bodies is 7,600, with 6,608 concluded.
In the year 2001, the State Intellectual Property Office received 62 applications for layout-
designs of integrated circuits, and 29 of them were publicized.
2. Trademark enforcement
In the year 2001, 41,163 trademark law violation cases were dealt with in total, among which
22,813 cases were trademark infringements and 18,350 cases were related to other violations.
Administrative authorities confiscated 250,000,000 illegal trademark signs and 14,004 molds, blocks
and other tools directly used for infringing production.  There were 2227.74 tons of infringing
products destroyed in the year and the total value of fines amounted to RMB 210,000,000.  Infringers
were ordered to pay the right owners damages of RMB 3,343,400 in total and there were 86 casestransferred to criminal procedures, which involved 88 persons.
3. Copyright enforcement
In the year 2001, copyright administrative authorities around China received 4,416 cases in
total in 2001, with 4,306 cases concluded, among which, 3,607 cases were concluded with impositionof a fine upon the infringer and 633 cases concluded with mediation.  66 cases were transferred to
criminal procedures.
The top five provinces with copyright cases reception and conclusion were Guangxi Zhuang
Ethic Autonomous Region, Hunan province, Jiangsu province, Liaoning province and SichuanIP/C/W/384
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province.  According to incomplete statistics, enforcement forces launched at least 161 assaults in
2001 against market for illegal publications and unregistered shops and outlets.
4. Border control for intellectual property right
In the year 2001, Chinese Customs authorities have greatly enhanced the intellectual property
right protection at borders.  Through close coordina tion with judicial bodies, administrative bodies for
intellectual property right protection, and the strengthened cooperation with right holders, infringing
acts in import and export have been forcefully contained, and the legitimate rights of right holders
have been effectively safeguarded.
In year 2001, the Customs authorities around China investigated and dealt with 330 cases of
infringements.  Domestic right holders were protected in 116 cases and foreign right holders wereprotected in 230 cases.  The total value of all these cases amounted to RMB 134,900,000.  Among
these cases, 297 cases involved export and import goods bearing counterfeit trademarks.  Further
more, the State Customs Administration received in total 803 application for protection from right
holders, among them 648 were approved after examination, a 34% increase over last year.
Intellectual property right protection is more an intrinsic development requirement of the
market economy in China than merely an imposed  fulfillment demand of China's international
commitments.  The Chinese Government has consistently given high priority to this undertaking.
With decades of efforts, China has now in place a well structured and sophisticated intellectual
property protection system which is in line with international standards.  The Chinese Government iscommitted to further rigorous enforcement of the intellectual property related laws and regulations,
strict fulfillment of its international obligations and close cooperation with other countries in this field
with the view to raising the protection of intellectual property right to a higher level.
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