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September 2021
Contents
News about Sonoda & Kobayashi
1. Sonoda & Kobayashi presents its China-focused newsletter
2. Story of the month

JPO News
1. JPO strengthens cooperation with ASEAN
2. JPO releases guide to support trademark applications
3. CNIPA held a regular press conference for the third quarter

Latest IP News in Japan
1. Toyota leads in Electric vehicle patents, but not in sales
2. Japanese city of Matsuyama trademarks name of a local danceLatest IP News in China
1. ZTE, one of China's 5G leaders, has more than 40000 global granted patents

2. Statistical analysis report on patent cases which were declared invalidation in

China
IP Law Updates in China: Insights from Sonoda & Kobayashi
1. Drug Patent Linkage System in China- News about Sonoda & Kobayashi 1. Sonoda & Kobayashi presents its China focused newsletter
Welcome to the September edition of Sonoda & Kobayashi’s bi-monthly newsletter.
As the picture on the first page of this document may have shown you, this edition is not
only about Japanese IP news, but also features Chinese IP-related issues and a written
contribution by our Chinese patent attorney.
Perhaps you may remember our recent e-mail or maybe you saw the posting on our
website.
Since this year, Sonoda & Kobayashi has opened an office in Beijing, China.
We hope to expand Sonoda & Kobayashi's reliable and high-quality services to China.
We are able to help prosecute patents, utility models, trademarks and designs, and standready to protect your intellectual property in China. We hope you will enjoy this special
newsletter edition in which we update you on China-specific IP news.
Feel free to reach out to us with any questions about IP protection in the middle kingdom.
2. Story of the Month
After graduating from university, Yanhui Wang worked at a major patent office in China forsix and a half years. She was responsible for all patent operations in the field of chemistry
pertaining to Japan and China. Ms. Wang then gained employment with a Japanese patentoffice for two years. She joined our office after qualifying as a Chinese patent attorney in2011 and as a Chinese lawyer in 2013.
Q1 : What brought you to Sonoda & Kobayashi?
A colleague who used to work in Sonoda & Kobayashi highly recommend it as aninternational IP law firm which is very friendly to foreigners. So I joined here about four yearsago.
Q2: What do you enjoy about working at here?
We can express our views freely, and my colleagues are coming from different countries. I
find it very interesting to experience different cultures.
Q3: Tell us one thing about yourself many people do not know?
I used to drive through vast grasslands, wild road, etc. for many days.
Q4: What is your most memorable moment here?

On the 20th anniversary of our firm, many colleagues invited their families to the party. We
could meet our colleagues’ families and learn interesting stories about them. Now becauseof the pandemic, we can't see each other face-to-face. That scene is what I miss most andwon’t ever forget
Q5: Pick a Japanese word to describe the office and explain why.
信頼感、安心感 “Shinraikan”, “Anshinkan” meaning “feeling of trust” and “sense of safety”
As a foreigner, I am given considerable trust and support to develop the business. We haveno social pressure in the firm, so we can focus on our work in a relaxed way.

JPO and CNIPO News
1. JPO strengthens cooperation with ASEAN
On the 3rd of August, the JPO and ASEAN held the 11th ASEAN-Japan Patent OfficeCommissioners’ meeting. In this edition, they approved the action plan for IP cooperationin 2021, and also discussed the results of a survey on patent examination for AI-related
invention in the ASEAN countries.
The meetings have been held regularly in the framework of the ASEAN’s IP action plan
2016 – 2025 where they aim to improve the IP environment in the region. The JPO has
been working with the ASEAN countries in various ways to deepen cooperation.
In the meeting it was decided to (further) cooperate on:- Organizing a second expert meeting to share knowledge on the development of patentexamination standards for advanced technologies- A study will be conducted on the status and challenges of using of patent information- A study on will be conducted for each country on their patent examination operations in
the field of advanced technologies- Promote accession to the Madrid and The Hague agreements- Promotion of cooperation on Human resource development and prosecution
management- Promotion of cooperation on commercialization of IP and IP awareness
During the meeting, the parties also discussed the results of a survey on patentexamination on AI-related inventions. The study looked at how certain example cases
listed in the JPO’s handbook are judged based on the practice in ASEAN countries. The
contents will be used for the 2nd expert meeting later this year.
For more information, please click here (in Japanese).
2. JPO releases guide to support trademark applications
On the 5th of August, the JPO published its guide to support trademark application called“How to apply for a trademark” (Shohyou shutsugan tte dou yaru no?). The point of thisguide is to provide easy-to-understand pointers to improve the quality of trademark

application and prevent rejections.
In recent years, the number of trademark applications in Japan has risen, and particularly
so those submitted by SMEs. Small- and medium-sized businesses now make up 60% of
all domestic trademark applications. The guide aims to support these businesses and help
them avoid common stumbling blocks.
The full guide can be found in Japanese on this page.
3. CNIPA held a regular press conference for the third quarter
On July 14, 2021, CNIPA held a press conference that included two parts. The first part
released the semi-annual statistical data of patents, trademarks, geographical indications
and integrated circuit layout-designs, and analyzed the main characteristics of thestatistical data in the first half of 2021. The second part answered reporters’ questions
regarding relevant issues.
In the first part, in addition to the semi-annual statistical data of patents, trademarks,
geographical indications and integrated circuit layout-designs, data on the protection andapplication of intellectual property rights were also released. For example, in the first halfof 2021, 339,000 patents were authorized and 3,724,000 trademarks were registered. The
number of administrative adjudication cases of patent infringement disputes in various
provinces (regions and cities) across China is 13,800. The amount of pledge financing ofpatents and trademarks in the whole country was 107.4 billion yuan, a year-on-yearincrease of 25.9%; the number of pledged projects was 6195, a year-on-year increase of
32.4%. The other section focused on the main characteristics of the statistical data in thefirst half of 2021. Among them, by the end of June, the average examination cycle ofinvention patents in China had been reduced to 19.4 months, the examination cycle ofhigh-value patents had been reduced to 13.4 months, and the average examination cycle oftrademark registration was unchanged at within 4 months. In addition, the data also
showed that the grant and registration of intellectual property rights for foreign applicants
continued to grow in China.
In the second part, CNIPA answered reporters’ questions, regarding, for example, thesituations of the introduction and implementation about “the early resolution mechanismof drug patent disputes (trial)” and “Measures for administrative adjudication of major
patent infringement disputes” issued by CNIPA.
More information can be found here (in Chinese)- Latest IP News in Japan 1. Toyota leads in Electric vehicle patents, but not in sales
Nikkei Asia, 2 September 2021
On the 2nd of September, Nikkei Asia reported on Electric Vehicle (EV) technology andsales.

In particular, the newspaper teamed up with a research firm to investigate global
companies and their competitiveness regarding EVs.
While Tesla and Volkswagen are ahead of Japanese automakers when it comes to EV
sales, Japanese car makers do hold important EV-related patents.
In the competitiveness ranking, based on EV-related patents in the U.S., factors such as
how often patents are cited or disputed were used to determine a score.
Toyota came out on top in the number 1 spot, and a grand total of 21 Japanese companies
made it into the top 50. Among these are parts maker Denso, Honda Motor and Nissan
Motor.
Also in the top 50 are 13 American companies, such as Ford, General Motors and Tesla,and several South Korean and German companies, namely Hyundai and Robert Bosch.
Chinese companies BYD and Nio ranked 32nd and 47th respectively.
The analysis looked at patents for EV parts such as motors and batteries, but also at
infrastructure pieces like charging stations. An analysis of the EV-related patents in the EU
reinforced the picture of Japan’s lead in the field.
According to the article, the high ranking for competitiveness stems from Japan’s successwith Hybrid vehicles that use many of the same components as EVs.
Yet the main challenge for Japanese companies is a familiar one, also faced by companies
in the consumer electronics sectors from the country: the need to translate strength inhardware into marketable products. Without a leading market position when it comes toselling EVs, the technological advantage of Japanese companies may be lost.
In 2020, Tesla sold more EVs than any other company in the world, while BYD and several
other Chinese manufacturers accounted for about 20% of unit sales. Japanese car
manufacturers Nissan and Toyota however do come close enough.
In terms of relative technological advantage, Tesla is ahead in thermal management
technology, which is important in stopping batteries from wearing out quickly. Ford,
meanwhile, has efficient air conditioning technology, and is aiming to make EVs 40% of its
sales by 2030.
The picture for Chinese EV companies is a little bit harder to interpret, but the expectationis that they will become a bigger force internationally.
The article ends with a warning that if Japanese technologies cannot connect theirtechnology with the business side, car makers could wind up in a similar global position as
the Japanese electronics industry.
More info can be found here.
2. Japanese city of Matsuyama trademark's name of a local dance
NHK, 6 September 2021

On the 6th of September, NHK published an article on the city of Matsuyama in Ehime
prefecture. The city had applied for a trademark for a locally originated dance, and its
application has recently been approved by the Japanese Patent Office.
The name of the dance “Yakyuken Odori” means “baseball fist dance” and was born in thecity during the Taisho era (1912 -1926). It is a dance during which participants play rockpaper-scissors, and was first performed after a baseball game.
While it is not unusual for local government to trademark names of agricultural products
and specialties, it is rare for this to happen to a name of a dance.
The article mentions that the local government of Matsuyama likely aims to enhance its
brand image thereby making the city more well-known around the country.
More information can be found here (in Japanese).

- Latest IP News in China 1. ZTE, one of China's 5G leaders, has more than 40000 global granted patents
Sina, September 4, 2021
On August 31, 2021, Sina reported on the World 5G Convention held in Beijing, during
which more than 1500 industry experts and enterprise elites at home and abroad
participated in the convention forum in the form of Online + Offline.
In the convention, ZTE, a well-known domestic ICT listed enterprise, also disclosed thatthey had developed 5G ATG Aviation Internet. In addition to the research on 5G Network,
ZTE has already planned another unique strategic layout mode - intellectual property rights
layout in the field of information and communications.
In terms of quantity, ZTE's patent layout is indeed at the forefront of the industry. In
February this year, the report " Who is leading the 5G patent race " released by IPLytics, aninternational well-known patent data company, showed that ZTE disclosed to ETSI(European Telecommunications Standardization Association) that the total number ofdeclared standard-essential patents for 5G ranked third in the world.
In fact, according to the semi-annual report recently disclosed by ZTE, ZTE has more than
80000 global patent applications, and more than 40000 global granted patents over theyears. On the issue of patent layout, ZTE has also adopted the "cross-border + closed-loop"
mode. It is reported that ZTE will reach a patent cross-licensing with mainstream
enterprises in the industry, and realize rapid iteration from new technologies to new
products through commercial interaction, so as to promote the expansion of thetechnologies of communications industry to vertical industries. At the same time, ZTE will
also manage and recover reasonable R&D investment through transfers, licenses, etc., soas to achieve a closed loop of sustainable development of innovation, management and reinnovation.

More information can be found here (in Chinese).
2. Statistical analysis report on patent cases which were declared invalidation in China
Patent Reexamination, August 25, 2021
“Patent Reexamination”, published a data statistical analysis report on August 25th
regarding patent cases which were declared invalid in China in June 2021.
In concrete terms, in June 2021, CNIPA issued 601 examination decisions of the request
for invalidation, and “Patent Reexamination” collected and analyzed the data thereof.
-01. Patent types
Among 601 examination decisions of the request for invalidation, the largest group was
patents for design, followed by patents of utility model, and the number of patents forinvention was the smallest, comprising 273 patents for design, 242 patents for utility
model and 86 patents for invention.
-02. Technical fields
The technical fields of patent for invention and patent for utility model mainly include
medicine, architecture, transportation, electricity, etc.
-03. Invalidation petitioner and patentee
There is a situation in which the same petitioner for invalidation made a request forinvalidation of multiple patent rights of the same patentee.
-04. The origin of petitioner for invalidation and patentee
The overwhelming majority of the petitioners for invalidation are companies registered in
China or natural persons of Chinese origin. Among them, the request for invalidation in thename of natural persons accounts for more than 1/3.
Most of the patentees are companies registered in China or natural persons of Chineseorigin, involving 567 cases. 34 cases of patents from foreign patentees had beenrequested for invalidation. Among them, the highest number of cases is 10 cases fromJapanese patentees, followed by 7 cases from American patentees, 5 cases each from
German and Swedish patentees, and 1 case from the patentee of another country.
-05. Trial cycle
The trial cycle is calculated from the "date of request for invalidation" to the "date ofissuance of invalidation decision". The trial cycle of invalidation cases by CNIPA is mostly 5~ 8 months. From the statistical results, the trial cycle is not necessarily related to thetypes of patents.
-06. Maintenance period of patent right
Among the 307 cases which had declared a patent right completely invalid themaintenance period of patent right (from the “date of announcement of granting the patentright” to the “date of issuance of invalidation decision”) is mostly 1-3 years, and the patents
with a longer maintenance period are fewer in number.

-07. The ratio of different invalidation types
Declaring a patent right completely invalid: 51.1%, declaring a patent right partially valid in
part: 12%, and maintaining the validity of a patent right: 36.9%.
-08. Causes of request for invalidation
Among the 153 cases of patent for design in which a patent right was declared completely
invalid, the main legal basis is Article 23, paragraph 1 (novelty) and Article 23, paragraph 2(no obvious difference) of the patent law. Among the 126 cases of patent for utility modelin which a patent right was declared completely invalid, the main legal basis is Article 22,
Paragraph 3 (inventiveness) of the Patent Law, and a small number of cases were declaredcompletely invalid only based on the drafting forms. Among the 28 cases of patent for
invention in which a patent right was declared completely invalid, the main legal basis is
Article 22, Paragraph 3 (inventiveness) of the Patent Law.
More information can be found here (in Chinese) .

- IP Law Updates in China : Insights from Sonoda & Kobayashi ・Drug Patent Linkage System in China
September 10, 2021
Author: Yanhui Wang
1. Background
China has tried to establish a drug patent linkage system since 2019. After several years,
the patent linkage system was finally officially implemented this year. The purpose of thesystem is to protect the legitimate rights and interests of drug patentees, reduce the risk ofpatent infringement after generic drugs are listed, and ensure the early settlement ofpatent disputes before generic drugs are listed. The implementation of this system
involves the revision and promulgation of a series of relevant laws and regulations, which
has taken a long time to realize and is still being improved.
2. Relevant laws and regulations(1) On October 17, 2020, CNIPA issued the fourth amendment to Chinese Patent Law[1],which came into effect as of June 1, 2021. Article 76 of the newly amended Patent Law
introduces the drug patent linkage system for the first time, clarifying the cause of action
and routes of patent linkage litigation. The cause of action includes confirming whether the
drug of the approval application falls within the scope of a relevant patent, and disputes
shall be resolved through judicial or administrative means.
(2) On July 4, 2021, the National Medical Products Administration (NMPA) and CNIPA
jointly issued the Measures for the Implementation of Early Resolution Mechanisms ofDrug Patent Disputes (Trial) (hereinafter referred to as “Trial Measures”)[2], which was
effective from the issue date and includes the following:-Patent registration system
The Drug marketing authorization holders shall register the patent information related todrugs on the "China listed drug patent information registration platform (CDE)"(https://zldj.cde.org.cn/home) within 30 days of receiving the drug registration certificate aswell as update their registrations within 30 days of any change, which will be the basis forthe generic drug applicant to make a patent declaration. At present, the types of patents
allowed to be registered for chemical drugs and biological drugs include: compound patents
for active ingredients of chemical drugs, combination patents containing active ingredientsof chemical drugs, and patents for pharmaceutical uses of chemical drugs; traditional
Chinese medicine composition patents, Chinese medicine extract patents, andpharmaceutical use patents of traditional Chinese medicine; patents for sequence structureof active ingredients of biological products, patents for pharmaceutical uses of biologicalproducts. Please note that relevant patents do not include: patents for intermediates, crystal
forms, metabolites, preparation methods, and detection methods.
-Generic drug patent declaration system
When submitting the approval application, the generic drug applicant shall make adeclaration on each relevant drug patent. The declaratory statement should fall under one of
the four categories: 1. there is no patent information related to the generic drug in the "China
Listed Drug Patent Information Registration CDE "; 2. the relevant patents of CDE have been
terminated or declared invalid; 3. the CDE contains relevant patents, and the generic drug
applicant promises not to be listed before the expiration of the patent period; 4. the relevant
patent rights included in the CDE should be deemed invalid, or the generic drug does not fallwithin the scope of the patent.
Only when the generic drug applicant makes the fourth declaration and the patentee orinterested party has an objection, it is possible to file a lawsuit or apply for administrative
adjudication within 45 days from the publication date of the application on the CDE platform.
-Judicial or administrative linkage system
According to Article 7 of the Trial Measures, if the patentee or interested party raises anobjection, he/she can choose to take action through either a judicial or administrative route.
If an administrative ruling from CNIPA is sought, it will still be possible to bring a lawsuit to
the Beijing Intellectual Property Court. On the contrary, according to Articles 4 and 10 of the
Trial Measures, if the case has been brought before the court, CNIPA will no longer accept it.
After the generic drug applicant makes the fourth declaration, the patentee may file a
confirmation lawsuit or apply for confirmation administrative adjudication in accordancewith Article 76 of the Patent Law and Article 7 of the Trial Measures. Then the patentee shallnotify the generic drug applicant within 15 working days from the date of acceptance of theconfirmation lawsuit or confirmation administrative adjudication. Accordingly, the NMPA willsuspend the approval procedure of the generic drug and set a nine-month waiting period foradministrative approval.
On the other hand, if the patentee fails to file a confirmation lawsuit or apply for confirmation
administrative adjudication within 45 days, the waiting period for administrative approval will
not be triggered, and the generic drug will smoothly enter the administrative approval
procedure. The patentee also has no right to raise any objection to the approval decision of
the generic drug marketing license issued by NMPA.

-Approval waiting period system
As mentioned above, from the date of filing or acceptance by the court or the CNIPA for theconfirmation lawsuit or confirmation administrative adjudication, NMPA shall set a waiting
period of nine months for the approval application of the chemical generic drug. During thewaiting period, the National Drug Review Institution shall not stop the examination.
It should be noted that the "waiting period" only applies to chemical drugs. There is no
waiting period for biological drugs.
-Classification system for drug approval
If a judicial or administrative ruling is received within nine months, NMPA shall handle theapplication as follows: I) if it is confirmed that the generic drug falls within the scope of
patent protection, the approval procedure of the chemical generic drug application will besuspended until 20 working days before the expiration of the patent; II) if it is confirmed thatthe generic drug does not fall within the scope of patent protection, if a settlement has beenreached between the two parties, or if the patent is declared invalid, the application for thechemical generic drug shall be transferred to administrative examination for approval.
-First generic drug market monopoly system
For the chemical generic drug that is the first to have successfully challenged the relevant
patent and the first approved for listing, a market monopoly period shall be given. NMPA
shall no longer approve the listing of generic drugs of the same variety within 12 months
from the date of approval of the drug, and the market monopoly period shall not exceed thepatent period of the challenged drug.
(3) On July 5, 2021, the Supreme People's Court and CNIPA respectively issued theProvisions on Several Issues Concerning the Application of Law in the Trial of Civil Cases
of Patent Disputes Related to Drug Registration Applications (hereinafter as the “Civil
Provisions”)[3] and the Administrative Adjudication of the Early Settlement Mechanism ofDrug Patent Disputes (hereinafter as the “Administrative Adjudication Measures”)[4], whichcame into force as of the date of promulgation.
According to Article 1 of the Civil Provisions, a case of first instance brought by a party toconfirm whether a drug falls within the scope of patent protection shall be under thejurisdiction of the Beijing Intellectual Property Court. In terms of acceptance conditions, inaddition to the general acceptance conditions for civil litigation, the following materials
shall be submitted: (1) relevant patent information registered in the CDE, including the title,
number, relevant claims, etc. of relevant patents; (2) relevant information of the drug,
including the drug name, drug type, registration category, and the corresponding
relationship between the drug of the registration application and relevant listed drugs;(3)the fourth declaratory statement made by the applicant and the basis of the statement.
However, if the applicant is not satisfied with the judgement of first instance, he/she may
appeal to the Supreme Court.
The Administrative Adjudication Measures stipulate that CNIPA shall establish an
administrative adjudication committee, and organize and carry out the work related to theadministrative adjudication.

3. Conclusion
Sine the new patent linkage system has just come into force, there are some points worthyof attention.
(1) To register or not?
The first step is information disclosure/patent registration. The holder of a drug marketing
license shall register all relevant patents within 30 days after obtaining the drug
registration certificate. At this time, since registration is not mandatory according toexisting legal documents, whether to register or not depends on the commercial
consideration of the drug marketing license holder. Without registration, it is impossible touse the drug patent link system to solve disputes early, or to prevent or delay the listing ofgeneric drugs.
(2) When a relevant patent has been invalidated, the administrative waiting period ends andthe generic drug enters the approval procedure. An invalidation decision often goes
through litigation procedures of first and second instances, and the effective cycle of theinvalidation decision is much longer than the nine-month waiting period, so it is doubtful
whether a valid judgment can be obtained within nine months.
In addition, administrative rulings are not final. If a party is not satisfied with anadministrative ruling, the party can bring an administrative lawsuit to the court. According
to the Measures for Patent Administrative Law Enforcement, the trial time limit of a patentadministrative ruling is three months and can be extended by one month if the case iscomplex. That is, the results of administrative adjudication can be obtained in three to fourmonths, which has the advantage of rapidity. In contrast, according to the Civil Procedure
Law, the trial time limit of civil cases of first instance is six months and that of second
instance is three months. Moreover, in view of the current backlog of cases at the Beijing
Intellectual Property Court, it is basically impossible to receive a judgment within the ninemonth waiting period. To sum up, under the current situation, the administrative route will
likely be the first choice in most cases.
(3) Under the "first generic drug market monopoly system" for the generic drug applicant,
NMPA will no longer approve the listing of generic drugs of the same variety within 12
months from the date of approval of the "first generic." Generic drug companies may havegreater motivation to challenge the patents of original drugs.
(4) At present, China's patent linkage system does not have any provisions similar to the"data protection period" in other countries. For example, the time interval between theapproval of a small molecule new drug and the submission of Abbreviated New Drug
Applications (ANDA) for generic drugs in the United States is at least 4 years; and in Japanand nearly 30 EU countries, this period is at least 8 years. However, at present, the time
between the approval of a new drug application (NDA) and ANDA is legally "zero interval" in
China.
As can be seen from the foregoing, there remain many problems that need to beaddressed, especially with respect to the balance between the interests of innovative drug
developers and generic drug manufacturers. The evolution of this new patent linkage

system will no doubt be the focus of attention of many drug developers and manufacturers
in years to come.

[1] https://www.cnipa.gov.cn/art/2020/11/23/art_97_155167.html[2] https://www.cnipa.gov.cn/art/2021/7/5/art_546_160571.html[3] https://www.cnipa.gov.cn/art/2021/7/5/art_546_160569.html?xxgkhide=1[4] http://www.court.gov.cn/fabu-xiangqing-311791.html

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