Jonathan Miao
The new Implementing Regulations of the Patent Law (hereinafter referred to as the new regulations) were promulgated on December 21, 2023, and are set to be effective from January 20, 2024. In conjunction with the new regulations, China National Intellectual Property Administration (CNIPA) recently released the updated Guidelines for Patent Examination (hereinafter referred to as the new guidelines).
The amendments related to patent invalidation procedures in the new regulations and guidelines are introduced as follows.
I. Violation of the "Principle of Good Faith" become an Ex Officio invalidation Ground.
Article 20 of the new Patent Law introduces the "Principle of Good Faith," stating that "applying for a patent and exercising patent rights shall abide by the principle of good faith." In alignment with this, in the new regulations Article 11 is added to explicitly stipulate that "patent applications shall abide by the principle of good faith, various patent applications must be based on genuine inventive activities and any deception or forgery is not allowed."
Furthermore, in Article 69 of the new regulations, violation of the good faith principle is listed as a ground for invalidation.
Moreover, in paragraph 4.1, chapter 3, Part 4 of the new guidelines, it is prescribed that "if the acquisition of patent rights blatantly violates the principle of good faith, the collegial panel can introduce the ground for invalidation as stipulated in Article 11 of the new regulations for examination."
This provision in the new guidelines makes the violation of the "Principle of Good Faith" not only as a ground for invalidation but also a basis for CNIPA to conduct ex officio examinations.
For a detailed analysis of the impact of violating the "Principle of Good Faith" on future patent examination and invalidation procedures, please refer to the relevant article of NTD Interpretation Series on New Regulations, The principle of good faith has officially become a specific legal basis in patent examination and invalidation procedures - Reflections on Article 11 of the New Implementation Rules of the Patent Law.
Readouts for the New Implementation Rules of China’s Patent Law XXIII: The Principle of Good Faith Entering Patent Law
II. The publication of the amended Claims after Invalidation Proceedings and the handle of "Subsequent Cases"
Article 73 of the new regulations stipulates that CNIPA shall publish the claims amended during invalidation proceedings, which ensures the publicity of patent documents, allowing the public to promptly and intuitively understand the scope of patent protection amended during invalidation proceedings.
The new guidelines removed the second paragraph of the original paragraph 4.1, Chapter 3, Part 4, which stated, "After the Patent Reexamination Board makes an examination decision declaring partial invalidation of the patent right, if the patentee does not file a lawsuit before the people's court within three months from the date of receiving the examination decision or the people's court issues a final judgment upholding the examination decision, the examination of other invalidation requests concerning the patent right shall be based on the effective and valid patent right ."
Given the requirement of Article 73 of the new regulations for timely public announcement of claims amended during invalidation proceedings, the above amendment in the guidelines implies that new invalidation requests against the relevant patent rights can be initiated directly based on the claims amended during prior invalidation proceedings, without waiting for the conclusion of judicial review on the initial invalidation decision.
It's noteworthy that, according to Article 73 of the new regulations, what CNIPA published is the claims amended during the invalidation proceedings, which may be maintained valid/ partially valid/ entirely invalid. Examination on subsequent patent invalidation cases ("subsequent cases") can directly be based on the amended claims published by CNIPA, irrespective of whether the amended claims are maintained valid/ partially valid/ entirely invalid finally. The rationality of this provision is that regardless of the final outcome of the prior invalidation proceeding, once the patentee amend the claims, and CNIPA issues an invalidity decision based on that amendment, it will be irreversible for the patentee.
These amendments in the new regulations and guidelines undoubtedly expedite the initiation of subsequent invalidation requests, contributing to the swifter examination of patent invalidation cases.
III. Limitations on the Scope of "Citizen Representatives"
The new guidelines impose restrictions on the scope of "citizen representatives."
In paragraph 3.6, chapter 3, Part 4, the new guidelines stipulate that "If a party entrusts its close relatives, employees, or citizen representatives recommended by relevant social organizations, it shall be handled with reference to the relevant provisions of entrusting patent agencies. The scope of powers of close relatives, employees, or citizen representatives recommended by relevant social organizations is limited to presenting opinions during oral hearings and receiving transferred documents in court". Specific requirements for identification documents of these three categories of representatives are also detailed.
This amendment is aiming at combating "unauthorized patent agents", and with reference to the relevant provisions in Article 61 of the Civil Procedure Law regarding litigation representatives, reiterate that patent invalidation cases should be handled by qualified patent agencies and patent agents.
For lawyers without patent agent qualifications, according to the most recent notification issued by CNIPA, they need recommendation from All China Lawyers Association to participate in patent invalidation proceedings as citizen representatives.
IV. Patent Invalidation Cases involving Ownership Disputes
Considering instances where patentees abuse ownership disputes to unduly delay patent invalidation proceedings to prevent their patents from being invalidated, paragraph 1 and 2, Article 103 of the new regulations prescribed the relevant procedures triggered by ownership disputes to suspend patent invalidation proceedings, paragraph 2 even allows CNIPA to refuse to suspend the relevant procedures.
Paragraph 7.3.1.2, Chapter 7, Part 5 of the new guidelines elaborates on the above provisions, specifying that patent invalidation proceedings may not be suspended if any of the following circumstances exist:
-an invalidation decision can be made based on the completed examination work;
-the grounds presented by the parties in the ownership dispute are evidently insufficient, and no sufficient evidence demonstrating the existence of an ownership dispute has not been submitted;
-evidence indicates that suspending the patent invalidation proceedings would significantly harm the interests of the parties or public interests;
-evidence indicates that the request for suspension is evidently made in bad faith or involves inequitable conduct.
Above provisions almost covered common situations where ownership disputes are misused to prolong patent invalidation proceedings. With these specified regulations, past practices of manipulating ownership disputes to delay patent invalidation proceedings can now be stopped.
At the same time, Paragraph 3.7, Chapter 3, Part 4 of the new guidelines also provides protection for the rights of parties involved in patent ownership disputes in cases where patent invalidation proceedings are not suspended. The parties of the patent ownership disputes can request to participate in the relevant invalidation proceedings and present their opinions for the collegial panel's consideration. This provision offers a channel for new stakeholders to join ongoing invalidation proceedings.
The above regulations not only safeguard the interests of relevant rights holders but also prevent the abuse of ownership disputes, and lead to greater efficiency in invalidation procedures.
V. Examination of Invalidation Cases Involving Early Resolution Mechanisms for Pharmaceutical Patent Disputes.
Considering the current "Measures for the Implementation of the Early Resolution Mechanism for Pharmaceutical Patent Disputes (Trial)", "Administrative Adjudication Measures for the Early Resolution Mechanism for Pharmaceutical Patent Disputes" and other departmental regulations, along with the “Provisions of the Supreme People's Court on Several Issues concerning the Application of Law in the Trial of Civil Cases involving Patent Disputes Related to Drugs applied for registration” have already established a framework for the early resolution mechanism for pharmaceutical patent disputes and have been effectively implemented, the new regulations and guidelines do not contain provisions specifically for the Early Resolution Mechanism of Drug Patent Disputes.
As a complementary measure, in paragraph 9, Chapter 3, Part 4, the new guidelines added "Special Provisions for the Examination of Invalidation Requests Involving Early Resolution Mechanism for Pharmaceutical Patent Disputes", which primarily requires generic drug applicants to mark the instances involving the early resolution mechanism for pharmaceutical patent disputes in the invalidation request and promptly inform the collegial panel of relevant administrative litigation or adjudication determination. For such disputes, CNIPA will conduct the examination in the order of the invalidation requesting date, and provide a reference for China Food and Drug Administration (CFDA) ’s determination of the "exclusivity period".
VI. Examination Methods and Designated Periods for Invalidation Proceedings
In paragraph 4.4, Chapter3, Part 4 of the new guidelines, under the "Examination Methods" section, a new provision is added: "In the invalidation proceeding, the collegial panel may, based on the specific circumstances of the case, conduct the examination through oral hearings, written examinations, or a combination of oral and written examinations."
This means patent invalidation cases may now be decided without oral hearings.
Regarding the reply period in invalidation proceedings, "If a specified reply period is required, this designated period is one month," stipulated in the paragraph 4.4.1, Chapter3, Part 4 in the original guidelines has been modified to "If a specified reply period is required, this designated period is generally one month."
This implies that, in the future, the reply period in the invalidation proceedings can be flexibly determined based on the case's circumstances. In other words, depending on the difficulty level of the reply, the collegial panel can determine a reply period longer than one month (e.g., 2 months) or shorter than one month (e.g., 15 days).
Jonathan Miao
Jonathan joined NTD in 2003. He worked as a patent attorney for 7 years before engaging in litigation and contentious legal works from 2010. Jonathan has rich experience in patent prosecution, patent invalidation, patent litigation and strategy counseling.
Jonathan is now leading a team specialized in providing legal services in the fields of chemistry and biotech. The services provided by this team include patent invalidation, patent search and patent monitoring, FTO search and analysis, patent litigation (including administrative litigation and civil lawsuits), enforcement at trade fairs, conducting infringement investigations and on-spot due diligence check, trade secret investigation and protection, IP strategy consulting etc.
