Analysis on the Revisions of Implementing Regulations of Patent Law

1. Patent term compensation system

The new Patent Law implemented on June 1, 2021 stipulated the patent term compensation system. The revised Implementing Regulations of Patent Law (hereinafter referred to as “the Regulations") adds a chapter specify the operation methods of the term compensation.

1.1 Patent Term Adjustment for delayed examination (PTA)

Rule 77 to Rule 79 and Rule 84 of the Regulations are specific provisions for granting patent term compensation for unreasonable delay in the examination process of invention patent as stipulated in Article 42, paragraph 2 of the Patent Law, that is, PTA (Patent Term Adjustment) system. The calculation method of term compensation of PTA stipulated in Rule 78 and Rule 79 of the Regulations is:

PTA=Max {date of announcement for grant - (date of filing the application +4 years); date of announcement for grant - (date of request for substantive examination +3 years)} - the number of days of reasonable delay - the number of days of unreasonable delay caused by the applicant.

Among them, reasonable delay includes the number of days that the patent application documents are modified in the re-examination procedure to obtain the invention grant, and the number of days during which the patent application is preserved or the patent examination period is suspended because the people's court or patent administrative department requires it; Unreasonable delay caused by the applicant includes the period of delay in responding to the office action, the period of deferred examination, and the period of incorporation by reference, etc.

When request for term compensation of PTA, an application shall be filed to CNIPA within 3 months from the date of announcement for grant of the patent right. According to Article 13 of the Transitional Measures on the Implementation of the Revised Patent Law and its Implementing Regulations for the Business Handling in Examination (hereinafter referred to as “the Transitional Measures”), the PTA system applies to the invention patents announced for grant from June 1, 2021.

1.2 Patent Term Extension for new drug marketing license (PTE)

Rule 80 to Rule 84 of the Regulations are specific provisions for the drug patent term compensation system stipulated in Article 42, paragraph 3 of the Patent Law, that is, PTE (Patent Term Extension) system. The calculation method of term compensation of PTE stipulated in Rule 82 of the Regulations is divided into two steps:

The first is the calculation of the five-year period. PTE= Date of the drug’s first marketing license - date of filing the application -5 years. Where, if the result is more than 5 years, then 5 years is the final result, if the result is less than or equal to 5 years, then the actual results shall prevail.

The second is the calculation of the total effective protection period of 14 years. The interval between the date of the drug's first marketing license and the expiration date of 20 years from the filing date, plus the PTE days calculated before, if more than 14 years, the expiration date of the 14-year term from the date of the drug's first marketing license is the patent right termination date, otherwise the expiration date of the PTE term is the patent right termination date.

The new drug related invention patent, may be able to enjoy both PTA and PTE, the two can be applied in superposition, but the longest effective protection period after the superposition of PTA and PTE should not exceed 14 years.

The application for PTE shall be filed to CNIPA within 3 months from the date of the new drug obtaining the marketing license in China. According to the Transitional Measures, the PTE system applies to patents related to new drugs obtaining the marketing license since June 1, 2021.

1.3 Other common issues

According to the provisions of the Interim Measures on the Implementation of the Revised Patent Law for the Business Handling in Examination (Announcement No. 423 of CNIPA) and the Interim Measures on the Implementation of the Revised Patent Law for the Business Handling in Examination (Announcement No. 510 of CNIPA), the patentee may submit a request for patent term compensation in the form of paper. From January 20, 2023, the patentee may submit a request for patent term compensation in electronic form or in paper form.

From the " Request for Patent Term Compensation and Drug Patent Term Compensation " issued by CNIPA on January 11, 2023, it can be seen that applying for PTA or PTE does not require the patentees to make such complex calculation for term compensation, they only need to fill in and submit the form. CNIPA will calculate the time limit and make decision on whether to give the compensation.

It is worth noting that according to the provisions of Announcement No. 510 of CNIPA, those who request term compensation for patent right shall pay the relevant fees. So far, CNIPA has not published the relevant fee standards. According to Rule 110 of the Regulations, the various fee standards for patent application of CNIPA shall be determined by the Development and Reform Commission, the Ministry of Finance together with CNIPA.

2. Administrative adjudication system on patent infringement disputes

According to the Patent Law, after an act of patent infringement occurs, the patentee may file a lawsuit before the people's court to resolve the dispute through judicial procedures, or he may report and complain to the administrative department for patent affairs to resolve the dispute through administrative procedures. Administrative adjudication on patent infringement disputes has played an important role in the protection of patent right. Statistics show that tens of thousands of patent infringement disputes are settled by administrative departments every year. In 2023, CNIPA handled 12 administrative adjudication on significant patent infringement disputes.

2.1 About the authorities of law enforcement and handling cases

Rule 95 of the Regulations stipulates that: " The administrative authority for patent affairs under the people's governments of any provinces, autonomous regions, and municipalities, as well as the administrative authority for patent affairs, under the district people's governments of prefecture level cities, autonomous prefectures, leagues, regions, and municipalities directly under the central government, having a large amount of patent administration work to attend to and has the ability to deal with the matter, can handle and mediate patent disputes."

The revised Regulations expanded the subject of law enforcement authorities handling patent disputes from the department of patent administration in the city with some districts to the department of patent administration set up by some district governments, which conforms to the actual needs of administrative adjudication on patent disputes, and is beneficial to expanding the force of law enforcement and handling cases and ensuring the quality and effect of adjudication. In practice, some regions have authorized the administrative departments of patent affairs of the district and county people's governments to carry out the administrative adjudication on patent disputes through local regulations or entrusted law enforcement, and have achieved some effects, which is worth popularizing, but also needs to be standardized.

After the implementation of the Regulations, it is recommended that the patentees, lawyers and patent attorneys pay close attention to the changes in the authority of law enforcement and handling patent disputes in each local region, accurately understand the institutional setup and jurisdiction, and file request for administrative adjudication with local market supervision departments and intellectual property offices.

2.2 Administrative adjudication on significant patent infringement disputes

Article 70 of the Patent Law, which came into effect on June 1, 2021, authorized CNIPA to handle, upon request, the national significant patent infringement disputes.

Rule 96, paragraph 1 of the Regulations specifies the criteria for determining patent infringement that has a significant national impact: If one of the following situations occurs, it belongs to the patent infringement disputes that have a significant impact throughout the country mentioned in Article 70 of the Patent Law:（1） Involving significant public interests; （2） Has a significant impact on the development of the industry; （3） Major cases across provinces, autonomous regions, and municipalities directly under the central government; （4） Other circumstances that the patent administration department under the State Council deems may have a significant impact. The criteria for determination is consistent with the Measures for Administrative Adjudication of Significant Patent Infringement Disputes promulgated by Announcement No. 426 of CNIPA.

Rule 96, paragraph 2 of the Regulations stipulates that: If the patentee or interested party requests the patent administration department under the State Council to handle the patent infringement dispute which do not belong to the patent infringement disputes that have a significant impact throughout the country, the patent administration department under the State Council may designate the administrative authority for patent affairs under local people's government with jurisdiction to handle it. This is different from the provisions of the Measures for Administrative Adjudication of Significant Patent Infringement Disputes (hereinafter referred to as “the Measures”). According to the Measures, the patentee or interested party requests CNIPA to handle the infringement dispute, should submit a certificate issued by the patent administration department of the province, autonomous region or municipality directly under the central government, to prove it is a significant patent infringement dispute. In other words, the Measures adopt the pre-examination or filing and submission system of the provincial administrative departments of patent, while the Regulations do not have such provisions. According to the provisions of the Regulations, the patentee or interested party can directly request CNIPA to deal with patent infringement disputes. CNIPA, after examination, finds that the case does not belong to the national scope of significant impact, can designate the patent administration department of the local people's government with jurisdiction to deal with it.