The draft is intended to provide:

In case of intentional infringement of the patent right, if the circumstances are serious, the amount of compensation may be determined within one to five times the amount calculated according to the loss suffered by the right holder, the benefit obtained by the infringer or the patent license fee; and in the case that it is difficult to calculate the amount of compensation, the amount of compensation that the court may determine at its discretion increases from 10,000 yuan to 1 million yuan as stipulated in the current Patent Law to 100,000 yuan to 5 million yuan.

In order to determine the amount of compensation, the people’s court may, when the right holder has tried its best to provide evidence, and the books and materials related to the infringement are mainly controlled by the infringer, order the infringer to provide the books and materials related to the infringement. Where the infringer does not provide or provide false books and information, the people’s court may determine the amount of compensation with reference to the claim of the right holder and the evidence provided.

The patent administration department under the State Council may, at the request of the patentee or the interested party, handle patent infringement disputes that have significant influence throughout the country; the department that manages the patent work shall handle the patent infringement dispute at the request of the patentee or the interested party, and may merge the cases in which the same patent right is infringed within the same administrative region; cases that infringe on the same patent right across regions may be requested to be handled by the higher-level people’s government.

The patentee or interested party may notify the network service provider to remove, block or disconnect the infringing product link, or take other necessary measures according to the judgment, ruling, mediation, or decision to stop infringement made by the departments that manage patent work. If the network service provider fails to take necessary measures timely, it shall bear joint and several liability.

The unit may dispose rights and patent right of service invention creation patents according to law, using property incentives in the forms of equity, options, dividends, etc. By such measures, it is possible to enable inventors or designers to share the benefits of innovation and promote the implementation and use of relevant inventions.

Where the patentee declares in writing to the patent administration department under the State Council that it is willing to permit anyone to implement its patent and clarifies the payment method and standard of the license fee, the patent administration department under the State Council shall make an announcement and implement an open license; anyone who wishes to implement an open-licensed patent shall notify the patentee in writing and pay the license fee in accordance with the method and standard of the announcement.

In addition, to improve the patent allowance system, the draft proposes to establish a domestic priority system for design patent applications, optimize the priority procedures, and extend the protection period of design patent rights from the ten years specified in the current Patent Law to fifteen years. The draft also clarifies the principle of honesty and credit and the principle of prohibiting abuse of rights, and adds a period-extension system for innovative drug invention patents.

(Source: Network of National Intellectual Property Administration)

The executive meeting of the State Council aims to improve the efficiency of intellectual property examination

Li Keqiang, Premier of the State Council, presided over the State Council executive meeting on December 24, deployed to increase support for the private economy and small and medium-sized enterprises, so as to enhance vitality and confidence of the market. It was decided to cancel the permit of opening corporate bank account, shorten trademark and patent examination cycle, and fully implement the market supervision system of “Randomly select the inspection objects, randomly select law enforcement inspectors, and timely disclose the checking and investigation results to the public”. The meeting emphasized the improvement of the efficiency of intellectual property examination, actively promotion of electronic applications, reduction of fees, and large relief in certification materials. The average review period for trademark registration will be further reduced to 5 months next year on the basis of a substantial reduction this year; the examination period of high-value patents will be compressed by more than 15% on the basis of 10% this year.

(Source: Network of National Intellectual Property Administration)

China’s trademark database to achieve free open sharing

On December 26, the CNIPA Trademark Office officially disclosed the basic information of all existing stock trademarks to the whole society free of charge, and the trademark registration facilitation reform took another solid step. The open sharing of trademark data will help strengthen the application of trademark data, exert its economic and social benefits, improve the transparency of trademark review, and further improve the quality of the review. Registered users of the China Trademark Online Service System can download the basic information of about 35 million trademarks free of charge, without having to re-apply for account rights, and the system data will be updated regularly.

(Source: Network of National Intellectual Property Administration)

In 2017, the number of overseas patent applications in China exceeded 60,000.

Recently, the World Intellectual Property Organization (WIPO) published the annual report on the World Intellectual Property Indicators (WIPI) in Geneva, Switzerland. The report shows that Chinese domestic companies and foreign companies are actively submitting patent applications in China in order to obtain better IP protection and promote the use of intellectual property in this country. The report points out that an applicant’s filing of patent applications overseas indicates its intention to expand its market share in the target country. According to the data, in 2017, US applicants submitted 230,931 equivalent patent applications overseas, and continued to lead the world; Chinese applicants submitted 60,310 equivalent patent applications overseas, an increase of 15% over last year, ranking fifth in the world.

(Source: Network of National Intellectual Property Administration)

The 20th China Patent Awards Announced

On December 25th, the 20th China Patent Awards Presentation Ceremony co-sponsored by the National Intellectual Property Administration of China and the World Intellectual Property Organization (WIPO) was held in Beijing. According to reports, in this year’s China Patent Awards, 30 Chinese patent gold awards and 10 Chinese design gold awards are selected from the total 2,281 participating projects; there are 59 Chinese Patent Silver Awards, 15 Chinese Design Silver Awards, 695 Chinese Patent Excellence Awards, and 61 Chinese Design Excellence Awards. According to incomplete statistics, from the implementation dates to the end of 2017, the 40 gold awards bring in sales of 83.5 billion yuan, profits of 13.9 billion yuan, export of 18.6 billion yuan.

(Source: National Intellectual Property Strategy Network)

The IP Court of the Supreme People’s Court unveiled in Beijing

On January 1, 2019, the IP Court of the Supreme People’s Court was unveiled in Beijing. Since January 1, the court began to fulfill its statutory duties and accept relevant cases in accordance with the law. On December 29, 2018, the seventh session of the Standing Committee of the 13th National People’s Congress appointed the President, Vice President and Judge of the IP Court of the Supreme People’s Court. In accordance with the “Civil Procedure Law of the People’s Republic of China”, “Administrative Procedure Law of the People’s Republic of China”, “Decision of the Standing Committee of the National People’s Congress on Several Issues Concerning the Proceedings of Intellectual Property Cases Such as Patent Cases”, “Provisions of the Supreme People’s Court on Certain Issues of the Intellectual Property Court” and other legal and judicial interpretations, the IP Court of the Supreme People’s Court mainly handles intellectual property civil and administrative appeal cases relating to patents and other cases involving complex technical issues. If the judgment, ruling or decision of the first instance case according to Article 2 of the “Provisions of the Supreme People’s Court on Certain Issues of the Intellectual Property Court” is made before January 1, 2019 and an appeal or reconsideration is made, the case shall be tried by the upper-level people’s court of the people’s court of the original trial; if made after January 1, 2019, the case shall be tried by the IP Court of the Supreme People’s Court. Where a party appeals to the IP Court of the Supreme People’s Court, in accordance with the relevant laws, the appeal shall be submitted to the people’s court of the original trial.

(Source: China Court Network)

In 2018, China completed the review of approximately 96,000 categories of Madrid International Trademark Registration

According to the Trademark Office of the CNIPA, as of December 15, the CNIPA Trademark Review and Cooperation Center and five centers out of Beijing have completed review of a total of about 7.95 million domestic trademark registration applications, 96,000 categories of substantive examination of Madrid international registration trademark territorial extensions, and 81,000 international registration follow-up businesses like change, renewal and transfer. At present, the average review period for domestic trademark registration and territorial extension of Madrid international registered trademarks has been shortened to less than 6 months ahead of time; trademark graphic elements and the sub-card search blind period are shortened to 10 days, the domestic and international change renewal review cycle  is shortened to 1 month, the domestic transfer review cycle is shortened to 4 months, and the international transfer review cycle is shortened to 3 months. In 2019, the review of about 9.5-9.7 million trademark registration applications, 95,000 categories of formality examinations and equal number of substantive examinations for Madrid international registration trademark territorial extensions, 60,000 international registration follow-up businesses, and 1.5 million change, renewal and transfer applications are expected to be completed.

(Source: China News Network)

Dragon Special Report and Agency Practice

Analysis of technicality in commercial method patents

1.Introduction

With the rapid development of computer and network technology, services through network, such as online banking and e-commerce, are coming into fashion. In the process, traditional business methods are gradually combined with computer technology, and computer software, computer hardware and communication networks have become the carriers of commercial method inventions. The use of computer technology or network technology to solve business problems makes it possible to grant patent rights to business methods.

In order to be protected as a patent, a commercial method invention application needs to meet the technical requirements in both object judgment and inventiveness examination.

2.Technicality in object judgment

Commercial method invention patents include two categories. One is pure business methods. This type is not detailed here, as it is already clearly determined as unpatentable.

The other type is invention patent applications relating to commercial method, such as administration, payment plan, commercial marketing, shopping, signing, auction, financial investment, tax treatment, insurance, health services, travel services, and legal services.

On April 1, 2017, Guidelines for Patent Examination made an amendment regarding invention patent applications relating to commercial method. The following paragraph is added after 4.2(2), Chapter I, Part 2: “If a claim involving business model contains both content of business rules, methods and technical features, the claim shall not be excluded from the possibility of obtaining patent rights under Article 25 of the Patent Law.”

The Guidelines for Patent Examination defines “technical solution” as a collection of technical means that utilizes natural laws to solve a target technical problem, and the technical means are usually embodied by technical features. It can be seen that technicality depends on natural laws. Because invention patent applications relating to commercial method usually carry out business activities using computer and network technologies, which obviously possess technicality, the amendment to Guidelines for Patent Examination gives patentability to such applications.

Case one:

1. A transaction method, characterized by comprising:
2. the point of sale POS terminal reading the card information of the transaction card;
3. the POS terminal sending the card information to a mobile terminal X that has established a communication connection therewith, the mobile terminal X further sending the card information to the POS service platform and receiving a verification result returned by the POS service platform through the mobile terminal X; passing the verification and executing step C;
4. the POS terminal sending acquired transaction information to the mobile terminal X which further sends the transaction information to the POS service platform to complete the transaction and receives the transaction result returned by the POS service platform through the mobile terminal X.

Because the POS terminal, mobile terminal, and POS service platform are all technical features in the sense of Patent Law, Case one is a typical patentable invention patent application relating to commercial method.

3.Technicality in inventiveness examination

Countries hold different opinions on invention patent applications relating to commercial method, and the examination policies are constantly changing. In China, whether such applications belong to patentable subject matter used to be determined on whether they belong to rules and methods of intellectual activity stipulated by Article 2.2 of the Patent Law and whether they constitute technical solutions.

At that time, whether a commercial method invention application constituted technical solution depended on the contribution of the solved technical problem, the used technical means, and the technical effect to the prior art. If it was determined that no technical problem was solved, the application was regarded as not constituting a technical solution according to Article 2.2 of the Patent Law.

With the advancement of business technology and increase of commercial method invention applications, inventiveness is now highlighted as the main examination standard. Determine the distinguishing technical feature according to the closest prior art, determine whether the claimed solution solves a technical problem (instead of other type of problem) based on the distinguishing technical feature, and, if it is not a technical problem, the claimed solution does not contribute to prior art and lacks inventiveness; if a technical problem is solved, it is then determined whether the solution is, for a person having ordinary skill in the art, obvious compared with prior art.

Therefore, the technical problem actually solved by a commercial method invention application determines its inventive technicality. Because technical problem and technical effect rely on natural laws which are the inherent necessity of the movements, changes and developments of objective things functioning without human intervention and possessing objectivity not changeable by human will, whether a claimed technical solution solves a technical problem is determined by whether the technical means of the distinguishing technical feature is bound by the laws of nature.

Please refer to the following case.

Case two:

1. A method for managing transactions and settlements by using:

a supplier system used by a supplier who issues an invoice;

a buyer system used by a buyer who receives the invoice;

a supplier banking system which manages the supplier’s bank account;

a buyer banking system which manages the buyer’s bank account;

a server communicably connected to the supplier system, the buyer system, the buyer bank system, and the supplier bank system via a communication network,

the method for managing transactions and settlements comprising the following steps:

the server receiving, from the provider system, an electronic bill in which the supplier system records an unique identification code for determining which bill it is;

the server logs the received electronic bill into the database;

(a1) the server transmitting a GUI screen to the buyer system and having it display the GUI screen, the GUI screen causing the buyer to see the content of the electronic bill and to input a payment request for the electronic bill;

(a2) the server or the buyer system accepting, for the GUI screen displayed on the buyer system, a payment request for the electronic bill inputted by the buyer, creating a transfer request message having the unique identification code recorded by the supplier system on the electronic bill, and sending it to the above buyer’s banking system; and

(a3) the buyer banking system accepting the transfer request message having the unique identification code, income and expenditure processing for transferring the electronic bill with the unique identification code being conducted to the supplier banking system, the supplier banking system transmitting the electronic payment details having the unique identification code to the server or the supplier system;

wherein, according to the above processing, the server or the supplier can specify which electronic bill has been paid based on the unique identification code held by the electronic income and expenditure details received from the banking system.

The above claim has the following distinguishing technical feature compared with the reference document: Step (a3) also includes transmitting electronic income and expenditure details to the server.

Based on the distinguishing technical feature, the claim actually solves the technical problem of how to implement income and expenditure management during the transaction and settlement processes.

In the above technical solution, after receiving the electronic income and expenditure details, the server determines, according to the unique identification code held by the electronic details, which of the plurality of issued bills is paid in order to clear settled bills. It can be seen that the action serves to complete the settlement process artificially prescribed to meet the income and expenditure management needs. As a result, such distinguishing technical feature cannot bring about technical effect to the method for managing transactions and settlements and cannot make any technical contribution.

Therefore, a claimed solution solves a “technical” problem only when its distinguishing technical feature is bound by natural laws. Because the distinguishing technical feature in the above case serves only to meet the income and expenditure management needs in transaction and settlement, it is an artificial operation unrelated to natural laws. As a result, it does not produce any technical effect and makes no technical contribution.

4.Conclusion

With the fierce tide of e-commerce and online banking, the wave of invention patent applications relating to commercial method will only reach a new high. When drafting such applications, the contribution of the technical feature to prior art shall be highlighted, i.e. technical means using nature laws. In this way, it can meet the requirement for technical contribution in inventiveness determination. When responding to OAs, the whole technical solution should be analyzed to determine whether the distinguishing technical feature with the closest prior art is bound by natural laws. By doing so, it is possible to determine whether any technical effect is produced and whether any technical problem is solved by the distinguishing technical feature.

The above personal opinions may contain drawbacks. Please kindly point them out if you find any.

(Author: Qianlan LIU)

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