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China Enhanced Criminal Sanction against IP Infringement

作者:Stephen Yang 浏览: 发表时间:2021-03-03 09:00:00

Stephen Yang,Partner of IP March

The 11th amendment to China’s Criminal Law took effect on March 1, 2021. The section of “Crime of Violating Intellectual Property Rights” which includes Articles 213 to 220, was extensively amended. Seven out of the eight articles in this section were amended. Under the current Criminal Law, criminal sanction against intellectual property infringement may be as serious as ten years of imprisonment.


Trademark Related Crime

Article 213 of the Criminal Law was amended to read "using an trademark identical with the registered trademark on the same goods or services without the permission of the owner of the registered trademark, if the circumstances are serious, shall be punished with a fixed-term imprisonment of not more than three years together with a fine, or a separately imposed fine; if the circumstances are particularly serious, a fixed-term imprisonment of not less three years but not more than ten years shall be imposed, together with a fine."


This amendment extends the criminal sanction against the crime of counterfeiting registered trademarks to "service marks" which was not available in the previous versions of the Criminal Law.


Article 214 of the Criminal Law was amended to read "knowingly selling goods under a counterfeit registered trademark where the amount of illegal gains is relatively large or other serious circumstances exist, shall be punished with a fixed-term imprisonment of not more than three years together with a fine or a separately imposed fine; if the amount of illegal gains is huge or there are other particularly serious circumstances, a fixed-term imprisonment of not less three years but not more than ten years shall be imposed, together with a fine.”


Article 215 of the Criminal Law was amended to read "forging or manufacturing without authorization, representations of other’s registered trademark or selling such representations, where the circumstances are serious, shall be punished with a fixed-term imprisonment of not more than three years together with a fine, or a separately imposed fine; if the circumstances are particularly serious, a fixed-term imprisonment of not less than three years but not more than ten years shall be imposed, together with a fine."


Copyright Related Crime

Corresponding to the Copyright Law amended on Nov 11, 2020 and to be effective on Jun 1, 2021, the following articles in the Criminal Law were amended to enhance the copyright protection.


Article 217 of the Criminal Law was amended to read "for the purpose of making profits, anyone who has committed one of the following acts of infringing copyrights or copyright-related rights, where the amount of illegal gains is relatively large or other serious circumstances exist, shall be sentenced to a fixed-term imprisonment of not more than three years together with a fine, or imposed a fine separately; if the amount of illegal gains is huge or there are other particularly serious circumstances, a fixed-term imprisonment of not less than three years but not more than ten years shall be imposed together with a fine:


(1) without the permission of the copyright owner, duplicating, distributing or disseminating to the public through information networks his or her written works, music, fine arts, audio-visual works, computer software, and other works as prescribed by laws and administrative regulations;

(2) publishing books for which others enjoy exclusive publishing rights;

(3) without the permission of the producer of the sound recording and video recording, duplicating, distributing, and disseminating to the public through information networks the sound recording and video recording made by the producer;

(4) without the permission of the performers, duplicating and distributing audio and video recordings of their performances or disseminating their performances to the public through information networks;

(5) making and selling fine art works bearing counterfeit signatures of others;

(6) without the permission of the copyright owner or the copyright-related right owner, deliberately avoiding or undermining the technical measures taken by the right owner to protect copyright or copyright-related rights for his works, audio and video recordings, etc."


Article 218 of the Criminal Law was amended to read "for the purpose of making profits, anyone who knowingly sells infringing copies as specified in Article 217 of this Law, where the amount of illegal gains is huge or other serious circumstances exist, shall be sentenced to a fixed-term imprisonment of not more than five years together with a fine, or imposed a fine separately."


Trade Secret Related Crime

Article 219 of the Criminal Law was amended to read "anyone who has committed one of the following acts of infringing trade secrets, where the circumstances are serious, shall be sentenced to a fixed-term imprisonment of not more than three years together with a fine, or imposed a fine separately; if the circumstances are particularly serious, a fixed-term imprisonment of not less than three years but not more than ten years shall be imposed together with a fine:

 

(1) obtaining the right holder’s trade secrets by theft, bribery, fraud, coercion, electronic intrusion or other improper means;

(2) disclosing, using, or allowing others to use the trade secrets of the right holder obtained by the means mentioned in the preceding paragraph;

(3) disclosing, using or allowing others to use the trade secrets in his possession, by breaching confidentiality obligations or violating the right holder’s requirements for keeping trade secrets.

 

Obtaining, disclosing, using, or allowing others to use the trade secrets with the knowledge of the acts listed in the preceding paragraph shall be regarded as infringing on the trade secrets.

 

The right holder mentioned in this article refers to the owner of the trade secrets and the user of the trade secrets with the permission of the trade secrets owner.

 

Anyone who steals, spies, buys, or illegally provides trade secrets for foreign institutions, organizations, or persons shall be sentenced to a fixed-term imprisonment of not more than five years together with a fine, or imposed a fine separately; if the circumstances are serious, a fixed-term imprisonment of not less than five years shall be imposed together with a fine."

 

The amended Article 219 provides enhanced protection of trade secrets and includes a new paragraph which defines a new type of crime, i.e. the crime of commercial espionage.

 

Article 220 of the Criminal Law was amended to read "if an entity commits the crimes specified in Article 213 to Article 219, the entity shall be fined, and the person in charge and other persons directly responsible shall be punished in accordance with the provisions of the respective articles in this section."

 

Patent Related Crime

The 11th amendment to China’s Criminal Law does not include any new provisions in regards to patent related crime. Specifically, Article 216 of the Criminal Law remains unchanged and reads “anyone passes off other’s patents, where the circumstances are serious, shall be sentenced to a fixed-term imprisonment or criminal detention of not more than three years together with a fine, or imposed a fine separately.”

 

Passing off is the only patent related act that could constitute a crime. However, the terms used in the Patent Law and the Criminal Law are not consistent. Rule 84 of the Implementing Regulations of China Patent Law defines patent passing off as follows.

 

“Any of the following is an act of passing off a patent as prescribed in Article 63 of the Patent Law:

(1) affixing patent indication on a product or on the package of a product which has not been granted a patent, continuing to affix patent indication on a product or on the package of a product, after the related patent right has been declared invalid or is terminated, or affixing the patent number of another person on a product or on the package of a product without authorization;

(2) sale of the product as prescribed in subparagraph (1);

(3) indicating a technology or a design to which no patent right has been granted as a patented technology or a patented design, indicating a patent application as a patent or using the patent number of another person without authorization, in such materials as specification of product, etc., which could mislead the public to regard the related technology or design as patented technology or patented design;

(4) counterfeiting or transforming any patent certificate, patent document or patent application document;

(5) any other act which might cause confusion on the part of the public, misleading them to regard a technology or a design to which no patent right has been granted as a patented technology or a patented design.

 

Affixing patent indication legally on a patented product, or on a product directly obtained by a patented process, or on the package of such products before the termination of the patent right, offering to sell or selling such products after the termination of the patent right is not an act of passing off a patent.

 

Where any person sells a product passing off a patent without knowing it, and can prove that he obtains the product from a legitimate channel, he shall be ordered to stop selling the product by the administrative authority for patent affairs, but be exempted from being imposed a fine.”

 

As can be seen, patent passing off includes many different acts. However, the wording in Article 216 of the Criminal Law seems to indicate that criminal sanction against patent passing off is only applicable to the cases where one passes off another person’s patent. It is not clear whether it is intentional that the wording is not amended in the 11th amendment to make it consistent with the patent law.

 

It is to be noted that item (4) in Rule 84 of the Implementing Regulations of China Patent Law, i.e., counterfeiting or transforming any patent certificate, patent document or patent application document, could also constitute crime according to Article 280.1 of the Criminal Law.

 

“A person who forges, alters, buys, sells or steals, forcibly seizes or destroys the official documents, certificates or seals of a state organ shall be sentenced to fixed-term imprisonment of not more than three years, criminal detention, public surveillance or deprivation of political rights; if the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than ten years.”

 


China Enhanced Criminal Sanction against IP Infringement
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联系我们

地址:北京市海淀区知春路63号51号楼(卫星大厦)1506室 
邮编:100190
电话:010-62966619
传真:010-62983448
网址:www.ipmarch.cn
Email:info@ipmarch.cn