February 5, 2016

Counterfeiting is a dynamic industry and methods of intellectual property infringement are ever-changing. In recent years, there has been a growing trend of goods being produced which do not directly infringe the trade mark of a brand, but which impersonate products through an identical or almost identical design, without bearing the logo. This has made design rights crucial to an effective IP protection strategy.  Registering such rights at the right time is critical to the protection of intellectual property in that product.  This is highly critical in China – not only due to the rife counterfeit and copycat market but also because of the rules relating to the registration of designs.

In China, designs (either two or three dimensional) are registered as design patents under the Patent Law of the People’s Republic of China. Protection comes from Article 11 which states that “after a design patent right is granted, no unit or individual may exploit the patent without permission of the patentee, i.e., it or he may not, for production or business purposes, manufacture, offer to sell, sell or import the design patent products“.  Once this protection has been granted, it lasts for 10 years from the filing date.

As designs are protected by patents in China, novelty is the key issue and this requirement is absolute: the design cannot be “known to the public both domestically and abroad before the date of the application“. Therefore, the item cannot be on sale, advertised, or otherwise known to the public anywhere in the world before a design patent in China is filed, or it will be invalid, without the one year grace-period allowed in Europe. As a result, filing the design patent application early on in the design process is a must.

There is an exception to this rule under Article 29 – that if the design has been filed in another territory within the six months prior to the application in China, this prior filing date becomes known as the “priority date” and therefore advertisement and sales within this six-month period will not destroy novelty for the purposes of the design patent application in China.

It should be noted that when an application is filed for a design patent, no substantive examination is made, and therefore there is no investigation into novelty. Only the formalities of the application are checked, and validity of the patent is called into question at a later date when challenged or attempted to be relied upon. With no valid design patent, there will be no valid claim against an infringer.

The “prior art” defence further enhances the requirement to register a design patent early. This states that accused infringers shall not be deemed to be infringing if before the date of the patent application (or the “priority date”), “any other person has already manufactured identical products, used identical method or has made necessary preparation or the manufacture or use and continues to manufacture the products or use the method within the original scope“.

Finally, design patent ownership is based on a “first-to-file” principle. Therefore, if a brand has not filed a design patent application, their design is known to the public, and a copycat manufacturer in China registers first, the counterfeiter may own the design in China.

Although designs can be well protected in China, and therefore counterfeiting protected against, it is critical that application is made for the design to be registered as a design patent at early stages of product development, and certainly before the product becomes known anywhere in the world.