China's New Supreme People's Court IP Tribunal

New Patent and industrial property appeals court in China

On 1 January 2019 a new IP-focused Tribunal within the Supreme People’s Court (SPC) will decide patent and other complex technical IP case appeals. This SPC Tribunal will hear appeals from civil (first-instance court) decisions and administrative (CNIPA Patent Re-examination Board) law cases. This effectively means that the first level of appeal from first instances cases is direct to the SPC.

For civil cases, the patent and other complex technical IP cases this change relates to are invention or utility patents, new plant species, integrated circuits layout designs, technical secrets, computer software, or antitrust. This is the same for administrative law cases, however the reference to "invention or utility patent" has been replaced by "patent", so design patents are also included. Wider intellectual property cases, such as trademark and non-software copyright cases, are not included at this stage but may be in the future.

The opportunity to request the SPC for a retrial still remains. The grounds for this have not changed, so this is essentially limited to circumstances in which there is new evidence or problems with the evidence on which the prior decision was based. Successfully obtaining an SPC retrial of an SPC Tribunal decision is likely to present obvious difficulties though.

The reasoning behind the change is to establish rules to protect innovation, create a sound business environment, and ensure uniformity of legal decisions. The intention is to reduce conflicting decisions at the High Court level, and also to remove perceptions of local bias. It will however become more important to focus on the first instance case with an SPC appeal in mind. Selecting counsel with relevant SPC experience for key cases will become important at an earlier stage.

Forum issues will generally be less important, as appeals will be centralised to the SPC so differences at the lower court levels may be less of an issue. The distinction made for design patents between civil and administrative actions may raise strategic issues though. Design patent invalidation or re-examination decisions from the Patent Re-examination Board (an administrative matter) will now be appealed to the SPC Tribunal. Appeals from design patent infringement decisions by a local court (a civil matter) will not be appealed directly to the SPC tribunal. As a result, forum issues may still be an issue for design patent infringement cases.

Patent litigation in China is already cheaper and faster than in most western countries. The removal of a layer of appeal will make these challenges even more cost effective. While ordinarily this would encourage more litigation, the prospect of an appeal direct to the SPC is likely to limit challenges to those having at least arguable merit.