China has become an increasingly popular venue for resolving international intellectual property disputes, according to a recent report by the Intellectual Property Court of the Supreme People’s Court. The report shows that more foreign innovators are recognizing China’s legal protection for IP rights and are confident in its market. In total, the court received 457 new cases involving overseas entities in the last year, up 4.6% year-on-year, and the number of cases involving all foreign entities has also been rising, indicating that China has become one of the preferred venues for international IP litigation.
IP disputes between foreign entities that are heard in China are typically administrative litigation, meaning that the cases involve Chinese authorities in charge of IP affairs. A foreign party usually turns to a Chinese court if it believes its patents or trademarks have been damaged by another foreign party in the country and it disagrees with IP decisions made by Chinese authorities.
According to experts, the rise in IP litigation reflects the increasing trust that foreign rights holders place in China’s judicial IP protection. It may also mean that they feel China’s IP protection is good, and therefore prefer to settle disputes in China. The report highlights that measures such as compiling a guideline on patent case management with the World Intellectual Property Organization and increasing international exchanges have helped to create a world-class business environment.
More companies and innovators are willing to invest and develop in China due to the efficiency of Chinese courts, according to Kang Lixia, an IP lawyer at Beijing’s Hanray Law Firm. The national-level IP Court, set up in Beijing in January 2019, has helped streamline the appeal process by allowing litigants to bypass provincial courts and appeal directly, which Kang says improves the quality of trials and optimizes the law-based environment for science and technology innovators.