The new amendment to China's patent law will affect how patents will be protected and how lawsuits will be considered.

The new amendment became effective Oct 1, and the State Intellectual Property Office is working with the State Council Legislative Affairs Office to draft implementation regulations.

Other rules, such as examination guidelines and revised rules regarding compulsory licensing, are being drafted to further implement the changes mandated by the patent law.

At the same time, it can be expected that corresponding changes will be made in the existing judicial practice regarding patents.

Importantly, the amended patent law left out two important issues.

First, the doctrine of equivalents, which was in an earlier draft of the patent law, was not ultimately adopted into law. Chinese drafters and jurists noted that the doctrine of equivalents is largely a judge-made doctrine, and they therefore deemed it unnecessary to enact it into statutory law.

Second, China had also contemplated legislating two other judicial doctrines: estoppel and laches, into the patent law.

As China's statute of limitations for patent litigation is two years, the further addition of concepts of laches or estoppel could have further eroded a patentee's ability to seek full compensation for infringement.

Moreover, it appears that consideration of such doctrines may need to await further revisions of other laws.

The new amendment will significantly affect how Chinese and multinational companies will compete on the basis of patents in this emerging market.

China is expected to generate more patentable inventions, and more patent applications will be filed and granted in China on behalf of applicants from overseas.

The new law may change the way the patent game is played in China. First, patent invalidation will become more complicated, because foreign evidence of prior public use, dissemination and knowledge will constitute prior acts under the new law.

Second, patent litigation will also become more complex, since the new law will allow the prior act defense and international patent exhaustion. Therefore, more skilled patent litigators are needed to navigate through this uncharted water.

Third, multinational companies will have to develop a proactive, yet practical strategy for dealing with the possibility of compulsory licensing of patents in China.

Finally, for those companies with R&D centers in China, there must be a patenting strategy that works for China, as well as the rest of the world.

The language of the amendment is far from clear, so ambiguities still abound. Many of the ambiguities remain to be clarified in new regulations, rules or judicial interpretations. Stay tuned for updates in the near future.

The authors are lawyers for the US law firm Jones Day. The opinions expressed are their own.

(Source: China Daily)